Crowdpark Bets On Social Wagers - VCs Bet $6m
I recently spoke with Crowdpark, an interesting startup that allows Facebook users to wager virtual currency on football games, elections, or anything they want.
The company is based in Berlin, Germany, a hot city for startups because of the low living costs and the high number of young, urban, early adopters. Most successful German startups tend to be copycats of successful businesses elsewhere, mostly US, but Crowdpark is part of a wave of original startups emerging from Europe.
Here are some of my notes from a conversation with Ingo Hinterding, Co-Founder and Chief Product Officer, and with Waldemar Jantz from VC firm Target Partners:
- We have a patent pending on our technology which allows for dynamic betting. It harnesses the wisdom of the crowds to create the best odds. Our first product is Bet Tycoon on Facebook.
- It's 100% legal because it's a virtual currency. You can buy credits but you can't cash them out for real money. You can't transfer winnings to others today but you will be able to in the future.
-It captures all the emotion of placing bets. And you can cash out at any point, even if a game is not ended. It's like the stock market, the value changes according to the players' bets.
- Can you use it to find better odds with bookmakers? I don't know, I would check it for that because it is the world's fastest bookmaker.
- We're setting up an office in San Francisco because we want to be close to the big players, Facebook, Zynga, etc. We believe it is important to have a presence here.
- Our technology is derived from prior business in developing algorithms to predict pricing in B2B markets, used by large companies.
- There will be mobile versions of its social gaming apps so that people can make bets while they are at a game or anywhere they find themselves. It's a very sticky experience.
- Users betting on the election of the German Chancellor were more accurate than polls, proving the wisdom of crowds.
- Waldemar Jantz said that his firm chose to invest in Crowdpark because it has original ideas, great technology, and it is not trying to be a copycat business.
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Weekly index of top bets: Crowdpark Social Betting Index
Crowdpark's significant market opportunity reaches across the large online betting market ($24B), social gaming market ($4B) and mobile gaming market ($8B). Founded in 2009, Crowdpark has an experienced team led by Martin Frindt, Ingo Hinterding and Christoph Jenke. Crowdpark's executive bench strength reflects expertise in: electronic prediction markets; product development design and social game mechanics, marketing and operations.
With Crowdpark's base in Berlin, the company benefits from being at the nexus of Europe's Silicon Valley and its digital entertainment and creative gaming hub. It is one of Europe's most creative cities, having attracted a cluster of gaming companies and events. Additionally, Berlin boasts more than 130 game developers, service providers, and publishers - the perfect ecosystem to further attract gaming talent.