Episode #6: Innovation in Sports Betting with Tomash Devenishek
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Tomash Devenishek, founder and CEO of Kero Sports joins us to discuss how his background in startups and tech helped him succeed in leading his own company. His discussion highlights the unique capabilities of his product, while providing insight into the larger sports betting industry, its evolution, and future.
Notes
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Drew Quinn: Hello Wondr fans, my name is Drew Quinn and welcome to another episode of Level Up with Wondr. Today we have a very special guest, a well respected figure in the industry Tomash Devenishek. Tomash has several years of experience in the tech industry and has more recently brought his expertise to the sports sports betting industry as a founder and CEO of Kero Sports. Awarded the top prize at the inaugural SBC Summit Barcelona First Pitch in 2022, Kero provides gaming operators with technology that adds a casino like experience to sportsbook apps, delivering new bets in seconds for immersive and consistent betting experiences. Thank you so much for joining us today.
Tomash Devenishek: Thank you for having me, Drew. I'm excited to chat.
Drew Quinn: Perfect. So thought it'd be great to start with your background, what drew you to the sports betting industry? Did you always know you wanted to work in this space or was there a specific moment that really sparked your interest?
Tomash Devenishek: If you like sports, there's always a, a non zero percent chance that you're going to be in the sports betting industry, right? So, so that was kind of my that was my journey, up until four years ago, I wasn't and I'm in my thirties now so a good portion of my life I spent being in the tech space in general around consumer products and things like that, but I've always been a huge fan of sports and eventually got to a place where I had the right thesis, the right opportunity and kind of all the stars aligned.
And that became Kero, but no, it wasn't the plan, but it was always possible.
Drew Quinn: That's awesome, and how has your background and your past professional experiences helped you in building the skills you needed to start your own company?
Tomash Devenishek: One of the most amazing things that happened to me was in university I was in a co-op program. I went to the University of Toronto and what they did was, you know, Like prior to the summer, you'd have to start applying for co-op jobs. And we had this co-op job board and you would have all the typical, like Microsoft and Kraft and all these big blue chip companies kind of advertising different co-op positions.
So I'm applying to all of them I'm barely getting interviews, nobody's responding to me, and I had no idea what was going on. So, eventually because I wanted to be in the co-op program, and so you didn't have to take one of their jobs, you just have to do anything that they would approve.
So I went to the general university job board and luckily I got a job at this startup which was like 14 people at the time, I did some marketing, digital stuff for them. That got me through my first co-op summer. When the summer ended, the guy said to me, he said, Hey, like, what are you going to do while you're studying?
Are you going to work at all? And I said, yeah, I'll probably go back to my lifeguarding job, cause that's what I did in high school. He said, no, no, like if you can, please stay with us part time, and I got to really see this company grow from whatever it was, 14 people to like a hundred plus over the course of my university journey.
That was super, super important because it gave me a taste for what it's like to build something from scratch. Post university, I went to work for bigger companies and that was more sort of technology related and then came back to the tech startup space again in the form of like head of product and then in the form of CTO, et cetera.
At the end of all that, I was in a place where I had a lot of technical skills, but also a lot of business skills. And I've seen sometimes, you know, I think in general, what you need is the belief that something is possible and how you get that belief is by seeing it done with your own eyes, like seeing something come to fruition.
So I've had more than anything, a good strong belief that I could build something because I have as part of something that wasn't mine but like I've had the skills and I've had the experiences and that kind of got me to start. So it was a combination of everything, technical skillset, confidence, know how, contacts, relationships, et cetera, resources.
Drew Quinn: Yeah, that's amazing. I think that's a perfect transition to when you talk about having the confidence to build something to talk about, Kero Sports. In building this company what accomplishments are you most proud of?
Tomash Devenishek: Yeah. I mean, you know, four years from when we started to now, there's been a lot of evolution to some extent. But also the one thing that's been a complete constant is the thesis. And so the thesis with which I started the company, and maybe I'll talk about what the company does today, and then we can kind of come back to what, what we were doing four years ago.
Today, when you go to bet on, on sports inside your favorite sports book or fantasy or daily fantasy app. What you're doing is you're interacting with contents, right? So if you're betting on the over under points for a particular basketball player in a game tonight, you're engaging with betting content.
What most people don't know is that no matter the brand, even some of the biggest brands, that content is not produced by the brand. It's coming from a company typically that specializes in that particular thing, so like NBA player props or something else or something else.
What Kero does is we are a specialist in micro betting content and what that micro betting means is literally the ability to bet on the next shots or the next free throw or the next anything, the next play in football or the next at bat in baseball or the next shot at soccer, et cetera, et cetera.
We do that today, and we do it with a very, very unique approach that nobody else in the industry does. Our approach is that as a fan of sports or somebody who's betting during the game while you're watching the game for the most part you're doing that because you're looking to elevate your entertainment experience, right?
If you were just betting to make money, there's lots of ways to do that. But if you're betting on something that you're watching, some portion of you is looking to be entertained more. And our thesis is that if you have hundreds of markets that you could bet on and you have to scroll through all hundreds of them and calculate the odds in your head to compare them to what you're seeing, eventually pick something, bet on it, and then wait 30 or 40 minutes for it to happen.
That's more work than entertainment, right? The entertainment experience, and this is, I now go back to the original thesis of the company when we started was, you should be able to consume betting content that is served, curated, or recommended to you based on what it is that you're seeing.
And so what Kero does is not only do we build short term micro markets like will this player's next three pointers go in or not, but we recommend and elevate those types of markets when they matter. So for example, yesterday I was at the at the Miami heat Mavericks game and you know, Jimmy Butler wasn't scoring that much, let's just say, right.
So the algorithm will pick that up and serve some type of a market related to his scoring streak when he's actually on the court. Because that's when you want to bet on Jimmy Butler, you don't want to bet on Jimmy Butler when he's sitting out or not really in the game or whatever.
So that's what we do we combine this notion of being able to build really good odds on whether something happens with this notion of recommendation, pair that together. And then as a user of a sports book with which we work you could just sit back, watch the game and kind of make continuous short term markets that are hopefully very engaging and exciting for you.
The thesis was always that, but obviously to go from idea to implementation, there's a lot of stuff. Where we started was purely with like, let's provide this type of experience to sports fans as like a fun experience where they can wager points and maybe win jerseys or tickets to, to sports games. How we delivered it was through professional sports teams. So, we worked with a lot of, and still until today work with sports teams who use us as a fan engagement solution where their fans inside their apps use our technology to predict what happens next in the game, talk to each other is kind of more of a social sort of free to play environments.
Obviously there's a huge journey between, between those two places, you know, the ability to take real money bets or sort of help sports books, take real money, that's with our content from kind of this idea of, hey, let's figure out how we can deliver highly contextual curated micro markets in real time to fans.
Drew Quinn: Yeah, that's awesome. You kind of touched on it already, but what would you say really makes your offering unique from other micro market providers?
Tomash Devenishek: We don't try and inundate the end user with another list of a hundred things because they already have hundreds of options in terms of stuff that they can bet on and rather allow them to sit back and be served stuff that's contextual.
Look at all mainstream forms of digital entertainment. Like when you go on Tik Tok or Instagram or Twitter or whatever, you're not going into a category of things and then searching for something and going through dozens of options before you find that one piece of content that you really want to engage with.
No, it's every piece of content that is put in front of you has some probability of being engaging to you. And so, yeah, you might scroll past two or three, but then, you know, you pause and like something and then read something and so on and so forth, so this is kind of what we're trying to mirror as well.
And nobody in the industry is doing that because I think the few folks who do have a footing in the space, they're all odds providers whereas we kind of think about it through the entire journey of the user experience, right? Like what does the user need? What is. Five years from now, how will people bet on sports?
And so we try and kind of take a longer term view and, and really look at the macro trends in human digital behavior.
Drew Quinn: That's awesome. And then again, you've already touched on this a little bit, but, you know, Kero puts a lot of emphasis on micro betting and social gameplay, social aspect. Why do you think these components really resonate with customers?
Tomash Devenishek: Well, you know, it depends on what, which vertical we're talking about, right? As I said, we work with many, many of the biggest pro sports teams in the US and I think there, the social aspect is quite important. Obviously on the real money sports side, it's probably less important because ultimately people are there to bet real money so that the focus becomes less on socializing and more on kind of what you're doing.
But I do think that any behavior that we as humans perform is always a lot more fun when you know you're not doing it alone. If you're betting on, let's just keep rolling with the Heat Mavericks game. If you're betting on that, would it not be fun to know, like, who else bet on the same stuff that you did? Or like, who's really crushing it in this game right now? And like, what, what did they bet on and, and stuff like that?
Anything that we do socially makes it more fun for us and because we try and think about the entire user experience, we do tend to also question like, Hey, what would it, but like, what would help with something like this?
I'll give you an example, a lot of our partners are actually international operators. We have one really large European operator who is also in Latam and other places and what we did with them was on top of the micro markets, which is it's a really, really cool product, actually, because they have streaming rights.
So they have the stream inside the sportsbook right below. It is a feed of micros that come in every 15 seconds. So you're watching the basketball game, Jimmy Butler scores his 3rd 3-pointer in a row, you're seeing it on video and then suddenly it's like Jimmy's on fire, you know, what's his next shot at two or three or something. Right. So it's really, really cool product.
Drew Quinn: That's cool.
Tomash Devenishek: Yeah, but then it gets better. What they did was to incentivize people to feel like they don't just have to win every bet, they also put a jackpot mechanic. So every time you're betting, you're winning, you're spinning for free for a 25,000 Euro jackpot. It doesn't cost you anything. It's like a free bonus almost with every bet. Every bet you make, there's a free bonus.
Drew Quinn: Hmm.
Tomash Devenishek: But this ties into your original question, like how does social play a part?
So then what we did was , on top of all this, there's also a it's almost like a, a tracker of who's winning the jackpot, right? And why is that important? Well, it's important because if I'm there and I'm playing, I bet once I didn't win the jackpot, I bet twice. I didn't win the three times, but then I see, Oh, Drew just won 15 euros in the jackpot.
Drew Quinn: Yep.
Tomash Devenishek: That's fun for me. First of all, I know there's like Drew is here and he's also betting, but now I see that he's winning. He just won 15 euros. Okay, like somebody's winning. So I should keep going. And so it's like, this is what I'm saying by we're a little bit different than everybody else, because we think about the entire user experience versus just let us make odds on a static list of 15 or 150 markets.
Drew Quinn: Yeah. Yeah, for sure. Now I want to transition onto you and your leadership quality. So as a founder and CEO, what is your leadership style? You know, how do you inspire innovation and growth within your team?
Tomash Devenishek: I'll tell you what I try and do, I don't know if I succeed, right? But what it starts at the hiring.
The ideal hire is somebody that we can give a platform to, to flourish and succeed. Like we never hire for we have these three things that somebody has to do and it's basically we're just getting a, a robot in to like perform the same tasks over and over that's not like people will hate their their lives and because we're not a car wash, no offense to car washes, but whatever like we're in the sports
Drew Quinn: Yeah,
Tomash Devenishek: Right?
Like people can be excited about their work. So we start with that. We're like, you know, can we give Drew a platform to be excited about what he's doing to express his curiosity? Could Drew be a good fit for our culture? And then does he have the kind of hunger appetite and curiosity to grow? And if the answer is yes to most of those things, then we bring you on.
And I think part of why that's important is because it then requires less micromanagement to actually succeed and inspire whatever, right? You've been brought into a fertile ground where you can succeed as an individual. And if everybody succeeds, then the team succeeds.
What I do do a lot is I try and as an avid fan of sports, I draw a lot of parallels between sports and, and like sports management and...
Drew Quinn: mm hmm.
Tomash Devenishek: You know I'm a big soccer fan, so soccer is a better sport to use as an analogy because you have at least 11 players, basketball you only have five, et cetera.
Soccer is 11 players, everybody's different, people have to shift sometimes and like cover for each other in different positions and so like what are the different management techniques that certain coaches use and, you know, some are very rigid, others are more fluid and kind of adjusted.
I've studied them a lot. And so I try and bring kind of the best of what I see in all of them. But ultimately the, the best structure I think is you, you have a combination of superstars but it can't, you cannot have all superstars, right?
In soccer, there's a central midfielder position, and it's not often a celebrated position, but like all the best teams that win have a really, really good guy in that position that three years, five years later, like nobody ever talks about. So it's kind of a thankless job, but like, this is the guy that made it. It's not Messi or Ronaldo, like, of course it's those guys too, but like without this guy, Messi never gets to score those goals. You know, Ronaldo never gets to score those goals and this team never gets to it.
This kind of combination of, you know different talents, different personalities and ultimately organizing it all against one mission. Like for us this year, now that we're kind of matured and we have customers and all that stuff, it's really a two part objective.
It's an objective of turnover or handle, which is a factor of our distribution and kind of the demand for a product. Luckily we've done a great job for both in both of those areas. Then the second one is the factor of our hold, IE, like how efficient is our product, right? It won't help us to have a billion dollars in turnover if our hold is negative 5%. It's just those two factors, right? Like how good is our product and then how widely distributed is it? And how much is it resonating with the industry?
Luckily we've done a great job in both and so it's all about kind of scaling that. But when you talk internally to the team, they have to know because anybody on the team ends up being in one of these kind of areas, right? Like I am partially responsible for how good our hold is, or I'm partially responsible, like I'm on the sales team, help with distribution. I'm on the product team, I help with how much it's resonating and so on so forth. So you need that clarity
Drew Quinn: That's great. And then I wanted to ask, you know, what advice would you have for someone looking to build their own company in the sports betting space or just in the tech space in general?
Tomash Devenishek: I think one, like get to understand what it takes, and there's no better way to do that than work at a startup. You hear about like oh Zuckerberg or this or that there's like a handful of dudes or girls who were first time founders and actually hit it out of the park. And there are hundreds or thousands more examples of successful entrepreneurs who earned their stripes elsewhere before they did it themselves. Like I've met now a few founders who are first time founders and thought it was kind of like it is in the movies, but it's not, you know, you need some of those skillsets.
There's nothing wrong with going and working somewhere where you can be part of the journey, get paid, have none of the downside and come out with all of that knowledge, like I did. Invaluable. In hindsight, like, because I was an immigrant and all that stuff, I, I always now reflect back and realize, man, like none of them really paid me well, you know? But like, I don't care
Drew Quinn: Mm hmm.
Tomash Devenishek: The value that I got learning all of that stuff has brought me here and it's like 10 times more value. So who cares about what the money was like, the experience is invaluable.
So I do think that people should spend a bit more time understanding what they're getting into in practice. And then from there, it's like that belief that I talked about, right. It's, it's really, really important to have those examples in your mind and because you will get challenged. Like it's not easy.
You will get those challenging moments where you're like, should I keep going? Should I stop? Is this going to be great? Is this going to be a failure? And like, you, you need that belief and experience. Difficulty is part of the journey, otherwise everybody would do it.
And, and then yeah, just some skills, right? Like for me, again, I was blessed with a combination of technical and business acumen, so I could kind of go across both. I think for folks that may not have both, one good advice is like, get yourself a partner that compliments you in that. You know, it was almost like a, I don't know if it's a blessing or a curse for me because I could do both so I never had a partner, but like, certainly you see those two, like there's a reason why Y Combinator only invests in the companies that have two founders, right? Because it's just much, much easier to succeed that way. So yeah, if you don't have a technical skillset, find a partner that has that, or if you're a super techie, but you're self aware enough to know that it's very hard for you to go on a podcast or get into a boardroom and do a sales meeting or whatever, like get yourself a partner that can do that, that they're both equally important. Those would be probably the top advices.
Drew Quinn: Cool. And now I want to transition into a sports betting in the future of sports betting. So I want to ask, how do you see the sports betting landscape changing over the next five years and what role do you see technology playing and driving these changes?
Tomash Devenishek: I think you can see it now. Certainly people love like same game parlays, right? Huge huge product category. And the reason for that is it's actually nothing new, it's just a different form of lottery, right? High upside, very low likelihood, but people will kind of take that like the more you stretch those to the more appealing it becomes.
And I think there's a study somewhere about this. I'm pretty sure. Where people will drive across state lines to buy a lottery in the other state, because the jackpot is bigger, even though, like, statistically speaking, the probability of winning it is lower on that side
Drew Quinn: Hmm.
Tomash Devenishek: but you're still going through all the trouble to go and buy that lottery ticket because it's just a bigger, like, the number, the number is shinier, right?
So I think, this combination of the lottery mechanic and the mechanics of what we're doing, which is kind of more curated, if you shoot those two atoms at each other, you really get like a nuclear reaction.
Drew Quinn: hmm.
Tomash Devenishek: I do think that that's probably the next big thing is the combination of these two because today there's separate mechanics, right?
You've got a bunch of like same game parlay contents and companies, and then you've got some micro markets companies. But I think if you analyze the SGP space, It takes a long time. You have to engage with it, exercise a lot of cognitive ability, then you make your SGP or even like a general parlay, and then you wait.
Drew Quinn: Mm hmm.
Tomash Devenishek: for a long time. Well, imagine you could do one every minute, smaller numbers perhaps, but like it was all kind of curated and put together and it didn't take two days for it to happen. That to me seems like a pretty exciting proposition. So I think that that could be one major thing from like a technology, like the future of space.
Drew Quinn: Mhmm. How has the industry evolved since you founded your company four years ago? And have you been able to address these changes in the experiences you're providing?
Tomash Devenishek: it's funny because the U. S. has changed. Globally, it's kind of, you know, it's different. What happens in the world is very different from the U. S.. We didn't really talk to the industry four years ago, so that's the thing, right? Like we went about it from like concept to some basic MVP to whatever.
Really in the last year and a half, we've probably been a sports betting company. Up until then, we were more of a technology company within the sports space. But certainly like we're aware of a lot of sports books and all that. Back then, I think there was this gold rush to go live in all the places that were putting in the regulatory framework and now it's, it's slowed down. So now it's all about like, how do we entrench? Now there's a much greater focus on like, what is our product, how we differentiate, etc. Two years ago, it wasn't that it was all like, how do we go live in Michigan and what partnerships do we need and blah, blah, blah, right?
That's what we heard a lot of., And now people are really paying attention to, to the tech, to the offering, to, to all those things. That's the U. S., and globally what we saw and it's very true, and it's probably the kind of the underlying opportunity behind Kero, like why we're excited, is in the U. S. there are a handful of players. So there's two brands that control most of the market, and then two to three others that are worth mentioning. We'll have three to 5 percent of the market, right? So it's like, it's this big oligopoly between two and then a bunch of small players. And for the most part, everybody kind of controls their entire stack, right?
Like they all own their technology, they own most of what you interact with on any one of these brands is owned by them. Whereas globally, it's the opposite of that, and the global market, first of all, is much, much larger. But also a lot of the technology is white labeled, so much of it is, is just sourced from capable third parties.
That's where we see the opportunity, right? Here it's been this competition of like, I want to own my stuff and what I have you shouldn't have, whereas globally kind of doesn't matter because first of all, some of these brands are in 15, 20 countries, right? So like, there's no real competition with any one entity because in any country you could be a competitor to somebody else and so on and so forth. They're all happy to take the best product, and I certainly think that what we are is the best version of microbetting that you could have on the market.
So that's what we see. Like, that's, that's how we react to it, right? You have to understand the U. S. landscape and realize early on, oh, we should actually spend a lot of time globally. Obviously still paying attention to the U.S. But you still have this major opportunity outside.
Drew Quinn: Cool. That's great. Thank you so much, Tomash. Those are all of my questions. You know, we really appreciate you taking the time to join us today. This has been very insightful and I really enjoyed our conversation and I'm really looking forward to see how your company is going to grow.
Tomash Devenishek: Thank you. My pleasure. My pleasure. And thanks for the invite again.
