Sporttrade, a Philadelphia-based fintech sports betting company founded by Alex Kane (pictured), on Tuesday said it has raised $36m in funding.
The company was founded in 2018 with the goal of creating an open betting marketplace it says will allows participants to trade sporting events the same way they trade stocks. It said this will feature tighter spreads, more liquidity, and unique features such as “always on” in-play trading, and the ability to trade in and out of bets at any time.
According to company officials, this new type of approach will change sports betting by following the playbook of the US capital markets and democratize the customer experience, while offering a secure and technologically advanced platform.
Pending approvals and licensing by the New Jersey Division of Gaming Enforcement, the Sporttrade iOS app is slated to be launched during the second half of 2021.
The coalition of investors from both the financial and gaming industries include lead investor Jump Capital, Impression Ventures, Hudson River Trading, Tower Research Ventures, Jim Murren, former CEO of MGM Resorts International, and Tom Wittman, former CEO of the Nasdaq Stock Exchange.
In addition, Sporttrade said it issued convertible debt to Nasdaq Ventures in connection with the transaction. It said the funding will be put toward customer acquisition, expansion into additional states, and continued investment in its team, which is up to 50 people.
“We are thrilled to back Alex and his amazing team at Sporttrade,” Yelena Shkolnik, Jump Capital partner, said in a statement. “They have built a retail trading solution for betting, reflecting pricing based on win probabilities and allowing users to easily trade in and out of any position. To enable low-cost wagers, they have assembled a team from across capital markets and betting, locking in partnerships with institutional market-making partners to enable a powerful and liquid exchange. The US bettor will finally have a transparent, open market of sports betting wagers to trade, and we couldn't be more excited to be a partner.”
Delavan Lake Investments, co-founded by David Frohardt-Lane and Brandon Moran, also participated in the funding round. Frohardt-Lane added, “When we first met with Alex in 2019, he had a vision to transform the existing sports gambling model and leverage the benefits of stock market investing for the recreational sports trader. His drive to apply financial markets principles to benefit the customer was the primary reason we knew he was the right person to partner with in this revolutionary venture.”
