Reddit co-founder leads investment in sports betting app Wagr

A co-founder of Reddit, Alexis Ohanian, is leading a $4 million (€3.37 million) funding round for sports-betting startup Wagr, which aims to merge social media with the gambling industry.

The startup aims to do this by allowing fans to bet socially, with friends, rather than via casinos. It wants to create a social platform that doesn’t require betting knowledge, thus expanding the market for casual wagers.

In a telephone interview cited by Fortune magazine, Mr Ohanian explained: “It’s about product-ising what already goes down in everyone’s group chat, which is wagers between friends about sporting outcomes. Right now the way these get resolved is through a ‘Cash App’ payment or a ‘Venmo’ payment on Monday, and surely we can do better”.

The startup also has the attention of several other prominent tech and business figures, with Tinder co-founder Justin Mateen and former-chairman and CEO of Saks Inc amongst other investments.

Under Wagr’s business model, customers would pay a platform fee in order to have a service that handles odds, payments and banter between users. The service would charge fees similarly traditional casinos and has pending license applications to be able to operate in two US states – Tennessee and Virginia.

On launch, the app will initially feature major sports, with players able to take either side of a point spread bet with someone they know, who’s willing to gamble.

While the company expects to eventually launch prop bets or money-line wagers, its initial focus will be on point spreads, in part because they lend themselves well to the P2P model.

Aside from the obvious financial advantages of Mr Ohanian’s investment in Wagr, his endorsement is also a promising seal of approval from a well-known and respected figure in the tech industry.

Mr Ohanian, who’s also known as the husband of tennis star Serena Williams, was one of three founders of Reddit, popularly referred to as the “front page of the internet”.

In 2006, after 16 months of work on the platform, he sold it to Conde Nast for $10 million (€8.44 million) – a deal he might now regret considering the company now has a valuation of $6 billion (€5.06 billion).