New York-based sports betting technology company Novig is bringing what it touts as a “revolutionary commission-free sports betting app” to Colorado.
The company’s announcement last week heralds its launch in the US. Novig characterizes its model as an “innovative platform [that] eliminates traditional fees, providing users with a unique and cost-effective way to engage in sports betting. Instead of charging everyday bettors, Novig generates revenue by charging market makers and professional bettors. With a user-friendly interface and cutting-edge features, Novig aims to redefine the sports betting experience for Colorado sports fans.”
Novig will operate as a sportsbook until regulators approve exchange model
Novig joins a long list of Colorado online sports betting operators. It will have to work to gain market share in Colorado’s sports betting market, which registered its fifth straight month of increased volume in November. The month’s total handle was $608.5 million, mostly from online bettors.
Even with the increase, the activity generated just $28.5 million in revenue, down more than 60% from October. That’s thanks to bettors winning $579.9 million, leaving a hold percentage of just 4.7%.
Novig received a betting license from the Colorado Division of Gaming in October to launch its app. The app will eventually, if approved, offer exchange betting.
According to the release announcing the launch of the Novig app in Colorado, “until exchange wagering is approved by the CLGC (Colorado Limited Gaming Commission), Novig will be operating as an internet sports betting operator and not an exchange.” Differences between exchange betting and traditional wagering on sports are significant.
A betting exchange allows individuals to post bets with the odds they choose, matching bettors with wagers, and creating a user-controlled marketplace. Theoretically, odds can be lower than at traditional commercial sportsbooks, and no commissions (or “vig”) are paid to a sports betting operator. Sportsbooks often add in 1-10% in odds to handle bets as a commission.
Novig enjoys big-time backers
Novig CEO Jacob Fortinsky believes the exchange model will be a game-changer in the sports betting industry.
“We’re thrilled to introduce our commission-free sports betting app to the vibrant community of Colorado. Novig is committed to delivering a seamless and cost-effective platform that enhances the enjoyment of sports betting. Using Novig really should be a no-brainer for sports bettors: we’re offering the same betting experience users are accustomed to, but better prices, faster in-game trading, more transparency, and a number of innovative features like liquidity screens, position tracking and partial cash outs.”
According to an article published last August in Forbes, the company recently secured a $6.4 million seed round of founding that attracted pro football legend Joe Montana and noted startup investor Paul Graham among its investors.
In that article, Fortinsky talked about his interest in creating a different experience from what he’s encountered from online sports betting apps.
“It felt very inefficient, outdated, exploitative. The No. 1 reason why people stop sports betting or don’t start sports betting is there’s a fundamental understanding that the house always wins. The game is sort of rigged against the everyday bettor. You’re just a pawn in their game, effectively. I felt like there’s a lot of opportunity to create a more fair, transparent and efficient system.”
Novig is also partnering with Full House Resorts at its Bronco Billy’s Casino in Cripple Creek to operate a brick-and-mortar sports betting exchange. It currently offers moneyline, spread and total betting on NFL, NBA, MLB and NCAA football and men’s basketball contests. It expects to add betting on soccer and tennis soon. It also intends to add player props, futures, parlays, SGPs and various peer-to-peer competitions.
