Gambling Rumors

Billionaire Mark Cuban has placed a bet on Unikrn, a startup that lets users gamble on esports videogame competitions, as part of a $7 million funding round led by venture-capital firm Binary Capital. The round, which brings Unikrn to a total of $10 million raised, was joined by investors including Advancit Capital, Freelands Group, 500 Startups, Indicator Ventures and Tabcorp, an Australian wagering and media company.
Pro sports in America have traditionally held gambling at arm’s length, in large part because of costly point-shaving scandals. Industry consultant Marc Ganis of Sportscorp Ltd. suggests any future affiliation with gaming “has the potential to kill the golden goose.” That raises a reasonable doubt about whether the other three leagues will join in Silver’s campaign. And no one seems to know when or whether Congress will act on the issue. Speaking at the recent GiGse convention for Internet gaming, Spillane preached patience. “We’re at the beginning of what I think is a long process,” he said. “But you have to start somewhere.”
Leonsis was asked: Would you be in favor of legalizing sports betting? His response: “First of all, I respect our commissioner. I love Adam Silver I think he’s doing a great job. And I think he is spot on. I think we’re living in this real-time technical trading world, and that there’s so much betting that goes on, I think this first iteration that we’re seeing with the Draft Kings kind of phenomenon, and this daily interactive gaming. But, it makes sense. You’re going to have wallets on your phone, people now are going to start to make wagers on, in a real time way, ‘I think he’s going to make a pass, instead of take the shot,’ and you’ll be able to instantly move money back and forth, so it’s better to get in front of it. and the consumer is going to do what the consumer is going to do. We have to make sure that it’s managed in the right way. But I do think it was smart to get in front of it, and not bury your head in the sand and say it’s not going to happen.”
The still new-ish commissioner used the powerful forum of the league’s annual Technology Summit — full of sports business insiders in expensive suits — to reiterate his position. What was most notable, though, was how thoroughly in line behind him NBA owners are. The panel discussions traditionally are off the record, so I cannot quote the pro-gambling positions uttered on stage. But in follow-up interviews, it was clear that almost everyone sees gold in Silver’s strategy.
NBA commissioner Adam Silver has made advocating for legalized sports gambling a priority since he assumed office last February, repeatedly calling for a reformed approach to a subject that has long been taboo for America’s biggest sports leagues. He has a supporter in his former boss, ex-NBA commissioner David Stern, who said Wednesday morning that he agrees with his protege on the subject. “I think I agree with Adam,” Stern said when asked about gambling in an interview on CNBC’s SquawkBox morning show. “Once daily fantasy became an acceptable exception to the law against gambling, I think that’s gambling, so now I think the best approach would be, as Adam Silver has advocated, is for there to be federal regulation. Bring the sports leagues in. If it’s going to happen, because it has happened anyway by Justice Department rulings and the like, you should make it legal and you should regulate it as tightly as you possibly can.”
Gov. Chris Christie is rejecting a call from the National Basketball Association’s commissioner to join him in lobbying Congress to legalize sports betting across the nation. Christie said during a televised interview Monday night that it was “kind of crazy” for NBA Commissioner Adam Silver to ask him to help with a legalization push when Silver is fighting efforts to make sports betting legal in New Jersey. Christie said the position represented a “bait and switch.”
Speaking at the DealBook Conference in Manhattan, Mr. Silver said that with an estimated $400 billion of sports betting already taking place in the United States, it should be regulated. “We should bring it into the sunlight,” Mr. Silver said. “If it is going to go on in record numbers, then we should regulate it, we should monitor it and learn from it.” Professional sports betting is legal in Nevada, but Mr. Silver called for federal legislation to address the issue. “If it is going to become legal, I don’t think it should happen on a haphazard state-by-state basis,” he said.
Voulgaris spent five months working for the NBA franchise. He says he advised his co-owner client on several trades. But he also felt excluded, held at arm’s length. “It was like if someone put a puzzle in front of you and said, ‘Solve this.’ But then, in order to solve it, you needed this special key that they weren’t going to give you.” He feels now that for all the momentum of the quant revolution in the NBA, there may be a glass ceiling for its true practitioners. “There’s a real disconnect between the basketball people, the business people and the — for lack of a better word — stats nerds. The stats nerds have no chance of ever becoming general managers. They’re just being used as a resource to mine.” At the end of the contract’s term, in the summer of 2010, Voulgaris decided to end his NBA flirtation and go back to being a gambler.
“This is going to sound really arrogant,” he says. “But the whole process” — of studying the game of basketball with the end of beating the books — “has led me to believe that I’d be able to put together a better team than almost any general manager in the league. If not maybe all.” In pursuit of this, in 2010 Voulgaris broke one of the cardinal rules of the sharp sports bettor: He sought publicity, conducting interviews with gambling and NBA-centric blogs. As with everything Voulgaris does, it was a calculated move. He wanted to burnish his bona fides as a quantitative basketball expert. And it worked. Despite the fact that he was giving up a yearly income that he says would dwarf all but the highest-paid executive in the NBA — who is Jerry West of Golden State, Voulgaris is quick to point out — he stopped gambling and signed a contract during the 2009-10 season with one of the co-owners of an NBA franchise to consult on matters of player acquisition and roster assembly. The owner, according to Voulgaris, made certain alluring pledges. “He was like, ‘You could be my GM someday; we can do this together.’ It was this whole spiel.”
By 2009, once they’d added this mysterious additional model to Ewing’s inner workings — version 2.0 — they started making bets based on the scores it produced after the All-Star break. “We just, like, crushed the second half of the season,” Voulgaris says. Since then, as each subsequent season has passed, Voulgaris’ confidence in Ewing has increased. So too has the frequency of his wagering. In a season, he now regularly puts down well over 1,000 individual bets. “I mean, I don’t want to sit here and brag,” he says. “But this is literally, like, the greatest thing ever when it comes to sports betting.”
In the summer of 2007, Voulgaris and the Whiz took Ewing on a dry run, testing the simulator against games from the previous season to see how accurately it could retroactively “predict.” But something funky was happening. Every score the model spit out was higher than the average lines produced by the bookmakers — the standard by which they would be judging themselves. The model, in other words, was recommending that Voulgaris bet the over in every single game. After weeks spent poring through code, Voulgaris finally caught the flaw. When assigning variables in the model, the Whiz had somehow assumed that the league-average free throw percentage was 88 percent, when in fact it’s around 75 percent — an absurd mistake (on the part of the Whiz, whose basketball knowledge at the time was practically nil. In more advanced versions of Ewing, they would jettison this primitive free throw method. Now, says Voulgaris, they’ve adjusted Ewing so that it predicts the player most likely to be fouled on any given individual possession, then uses that player’s specific free throw percentage to run its simulation.
And that’s when Voulgaris started to lose. And lose big. He lost a third of his bankroll in the final month of the 2003-04 season alone. Exasperated, his patience gone, he started to “tilt,” boosting the volume of his wagers in an effort to win back what he’d already lost. He won’t quantify exactly how much he gave back to the bookmakers all told except to describe it as a catastrophic time. He took the second part of the 2004-05 NBA season off. Mulling things over, he realized he needed a new approach. In essence, he decided he could no longer rely on his ability to suss out edges by his wits alone. He needed the help of a new machine.
A specialist in the NBA, his sports gambling success (was almost completely the result of a kind of studied perspicacity, born of a talent for pattern recognition and the stamina to watch uncountable hours of televised basketball. In betting parlance, the man could suss out an edge — and in 2002, he discovered one that would line his pockets for years. It all had to do with how most bookmakers set their halftime totals, the predicted number of points scored in each half of the game. Each half, of course, is its own discrete period of play, and the fourth quarters of close games can end in elongated foul-clogged stretches of free throws, timeouts, fast play and, hence, a burst of scoring. But incredibly, bookmakers at the time didn’t account for this fact; they simply arrived at a total for the full game and cut that figure roughly down the middle, assigning some 50 percent of the points to (the first half and 50 percent to the second.
For years, there have been whispers around the NBA that Michael Jordan first retired from the league in 1993 to play baseball because of his heavy involvement in gambling. Ron Shelton, who directed the ESPN “30 for 30″ documentary “Jordan Rides the Bus” that airs at 7 p.m. Tuesday, has been disabused of that notion. “I probably, like most people in America, thought he left the NBA for a year because of gambling,” Shelton told us Monday. “After researching the project, I was utterly convinced that was nonsense. And probably like most people, I thought he was a catastrophically bad baseball player. And after researching it, I got a different view about that, as well.”