Mark Cuban and Michael Jordan may own competing NBA franchises, but when it comes to sports data, they're on the same team.
Cuban and Jordan have joined venture firm Revolution Growth to acquire a minority stake in sports-data technology company Sportradar. Revolution declined to disclose the size of the investment, but a source familiar with the situation said the funding round was roughly $45 million.
Founded in 2001, Sportradar provides information and data on 48 different sports to companies such as Google, Turner Media, and Yahoo Sports, the dominant player in the fantasy sports industry with nearly 20 percent market share. Switzerland-headquartered Sportradar began by offering data and fraud detection services to sports teams and leagues in Europe before switching its focus to real-time sports data and statistics.
The company makes money by licensing its data to businesses in the gaming industry and other sports-related companies, which then provide the data to consumers. "People are just insatiable for the kind of data and information that they want to track, either for their own enjoyment or because they play fantasy games," says Ted Leonsis, co-founder of Revolution Growth. Cuban, Jordan, and Leonsis are all joining Sportradar's U.S. advisory board. Cuban did not respond to a request for comment.
Private equity firm EQT invested around $50 million in Sportradar in 2012 when the company was valued at roughly $140 million. In 2013, Sportradar began licensing its data to businesses in the U.S. The company generated about $100 million in annual revenue in 2014, according to data from EQT.
During the past nine months, Sportradar has made exclusive agreements with the NFL, NHL, International Tennis Federation, and NASCAR. The company will use the funding round led by Revolution primarily to help create new data products for businesses in the fantasy sports, gaming, social-media, and technology sectors.
While gambling on sports continues to be illegal in most U.S. states, Leonsis says Sportradar's data is sought by enough non-gambling companies to create a significant market opportunity in the U.S.
"The licensing of data to consumers and to media companies--that's going to happen whether there's legalized gaming or not," he says, adding that it's widely expected that the U.S. will allow some form of legal gambling on sports in the near future.
Sportradar has more than 1,000 total employees in offices in Switzerland, Minneapolis, San Francisco, and New York. The most compelling statistic related to the company, however, pertains to the growing popularity of fantasy sports, according to Leonsis.
"There are 60 million people playing some kind of daily fantasy," he says. "Five years ago, there were none."