When Carsten Koerl was growing up in the mountains of southern Germany, he dreamed of being a downhill ski racer or a professional tennis player. He wasn’t quite good enough at either – so he turned to computer engineering and has since become a sports data mastermind who’s revolutionizing online betting and changing the way fans watch games.
Mr. Koerl is the brains behind Sportradar, a Swiss-based technology company that tracks 60 sports and generates reams of statistics from more than 400,000 games a year, feeding the information to betting businesses, media outlets and sports leagues in 95 countries. The company’s reach includes every game in the National Hockey League, National Basketball Association, National Football League, Major League Baseball and even the German Handball Bundesliga and the Grand Slam of Darts.
Sportradar has become such a hot commodity the Canada Pension Plan Investment Board bought a 39-per-cent stake in the company along with TCV, a Silicon Valley investment group. The deal closed last week and although the purchase price wasn’t released, CPPIB said the transaction valued Sportradar at US$2.4-billion. Other investors include basketball great Michael Jordan, Dallas Mavericks' owner Mark Cuban as well as Ted Leonsis, who owns the Washington Capitals.
CPPIB saw the investment as way of tapping into the growing demand for online sports betting, particularly in the United States, but the real attraction was Mr. Koerl. “Carsten has created a remarkable business,” said Ryan Selwood, who heads CPPIB’s direct private equity. “It’s certainly a unique business model.”
Mr. Koerl, 53, doesn’t fit the image of a hard-driving entrepreneur. He’s relaxed and jovial in conversation, joking about how his 14-year-old son beats him in golf and preferring to call competitors “market companions” because it sounds less harsh. He summed up his career in one sentence: “I have a passion for data, I have a passion for IT and I have a passion for sport.”
He’s been putting all of those passions to use ever since he earned a computer engineering degree from the University of Konstanz in Germany. He created two businesses after graduating and in 1995 turned one into betandwin, an online sports betting venture he took public on the Austrian stock market in 2001. Now called bwin, the company is part of British gambling giant GVC Holdings PLC. Mr. Koerl left bwin in 2002 and met a pair of Norwegian programmers who were using crawler technology, essentially scouring the internet, to provide data to sports bookmakers. He liked the idea and launched Sportradar outside Zurich in 2003 with $149,000.
At first, the company made money by collecting basic information such as game times and results from 250 soccer leagues. The information proved a godsend for online sports betting operators who were desperate to offer as many betting opportunities as possible to clients. From there, Sportradar branched out into providing detailed data packages to leagues, such as the NHL, and media outlets including The Globe and Mail. Today, almost every NHL game or player stat analyzed by fans or quoted in the media has been generated by Sportradar. The company also runs an online broadcasting service for smaller leagues such as professional volleyball.
The core of Sportradar remains betting and nearly 70 per cent of its revenue comes from providing data to betting companies. To gather the data, Sportradar relies on a network of 6,000 specially trained freelancers who attend games around the world. It also has access to statisticians from leagues such as the NFL, which has around 20 stats specialists at every game, and tracking devices such as computer chips in NFL players that measure their performance and cameras at NBA games that analyze players’ shooting accuracy. All the information is co-ordinated from 15 regional offices.
Speed and accuracy are critical given the rising popularity of in-game betting. Placing bets during matches, on things such as who will score the next goal, now dominates betting in many countries, notably Britain where in-game betting accounts for about 70 per cent of all sports wagers. But it’s also susceptible to abuse. When games are shown on television, there’s usually a delay of up to eight seconds in the broadcast. That’s enough time for someone who has a friend in the stadium to get tipped that a goal has been scored and place a bet online before the TV audience is up to date. Sportradar transmits its data in a fraction of a second, cutting out any advantage for so-called court siders. It also has a fraud detection system that can identify match-fixing and other illegal betting activity.
Mr. Koerl said there’s much more to come such as artificial intelligence and sensors that can produce real-time data that coaches can use during games to change tactics. He’s also focused on the United States, where sports betting is about to explode thanks to a recent Supreme Court ruling that allowed states to approve sports gambling. Five states have issued licences and 18 more are expected to follow suit next year.
“I am fascinated by technology and by sport," said Mr. Koerl, who spends about 200 days on the road and attends most major sports events. “I can live my dream."