SharpRank, a Timonium company that evaluates sports betting experts, has raised $2.5 million so far in a seed round.
The company plans to use the funding to continue to enhance its data science and technical infrastructure, along with testing how its product meets current market demand. SharpRank began raising money on March 4, and is still in talks with additional investors, which may oversubscribe the round.
“Before us, this type of oversight and independent rating agency hadn't existed in the market,” CEO Christopher Adams said.
The seed round is supported by the Maryland Technology Development Corp. (TEDCO), Old Line Capital, Sharp Alpha Advisors, Eilers & Krejcik Gaming and other independent investors. The company's last round was in 2021, when it raised $1.4 million. SharpRank currently has 10 full-time employees.
SharpRank's latest raise comes as the sports betting market exploded in 2021. The industry doubled in size as Americans wagered more than $52.7 billion on sports, according to research from Morning Consult. The firm's data showed that nearly one in five adults bet on sports at least once a month. In Maryland, sports betting began last December.
Along with the new capital funding, SharpRank is monetizing partnerships with media companies, such as Sports Illustrated and USA Today. A lot of sportsbook operators are also interested in the product, especially as they move toward having more robust content arms, producing videos and articles about the industry, Adams said
"What we see in the market a lot is a merging of sportsbook operators and media platforms," Adams said.
SharpRank is able to help companies in the sports betting ecosystem compare their analysts in order to make better hiring decisions and source new talent through data. The company uses over 40 in-house parameters, such as risk profiles, to evaluate sharps, Adams said. He compared the company to Morningstar, pointing to how the investment company provides more detailed information than just past returns to provide value to users.
"You can start to see where people are having success," Adams said. "The public can see that and say, I just want to know who the best person is when picking the Packers."
Alongside its business-to-business services, SharpRank has a consumer app for amateur bettors with 15,000 active users. The app creates profiles detailing the picking habits of both sports betting experts and regular sports fans, which allows media companies or sportsbooks to create content tailored to specific users.
“We create a huge advantage for partners because we're looking at the DNA of the expert, and matching it with the DNA of one of their consumers,” Adams said.
For example, instead of simply offering a blanket promotion to every customer, a sportsbook company using SharpRank's technology can create a more individualized promotion, such as a risk free bet for a specific game, Adams said.
For sports betting experts, the company also serves as a way to establish their credentials.
"We serve as that lightning rod," Adams said. "They can then point to us and say, 'this isn't my opinion of myself, this is a third party.'"
