One week ago, Philadelphia-based venture capital company SeventySix Capital announced its new sports advisory business, a consulting firm with a focus on sports-adjacent endeavors.
Among the leaders brought on to head up various divisions of SeventySix Capital Sports Advisory is Evan Davis, former vice president and general counsel of Rivers Philadelphia Casino (previously known as SugarHouse Casino), who is now the managing director of this new advisory venture’s sports betting vertical.
On Tuesday, PennBets spoke one-on-one with Davis about his career change, the new venture, and how he views the immediate and long-range future of the sports betting business.
(This Q&A is abridged and has been edited for clarity.)
PennBets: Let’s start on the personal front, with your career. I didn’t realize you had parted ways with Rivers Philadelphia Casino until very recently. Was it a straight cause-effect relationship — you left that role for this one with SeventySix Capital?
Evan Davis: I left Rivers earlier this year with the intention of doing two things. One was developing a consulting practice within the business side of sports betting. And the second was to maintain a career as a practicing attorney in some way, shape, or form. And so, over a period of a few months, it all took shape, in that I’ve known [SeventySix Capital Managing Partner and Sports Advisory Chairman] Wayne Kimmel for several years, and he and I discussed an idea that he had of launching a large sports consulting firm within the SeventySix Capital umbrella. So I had previously been consulting on a smaller scale, and then when Wayne came to me in the spring with a discussion involving doing this through SeventySix, joining forces with a few other folks that had tremendous expertise and connections in other areas of the sports business world, it just seemed like an amazing fit.
So you were able to pursue your vision of launching your own sports betting consulting firm, without having to go totally out on your own.
Evan Davis: Yes, I was doing it with one other person, a good friend of mine who had come from the sports world and had launched a consultant practice about a year prior. And, while there were advantages to that, I think that for the type of work I’m looking to do and the types of potential clients I’m looking to serve, the opportunity to leverage my background and experience with the framework that SeventySix Capital could provide, and the other folks who they were going to bring in to be a part of this group, was really an opportunity I couldn’t turn down.
This SeventySix Capital Sports Advisory venture — how exactly is this new and different from what SeventySix Capital was already doing investing in startups?
Evan Davis: This is a totally separate company. SeventySix Capital is one of the best known names in sports tech investing, and has been for quite some time. SeventySix Capital Sports Advisory is not an investing platform. We are a consultant platform, that really is geared toward assisting companies on more emerging verticals that are sports related. So, we’ve identified four of those at present to be sports betting, eSports, newer forms of media, and social responsibility. Those are the four sports-adjacent business areas that we’ve seen really start to skyrocket over the last two or three years, and that we think will continue on that trajectory for some time to come. We’ve seen the nature of companies that are looking to explore opportunities within that space, and they range from early-stage startups to professional sports teams to pretty much everyone in between. And we think that bringing together people who have the background and experiences, who have actually worked in those different business lines, and being able to provide that expertise to clients is something that makes this group unique in the United States today.
You mentioned the four different verticals: the eSports arm, the media arm, the social responsibility arm, and your sports betting arm. How closely are these different verticals going to be working together? Are you going to be coordinating a lot with the other divisions?
Evan Davis: Yes, the plan is to work as closely as possible when it’s warranted. I think that there are some clients who will absolutely benefit from combining these various expertises that we bring to the table. For example, a media company that is looking to integrate itself further with sports betting would benefit greatly from being able to have my colleague Mike Schreiber, who has a ton of experience coming from NBC Universal, Comcast, and Altice Media, and me, with my experience from the gaming operator and sports betting operator side, work on their product together.
Are there particular things you learned from Rivers’ first year-plus in sports betting that you’re bringing into this venture in terms of understanding what does and doesn’t work?
Evan Davis: I think what we learned is how much there is that we still need to learn. And by that I mean how nascent this industry really is within the United States. We as an industry are constantly evaluating what people are looking for, and what they’re not looking for. There are well over 100 million Americans who are eligible to bet on sports in this country, and what they all might be looking for is not consistent across the board. And so I think that one of the biggest challenges, but also one of the biggest opportunities for growth within the industry, is how to engage people who are sports fans — potentially even just casual sports fans, who have not to date even shown an interest in betting on sports, but might if the industry were to align more with what they want sports betting to be.
In the Pennsylvania market specifically, do you think that companies are either over-focusing on local teams or under-focusing on them?
Evan Davis: Clearly, Philadelphia and Pittsburgh both have very passionate fan bases for their local teams. So the opportunity to tap into that passionate fandom is huge for sportsbooks within Pennsylvania — but also sportsbooks in New Jersey, where the southern half of the state tends to be just as passionate about Philadelphia sports teams. And if and when sports betting someday launches in Ohio, I think you’ll see the same thing eventually along the eastern border of Ohio with respect to certain Pittsburgh teams.
With that having been said, I think that you don’t need to be a passionate sports fan, necessarily, to enjoy sports betting. In some ways, sports betting can really add to the enjoyment that a casual fan gets out of a game — sometimes even more so if you don’t have a rooting interest in that game. So, if you’re a passionate Eagles fan, but a casual soccer fan, and you’re watching television at 11:00 at night and watching the MLS is Back tournament is on, and LAFC is playing Seattle and you don’t know much about either team and you don’t care who wins, putting down $20 on one of those two teams will suddenly give you a significant rooting interest in the game and keep your eyes glued to the TV for two hours. You don’t need that extra boost, if you will, to want to tune in and follow the Eagles every Sunday, but it really does magnify your enjoyment of a late-night MLS game, for example.
And the beauty of it is that it doesn’t take much money for people to have rooting interests. You don’t need to put hundreds of dollars on a game to then say, “I’m going to sit here and watch this and root for a team.” I think that there’s a way for betting companies to attract casual fans with smaller-dollar bets and still get them involved in this, even in a smaller way, that’s still going to be a rising tide that lifts the ships of the sports teams themselves and their TV partners and their other sponsors, because those are still two more eyeballs that are watching a specific sporting event that may not otherwise have been.
With where we are right now, with everyone still feeling their way through the coronavirus and not sure where it’s all headed, how cautious are you about the near-future of sports betting? Should entrepreneurs be stepping lightly until sports really return to normal? Or is your attitude “full-steam ahead” because eventually we’re getting through this and it’s getting back to normal?
Evan Davis: I think it’s full-steam ahead. And that’s not necessarily my attitude, it’s what we’re seeing out there. Additional sportsbook operators are continuing to enter the market. Additional deals are continuing to be struck between certain [business-to-business] suppliers, both the well-established ones and some more nascent startups. Sportsbooks are entering into partnerships with professional sports teams it seems like every week now. So, I think that this is clearly full steam ahead, and it’s because we know that sports are coming back — potentially with a few hiccups, as we saw this past weekend in baseball. But sports are about to come back, and come back with a vengeance, because if the schedules all play themselves out, we’re going to have a September with all four major sports in action. That’s going to be an unprecedented time for sports in America.
And, knock on wood, a year from now our sports schedule will have normalized, and we’ll have fans in seats again, and we’ll be back to normal. And sports betting isn’t going away. It certainly doesn’t depend on whether or not we have fans in stadiums. So, to the extent that there’s sports here, and as we saw during the shutdown, to the extent that there’s even sports going on in Europe or elsewhere, there’s an appetite for Americans to wager on them.
So big picture, pandemic aside, looking at the long term, where do you see SeventySix Capital’s role in the local and/or national sports betting expansion? What is the goal?
Evan Davis: I think that we’re really well positioned to play a central role as sports betting continues to not only roll out in additional states across the country, but also gain in prominence as a business enterprise. Given the nature of experiences and backgrounds that we’re able to bring to the table, I’m excited for us to be able to work with sports teams, leagues, former professional athletes, startups, and other companies that really have unique ideas on how their existing media platforms or existing technology can integrate into the sports betting world and the business opportunities that can arise from that. So it’s my hope, and also my expectation, that SeventySix Capital Sports Advisory is going to be at the epicenter of the growth of sports betting and these other verticals, as we see them continue to take off over the next few years.