Episode 65
Insights with Sports Betting Titan Paris Smith
In this episode, we have an extraordinary discussion lined up with betting industry titan Paris Smith, the former CEO of Pinnacle Sports, as well as inplayLIVE CEO, Andrew Pace.
Paris takes us through her fascinating journey, from rebuilding her business after Pinnacle's US exit in 2007 to proving herself in Asia's tough market. We also explore her pioneering work in a largely male-dominated industry, the challenges of managing a sportsbook, and the cutting-edge technology driving the industry forward. Paris shares her vast experience, including handling esteemed bettors like Billy Walters and the evolving landscape of live betting, micro-betting, and responsible gaming.
Stay tuned as Paris talks about her current ventures in advising and consulting, and the future direction of sports betting. Whether you're a seasoned bettor or just curious about the industry, make sure to tune into this electric episode!
🔑 Key Topics
00:00 CEO of Pinnacle Sports, background, leadership.
07:53 Challenged by rebuilding business after Pinnacle's exit.
10:30 Privileged career path, support from phenomenal people.
18:11 Pinnacle benefits from European soccer market strategy.
22:29 Bookmaker shares concerns about single game parlays.
26:48 CEO/COO explains success based on player loss.
31:37 Big hitters should create VIP room concept.
40:16 Allowing syndicate/AI services raises scraping concerns.
43:44 Rapid technological advancements in sports betting ecosystem.
50:02 Concern about race to the bottom on bonuses.
57:09 Recent exposure to betting exchanges, limited market.
01:03:04 Thriving business, Life Winning, with daughter's support.
01:03:51 Celebrating success: daughter hired, but quitting soon.
📚 Timestamped Overview
00:00 Summary: Interviewing CEO of Pinnacle Sports, discussing background and leadership in sports betting industry.
07:53 Challenging time rebuilding business after market exit.
10:30 Feeling privileged in career, supported by mentors, surprised by struggles of young women, recalling boss and government meeting.
18:11 Pinnacle benefits from US market absence, offers value and best lines for high volume bets. Mentions admiration for Billy Walters' betting system.
22:29 Bookmaker expresses concern about popularity of single game parlays and their impact on players.
26:48 CEO/COO of sportsbook prioritize player losses over handle, leading to imbalance.
31:37 Major players should create a VIP room within their ecosystem to protect players and generate tax revenue.
40:16 Allowing syndicate/AI betting may lead to line scraping, as seen on some exchanges.
43:44 Technology always catches up, Pinnacle has an advantage in risk management.
50:02 Emphasizes responsible gaming and education, and criticizes race to the bottom on bonus offers.
57:09 Recent interest in exchange betting, limited accessibility for sharp bettors, and challenges for market growth.
01:03:04 Entrepreneur promotes self-love and success, hires daughter as support.
01:03:51 The speaker congratulates someone for hiring their daughter but later reveals she quit the next day.
🎞️ Top Quotes & Hooks
Sports Betting Leadership: "17 years as the CEO of Pinnacle Sports, a sports book that very much aligns with our values at inplayLIVE and this podcast Behind the Lines, a sports book that doesn't limit its winners, a sports book that really sort of sets the lines for the industry, and a book that much of the industry looks to as a leader in the space."
— Shane Mercer [00:01:37 → 00:01:56]
The Birth of Online Sports Betting: "It doesn't make sense for everybody to try to, you know, make all the same mistakes that I've made."
— Paris Smith [00:03:36 → 00:03:41]
Supportive Leadership in Career Struggles: "Even now, I listen to you know, I go to a conference and speak, and a lot of young ladies come up to me and talk to me about my career. And I'm so surprised of their struggles that they have, because I was old school. You know? These guys, they supported me. They, you know, they had my back..."
— Paris Smith [00:10:41 → 00:10:59]
Hollywood Potential in Sports Betting: "If Hollywood could capture this moment and make a film of this journey, I think it would be extremely entertaining."
— Andrew Pace [00:12:04 → 00:12:45]
The Influence of Billy Walters on Pinnacle: "If you were to rewind the tape and actually think about the way Pinnacle interacts with sharp players, number 1, from the standpoint of not limiting them, I think that's goes without say, but the way the line moves."
— Andrew Pace [00:17:34 → 00:17:46]
The Genius Behind Billy Walters' Betting System: "He orchestrates this phenomenal, you know, the the the system that he had was phenomenal. And people that worked with him, nobody knew who the other one was. So, you know, they would all be betting and doing whatever they're doing, not understanding that they're part of, like, you know, the symphony, if you will."
— Paris Smith [00:18:56 → 00:19:16]
The Impact of Legalization on the Gambling Industry: "What an incredible angle and way to look at that. Like, that's just so, like, we're super fast forwarding here, but I feel like we just have to bring it up then because you brought public companies."
— Andrew Pace [00:20:13 → 00:20:22]
The Rise of Single Game Parlays: "And the, single game parlays, they're the all the rage, but what people are actually paying to get those, you know, for me as a bookmaker, it's a bit criminal."
— Paris Smith [00:22:29 → 00:22:40]
The Future of Sports Betting: "I do feel like there's gonna be a world where a sportsbook will have an elite group or a VIP or platinum service where they can have a model"
— Paris Smith [00:23:21 → 00:23:34]
Rising State Taxes in the United States: "New York, I think, currently the highest at 51%, but we just saw, Illinois make a big jump and and a few of the other sort of signaling that they wanna, you know, raise it up."
— Shane Mercer [00:24:36 → 00:24:46]
Insider Revelations on Sports Betting: "Their entire basis for success with any given player is based on their loss and not based on their handle because they simply just couldn't get the handle."
— Andrew Pace [00:27:01 → 00:27:09]
The Ethics of Heavy Juice in Betting: "And then you reference that kind of in the context of of heavy juice and, like, almost being criminal."
— Andrew Pace [00:27:43 → 00:27:49]
Micro-Betting Strategty in NBA Games: "You could do a same game parlay with team totals and and the game total, and potentially even a player's points in that circumstance that actually does have, an edge."
— Andrew Pace [00:28:43 → 00:28:54]
VIP Experience for Gamers: "What I would love to see is one of the big hitters saying, you know what? We want a VIP room. VIP not meaning the whales that lose, you know, but, like, that concept. And within their own ecosystem, have it where they actually, you know, would either partner with a prime, a pinnacle, or do it themselves, which well, I'm sorry. Don't do it yourselves if you're listening to me because you can't."
— Paris Smith [00:31:37 → 00:32:08]
Impact of High Taxes on Sportsbooks: "If all of a sudden you're paying you have to pay an extra 15% in tax that is taken directly away from your bottom line, you know, that doesn't even make sense."
— Paris Smith [00:33:37 → 00:34:29]
The Misconception of Wealthy Sportsbooks: "They tend to think, like, here's the rich sports book that keeps taking all of my money because, you know, they're losing on their big long shot parlays on a regular basis."
— Shane Mercer [00:35:16 → 00:35:32]
The Path to Profitability for Sportsbooks: "At this stage, they aren't, you know, they aren't returning any kind of value for their investors."
— Shane Mercer [00:35:40 → 00:35:44]
The Impact of AI in Betting: "If you're gonna allow, like, some sort of syndicate or some sort of AI service or anything like that to bet on your site as a place that allows sharp action, that makes it more difficult to eliminate people from actually scraping lines."
— Andrew Pace [00:40:22 → 00:40:40]
Paris Smith On If Betting Exchanges With Grow In North America: "No”
— Paris Smith [00:41:00 → 00:41:04]
The Advantage of Pinnacle's Market Control: "Pinnacle is just like, bam. Like, markets are shut down. Like, there's no risk associated with with people that are at the event. And and I always looked at that in awe because I would sit there and I'd go, this is amazing that they are able to do this."
— Andrew Pace [00:43:58 → 00:44:15]
The Ethics of Technology in Betting: "It seems like all of the soft books are putting their technology funds into developing technology that is designed to identify sharp bettors as quickly as they can and eliminate them."
— Shane Mercer [00:46:44 → 00:46:58]
Responsible Gaming Regulations: "There's new product that the states want people to pay for, and it's like, well, actually, you as a state should provide that to the sportsbooks that you have if you care about the player and responsible gaming."
— Paris Smith [00:48:56 → 00:49:08]
The Race to the Bottom in Gaming Bonuses: "The market wants to see x increase in new sign ups. The trigger for that in an organization is increase the sign up bonus. So they're increasing the sign up bonus, which is, you know, feeding into, you know, I mean, the bonus doesn't give you irresponsible gaming, obviously, but it feeds into it, especially for the reload bonuses, you know, or or the conversion from sportsbook to casino or whatever it might be."
— Paris Smith [00:50:36 → 00:51:03]
The Power of Education in Gambling Legislation: "If you give people the education on the theoretical loss of this parlay that's now coming through and people have that understanding and they go to make that decision to continue to make that wager, you've put yourself as a state or, you know, any sort of legislature or region or whatever the case in a responsible position where people have been exposed to the actual, the theory behind behind it and and the profitability to to the book itself, right, which which obviously is is, in my opinion, quite powerful. And that that to me is, like, doing your part."
— Andrew Pace [00:51:58 → 00:52:27]
Responsible Gambling Insights: "When you're betting with that style, you're not the one gambling."
— Andrew Pace [00:53:04 → 00:53:08]
🤔 Q&A
What was one of the significant challenges Paris Smith faced in her career?
One of Paris’s most significant challenges in her career was rebuilding Pinnacle after the company was forced to pull out of the US market in 2007. This abrupt exit required a strategic pivot to new markets. Paris had to spend substantial time in Asia, where she encountered skepticism as a female leader. She had to work harder and prove her capabilities to earn the respect of her counterparts. Her ability to overcome these obstacles and successfully adapt showcases her resilience and leadership in the industry.
How did Paris handle the initial limitations in technology and communications at Pinnacle?
In the early days, Pinnacle faced limited phone lines and high call costs, making operations challenging. Paris shared an insightful story about her first call from the legendary bettor Billy Walters. Despite the technological limitations, she gleaned crucial betting insights from this interaction. The support she received in understanding and managing these complex betting processes was instrumental in overcoming the technological and logistical hurdles at the time.
What percentage of Pinnacle's soccer betting volume is from live betting, and what are some concerns discussed regarding it?
Live betting accounts for approximately 85% of Pinnacle’s soccer betting volume, underscoring its tremendous growth and popularity. However, there are concerns about latency and obtaining reliable live data, which are critical for providing an optimal live betting experience. The conversation in the episode delved into these technical challenges and how they impact both the sportsbook and the bettors.
What was Paris Smith's experience in terms of team dynamics at WWTS in Antigua?
At WWTS in Antigua, Paris worked in a primarily female team, which fostered a unique and supportive working environment. This camaraderie contributed to delivering top-notch customer service, a principle that Smith carried with her to Pinnacle Sports. The close bond among the team members at WWTS helped shape her approach to management and customer relations, challenging the stereotype of sports betting as a male-dominated industry and showcase Smith’s early impact as a trailblazer.
How does Paris Smith view the challenge of high taxes and regulatory requirements in the sports betting industry?
Paris highlights that high taxes and stringent regulatory requirements can significantly impact sportsbooks' profitability. These financial and regulatory burdens can restrict their ability to offer attractive products to players. Smith stresses the importance of balancing regulatory costs with the need to protect both operators and players. She argues for a regulatory landscape that allows sportsbooks to thrive while ensuring player safety and responsible gaming.
How does Pinnacle handle market issues stemming from data problems in live betting?
When Pinnacle faces data problems affecting live betting markets, they allow their traders to have the autonomy to take down those markets temporarily. This decisive action helps maintain the integrity of the betting experience and mitigates risks. Paris Smith highlights this proactive approach as essential in preventing inaccurate betting lines from being offered to players, thereby protecting both the sportsbook and the bettors.
What approach does Paris Smith suggest for appealing to both recreational players and sharp bettors?
Paris suggests offering a variety of betting options to attract both recreational players and sharp bettors. She emphasizes that providing elite or VIP services could enhance the betting experience for high-stakes players while maintaining a broad appeal to recreational bettors. Paris underscores the importance of protecting players and avoiding excessive regulatory taxes to create a sustainable and attractive betting environment for all types of players.
What are some projects Paris Smith is currently involved in?
Paris Smith is deeply involved in several advisory, consulting, and angel investing projects. Some of the projects she is passionate about include Rithmm, Kero, HotTakes, Rivalry, and the Forever Network. Her continued engagement in these ventures reflects her ongoing passion for the sports betting industry and her commitment to fostering innovation and growth within it. These diverse projects also demonstrate her ability to adapt and contribute to various facets of the industry.
What does Paris Smith believe about the integration of sportsbooks and exchanges in North America?
Paris expresses skepticism about the immediate feasibility of sportsbooks integrating with exchanges in the North American market due to regulatory and market dynamics. However, she acknowledges the potential for future synergies between the two. Smith highlights that such integration could offer enhanced betting options and flexibility for players, but it requires careful consideration of the market landscape and regulatory frameworks.
What role does technology play in responsible gaming according to Paris Smith?
Paris underscores the critical role technology plays in promoting responsible gaming. Sportsbooks can leverage advanced technologies to identify and manage sharp bettors, ensuring a fair and secure betting environment. Additionally, Smith advocates for the use of technology to support responsible gaming practices, including implementing educational components to help players make informed decisions. She discusses the balance between leveraging technology to manage risk and using it to protect and educate players, highlighting its dual role in the modern sports betting landscape.
❇️ Important Notes & Bullets
Paris Smith's Career
Challenges in rebuilding after Pinnacle's US market exit in 2007
Proving herself in Asia and advocating for women in sports betting
Early Career
Began with WWTS in Antigua, focused on transparency and customer service
Unique team dynamics with primarily female staff
Sports Betting Landscape
Managing limited phone lines and first call from Billy Walters
Live betting growth, especially in soccer (85% volume)
Issues of latency in live data and role of syndicates
Pinnacle's autonomous decision-making for traders
Technology and Responsible Gaming
Identifying sharp bettors and managing lines
Debate on eliminating sharp bettors and responsible gaming practices
Impact of sign-up bonuses and the need for player education
Industry Trends
Elite/VIP services impact and financial challenges due to regulations
Role of geocomply in regulatory efficiency
Success of Curacao-based sportsbooks and micro-betting challenges
Need for sustainable betting landscapes similar to the Pinnacle model
Smith’s Contributions
Pinnacle Sports CEO for 17 Years
Consulting and investing in various projects (Rithmm, Kero, HotTakes, etc.)
Influence of Life Winning and continuous passion for the industry
Notable Insights
Appreciation for Paris's problem-solving skills
Pinnacle’s potential payments from US sports
Introduction of micro-betting and its impact on the market.
👋 About The Host & Guests
Shane Mercer is energetic host of "Behind the Lines," a groundbreaking podcast dedicated to purifying the sports betting industry. With a keen eye for detail and a passion for transparency, Shane guides listeners through the complexities of sports betting, ensuring they are well-informed and savvy. As a vital member of the inplayLIVE team, Shane works alongside Andrew Pace, the visionary founder of inplayLIVE, hailed as the most sophisticated sports betting community on the planet. Together, they bring insider knowledge and expert insights to their audience. Shane’s dedication to his craft and commitment to excellence make him a respected voice and trailblazer in the sports betting world.
Andrew Pace, CEO & Founder of inplayLIVE, is a respected expert in the sports betting and gaming industry, frequently sharing his deep insights as a guest on the "Behind The Lines" podcast. He is a passionate advocate for education and transparency within the industry, focusing on creating a sustainable and player-friendly betting ecosystem. Known for his detailed knowledge of algorithms and live betting, Andrew's expert advice is sought after by industry leaders and newcomers alike. On "Behind The Lines," Andrew provides critical, forward-thinking perspectives on topics ranging from regulatory challenges to responsible gaming, making him a key contributor to discussions about the future of sports betting.
Paris Smith, a North Dakota native, landed her first job in the betting industry at WWTS and then went on to become the CEO of Pinnacle Sports for 17 Years. She found her passion for leadership early on through playing basketball and ventured beyond her home state during college for an internship in Antigua. Paris is now an Angel Investor in the sports betting industry, where she invests in top talent at companies like Rithmm, HotTakes, Kero Sports, Rivalry, and has a keen passion for high potential betting startups.
📜 Full Transcript
Paris Smith [00:00:00]:
You know, I mean, all these players that were historical, you know Right. He didn't even understand who they were. Right? And we're sitting there talking to him every day. I took my first phone call from Billy Walters.
Shane Mercer [00:00:13]:
No way. Your first phone call
Andrew Pace [00:00:15]:
You've got to be kidding me.
Paris Smith [00:00:15]:
My very first call. Well, everybody else hung up.
Shane Mercer [00:00:29]:
Welcome to another episode of Behind the Lines, the only podcast purifying the sports betting industry. Remember to like, download, subscribe, follow us on all the socials @inplayLIVE. And if you wanna see what we're all about behind the scenes, well, we have a promo code for you that is behind the lines, all caps. Check us out. I'm your host, Shane Mercer. That guy over there, Andrew Pace, founder of inplayLIVE, the most sophisticated sports betting community on planet Earth. And Pace and I have a very, very special guest with us today. Someone we are honored to have here on the show, a true trailblazer and a titan of the sports betting industry, Harris Smith, thank you so much for joining us.
Shane Mercer [00:01:13]:
Welcome to the show.
Paris Smith [00:01:14]:
Thank you so much. It's a pleasure to be here.
Shane Mercer [00:01:17]:
You are joining us, from beautiful sunny Curacao, an island that many people within our sports betting community are very familiar with. We'll get on to all of that in a little bit. But, Paris, first, for anyone out there who doesn't know who you are, I just wanna give them a little bit of your background, and then I want you to kind of expand on it for all of us. 17 years as the CEO of Pinnacle Sports, a sports book that very much aligns with our values at inplayLIVE and this podcast Behind the Lines, a sports book that doesn't limit its winners, a sports book that really sort of sets the lines for the industry, and a book that that much of the industry looks to as a leader in the space. And it is that leader in large part thanks to your leadership. But before we get into your time at Pinnacle, give us a little bit of your background, where you come from, how you got into sports, how you got into sports betting.
Paris Smith [00:02:14]:
So I'm just a little North Dakota girl. I, was born and raised in North Dakota. Loved it, loved being from North Dakota. I played basketball, you know, that's where I take a lot of my leadership principles. And then I, I did an internship in college, and I ended up in Antigua. I did my internship what was supposed to be 3 months, and, I loved it there. I started looking for a job and struggled looking for a job because Antigua's you know, you have to hire locals, which is fine. And they're like, sorry.
Paris Smith [00:02:48]:
Can't hire you. You're white. And, you know, this is, like, 29 years ago. So that was a interesting life lesson. Appreciated it very much. And then I got a job working at, as a clerk at WWTS, and that was in 1995. And, actually, June 7th is the day that I no. July 7th, that number? TS.
Paris Smith [00:03:20]:
Worldwide WTS? Worldwide Tele Sports. It was one of the first, you know, back in the day of the online. It was in Antigua. And what was unique about WWTS is the gentleman who ran it, who I worked for, he was just the kind of person that thought, you know what? It doesn't make sense for everybody to try to, you know, make all the same mistakes that I've made. So he was the guy that opened the door, and I met pretty much every other titan, if you will, during that period where they would come to Antigua, and we would explain to them, you know, you open up an account at this bank and you do advertising at this, magazine. You use these, you know, NetTeller is your payment solution, MoneyGram, Western Union. Like, I'm going way back here. And, you know, this is how we do the marketing.
Paris Smith [00:04:10]:
This is what you should be paying. Like, we were really transparent and, and helpful. And through that, you know, people that I see at conferences today, you know, they're like, oh, remember when I was in Antigua? I remember you from Antigua, and I'm like, I can't remember. There's too many. Now I'm getting old. But I, I was gonna say I worked my way up through as first, I was a a clerk, and then from being a clerk, I was a marketing director. And then I, started helping the owner, and I was like, his right hand vice president, if you will. And, and, yeah, I saw the industry from the infancy through its fruition.
Shane Mercer [00:04:52]:
That is so cool. Really interesting to hear somebody who sort of started at at that point in the industry when people were picking up the phone to place bets. You know? No Internet. No Internet. Right. Wow. Yeah. And and nobody's placing bets online.
Shane Mercer [00:05:08]:
You know, talk to me then a little bit about how you kind of grew into the company then before Pinnacle came along.
Paris Smith [00:05:16]:
Right. So, prior to, Pinnacle starting, I was working in Antigua, and, it was actually actually I did speak to some of the people at Pinnacle just trying to help them along. They were in Curacao. And, you know, I think in the end, the people from Pinnacle that hired me, they just they kept calling me literally for about 5 years. And I'm like, you know, don't poach. Don't poach anybody on my team. Don't poach me. And then, in the end, when the gentleman sold his company, I was ready to jump ship.
Paris Smith [00:05:49]:
And, and then that's when I went over, but went over to, to Pinnacle. But their big thing was, you know, we had the best customer service at WWTS. The owner, Bill Scott, he, he just loved having female clerks answer the phone. And when I started, I would you know, people would call in and say sportspen. They'd hang up because he didn't expect to have a woman on the line. So he was the first person that hired women. And at one point, we had a 185 employees, 3 men. The owner, the IT, and his guy that was there shortly for, to help manage the wines.
Paris Smith [00:06:27]:
And then he left and the girls took over. And it was all women. At one point, people thought it was a modeling agency.
Shane Mercer [00:06:35]:
Why was that? You know
Paris Smith [00:06:37]:
because they're all young, smart, you know, really ambitious, and, you know, they ended up working their way throughout the organization.
Shane Mercer [00:06:46]:
Yeah. No. I I'm wondering why was it that that, the owner wanted women picking up the phone. Was it just that that it's all guys who are calling and they'd rather speak to a woman?
Paris Smith [00:06:55]:
Well, that is precisely the point. He also trusted women more. You know, way back when they had, you know, like a company called Sports International, All the major bookmakers that they had brought to the Caribbean to answer the phones for them branched off and did their own things. You know? Rich's SuperBook, Universal Sports with John Giardino. I can't even believe I'm remembering these names right now, but, you know, all those guys started their own, and Billy saw this. And he's like, you know, I just want people that wanna work. You know, he paid them extremely well. I was in Antigua just the other day and met with a group of them, and it's just we still have a super, super close bond, all of the staff.
Shane Mercer [00:07:38]:
You know, that that's really, really cool. You know, I think a lot of people out there, maybe sort of have this, idea that sports betting is kind of like a man's world. You know? And I you're you're clearly proving that that's not the case.
Paris Smith [00:07:53]:
I'll tell you where it was the most the only time that I was, like, challenged. And that is when, and I'm kinda jumping ahead, but when Pinnacle pulled out of the US market, January 11, 2007, I remember like it was yesterday, then my job was to rebuild the business, and I spent a lot of time in Asia. And I would go and have these meetings. We had a partner there that was phenomenal and set up everything for me. But I'd be sitting in the lobby waiting for the people to come and, you know, and I I knew what they look like. So I'm like, well, that's the guy, and he's staring at me, but he's not thinking it's me. So I'd let him wait, and then I'd go over and say, are you here to meet Pinnacle? Yes. We're waiting for CEO of Pinnacle.
Paris Smith [00:08:40]:
And I'm like, well, is it Paris? Yes. I'm like, I'm Paris.
Andrew Pace [00:08:45]:
And, they're like, no. You're not. Yeah. And you're like, yes. I am.
Paris Smith [00:08:50]:
And I'm taller than them. I'm bigger than them. I'm like, you know, come on. You can't mess with me. You know? But it was, I mean, you know, we had that that liaison, which made it much easier for me, but it, you know, sometimes it wasn't there all the time. And, and I really had to it was kinda neat because I had to buy you know, go into w w t s, I had to prove myself. I never felt like I was getting like, I had to do I I knew I had to work harder because I was a woman, but, going into Pinnacle, that was super interesting. One of the reasons why they hired me was they said they wanted somebody who had experience, who had integrity, who and who didn't bet and who didn't have an ego.
Paris Smith [00:09:31]:
So, here I am. And, so when I, you know, when I started working, in Asia, it took him a while. Like, you know, when I say a while, I'm talking we'd have to talk for about 20, 30 minutes, and then after that, they were amazing. And I would send other team members to Asia because, you know, I have a I was a single mom, and, and I I would think, let me send whomever else. And the Asian agents would call and say, you know, no. We want Paris. They don't work. They're tired.
Paris Smith [00:10:00]:
They sleep all the time. They get jet lag. They get sick. They can't come out after karaoke. So I had to keep going.
Shane Mercer [00:10:10]:
Wow. You know, it sounds like, Paris, that, you know, you didn't really start off wanting to get into sports betting. It was more of just, like, a job and you kind of you kind of, yeah, just sort of grew into it to the point where you became the CEO of 1 of the of probably the sharpest sportsbook in the world.
Paris Smith [00:10:30]:
Yeah. It's, I mean, I just feel so privileged. You know? And I've worked for such phenomenal people that, you know, I I didn't really comprehend. And even now, I listen to you know, I go to a conference and speak, and a lot of young ladies come up to me and talk to me about my career. And I'm so surprised of their struggles that they have, because I was old school. You know? These guys, they supported me. They, you know, they had my back, and if anybody would I mean, maybe people were like, what the hell is she doing here? And they were like, you know, my my first boss, he was, he was brutal. I went to a government meeting, and I sat there and talked to the minister of communications and, and telecommunications, and I was supposed to explain to him the problem that the island had with the phone lines.
Paris Smith [00:11:19]:
You have a 125 lines coming into the island, and I have 5,000 players. So you need to increase your phone lines. And he this was like, well, where's Billy? And I'm like, well, Billy doesn't understand this, so he sent me. Oh, and the guy picks up his pager. Right? We're going back 30 years. Picked up his pager, and he's looking, and I'm like, oh my gosh. I go back to the office and I said, you know, Billy was like, how was the meeting? I'm like, he kind of ignored me. What? And he got on the phone.
Paris Smith [00:11:48]:
Don't you ever treat my girl like that. I had to go back the next day. I'm like, oh, god. Here I go. And the meeting had note takers. It had other ministers. They listened, and they they responded. So there we go.
Andrew Pace [00:12:04]:
You know what's crazy about all that is I'm picturing just like sometimes you you think about the Wolf of Wall Street, like the film, right, and the parallels of the stock trading and Yeah. And, you know, the boiler room and all that kind of stuff. And and then I'm just picturing that for sports betting, and I'm thinking to myself, okay. You got 5,000 players. You got a 125 phone lines. The phone lines are completely jammed up. I'm assuming the cost per call is, like, in the dollars per minute because it's I'm assuming none of the players live in Curacao. Right? So, it it like, just just, you know, if Hollywood could could capture this moment and and and make a film of of this this journey, I think it would be extremely entertaining.
Paris Smith [00:12:46]:
Yeah. No. I I mean, you know, I tell stories all the time because when you get old, you just have to live in your past. And, it's, you know, it's so fun to you know, even when I was back in Antigua talking to the girls, we were remembering everybody's PIN number. You know, Billy Walters.
Andrew Pace [00:13:04]:
Oh my god.
Paris Smith [00:13:06]:
You know, I mean, all these players that were historical, you know Right. He didn't even understand who they were. Right? And we were sitting there talking to him every day. I took my first phone call from Billy Walters.
Shane Mercer [00:13:20]:
No way. Your very first phone call..
Paris Smith [00:13:22]:
My very first call. Well, everybody else hung up. And so and then he he he answered. You know, he, he spoke to me, and he actually was he was he's the most, I'm a massive fan, and he was helping me understand the rundown because I didn't get training. You know, I walked in. Hey.
Paris Smith [00:13:44]:
Do you know sports? Yeah. As a basketball player. Do you know Gambling? I I dealt blackjack. Okay. Answer the phones.
Andrew Pace [00:13:50]:
Perfect.
Paris Smith [00:13:51]:
These are straights, parlays teaser,s reverse, if bet. You know, these are the games, and I because I was a basketball player, I was such a fanatic about it, and I knew all the teams, all the games. But then there was baseball and football and yeah. So he helped me with the rundown.
Andrew Pace [00:14:08]:
You know what's interesting though, Paris, is is you just skipped over that detail so quickly. Like, there are very few people that would connect those dots quickly and efficiently. So, you know, you're like, oh, you're obviously humble saying, you know, I I had a great cast or supporting cast around me. But there there's some there's something that you didn't mention, and it's like, clearly, you had to work very hard to Yeah. To for this learning curve to become manageable for you. But, anyway, sorry. Keep going with the Billy Walters call.
Andrew Pace [00:14:37]:
I don't want that to end.
Paris Smith [00:14:39]:
But I was just saying he was like, you know, darling, when you're reading the line, you, you know, you have to understand there's a total and then there's, you know, the and he just went through and explained everything. And I was like, gee. Thanks, Bill. And then everybody that started, like, it was when we're all sitting there talking, every single person, you know, they they all remember him vividly because he was such a gentleman, and he made huge bets, whatever the next bet was. And, and then but they didn't understand who he is. You know? Right.
Andrew Pace [00:15:13]:
Well, I guess with on I I mean, you guys had more intimate relationships with those players then than an online casino would have with you now. But, like, can you speak to risk management? We're gonna get into that Mhmm. For today, for sure. But can you speak to risk management then? Like, you got Billy Walters on the phone with you. I'm assuming he's a winning player. Maybe he wasn't, you know, like, maybe he wasn't to the level that he got to at that time. But Yeah.
Paris Smith [00:15:38]:
He was. He was bigger.
Andrew Pace [00:15:40]:
He was?
Paris Smith [00:15:41]:
He was from the beginning. Yeah. So what was so interesting, again, I'm super close to him. Have you if you haven't seen his podcast, I'd strongly recommend it. There's rumors of a, documentary, which I think would be phenomenal. But with with Billy, I had, again, the luxury. You know, I'm so lucky. It's insane.
Paris Smith [00:16:03]:
But both WWTS and pinnacle, those are the 2 books that truly got it. So Billy Scott, he would take, you know, whatever Billy Walters wanted, he would get. Why? Billy would win a million or whatever. Let's, you know, a million or 2,000,000 a year. But if Billy won, we won. So Bill Scott was smart enough to take the information and take that, you know, the bets that he had and move the numbers off of that. And that's exactly what, you know, what, what Pinnacle had done. Pinnacle would take much larger bets, so, of course, he would bet Pinnacle first, but, you know, we were there before Pinnacle, overall.
Paris Smith [00:16:43]:
So, you know, Pinnacle, that was the same thing. You know? Let Billy come in. As soon as Billy would put in his team plays, the lines would move, and that was like the secret sauce for Pinnacle. Even today, you have you know, everybody's got an algorithm. Everybody has modelers. Everybody has AI. It's all super sophisticated, but there's still something special about Pinnacle, the secret sauce I call it.
Andrew Pace [00:17:08]:
So if I if I were to take that information, you're essentially telling me that the trade off for the bookie, whomever it is, Pinnacle Mhmm. W w t s, whatever the case, is the information from the player that was then used in some capacity by the person who then took the book. So that could be adjusting the line. It could be going and wagering yourself. You know, the list goes on.
Paris Smith [00:17:31]:
That's why they hired me. Remember? I'm not a bettor.
Andrew Pace [00:17:34]:
Right. So if you were to rewind the tape and actually think about the way Pinnacle interacts with sharp players, number 1, from the standpoint of not limiting them, I think that's goes without say, but the way the line moves. And you know this. We talked about this offline briefly. We predominantly bet live. If you look at the way the line moves live, on Pinnacle, you know, you maybe have 1 or 2 clicks that you're available to get an edge on potentially. And then, of course, that edge is gonna be be swept away. How influential do you think this sort of Billy Walters model was on the phones to where Pinnacle is now today?
Paris Smith [00:18:11]:
It still it still has the same, the same impact. Right? Because but being out of the US market as Pinnacle is, you know, live European football, soccer is massive for Pinnacle. And because of the model with the high high volume, low vig, you get people that want that value so you can take that and utilize it to have the right lines and the best lines, which is what everybody's taking and utilizing to to help manage what they're doing. I just I was you know, I because I'm living what I live, it I always thought, why would people throw Billy Walters out? You know, why does he have to have 100? You know, he orchestrates this phenomenal, you know, the the the system that he had was phenomenal. And people that worked with him, nobody knew who the other one was. So, you know, they would all be betting and doing whatever they're doing, not understanding that they're part of, like, you know, the symphony, if you will. So, but, yeah, I just I could never because that's all I know, I could never understand why they weren't, you know, in that mindset to I mean, it they weren't in the mindset to utilize the information. Their mindset was hold percentage.
Paris Smith [00:19:33]:
Right? So they wanna hold as much as they can, especially as companies started becoming public. You know, I've always said, I will never work for a public company in sports betting again. W w t s went public. It was awful because we did have that large player base, you know, not as big as Pinnacle, obviously, but we had a lot of really sharp players. And when a board comes in and doesn't understand the risk of of sports betting in this capacity, you know, they're like, well, we gotta shut down those people that are betting over $10,000 a game. It's like, they're the bread and butter. Like, maybe not the bread and butter and the win loss, but the bread and butter and the win loss for the masses.
Andrew Pace [00:20:13]:
What an incredible angle and way to look at that. Like, that's just so, like, we're super fast forwarding here, but I feel like we just have to bring it up then because you brought public companies. Obviously, the legalization in New Jersey in 2018 and then Ontario, obviously, more recently. You were still with Pinnacle during these, like, very formidable years. I know Pinnacle wasn't operating in the United States at that time, but we now have all these publicly traded companies, the DraftKings, the FanDuels, the MGMs, Caesars, the list goes on and on, in this regulated landscape that precisely takes the angle that you just said they shouldn't. So, like, what what what what are your thoughts on all that? What's your message to to to the industry or those books?
Paris Smith [00:20:57]:
Oh my. You know, one thing I will say is kudos because they're doing they're doing a great job. You know? I have a lot of respect for FanDuel, DraftKings, BetMGM, and the leadership that they have. However, it would seem to me that, you know, they have to react to the they have to do what the market wants. So they put in micro betting, and they put in, you know, all the different, you know, derivatives of everything that you can possibly come up with. One thing, and I'm it it's answering your question, but it's a little bit of a sway. The whole thing was lottery. You know? When when the DraftKings and Vandals were operating in the states, I was like, I mean, you know, why would they not want sports betting? Lottery is the most you know, as me and my world, lottery is criminal.
Paris Smith [00:21:48]:
There's no chance anybody has to win. It's like stealing money from people. And then all of a sudden, fast forward, here you have, you know, Jason taking the risk and and acquiring jack Jackpot. Right? And, at the lottery company. But it makes sense because the players I mean, there's a huge market in the US. There's what I would call a true sports bettor, which is your people. Right? And then there's sports enthusiasts. And the reality is between the the micro betting and all those, you know, derivatives that people are offering, it's and those are also like the chances of winning those.
Paris Smith [00:22:29]:
And the, single game parlays, they're the all the rage, but what people are actually paying to get those, you know, for me as a bookmaker, it's a bit criminal. So but it's the norm and, you know, and and everybody's like, and you can hold, you know, so you've got the market with the product saying, oh my gosh. You can hold this much. And I'm like, but what about the player? You know, we used to feel bad about parlays. It you know, back in the day not bad, but, you know, it's like, oh, here, you know, we we'd add so much juice onto them, but that's just the way the parlays worked. In any case, but the it it shifted so much. And it is there is a whole market for the lottery type sports bettor, and I think that that was a really interesting move. Everybody's watching it very carefully.
Paris Smith [00:23:16]:
I think it's exciting, you know, what what they're doing, but I do feel like there's gonna be a world where a sportsbook will have an elite group or a VIP or platinum service where they can have a model or you know? I'm I'm not with Pinnacle, obviously, but they could partner with a Pinnacle and call it, you know, the pinnacle whatever, and, and offer a true sportsbook. If they don't, you're always gonna have people either betting offshore. You have a ton of professional bettors that don't live in America, because they can't. So, you know, it's they're never gonna get onshore what they really should between the regulations and the the tax that is just unbearable, you know, for any actual operator, it, you know, it's gonna be difficult for them to, to get back onshore and provide a proper product for all players. Players. Right.
Shane Mercer [00:24:15]:
Yeah.
Andrew Pace [00:24:15]:
Right. Right.
Shane Mercer [00:24:17]:
Go ahead, Shane. I'm glad you brought up the tax thing because we've sort of been covering that here on the podcast for the past couple of weeks. It's come up a few times in some of the topics we've been talking about. And, you know, it looks like a lot of the states, specifically, you know, in the United States, the various states are looking to increase their taxes pretty, you know, pretty significantly. You know, New York, I think, currently the highest at 51%, but we just saw, Illinois make a big jump and and a few of the other sort of signaling that they wanna, you know, raise it up. Is that the reason that, a book like Pinnacle felt like, you know, the United States just isn't our market? Is it is it because of the taxes?
Paris Smith [00:24:57]:
Well, it it's, it's so difficult to make money.
Shane Mercer [00:25:01]:
Yeah.
Paris Smith [00:25:01]:
Right? It's not just the taxes. It's all the regulatory requirements. It's the money for a responsible gaming compliance. I mean, we have they have all of that because of the other licenses that they have globally. But, I mean, it's so intense. And then, you know, the data rights, that's forget that. Don't even get me started on data rights. So, you know, you have all these different costs that back in what I would refer to as my good old days in early, w w t s and early pinnacle, you know, you were we're all making, like, an honest living.
Paris Smith [00:25:35]:
Right? Now it's like, you know, some people that you know, one of my favorite companies is geocomply. And if you wanna say brilliant, that's the most brilliant company in the entire ecosystem. Right? But, you know, it's like to imagine that they get something for everything is mind blowing.
Shane Mercer [00:25:58]:
Yeah. That's a good point. They they really do have their finger in absolutely every single sports book in any jurisdiction where geocomply is is mandatory. And you say it's brilliant. I find it frustrating sometimes. You know, these books keep kicking me off because I do comply, but you know?
Andrew Pace [00:26:12]:
Well, there's a difference between frustrating to the player Yeah. And efficient for the regulator for the regulation. Right? So, like, do we want an added few seconds in our login or potentially wager process to confirm our location? Of course, we don't. But But we're in a regulated landscape where it's like, you know, did you want DraftKings and FanDuel? Well, you got them now. So, you know right? Like, they're the ones that have been able to to apply that.
Shane Mercer [00:26:38]:
But that's Chase's way of telling me, Shane, quit complaining over there in Ontario.
Andrew Pace [00:26:43]:
No. No. We all have a good we all have a good. Life's all about perspective. Right? Yeah. So, Paris, I guess, like, just back to the micro betting thing that you mentioned there.
Andrew Pace [00:26:48]:
We had a CEO of a sports book or COO of a sportsbook that's, licensed in Curacao on on the podcast, this year. And they basically said that their entire basis for success with any given player is based on their loss and not based on their handle because they simply just couldn't get the handle. Now if we the you know, some of these smaller Curacao books, I can understand that discussion. Like, that makes sense to me where you go, hey. Andrew Pace has come in. He's max bet, you know, this market. He's actually called it out to a whole bunch of his members as well. All of a sudden, the risk on that one side of the game is is so far from balanced if if even remotely balanced at all.
Andrew Pace [00:27:31]:
Like, that just makes total sense to me. If you take your discussion about, like, micro betting with some of these big players, you know, the same game parlays and all the little props and gimmicks that they have available for you to wager on, And then you reference that kind of in the context of of heavy juice and, like, almost being criminal. Where does that fit in then with sustainability with a winning player? Because if they're offering all of that with such profitability and with such high juice, what is the problem of of having a sharp player in the ecosystem if you can manage your your risk and limits with that player?
Paris Smith [00:28:08]:
Would you, as a Sharp bettor, bet the, the the micro betting?
Andrew Pace [00:28:14]:
Yes.
Paris Smith [00:28:15]:
Well, other than to arbitrage?
Andrew Pace [00:28:18]:
Yes. Absolutely. So, like, to give you an example of that, let's just say that we have, like, a correlated live wager, at the end of an NBA game, where we believe that points are gonna be coming in on a basis of the score, the time left, the situation, and and we believe that, you know, the over has some sort of edge. You could do a same game parlay with team totals and and the game total, and potentially even a player's points in that circumstance that actually does have, an edge. Now you asked, would I? I said, yes. Do I? The answer is no because I really just can't. It's it's it's extremely difficult for me to be able to do something like that.
Andrew Pace [00:29:05]:
But I do know of people in our group that, you know, have a little bit of a leash with with maybe one of their books that that do take those angles and edges when and where they can. And they certainly they certainly, you know, take advantage of it, in that time frame. But I think more more than that, you're saying, would you do that? Let's just say that I did answer no. I say no. Go ahead with what you were gonna say.
Paris Smith [00:29:30]:
Well but so you're looking at a completely different player base.
Andrew Pace [00:29:34]:
Yeah.
Paris Smith [00:29:34]:
So, you know, if you as a sportsbook, you know, that's the challenge people are having. You know, Prime Sports, I think that their philosophy is really phenomenal what they're doing and and taking that, you know, that big risk go entering the US market with their philosophy, you know, but they're gonna have to find that recreational base.
Andrew Pace [00:29:57]:
Right. This is so hard.
Paris Smith [00:29:58]:
How do you appeal to the recreational base? And those recreational base people, they want this, you know, they want the micro bedding from Kero, whomever it is, and, you know, they want that. So you have to make sure that you provide all of those things. And quite honestly, you know, after I've left Pinnacle, I've seen so much more. Because when somebody would come to me, like, you know, the micro betting guys, I would look at it and go, it's not for a pinnacle player. Not interested. Turn it off. Now, you know, I'm doing a small bit of, angel investing, a lot of advising and consulting, and it's like, oh, you know, that's kind of interesting.
Paris Smith [00:30:38]:
Like, you know, do I a 100% believe in it? Is it in my DNA? No. But, you know, I'm not, ignorant to not see what that value is for the ecosystem of the overall gaming experience.
Andrew Pace [00:30:51]:
Right. Right. So it sounds like I mean, Prime and and what they're doing is is obviously similar to to the pinnacle model. You know, I I think about that and what you just said where they're you're like, they're gonna have to appeal to the recreational base. Well, it's like these the MGMs are appealing to the recreational base, so they do have that base. And that's where yeah. I just I just wish that there was a a little bit of a more sustainable, landscape there for for people in the United States. Actually, in Canada, we have it great in a lot of ways.
Andrew Pace [00:31:21]:
You know, we have access to a lot of great sportsbooks and a lot of different ways that we can play with them. But there's some people that, you know, come out of, you know, a small state like Massachusetts that's been put on the spotlight recently, and you go, you might play there for a month and then not have anywhere to play. It's it's kinda kinda nuts.
Paris Smith [00:31:37]:
What I would love to see is one of the big hitters saying, you know what? We want a VIP room. VIP not meaning the whales that lose, you know, but, like, that concept. And within their own ecosystem, have it where they actually, you know, would either partner with a prime, a pinnacle, or do it themselves, which well, I'm sorry. Don't do it yourselves if you're listening to me because you can't. But or you would be. But, you know, that would be interesting because then you're actually you know, the reason that people wanted regulation was to protect players and get tax money. You know? If if that was, you know, the whole premise and if people really followed through with that, it wouldn't be, you know, taxes that would make it so a company can't function. I mean, you know, if they're trying to limit accessibility for companies, yeah, they're doing a fantastic job.
Paris Smith [00:32:43]:
You know, it's, but how many people, you know, they're they're pulled out. They pulled out of the US market. It just doesn't make sense, and they're not bad. Everybody that's come in, they're not bad. They're all solid companies. Right. But it's just, you know, sometimes and and it's this is not just regulated markets in the US. There's regulated markets globally.
Paris Smith [00:33:04]:
Pinnacle, never never wanted the UK license. It was it's saturated, and the regulators with all their rules and, you know, when we were applying for the license, we would ask questions when people would get, fined exorbitant amounts of money. You know? Okay. Well, how could we, how could we not have that happen to us? Well, you have to try and see see if it works.
Andrew Pace [00:33:31]:
Thanks!
Paris Smith [00:33:34]:
Yeah. You know? And that was like, okay.
Paris Smith [00:33:37]:
And it's literally, like, you can tell when they need some cash, all of a sudden, poor William Hill is, you know, getting a huge fine. It was there was a period where it was really ridiculous. And, you know, so it's you know, you can't say it's just the US, but then there's also states and countries that have it right. Right? And and the thing is when you get it right, your peep the sportsbooks are gonna be able to do more for the environment, do more for the communities, do more for their employees, you know, grow. There's so many benefits, hire more employees, put more money into marketing and advertising. But, you know, if if all of a sudden you're paying you have to pay an extra 15% in tax that is taken directly away from your bottom line, you know, that doesn't even make sense.
Andrew Pace [00:34:29]:
Yeah. We we had this discussion, I think, last week, right, Shane, where we were just like, you know, they just have the power to essentially say, hey. We were get we're getting money now that we weren't getting before. Let's double it. Like Yeah. You know?
Paris Smith [00:34:41]:
And doing nothing for it. But, you know, what's what I'm watching and loving to watch not loving. No. That's not the right word. But it's so intriguing when all of a sudden, you know, Illinois is like, oh, we you know, we're gonna change our taxes. Okay. Great idea. And here goes the share price of all the public companies.
Shane Mercer [00:35:00]:
Yeah.
Paris Smith [00:35:01]:
So, I mean, there's a cause and effect here. They the government, they can't sit and, you know, for, yeah. I feel like they're just, pillaging poor sportsbooks, and, you know, they sit and look at our integrity.
Shane Mercer [00:35:16]:
That's funny that you refer to them as poor sportsbooks because I think a lot of the general public out there certainly wouldn't look at them with that kind of a a lens. Right? They they tend to think, like, here's the rich sports book that keeps taking all of my money because, you know, they're losing on their big long shot parlays on a regular basis. Yeah. You know?
Paris Smith [00:35:33]:
Those are personal choices.
Shane Mercer [00:35:34]:
Those are. Those are. And you're right, though, to think those poor sportsbooks because they aren't profitable. Right? And and at this stage, they aren't, you know, they aren't returning any kind of value for, their investors. And I'm wondering, as a former CEO of of the sharpest book in the world, what is the path to profitability for these sportsbooks? And then I guess the follow-up to that is, can they walk a path to profitability that doesn't involve limiting as we sort of watch what's playing out in Massachusetts?
Paris Smith [00:36:06]:
Yeah. Well, the path, boy, I wish I had that answer. But I think, you know, if if they just continue to focus on the product, right, the re like I said earlier, the reality is people have, you know, people have not imitated Pinnacle. Right? It's been 25 years. And, you know, there's there's a story for another podcast, kind of like how it got to the point where it got where it's sustainable. And then along with an phenomenal trading team constantly you know, I mean, we're talking people had newspapers, and now they have algorithms, and they're scraping. And, I mean, it's a whole different world. And the fact that Pinnacle still remains as strong as it is is really mind boggling.
Paris Smith [00:36:56]:
You know, kudos to to the trading team on that.
Andrew Pace [00:36:59]:
Well, that's a testament to you and the team as well. Right? Because the infrastructure for all of that, you guys brought it up from no inter no Internet is probably the wrong term, but, essentially, no
Paris Smith [00:37:08]:
Well, there was no Internet. Really? Yeah.
Andrew Pace [00:37:11]:
Right? But, like, dial up Internet to where it is today. And in order to withstand the test of time, you have to have this infrastructure set up that obviously can adapt, but also can withstand. You know? And I know firsthand the scraping that occurs from Pinnacle to other sites. Like, I see it. So you guys are being essentially like, there is an argument to be made that that's being stolen.
Paris Smith [00:37:43]:
Right? Oh, a 100%. That was one of my big things. You know, I always wanted to you know, it The problem is technology. You know? The the solution is technology, but the problem is technology because people, you know, no matter what things I put in place to to stop people from scraping, You know, there's there's some other technology that's being built or developed, that can overcome that. So it's really complicated. One thing I will say, you know, I think, the fact that everybody is scraping it, You know, we we did have a little program where we could put up a wrong line.
Andrew Pace [00:38:26]:
There we go.
Paris Smith [00:38:27]:
Let me let me be cryptic here. I was accusing a very largest sportsbook of taking our lines. And they said, no. No. We don't. No. We don't. And we're in at g two e, and my guys did not realize g2e was happening because they are worker bees.
Paris Smith [00:38:48]:
And all of a sudden, there was a tweet, and it said, wow. This sports book put, put up this this bad line. I wonder if Pinnacle's trying to zing them, And sure enough, they were. It was you know, isn't it time that they stop take stealing the Pinnacle line and start doing risk management for themselves since they're such a big operation? And it they literally had done it. So now we're having a conversation about them potentially paying us. But at that moment in time, there was no talks of Pinnacle getting any type of license, and you'd have to have a license to be a supplier. You know? But if Pinnacle goes in and gets a supplier license, in theory, the US sports should and likely would pay for that
Andrew Pace [00:39:36]:
line. Right. Right. And that's the other the whole other discussion, which we don't even need to get into, but that line being posted bettors than playing that line and then not being paid on it, like being free rolled on it. Right? So Yeah. How that stuff can get handled disgusting. But, yeah, anyways, I think there's a small hard drive of books that you could I could hand over saying, oh, look. It's the same as Pinnacle.
Andrew Pace [00:39:58]:
So some of them aren't the most reputable, and there's some shady ones doing it that probably would be kinda more like a a speck on the window as, as you're driving through, and you wouldn't even care about them. But yeah. Anyways, it's it's really interesting.
Paris Smith [00:40:10]:
Imitation is flattery. It's flattery, but not in this case. Sorry. That's stealing.
Andrew Pace [00:40:16]:
But, I mean, like, again, this is gonna get so far past, like, my knowledge, but I just have to make the assumption that if you're gonna allow, like, some sort of syndicate or some sort of AI service or anything like that to bet on your site as a place that allows sharp action, that makes it more difficult to eliminate people from actually scraping lines. So if you have, right, and we see that with some of the exchanges that we play on where, you know, you do see lines being bought The offer align and you see it being bought within a fraction of a second because an algorithm's working on that, and they they perceive value in in that case. And if you allow that kind of stuff, then then obviously a certain degree of scraping can happen as well. Here. I'm I'm assuming.
Paris Smith [00:41:04]:
No. 100%. And, you know, that's the the whole thing. I mean, you know, most, most of the Sharp syndicates in, definitely, nobody's sitting behind their computer placing a bet.
Andrew Pace [00:41:17]:
Right.
Paris Smith [00:41:17]:
That doesn't happen. Right? Everything is API driven and generated.
Andrew Pace [00:41:22]:
Right. Right.
Paris Smith [00:41:24]:
Maybe you do pace. Maybe you're your thinkg. No. I mean, live is even more interesting.
Andrew Pace [00:41:34]:
But that's just that's just my hands and and my words and all the people that that have the ability to to follow, but that's that's all it is. It appears that way at at times, I'm sure.
Shane Mercer [00:41:44]:
Yeah. On on the topic of live betting, where do you kind of see that fitting into the ecosystem? Is it is it, I guess, you know, as niche perhaps as maybe it once was? Is it growing? Do you see it continuing to grow? Or is you know, do you see sort of see sports betting as as a a pregame thing over the long term?
Paris Smith [00:42:05]:
Pregame's old. Old news. Yeah. Old news.
Shane Mercer [00:42:08]:
That's an old hat.
Paris Smith [00:42:09]:
Yeah. Like, I think, you know, it was approximately 85% live soccer was Pinnacle's volume. Wow. So, you know, that says quite a lot there. But, I think, it's only gonna increase. The problem is in order to do a proper live bedding, you have to have the right data feed coming in. And if there's latency, a company like Pinnacle, they can't tolerate latency for obvious reasons, but, you know, you have to get that that live data. It has to be live live, and that's the problem.
Paris Smith [00:42:49]:
Again, you know, data, you've got to you know, if I'm sitting at IMG or Bet, Betradar's office or whatever, sport radar, you know, people can take their stuff too. Right? Right. And, so, you know, it's it's a problem that everybody has, and everybody is so worried about making as much money as they can that nobody wants to sit and have a conversation about how it could actually work in an ecosystem that, everybody benefits from.
Andrew Pace [00:43:20]:
Right.
Shane Mercer [00:43:21]:
Right. Yeah. Pace has a very, high intolerance for latency as well.
Paris Smith [00:43:26]:
Yeah. It's worse.
Andrew Pace [00:43:29]:
I'll do I I had the you know, whatever data feed is, sometimes it's not even watching the game. Sometimes it's just the the text version of the game. Yeah. You know? And and for me, like, obviously, court siding is a big thing coming up from the time that you started in the industry until now.
Paris Smith [00:43:44]:
Yeah.
Andrew Pace [00:43:44]:
But I mean, like, I've always looked at that as something that's that in the grand scheme of things is going to be short term because technology is just always gonna be able to catch up. But if I do look at Pinnacle, you know, if I rewind the tape and go, okay. Like, I'm at a game and it's, like, 9 years ago. Pinnacle is just like, bam. Like, markets are shut down. Like, there's no risk associated with with people that are at the event. And and I always looked at that in awe because I would sit there and I'd go, this is amazing that they are able to do this. And why are not why aren't other sportsbooks catching up to this? Because that puts with that's, like, a part of the winning player ecosystem, but you could make an argument that it is it is a form of cheating.
Andrew Pace [00:44:30]:
You know, there's there's two sides of that discussion. That's a that's a whole other debate. Right? But why are these other sportsbooks vulnerable in these spots, and why can't they catch up to it so that we can all have a level playing field with the wagers that we're taking, which means you have access to the information at the same time that I have access to the information. We all get to enjoy the game at the same time and engage in that behavior in a in in on a level playing field. Right?
Paris Smith [00:44:55]:
Well, I think for a lot of sports folks, they didn't care. Right? We didn't have a choice. We had to be ahead of and right with the best because the second we had any form of latency, we would be pummeled. Like, you know, you can't say, hey, everybody. Come and take your shot. And, you know, you you you have to have all your armor, on perfectly.
Andrew Pace [00:45:21]:
So can you talk about the the whole being pummeled concept? Because I've literally witnessed one night where there's all these markets live in Pinnacle, and the next day, they're all gone. What what what did that process look like? Like, you you guys just got cracked on a live market, like, really hard by, you know, potentially a bunch of sharp bettors. What's what's the next step?
Paris Smith [00:45:41]:
You know, I mean, we're we're not, we're not a bank with only, withdrawals. So, you know, if there's something that's not working, then we're gonna take it down. And when I say not working, it's not working because of the data that we're getting for it. You know, it's just, you know, a business common sense. You know? I wasn't sort of involved in that. That's where the traders would have a lot of autonomy for that.
Andrew Pace [00:46:08]:
Cool. Cool. Yeah. It's and it's crazy back to those, you know, gimmicky markets and things like that that you're talking about. They can get pummeled on them, and the next day, they're just sitting there. They don't they don't care. It's it's really interesting.
Paris Smith [00:46:20]:
Yeah. The minute something goes wrong.
Shane Mercer [00:46:23]:
Paris, I wanna ask you about something because you've sort of talked technology here, you know, the data feeds, and and sort of technology being the problem but also being the solution and the sort of sort of, you know, constant keeping up with it. And I wanna ask about you know, back to the conversation around limiting. It seems like and, you know, you can correct me if if my sort of analysis here is wrong. But, you know, it seems like all of the soft books are putting their technology funds into developing technology that is designed to identify sharp bettors as quickly as they can and eliminate them. And I'm wondering, like, is that a proper, you know, is that a proper use of those funds? And is that sort of the right the right strategy to go about things in this space?
Paris Smith [00:47:09]:
Yeah. It's just our model. Right? So we would put our energy into identifying sharp bets so we could utilize those bets and move the lines. Right? Mhmm. And, you know, so even and you can't expect a bunch of traders to sit there. So everything was very, yeah, very automated with the models that it would just trigger, you know, look at this line, look at that line. But, you know, you can use that same technology and ideology for to you can either utilize the information, like Pinnacle does, block the players, like many of the other sportsbooks do. You can utilize that same information for responsible gaming.
Paris Smith [00:47:52]:
Right? So it's it's all about how you choose for your for your strategy, how how you how you choose to focus the resources on that.
Shane Mercer [00:48:05]:
Do soft books actually care about responsible gaming?
Paris Smith [00:48:13]:
It's a rabbit hole for me. I think I mean, realistically, like, you know, I know, you know, I like, my you know, I love Adam. I love from Bed MGM, and, you know, I'm a huge fan of Jason. Like, I think that genuinely, they do because they they're intelligent men. They have great businesses, and they, they have this sustainable model. They know that they won't have to have a sustainable model. However, does the market what the market wants and what they want, is that consistent? Right? So you have all these responsible gaming, you know, rules and regulations that the states are saying you have to put in. There's new product that the states want people to pay for, and it's like, well, actually, you as a state should provide that to the sportsbooks that you have if you care about the player and responsible gaming.
Paris Smith [00:49:09]:
And then in addition to that, if, you know, bonusing, that is you know, I mean, bonusing is so bad because all you do, you have you know, you take that same resource for your modeling and algorithms and say, oh, this guy is going down a spiral quickly. Give him a bonus. It looks like he's slowing down. Give him a bonus. You know, to me, that's not responsible gaming. That's not helping the players. I think that there is a lot more that they could do. Everybody would be better off.
Paris Smith [00:49:41]:
You know, Pinnacle doesn't do in the sports book at all any bonusing. And when we stop bonusing, the sign ups remain the same. They weren't helping us. People wanted the product. Yeah. Way back when when we stopped, the sign up bonus was the only thing we were doing. Nothing. No change.
Andrew Pace [00:50:00]:
That is crazy. Mhmm.
Paris Smith [00:50:02]:
Yeah. And I you know, but it's the race to the bottom on the bonus thing as far as I'm concerned. But I do think that, you know, if they you know, there are other things you know, I'm I've invested in a couple small things where they have educational pieces and responsible gaming components of that for college kids. And, you know, stuff like that, I think, can only help. And, you know, if the if the number on what I was saying earlier, if the number on the market wasn't the number of new sign ups. Right? So the market wants to see x increase in new sign ups. The trigger for that in an organization is increase the sign up bonus. So they're increasing the sign up bonus, which is, you know, feeding into, you know, I I mean, the bonus doesn't give you irresponsible gaming, obviously, but it feeds into it, especially for the reload bonuses, you know, or or the conversion from sportsbook to casino or whatever it might be.
Paris Smith [00:51:03]:
So, you know, they use those things as triggers. Landbase has a whole team of people trying to figure out how to maximize everybody's loss.
Andrew Pace [00:51:12]:
Right. Right. You know, it's really interesting that you bring up, like, like, the the education side of it. You know, maybe it's something to do with a course or maybe it's something that's in curriculum in universities or whatever the case may be. And right away when you said that, it made me think about me playing blackjack. I understand the statistics. I understand the theoretical loss, and I still play when I go to Vegas because I want to go, and it's an entertainment thing, consenting adult to go have some fun, have a drink or 2, and lose some money.
Paris Smith [00:51:41]:
I was a blackjack dealer, so I don't play.
Andrew Pace [00:51:44]:
Right. Well, yeah, right. You you mentioned that. Right? And I'm not an obviously, you know, if you if you throw 1 deck out and you deal to the bottom, you know exactly what the final cards are gonna be. So, like, you know, that isn't what we're doing here. But, obviously, you can count cards in blackjack, and I'm I'm referencing not doing that. So it's like if you give people the education on the theoretical loss of this parlay that's now coming through and people have that understanding and they go to make that decision to continue to make that wager, you've put yourself as a state or, you know, any sort of legislature or region or whatever the case in a responsible position where people have been exposed to the actual, the theory behind behind it and and the profitability to to the book itself, right, which which obviously is is, in my opinion, quite powerful. And that that to me is, like, doing your part.
Andrew Pace [00:52:28]:
And and speaking to that, I I could be wrong, but I don't think I've ever seen another sports book that teaches players how to arbitrage, how to middle hedge calculators, all the things that you can find on Pinnacle that we actually use in our community quite quite a bit. And I know Jesse was involved in those as well, which is just so cool. But when you talk about, like, caring about responsible gambling, I I love the stance that you guys took on that stuff. And the reason why I love it so much is number 1, we're sharp as hell. Bring it on. Number 2, we're gonna teach you how to do this so that you can do it with the other sportsbooks to us. And I always like to say, like, hey. When you're betting with that style, you're not the one gambling.
Andrew Pace [00:53:08]:
The sportsbooks are gambling against each other. And that was literally, like, kind of you and your team saying bring it on. Right?
Paris Smith [00:53:16]:
Yeah. Yeah. When they came with a banner, Arb's welcome. I'm like, you gotta be kidding be.
Paris Smith [00:53:22]:
And that was, like, the most popular band a long time ago. I was, like, everybody's, like, kicking our ass out of time, and we're, like, we love that. Like, we wanted volume, volume, volume. The more volume we got, the more we can, you know, utilize that information to change the lines and move the lines accurately. So but it's interesting because your product, what you have, that helps bettors. You know, there's a few different products out there. I'm involved with rhythm a little bit, you know, and that helps people
Shane Mercer [00:53:55]:
We had their CEO on.
Paris Smith [00:53:56]:
You did? Yeah. We did.
Shane Mercer [00:53:58]:
Yeah. Yeah. It was great. Yeah. We we had them on and chatted, and learned a little bit about the the the modeling that they provide bettors with. So it's yeah. Very, very, you know, interesting tool that they're offering out there.
Paris Smith [00:54:08]:
Yeah. Yeah. But I love that. You know? But yet, how do you market this? And this is gonna be her challenge. I'm sure she can overcome it because, you know, you can't partner up with the you know, with the mindset that we're talking about earlier with the sportsbooks, you know, Pinnacle might say, yeah. Use her line. The you know, you're gonna feel confident and you're gonna make your bets, and that's perfectly fine. But all the other sportsbooks, they wouldn't want that.
Paris Smith [00:54:36]:
So I'm curious if there's gonna be a shift eventually where a sportsbook does take a stance and say, we wanna help the player, whether it be through, the education component of it. There's a small company called Hot Takes. It's it's a great story. You could talk to their guy too. It it's a really cool story. How a bunch of college kids, you know, they saw everybody betting, but not knowing what they're doing, so they did a bunch of, tutorials on it, and now they're linking in Responsible Gaming for it. They're Canadian, by the way. But, you know, like, things like that, that's great.
Paris Smith [00:55:14]:
And if it's, you know, I would think a sports book that's trying to look as though, you know, we're here to help the player. Right? And and, and create this industry. Whoever would jump on that in in that's in the current market leaders, I think they would get a real advantage, at least for from the perception.
Shane Mercer [00:55:33]:
Yeah. Yeah. Definitely. From from that side of things. Paris, we're sort of running out of time here, but I do wanna move the conversation a little bit forward and get your take on on sort of another aspect of the industry that, you know, at inplayLIVE, we're exploring it a little bit more, sort of throughout this this year in 2024. And it's something, you know, that that's been around in in Europe for quite a long time, but not so much in the North American market, and that's exchanges. You know, we've we've had on, the leadership at SXBet, leadership at STX Bet, which is just in Ontario. What are your thoughts on exchanges? Do you do you sort of see them growing in the North American market?
Paris Smith [00:56:19]:
No, I mean, again, if it was a great idea because, like, let's go Right. Let go back. BetFair. Pre 2006. K. Vet Fair was in the US market. They, you know, hey, Paris. Do you know anybody who we could hire for marketing? It's just not getting traction, because Americans don't wanna bet in exchange. So now so I've always been exchanges, bad idea.
Paris Smith [00:56:46]:
And I've you know, some of my favorite people in the industry are pushing exchanges right now, but they're doing it in unique ways. One thing, if a sports book would enter it would integrate with an exchange, and then those bets that they don't wanna take, they put they can put through the exchange so they can be matched, and they don't have to take the risk. That's a great idea.
Andrew Pace [00:57:07]:
It's out there.
Paris Smith [00:57:09]:
Yeah. Yeah. There's it's it's relatively well, I've only heard about it more recently. And then the other thing on that is, you know, it well, that's for me, that's the main way an exchange makes any sense whatsoever. But, you know, it it's just not oh, and then the other thing is because all of these, you know, sportsbooks are limiting, if you're a sharp bettor sitting in New York, you could bet into The Exchange at, you know, and at least get your bet off. Right? Maybe not New York, but you know what I mean? So that is a way for those sharp syndicate groups to get bets on. But, yeah, other than that, it's, it's a tough one. I I don't see it as being a thriving market.
Paris Smith [00:57:57]:
And, again, you know, I I say this all the time on panels. I'm such a jerk. And then my you know, there's a group forecasters. They're my favorite little company out there. And, and I they look at me like, don't say it. Don't say it, Paris. But I can't help myself. I'm not a No.
Andrew Pace [00:58:14]:
We we we tremendously value your advice and your opinion, so I'm I'm glad you did say that.
Shane Mercer [00:58:19]:
I'm glad you're very honest about it. From this from the sounds of it, it sounds like you're very sort of bearish on exchanges because you don't think the masses are interested at least in North America.
Paris Smith [00:58:30]:
Right. Well, they have not been historically. Right? If it was a great idea, Bet365 would have done it. Right?
Andrew Pace [00:58:36]:
Right.
Paris Smith [00:58:36]:
They didn't. Let's be fair. They have the best research. I mean, they're just phenomenal. So and, Betfair was such a monster. Come on. Even when they were at their height before they put in all their fees, nobody in America was betting into it. Right.
Paris Smith [00:58:52]:
It was there. Anybody could have, but they didn't because it didn't make sense to them. So now my point is with the shift to that different type of lottery type recreational player, maybe somebody can make some magic happen. I don't see it happening. I you wouldn't see me investing in it. Right.
Andrew Pace [00:59:13]:
That's fair. Could since you brought up, you wouldn't see me investing in it, why don't we just, transition while we wrap up here, post Pinnacle, to today and what it is that you're doing. I I wanna know what you're doing, what you're passionate about, why the hell you're still in Curacao.
Paris Smith [00:59:32]:
Oh, you're not getting that answer.
Andrew Pace [00:59:37]:
Okay. Okay. Pretend I didn't ask that one. And then what what it actually what what it is that you're actually looking for, what it takes to get you excited about a project?
Paris Smith [00:59:47]:
Mhmm. So, what I'm doing, I'm doing a lot of advising. I'm doing a lot of consulting, and my passion is people. Right? So, like, what I found very organically, this has happened doing a bit of angel investing as well. Because I just I see these people, and I really believe in what they're doing. You know, my my little small rules are I have to really like the people. I have to believe in what they're doing, and it has to make financial sense to me. And that's actually in that order.
Paris Smith [01:00:21]:
Right?
Andrew Pace [01:00:22]:
So can you give us a a couple examples of a couple of those projects that you're passionate about? Because we got a a whole community of bettors that would be, I'm sure, interested in those projects.
Paris Smith [01:00:30]:
Well, I've got, like, 5 things that I'm working on. Rhythm. I love rhythm. You know, they was behind the betting strategy of Billy Walters. You know, that's kind of a a cool connection for me. It comes from my DNA. Kero, I've actually invested in Kero. I'm not a huge fan of micro betting, but I'm a massive fan of Tamash and his team and what they're doing.
Paris Smith [01:00:58]:
Hot Takes, that's the group that does the educational and the, and the responsible gaming components. They're trying to get bigger, branch out, and, you know, have a a longer a larger reach. And then, I'm a massive fan of rivalry. Oh. I love rivalry. I love what they're doing. I think Steven Salz is the cutting edge CEO. I've introduced him to a few people.
Paris Smith [01:01:26]:
Everybody who's ever met him is blown away. He's, you know, he's a risk taker. He's very, pragmatic. I I rate him extremely high. You know, esports is his thing, but he does everything differently, and he approaches things very differently. So that's one of my I'd say I'm passionate about rivalry. And Forever Network. Forever Network, it's also, Forever Basketball.
Paris Smith [01:01:53]:
They're doing a ton of acquisition and retention, which I love. And everybody that's partnering up with them, they're getting phenomenal results, and, you know, that's what everybody struggles with. People always say, I'm looking for a good marketing person. I'm like, I can't believe you would ask me that question because Pinnacle you know, when I was at Pinnacle, I did not thrive in the marketing sector. The product was our marketing. Right. So, you know, but that that one is gonna help a lot of companies, the the Forever Network.
Andrew Pace [01:02:27]:
Cool. Yeah.
Shane Mercer [01:02:28]:
Hopefully, there are some people
Andrew Pace [01:02:30]:
hope hopefully, those are some some companies we can reach out to to learn a little bit more about on our show and and and get them some exposure to our community because we love, continuing to learn and better ourselves.
Paris Smith [01:02:42]:
Well, you know, right now is such an exciting time. I'm passionate about the industry. Right? I I love to see well, now I get to pick what I want to focus on. You know? Was I passionate about compliance? No. Am I passionate about regulation? Not particularly, but I respect it. Right?
Andrew Pace [01:03:04]:
Right.
Paris Smith [01:03:04]:
And, and I promote it. So it's, you know, being able to pick the things that I love. I'm I'm really, you know, people always say, how are you doing? I'm like, I'm thriving. I have a company, and it's called life winning. So somebody's like, oh, why Life Winning? I'm like, really? You're asking me, the girl that ran w w t s, pinnacle. I've got, like, the best life ever. I just hired, an amazing support person in my company, who happens to be my daughter. So, yeah, if I see you at a conference, I'll introduce you to her.
Paris Smith [01:03:44]:
Nobody thinks she's my daughter because we have different last names. But, yeah, I'm I'm just having the best time. I'm loving it.
Andrew Pace [01:03:51]:
That's awesome. And I think that, like, just as a general statement, you know, if you can, have a have a successful career, people always view success, like, in a monetary capacity. But, you know, like, you almost just define success as hiring your daughter, and it's like, that's obviously extremely special. So huge congrats. Hopefully, she has some overlapping patch and as well. I'm just gonna say now let's hope she actually enjoyed it. Yeah. I heard my daughter and she quit the next day.
Andrew Pace [01:04:20]:
Yeah. Yeah. No. No. Yeah. But that's awesome, Paris. Like, huge congrats on on all the accomplishments in the career, and I think that, you know, you really don't know the impact that you have on someone. And I think that Pinnacle has just had such a tremendous impact on the industry.
Andrew Pace [01:04:38]:
And, like, it's this light at the end of a dark tunnel. Like, is it easy to win money on Pinnacle? Like, god, no. It's damn near impossible. But is it what the industry could become from the standpoint of being player focused, player forward, player positive? Absolutely. Like, that's the hope. Right? So, yeah, huge thank you for for your impact on the industry because I know it's helped me directly even though we had never met.
Paris Smith [01:05:06]:
Oh, my pleasure. Yeah. Thank you guys so much for your time.
Shane Mercer [01:05:10]:
We loved having you on the show, Paris. We definitely learned a lot from having you on the show, and I hope our entire, audience, has learned a lot, from having, you appear here on the show. So just thank you so much. And, yeah, we'd love to have you on again at some point and would love to to meet you in person if ever get the opportunity. That would be amazing.
Paris Smith [01:05:27]:
Sounds good.
Shane Mercer [01:05:27]:
Alright. Well Thank you. To you, to pace, to all of the sports bettors tuning in from around the world till next week. Keep beating those books. Thanks for tuning in to another episode of Behind the Lines. Remember to like, download, and subscribe. We are on YouTube, Apple, Spotify, and everywhere you get your podcasts. Have a betting story or wanna be featured on our podcast? Drop a note in the comments below.
Shane Mercer [01:05:48]:
And if you wanna join inplayLIVE, use promo code 'BEHINDTHELINES'.
Paris Smith, Pinnacle Sports, sports betting industry, rebuilding business, Asian market challenges, female CEO, sportsbook management, Billy Walters, live betting, latency issues, data acquisition, syndicates and algorithms, sports betting transparency, WWTS, customer service, female staff in sports betting, stereotypes in sports betting, VIP services in sportsbooks, offshore betting, regulatory requirements, geocomply, Curacao-based sportsbooks, micro betting, recreational players, responsible gaming, technology in sports betting, high taxes on sportsbooks, sharp bettors, sign-up bonuses, betting strategies.