Predictionstrike

PredictionStrike runs an online marketplace modeled on a stock market in which sports fans buy, hold and sell virtual shares of professional athletes. Share prices are set by a proprietary algorithm that combines on-field player performance with user demand, measured by how frequently a player's shares are traded. The platform covers players in the NFL, NBA and Major League Baseball as well as UFC fighters, and prices move sharply on game results — a Patriots receiver's share price rose 55.40% after a two-touchdown game in the 2023 season opener.

The company positions the product as a "fantasy derivative platform" and a "game of skill" rather than sports wagering, which management argues places it outside the state-by-state licensing regime applied to sportsbooks, comparable to the status daily fantasy operators such as FanDuel and DraftKings held before entering sports betting. The company nonetheless says it continues to apply for game-of-skill and fantasy sports operator licenses in states that require them.

Founding story

Co-founders Deven Hurt and Brad Chabra grew up together in Bay Shore, Long Island, attending elementary, middle and high school together before graduating from Harvard and American University respectively. Both began working in 2018, Hurt in cybersecurity and Chabra in finance, and soon began discussing starting a company. They launched PredictionStrike in 2019 amid growth in sports betting and fantasy sports, modeling the marketplace on a stock exchange. Hurt, a bioengineering major, built the initial marketplace himself and later ran the company while attending Harvard Law School full time, graduating in May 2023.

Business model

PredictionStrike operates a consumer marketplace and takes a cut of trading activity rather than acting as a licensed sportsbook. It also sells a subscription tier and has identified data licensing as a potential future line of business.

Most revenue comes from a 2.5% fee charged on each transaction. The company also offers a paid subscription that gives users lower transaction fees and additional perks, and has said it hopes eventually to sell data it collects on athlete popularity trends and trading patterns.

Traction

As of September 2023 the company said it had processed $60 million in transactions and had more than 175,000 users, up from $15 million and 100,000 users a year earlier.

Latest developments

In September 2023 PredictionStrike announced a $10 million Series A led by Bullpen Capital at a stated $32 million post-money valuation, following a $3 million seed round in 2022 at an $18 million post-money valuation and a $1.7 million pre-seed round co-led by MaC Venture Capital. Proceeds from earlier rounds were used to fund outside hires to improve the product.