Rivalry Issues 2024 Business Update
TORONTO, Feb. 05, 2024 (GLOBE NEWSWIRE) — Rivalry Corp. (the “Company” or “Rivalry”) (TSXV: RVLY) (OTCQX: RVLCF) (FSE: 9VK), the leading sportsbook and iGaming operator for Millennials and Gen Z, today issued a letter to shareholders summarizing recent progress and outlining strategic priorities for 2024. The full text of the letter follows. All dollar figures are quoted in Canadian dollars.
Rivalry Corp. 2024 Business Update
To our Shareholders,
Rivalry is defining the future of online gambling for a generation born on the internet.
Our aspiration is to set the standard for what is possible in this category, and to be market leaders in the inevitable generational shift that is underway.
We exited 2023 as a substantially diversified company, both geographically and across our product suite, with the strongest customer KPIs in our history.1 Our esports expertise no longer solely defines us, and our rapid ascent in other segments such as traditional sports, casino, and fantasy outlines the increasingly widening opportunity set we’re realizing as a result of our unrivaled demographic understanding.
Rivalry’s brand has become a bridge to Gen Z experiences. We’ve proven we can acquire, engage, and retain this demographic in gambling products under our umbrella. The value we’re beginning to unlock from this cannot be overstated.
The potential for how far our brand can go is just beginning to unfold. And it is why 2024 is setting up to be a year of significant growth, powered by our relentless pursuit to deliver a one-of-a-kind experience to a digitally native demographic that we can delight better than anyone else.
What we have built is only made possible by a world-class team excelling at their craft. One that is unafraid to push against the long-standing industry status quo. This high standard has made Rivalry a gravitational center for talent and breeding ground for innovation that we believe is unmatched in the online gambling industry.
This is the engine building operating leverage for Rivalry, enabling us to deliver on growth while maintaining financial discipline, leading us to profitability.
Having taken significant strides toward our vision in 2023, we now enter 2024 hungry for more. In this letter we will highlight some of our achievements last year and share what shareholders can look forward to in 2024.
We’re proud of our accomplishments last year:
- Maintained growth momentum, with year-to-date reported betting handle increasing 127% to $338.1 million, revenue increasing 70% to $29.2 million, and gross profit up 175% to $13.2 million through Q3 2023 compared to the first nine months of 2022, while marketing spend decreased by 8%.
- Proved our Gen Z demographic thesis by leading from the front with gaming and internet culture while diversifying below, with casino growing to nearly 50% of total wagers, followed by esports, and then sports.
- Achieved record high customer KPIs, including all-time high average handle per customer, average revenue per user, and record low cost of customer acquisition, demonstrating the operating leverage which compounds with scale.1
- Reached key product innovation milestones, including the release of an industry-first same-game parlay product for esports, supporting an improved sportsbook product mix and enhanced margin profile.
- Debuted our iOS mobile app in Ontario, contributing to a 400%+ year-over-year increase in betting handle in the province in Q3 2023.
- Rapidly scaled our casino offering with new features, games, and mobile functionality.
- Developed and launched our second-ever original game, Cash & Dash, which has already become one of the most popular and highest-grossing casino titles on our platform.
- Continued marketing excellence and expanded creator network with over 100 brand partners and 90M+ aggregate followers, creating reliable consumer touchpoints to engage our core audience and enabling us to drive growth without the use of excessive bonus and promotional offers.
A Generational Brand in Online Gambling Delivering Tangible Business Results
There are generational cycles in technology where new products rise up to serve an emerging customer in a way legacy companies did not. In the online betting space, we believe Rivalry is that company.
It’s reflected in a product suite that looks like nothing else in this category – one that is intrinsically entertaining, culturally relevant, and always evolving. It’s reflected in a brand strategically positioned at the intersection of gaming and internet culture with marketing that spreads globally through unignorable creative work. It’s seen in a company that deliberately stands out in a sea of sameness with a customer base averaging a decade younger than our peers.2
Everything we put out into the world is intentionally-designed to resonate with our target audience. Customers, interested brand partners, and various other stakeholders have come to view Rivalry as a proven onramp to interactive and entertaining experiences broadly, which is opening up exciting possibilities for the Company to expand.
In 2023, this enabled us to launch a standalone NBA fantasy app called Rivalry Ultimate Fan, which is acquiring new users, cross-selling them, and further engaging existing ones in our product universe.
The value being created from our original game IP is also materializing rapidly. Four months after launching our latest first-party game Cash & Dash, it has become the fifth most-played game on our platform and among the top ten highest-grossing titles by revenue.
In roughly a year’s time, casino has grown to nearly 50% of betting handle, growing 141% year-over-year in Q3 2023 without cannibalizing player wallet share. Casino.exe, our custom-built platform, has represented a key part of our success in this segment by differentiating Rivalry’s casino offering from the others out there.
The connective thread between these things is a highly-nuanced understanding of Gen Z’s consumer behaviors, its connectivity to gaming and internet culture, and our ability to transform it into a successful product experience that is well-differentiated from the pack.
Together, this creates a generational brand in online gambling delivering tangible business results, and one where the possibilities of its products, marketing, and brand are limitless.
Rivalry in 2024 and Beyond
We are committed to pursuing strategic and well-measured investments in key areas of our business, positioning Rivalry for sustained growth throughout 2024 and beyond. Our objectives are designed to maintain and accelerate our momentum towards profitability. Initiatives and catalysts anticipated to drive results in 2024 include:
- Operating leverage and profitability: Continued cost management to balance profitability with growth by doubling down on proven marketing tactics which deliver business operating leverage and position Rivalry for long-term success.
- New original games: Releasing more first-party games in 2024 which blur the lines between gaming, betting, and entertainment to meaningfully engage a digitally native audience.
- Casino B2B opportunities. Our original casino games have demonstrated their ability to engage an under-30 demographic and drive revenue; we believe this will open up B2B licensing opportunities and create a new revenue stream for our business.
- Product innovation: New proprietary releases and enhancements to the current product suite across sportsbook, casino, and more, including those which drive usage of higher-margin verticals and increase overall player engagement.
- Player value focus: Strengthening innovative player retention initiatives through gamification and loyalty programs that not only increase player satisfaction and compound user value, but contribute to the profoundly unique experience of betting on Rivalry.
- Geographic expansion: Growing our Total Addressable Market by entering new markets.
- Traditional sports expansion: Investing further in the traditional sports segment, which has increased on Rivalry by 60% since 2022, demonstrating the success of our brand among Gen Z broadly and enabling us to continue broadening our TAM.
Our multi-year track record of triple-digit growth amidst decreasing year-over-year marketing spend is a testament to the execution of our team, business model, and brand leadership among Gen Z. We have unparalleled demographic expertise, a product innovation engine delivering results, unforgettable marketing, and an immensely talented team.
Our vision for online betting is challenging conventional norms in a long-standing industry. We are disruptors, stepping on nicely manicured lawns by seeing the future of online gambling and creating it. The next generation is just getting started on their customer journey, and we are poised to own it.
We have conviction in our one-of-one strategy in this industry and will continue pushing it forward at every opportunity.
As we step into 2024, our enthusiasm is at a high to showcase the same operational excellence that has set us apart in a fiercely competitive industry.
With that, I wish everyone a happy, successful, and healthy year.
Co-Founder & CEO
Rivalry Corp. wholly owns and operates Rivalry Limited, a leading sport betting and media company offering fully regulated online wagering on esports, traditional sports, and casino for the next generation of fans. Based in Toronto, Rivalry operates a global team in more than 20 countries and growing. Rivalry Limited has held an Isle of Man license since 2018, considered one of the premier online gambling jurisdictions. Rivalry also holds a sports bookmaker license in Australia and an internet gaming registration in Ontario, and is currently in the process of obtaining additional country licenses. Rivalry’s sportsbook is built on a proprietary tech stack and features a variety of originally developed products geared for Millennial and Gen Z fans including Same Game Combos, an esports parlay product, original casino games, and an interactive casino platform, Casino.exe.
Steven Salz, Co-founder & CEO
Cody Luongo, PR & Communications
Cautionary Note Regarding Forward-Looking Information and Statements
This news release contains certain forward-looking information within the meaning of applicable Canadian securities laws (“forward-looking statements”). All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “anticipate”, “achieve”, “could”, “believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “outlook”, “expect”, “project” and similar words, including negatives thereof, suggesting future outcomes or that certain events or conditions “may” or “will” occur. These statements are only predictions.
Forward-looking statements are based on the opinions and estimates of management of the Company at the date the statements are made based on information then available to the Company. Various factors and assumptions are applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Forward-looking statements are subject to and involve a number of known and unknown, variables, risks and uncertainties, many of which are beyond the control of the Company, which may cause the Company’s actual performance and results to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. Such factors, among other things, include regulatory or political change such as changes in applicable laws and regulations; the ability to obtain and maintain required licenses; the esports and sports betting industry being a heavily regulated industry; the complex and evolving regulatory environment for the online gaming and online gambling industry; the success of esports and other betting products are not guaranteed; changes in public perception of the esports and online gambling industry; failure to retain or add customers; the Company having a limited operating history; negative cash flow from operations; operational risks; cybersecurity risks; reliance on management; reliance on third parties and third-party networks; exchange rate risks; risks related to cryptocurrency transactions; risk of intellectual property infringement or invalid claims; the effect of capital market conditions and other factors on capital availability; competition, including from more established or better financed competitors; and general economic, market and business conditions. For additional risks, please see the Company’s annual information form for the year ended December 31, 2022 and other disclosure documents available on SEDAR+ at www.sedarplus.ca.
No assurance can be given that the expectations reflected in forward-looking statements will prove to be correct. Although the forward-looking statements contained in this news release are based upon what management of the Company believes, or believed at the time, to be reasonable assumptions, the Company cannot assure shareholders that actual results will be consistent with such forward-looking statements, as there may be other factors that cause results not to be as anticipated, estimated or intended. Readers should not place undue reliance on the forward-looking statements and information contained in this news release. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and the Company does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws.
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.
Source: Rivalry Corp.
1 Nine months ended September 30, 2023.
2 Casino.org, “Study: A comparative profile of the Internet gambler: Demographic characteristics, game-play patterns, and problem gambling status”