Three Australian brothers quit their jobs to set up an online bookie and promise to take bets from winning punters.
Grant Palmer, aged 30, and his brothers Matthew, 26, and Adrian, 24, have left very promising finance careers and are already on their way to generate their first $100 million. The brothers have opened up an online sportsbook in Australia – Palmerbet – in August 2013. Less than a year since the start of operations the bookies are already generating publicity buzz and of course earnings.
The unique selling proposition of the bookmaker operating in full compliance with Australian gambling laws is a promise to work with punters, who are constantly winning, and thus are barred by the other bookies.
Early careers of the brothers
Grant Palmer has spent eight years at Merrill Lynch as an equities trader, while Matthew was a foreign exchange trader at Singapore Macquarie Bank. The youngest of three has joined his brothers right after graduating from a university.
Turns out the brothers do have some bookmaking experience. Grant was working on weekends as an on-course bookie, generating bets of around $200,000 every Saturday. Their online start-up is already taking an average of $1 million in bets every Saturday.
The siblings have agreed to reach $50 million in their first year of operation, but it already looks like they will be able to double this amount of turnover. The brothers didn’t reveal the actual figure of their revenues, however.
The market and the concept
The wagering market in the country is currently valued at $26 billion, have of that belongs to those who go online to bet on sports in Australia. Despite the fact that the Palmers’ operation is peanuts compared to the whole market, the brothers expect to capitalize on the frustrated punters, who are banned from everywhere else because of their constant winning.
New Australian online bookie promises to take bets from winning punters
• New online sportsbook in Australia will accommodate bettors banned elsewhere for winning
• The bookmaker was set up by three brothers
• Taking bets runs in their family as their father and grandfather also were renowned bookies
Winning bettors and limiting their access to bookmakers is a highly sensitive topic Down Under. The online forums and discussion boards are full of angry posts from punters who have been deactivated at a variety of online destinations after winning consecutively.
Another thing online bookies do is block a bet if it’s deemed too large and suggest a smaller amount. According to Grant Palmer, these practices are fine by him, considering the majority of online outlets in Australia are now owned by the British gambling giants. He comments: “They have the mass market tied up and they’re not interested in having days when they win and lose. What their mantra basically is now, in my opinion, is to reduce their average bet size and increase their sustainable win rate.”
How Palmerbet is different
The brothers’ venture operates in a way pretty similar to traditional bookmakers, when some of the time they might be actually losing. But they expect to offset the losses in the end. Grant says: “We’re confident we can manage the flow of money, use our insights into form and pricing and what the market is doing, and at the end of the year we’ll have a profit.”
Palmers also revealed they will be betting back into the markets based on the information received from where their winners are putting their money.
According to some industry insiders, Palmerbet has already limited bets of some of their punters, despite the opening promise of not doing so. When confronted about this, Grant Palmer replied the company will try to take as many bets as possible from winning punters, but he can’t promise to accommodate every single wager.
Palmerbet is located at the Canterbury Racecourse and has undergone serious licensing procedure required for NSW bookmakers. Their staff is currently limited to a dozen people. The bookie spends around $10,000 on Facebook marketing each month, but according to them, word-of-mouth is still the most effective channel.
They even plan to increase the number of business development managers, understanding that the premium end of the market needs lots of personal relationships to connect the big bettors and the bookies.
As for the site itself, Palmerbet is powered by Generation Web software, which also supplies its platform to TomWaterhouse and Betstar. The design of the site was done by Wiliam agency, renowned for Luxbet’s design, the online wing of Tabcorp giant.
The bookmaking and horse-racing runs in the brothers’ blood. Both their father, Andrew, and grandfather, Ted, were renowned bookies of their time, taking wagers at Sydney racetracks. Family bookmakers are frequent in Australia, take a look at Matthew Tripp or Tom Waterhouse.
According to Grant Palmer, the increasing profits are surely an attraction, but he also pointed out the brothers have no intention of selling their business. That is unlike Waterhouse who sold his company to William Hill, and Tripp who gave in to Sportsbet. Grant said: “We’re here for the long run. We didn’t quit our jobs for a quick buck.”