1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Thesis
3. Valuation & Price Target
4. Business & Product Moat
5. People & Governance
6. Market & Macro
7. Financial Quality
8. Risk Register
9. Prediction Market
10. 𝕏 Posts
Discussion
1. Investment Snapshot
2. Valuation
Discussion
Symbol
SRAD
Event Date
2021-09-15
IPO Date (Actual)
2021-09-14
Sector
Information Technology
Subsector
IT Services
Offer Range
$27.00-$27.00
Shares Offered
19M
205.27M
$7.8B
9.3%
Implied Upside vs Midpoint
Description
Sportradar is a leading technology platform enabling next generation engagement in sports, and the number one provider of business-to-business (“B2B”) solutions to the global sports betting industry based on revenue. We provide mission-critical software, data and content via subscription and revenue share arrangements to sports leagues, betting operators and media companies. Since our founding in 2001, we have been at the forefront of innovation in the sports betting industry and we continue to be a global leader in understanding, leveraging and monetizing the power of sports data. Our mission is to enhance sports fan engagement globally through our fully integrated technology and services platform. Sportradar offers one of the most robust and fully integrated sports data and technology platforms. We serve as a critical data infrastructure and content layer to the sports betting and media industries. On top of that infrastructure layer, we have built one of the most advanced and comprehensive software offerings. Our products simplify our customers’ operations, drive efficiencies and enrich fan experiences. Our end-to-end offering, integrated technology and global footprint make us important partners to our customers and deeply embedded across the sports ecosystem: • Betting Operators: For our over 900 sports betting operator customers, we cover over 750,000 events annually across 83 sports, including live data coverage of 600,000 events across 37 sports. The breadth of our data offering and sports coverage is an important differentiator for Sportradar, especially in the U.S. market where we are the #1 provider of data to bookmakers. We supply sports data, in many cases as the sole provider, to over 85% of all bookmakers in the United States, who in turn manage nearly every legal sports bet placed by U.S. sports bettors. Our offerings include pre-match data and odds, live data and odds, as well as sports audiovisual content. Our full-suite of software solutions includes managed trading services (“MTS”), managed platform services, betting entertainment tools, virtual games and programmatic advertising solutions. We are the only independent one-stop-shop provider across the value chain. • Sports League: For our over 150 sports league partners, we provide access to over 900 sports betting operators and over 350 media companies to distribute their data and content globally. We give them greater reach and serve as an intermediary to the highly regulated betting industry. We also provide our sports leagues partners with technology, data collection tools, and integrity services. • Media Companies: For our over 350 media customers including both traditional and digital leaders, we provide products and services to help reach and engage sports fans across distribution channels. Our deep relationships across the sports value chain have been developed over the course of nearly twenty years, and have powerful network effects. The more betting operators and media companies we bring onto our platform, the broader distribution we have to sports fans and bettors. This attracts new sports leagues to partner with us. Each new league partner adds more events to our portfolio and new opportunities for us to help betting operators and media companies engage their customers. This feedback loop strengthens our value proposition in the ecosystem. At the heart of what we do is our proprietary technology stack. Our product strategy is centered on speed, reliability and scalability to match the demands of our customers. We use advanced algorithms to create scalable, customized insights in real-time with latency averaging 700 milliseconds (“ms”). We have one of the industry’s leading cloud native storage and distribution platforms. We leverage AI and machine learning capabilities, based on our rich data lake, to provide the most accurate odds. We are innovators at the forefront of revolutionary new technologies in sports data and analytics including computer vision, data visualization, virtual gaming and simulated reality. Sportradar leads on breadth of events coverage for sports data and odds. We offer the largest volume of data in the world across our peers, leveraging nearly 20 years of historical sports information. We collect over 1.2 billion live data points per year from over 600,000 events in 37 sports. In 2020, we generated 3.7 billion live and pre-match odds changes, collected 1.9 billion betting tickets and processed 21 billion odds changes from betting operators. We have a strong betting data rights portfolio, including non-exclusive rights to the National Basketball Association (NBA) and the Major League Baseball (MLB) in the United States, as well as exclusive rights on a global basis to the NBA (excluding the United States and China), MLB (excluding the United States) and National Hockey League (NHL). In addition, we hold exclusive and worldwide media data rights for the NBA and MLB (including in the United States). We also hold data rights to more than 500 other sports leagues and competitions across the world on both an exclusive and non-exclusive basis. We are highly diversified across tiers of customers and tiers of sports content. The breadth and quality of our sports betting data coverage separates us from our competition. In addition to sports data, we provide our customers with the largest sports audiovisual content offering including 200,000 events per year across tier 1 and other-tier sports leagues. Sportradar provides global coverage, with strong U.S. market positioning, including rights for major U.S. sports leagues. Sportradar’s software solutions address the entire sports betting value chain from traffic generation and advertising technology, to the collection, processing and extrapolation of data and odds, to visualization solutions, risk management and platform services. We have designed our platform to solve the challenges that sports betting operators face competing in a complex ecosystem, in real-time, and on a global scale. Sportradar offers full-service, turn-key software packages, as well as flexible, modular products depending on the size and capabilities of our customers. Our valuable data assets and analytics capabilities enrich all of our software offerings. Our platform is used globally by organizations of all sizes from large enterprises to small start-up businesses. As of December 31, 2019 and 2020, we had 1,601 and 1,612 customers, respectively. As our customers experience the benefits of our platform, they typically expand both their usage and the number of products and services that they purchase from us. Many of our sports betting customers have automated entire workflows that would have otherwise been done manually in-house. Our ability to expand within our customer base as well as our ability to grow alongside our customers is best demonstrated by our Dollar-Based Net Retention Rate for our top 200 customers. As of December 31, 2020 and 2019, our Dollar-Based Net Retention Rate was 113% and 118%, respectively. As of June 30, 2021, our Dollar-Based Net Retention Rate was 138%. The increase in the Dollar-Based Net Retention Rate as of June 30, 2021, as compared to December 31, 2020 and 2019, is primarily due to the negative impact that the COVID-19 pandemic had on revenue retention of our top 200 customers in the first half of 2020, as many of our top 200 customers reduced their spending under existing contracts during such period given the cancellation or postponement of various sporting events. Following the resumption of live sporting events in the first half of 2021, we saw an increase in revenue generation levels among our top 200 customers, along with additional revenue as a result of many 2020 postponed events occurring in the first half of 2021. This resulted in a spike in the Dollar-Based Net Retention Rate during the six month period ended June 30, 2021. We have grown through both organic and inorganic expansion. For the years ended December 31, 2020 and 2019, our revenue was €404.9 million and €380.4 million, respectively, representing year-over-year growth of 6.4%. Historically we have been able to achieve a 20% revenue compound annual growth rate (“CAGR”) from 2016 to 2020. Our business is profitable and benefits from positive Adjusted Free Cash Flow generation. For the years ended December 31, 2020 and 2019, respectively, our profit for the year was €14.8 million and €11.7 million, representing year-over-year growth of 26.5%. Our Adjusted EBITDA was €76.9 million and €63.2 million for the years ended December 31, 2020 and 2019, respectively, representing year-over-year growth of 21.7%, profit for the period as a percentage of revenue of 3.7% and 3.1% and Adjusted EBITDA margin of 19.0% and 16.6%, respectively. Our net cash from operating activities as a percentage of profit was 1,021.6% and 1,251.3% for the years ended December 31, 2020 and 2019. We had strong Cash Flow Conversion, defined as Adjusted Free Cash Flow as a percentage of Adjusted EBITDA, of 69.6% for the year ended December 31, 2020 and 87.3% for the year ended December 31, 2019. Our net cash from operating activities was €151.3 million and €146.0 million for the years ended December 31, 2020 and 2019, and we have been Adjusted Free Cash Flow positive since 2013, including for the years ended December 31, 2020 and 2019, with €53.5 million and €55.3 million of Adjusted Free Cash Flow, respectively. For the six month periods ended June 30, 2021 and 2020, our revenue was €272.1 million and €191.6 million, respectively, representing period-over-period growth of 42.0%. For the six month periods ended June 30, 2021 and 2020, respectively, our profit for the period was €17.7 million and €20.2 million. Our Adjusted EBITDA was €59.8 million and €40.8 million for the six month periods ended June 30, 2021 and 2020, respectively, representing period-over-period growth of 46.5%. For the six month periods ended June 30, 2021 and 2020, profit for the period as a percentage of revenue was 6.5% and 10.6%, respectively, and Adjusted EBITDA margin was 22.0% and 21.3%, respectively. Our net cash from operating activities as a percentage of profit was 382.6% and 374.9% for the six month periods ended June 30, 2021 and 2020, respectively. We had Cash Flow Conversion of 6.9% and 80.7% for the six month periods ended June 30, 2021 and 2020, respectively. Our net cash from operating activities was €67.5 million and €75.9 million in the six month periods ended June 30, 2021 and 2020, respectively, and we had Adjusted Free Cash Flow in the six month periods ended June 30, 2021 and 2020 of €4.1 million and €32.9 million, respectively. In our mature markets, where sports betting has been legal for many years, we are highly profitable. Revenue in the RoW Betting segment was €235.0 million and €224.7 million for the years ended December 31, 2020 and 2019, respectively. Revenue in the RoW AV segment was €105.9 million and €102.7 million over the same time periods, respectively. Revenue in the United States segment, where we have been investing heavily in data, content, technology, personnel and operations, was €34.4 million and €22.9 million over the same time periods, respectively. Revenue in the RoW Betting segment was €148.5 million and €108.4 million for the six month periods ended June 30, 2021 and 2020, respectively. Revenue in the RoW AV segment was €75.6 million and €56.7 million for the six month periods ended June 30, 2021 and 2020, respectively. Revenue in the United States segment was €28.9 million and €13.4 million for the six months periods ended June 30, 2021 and 2020, respectively. As a result of our investments, we are nimble, innovative and prepared for global growth. In addition to investments in strategic markets like the United States, which we believe will fuel significant growth in our business, we have also invested in new high growth products including programmatic advertising, e-Sports and gaming technology such as virtual sports and simulated sports events. We expect these investments to expand the scope of our value proposition, increase our total addressable market (“TAM”) and drive wallet share with customers. We are part of a founder-led organization with a strategy that is focused on innovation and long-term value creation. Our Founder and Chief Executive Officer, Carsten Koerl has been at the forefront of the online sports betting industry since its early days. Our investor base includes top-tier investors such as CPP Investments and Technology Crossover Ventures (“TCV”), as well as notable sports industry individuals such as Ted Leonsis, Mark Cuban and Michael Jordan, who each hold less than 5% minority interest. References to these individuals are included in this prospectus because they are leading figures in the global sports industry, which is the industry in which we operate, and distinguished members of our existing investor base. We believe that disclosing the identity of such investors provides potential new investors with a better understanding of the entities and individuals in the sports industry that have financially supported our growth by investing in our business. --- We are a Swiss stock corporation (Aktiengesellschaft) organized under the laws of Switzerland, currently registered in the commercial register of the Canton of St. Gallen (the “Commercial Register”) under CHE-164.043.805. Our principal executive offices are located at Feldlistrasse 2, CH-9000 St. Gallen, Switzerland. Our telephone number at this address is +41 71 517 72 00. Our website address is www.sportradar.com.
Sportradar Group AG annual income statement and balance sheet, FY 2022 to FY 2025, as reported in SEC filings (EUR).
| Metric | FY 2022 | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|---|
| Revenue | EUR 730M | EUR 878M | EUR 1.1B | EUR 1.3B |
| Gross profit | EUR 554M | EUR 726M | EUR 931M | EUR 1.1B |
| Net income | EUR 10.5M | EUR 33.9M | EUR 33.6M | EUR 100M |
| Metric | FY 2022 | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|---|
| Total assets | EUR 1.4B | — | EUR 2.3B | EUR 2.9B |
| Total liabilities | EUR 632M | — | EUR 1.4B | EUR 1.9B |
| Total equity | EUR 757M | EUR 873M | EUR 930M | EUR 978M |
| Cash & equivalents | EUR 244M | EUR 277M | EUR 348M | EUR 365M |