Shares in troubled betting exchange Betfair closed at 584.5p on Wednesday, down 16p on the day, and down over 70p since the start of the trading week. Shares had dipped as low as 578.5p on Wednesday, a historic low since the company went public last October. With all the clarity that hindsight provides, an unnamed (and presumably seething) investor told Euromoney, “you have to ask if that company should ever even have gone public.”
By coincidence, the BBC’s weekly practice of asking three questions of technology gurus at high-profile firms turned the spotlight on Betfair CTO Tony McAllister on Wednesday. As if responding to mounting concerns that Betfair lacks a coherent strategy for expansion into new markets, McAllister claims his company’s biggest tech problem is “making our platform and our products and services adaptable to an international market.” Recalling Betfair’s launch over a decade ago, McAllister describes how the exchange was designed purely with UK customers and events in mind, and that the digital add-ons necessary to accommodate punters outside the UK “created a bit of a monolith, if you will, from a technology standpoint.”
McAllister described the difficulties both he and Betfair face in dealing with the regulatory patchwork quilt that Europe presents. “One of the biggest challenges I have is how to make my platform adaptable and agile enough to deal with regulations that may be different in Italy than they are in Spain, and again different in Greece as they are in the UK. In some cases I may need to put kit in a country, or I may not be able to put kit in a country, I may build and run some products and not run other products That’s the biggest challenge I face today, rebuilding my entire infrastructure, physical as well as software, to deal with the changing regulatory landscape.”
Of course, if Betfair’s ship doesn’t right itself soon, a changing regulatory landscape won’t be the only challenge the company faces. Bodog currently has Paddy Power COO Breon Corcoran as the favorite to take outgoing CEO David Yu’s place at Betfair’s helm. (Betfair’s own COO Niall Wass is a distant second.) But unless Betfair’s shares show some sign that they’re still capable of going up as well as down, the company may start thinking about doing some more extensive executive shuffling.