CEO Spotlight Series: Exclusive Interview With Vinit Bharara, CEO of Mojo

Q. Vinit, can you give a brief snapshot of Mojo’s business strategy and how you are differentiating yourselves versus the incumbent online sports book operators like FanDuel, Draft Kings, BetMGM, and others?

Our vision at Mojo is to allow customers to bet on athletes and teams like stocks—that’s our core value proposition. The centerpiece to that vision is liquidity. If you think about the global stock market, liquidity is the essence of that market as well. People know the asset they bought has a market value, and they can track that value in real time. As events change, the fair market value of that asset changes, and the customer has the ability to get in and out of their position at that value at their own discretion, at all times. We wanted to bring that same concept to sports betting.

In fact, I think these virtual stocks in teams and players on Mojo are even more interesting in some ways than traditional stocks because the prices are based on the latest probability of an objective stat or outcome that you can actually track throughout the course of a game, or an entire career. And it’s sports, something most fans understand really well. With traditional stocks in companies, the prices and value can be far more opaque, in that there’s no definitive objective formula for the relationship between share price, revenue, expenses, profitability, etc. So, you can predict the earnings of a company correctly, but the price of that company stock might still go down.

Q. You brought up the term liquidity. Can you discuss that concept a little more? Why is that function central to your vision?

So, when I mention liquidity, it’s essentially delivering three things to the customer: Control, Availability, and Fair Value.

For a customer to have complete control, the product or service needs to be available, and it has to be transparently, fairly priced—that’s how a high-performing market operates. It’s the fundamental tenet of our value proposition.

So how does that translate to our business? By converting a bet into a virtual stock with a price, we’re creating a live asset that has a transparent, universal value. That provides you with the control and freedom to manage that bet/asset as you see fit. We call it Liquid Trading, and it allows you to buy-in, sell-out—or sell a portion of your bet—in a frictionless environment as you are following the sporting event. That’s missing too often elsewhere. So many times, you’ll place a bet and there’s not an available exit/cash out price. Or if it’s available, you know it’s not a fair price, and the reason why that price is being offered is not transparent. It’s just not liquid.

To be clear, providing as much liquidity as we can is our never-ending North Star. There are some highly uncertain times when we’re currently unable to provide a price, like when a player suffers an undisclosed injury, or it’s within the last couple of minutes of the game. But our goal is to keep getting better and better, whether it’s price availability, the quality of the prices we offer, and the sizes you can buy and sell. We want to be the best.

Q. How does your offering fit in with live betting?

That’s basically the ultimate application of our offering. Many think live [wagering] will soon dominate the U.S. sports betting landscape, as it already has in Europe. We want to win that space. We want to be that second screen.

We think the best live experience requires amazing liquidity so you can make betting decisions with your capital freely as you watch the game, instead of your money being locked up. You can take the over on a player’s points, change your mind in the second quarter, and either take some winnings or cut your losses and now take the under. And then change your mind again in the fourth quarter. That requires available, fair market value buy and sell prices on your bets. I can’t get in and out of a bet at will if there’s not a price, and I won’t trade freely if the price is unfair and has me losing way more than I should.

We believe that kind of live, efficient market type dynamic is also the most entertaining type of betting experience. Players and teams are streaky, games are often back and forth, comebacks can be crazy, and the probability of outcomes can swing wildly—which means that the virtual stock prices of the bets are often super volatile. We show all of that in our cool, real-time graphs so you can track what’s happening easily and act fast if you want. I just think it’s really fun. And that’s sort of the whole point of what we’re trying to do—make the experience as entertaining as possible.

Q. Mojo successfully raised $100M of venture capital from a number of notable investors in 2021, including your former business partner at Diapers.com, Marc Lore, Alex Rodriguez, Thrive Capital, Tiger Global, Finn Capital, and the NFL Players Association, among others. This puts you in a nice position versus other new entrants; how are you managing the cash you raised versus the need to scale and more than likely come back to market in the next 12–24 months?

Yeah, that’s a good question. We know we’re in a fortunate position to have been able to raise that much capital. We’re stewards of that cash and we’re constantly evaluating the best use. Right now, our capital is about building the best possible product and scaling our offerings to the customer. We’re just in New Jersey, which is less than 3% of the population—so it’s a great place to perfect the product and build the best value prop for the customer. Our effort-to-scale audience will coincide with launching into multiple new states.

To expand on that a little more, the reason this vision of extreme Liquid Trading hasn’t really existed before is because it’s very hard to offer. We are the ones guaranteeing as much liquidity as possible. We are the ones trying to make sure there is an available, universal price to enter and exit. We are taking on the financial risk. That means we ultimately have to be the best anywhere at predicting sporting outcomes on a second-by-second basis across thousands of games and player careers across several sports. Of course, this has to be done in an instant automated way. So, we’ve had to build some seriously sophisticated, innovative proprietary technology that digests tens of millions of historical events and incorporates advanced algorithms, statistics, machine learning, and even some AI. We’ve named our system ARCHIE as a nod to the mathematician, Archimedes. This is all way above my skill or understanding, so we’ve had to hire a lot of incredible people that are a lot smarter than me! You can imagine the type of data scientists, statisticians, risk managers, traders, engineers, and overall quants walking around our floors. Really great, nice, fun people, but their sheer horsepower can be intimidating!

Of course, the other primary area of expense has been ensuring that our product and technology is fully compliant with all state regulations governing licensed sportsbooks. We’ve built all that in-house, which requires a significant investment as well.

Q. Speaking of regulation, you certainly have come to learn how regulated the gaming industry is and how the pace of change can be slow. How are you navigating this, and how does that shape your decision-making in the near to intermediate term?

You have to embrace it and remind yourself that there’s a reason for regulation, and that reason is to protect the customer. Once you realize that compliance is enhancing the customer experience, which we are always trying to do, it becomes a far easier choice to make. That’s important to note. We chose to be licensed and regulated because we wanted to do this the right way.

We’re fortunate to have great people on it. Scott Silverstein, who’s the former CEO at The Topps Company, leads a team that approaches compliance with diligence and great attention to detail. We take regulation very seriously, because we recognize that ultimately, it’s a benefit to the customer and it enhances our product.

Q. I think one thing that makes Mojo very unique versus many other startups in gaming is that your team is very seasoned, having had multiple notable exits (you were the co-founder of Diapers.com that sold to Amazon in 2011 for $545M), and you are not necessarily “gaming” people, per se. How has that affected your approach?

Yes, that includes my co-founder, Bart Stein, who has successfully sold his startups to Yahoo and Walmart. He’s one of the great product visionaries in the country.

It’s definitely true that most of us don’t come from the gaming industry, and there are some pros and cons that come along with that. One of the advantages is that we’re bringing fresh eyes to the industry, and we believe that drives some significant innovation.

It also should be noted that some of us do come from an adjacent industry. Our foray into entrepreneurship was solving this challenge of providing liquidity, market making, and two-way pricing at all times for sports cards. So that experience has certainly been advantageous.

Q. Speaking of that initial company, can you share some of the backstory of your early foray into that sports trading card market in the late 1990s/early 2000s?

Sure. Going back over 20 years ago now, along with my two childhood best friends Marc Lore and Lax Chandra, we thought it would be a great idea to build a company that allowed the everyday sports fan to invest in athletes like stocks. While we began to research the idea, our lawyers informed us that if we wanted to build the company the way we had intended, it would probably be considered online gambling, which was not permitted at that time. As a result, we launched what we thought was the next best thing—a company called The Pit. The Pit was a sports card stock market that allowed people to invest in athletes, but their rookie card was the proxy. Like Mojo, we focused on providing insane liquidity with a best-in-class in-house markets/trading team. What we saw was this very electric and live marketplace with people trading in and out as prices changed during games and otherwise. It was very successful, and we eventually sold it to Topps, the biggest trading card company in the world at the time.

Fast forward more than 20 years. With online gambling becoming legalized in more and more states, we thought this would be the ideal time to revisit this dream idea from our youth and operate the company the way we had always intended. Build a sports stock market, where you can use your sports knowledge to bet on athletes and teams like stock, from the entire career to the next play. No sports cards, NFTs, or other type of proxy, which we learned has lots of flaws, especially a lack of intrinsic value.

Q. Twenty years later, and after a number of successful companies under your belt, have your outside-of-the-box views and a little “gray hair” been a competitive advantage for fundraising, understanding the potential early mistakes that can be made, developing your product roadmap, and recruiting?

Ha, I hope one of the benefits that comes with gray hair is knowing some of the mistakes to avoid and having a better understanding of the keys to a winning playbook. To start, you first have to set a big, clear vision, and you need to ensure you will have access to enough capital to execute it.

Most importantly, though, you learn that it always comes down to the people you can attract and retain. I can’t emphasize it enough: the people make the company. Part of that is definitely sheer smarts and raw talent, which I discussed earlier. But I’ve learned it’s equally about their other qualities, like optimism, EQ, resilience, and grit. Some people just know how to deal with pressure, uncertainty, and complexity of a startup. You need people that know how to handle things when they don’t work out and how to get along with all types of colleagues from different backgrounds. Startups are not for the faint of heart. They are so hard. But the best keep fighting to find a way and, more often than not, win in the end.

It’s why I’m so excited about Mojo. We have the most talented, passionate, and find-a-way people I have ever worked with. It has me really excited about where this company can go in the future.

Q. If we are having this discussion in April 2025, what do you think the state of the online sportsbook industry looks like?

What we see very clearly is that the trend is going to be towards legalization. So ultimately over time, we expect that the vast majority of states will offer legalized sports betting to their citizens. Companies that innovate on differentiated product offerings will have the most success. So, I expect to see a lot of innovation, product enhancements, and differentiation in the next few years. We plan to be at the forefront of that.

Q. How many states do you see Mojo rolling out into during this timeframe?

Consistent with where the country is going, our plan is to steadily and methodically roll out as many states as we can over the next few years. Remember, we really want to do this the right way, and we’re presently focusing on what I think can be a truly epic value prop for the customer, rather than speed of expansion. But make no mistake that our ultimate vision is to be in every state with legalized sports betting.

Q. I think very wisely, Mojo has kept its efforts and early traction to date fairly close to the vest. I can appreciate that, particularly in an industry where there is a lot of business promotion. With that said, you are on the tape with us today. Can you share some interesting facts or metrics about Mojo and your early experience going live in New Jersey? How engaged are your customers, and what are some of the promising early takeaways?

The first product that we launched allows customers to bet on the career of an athlete, which you can’t find anywhere else. It has lots of similarities to investing versus traditional gambling, so we’ve found that we’re reaching an untapped audience of stock traders who are sports fans, but not regular bettors. Relatedly, the only other way you could even tangentially invest in athletes’ careers is through sports cards or NFTs, but Mojo is a better mechanism since there’s real intrinsic value here with your asset; you’re investing/betting on their objective stats. That’s not the case with cards or NFTs, where you can correctly predict a player’s success and still lose money. So, we’ve been able to attract a lot of folks from those industries.

And then, we found these prices—which represent the latest market projection of athletes’ future careers as they play—have been culturally relevant and interesting for mainstream media. It’s the ultimate sports debate topic. ESPN referenced those price movements 7 or 8 times during the NFL season. Interestingly, you also had some users putting down thousands of dollars into guys like Jalen Hurts and Brock Purdy, betting on their careers. Just a lot of absolute size . One user made $70,000 on Daniel Jones as he had such a good year, surpassing expectations for what his career might look like.

That’s the career bet. Our recent beta testing of liquid daily prop bets where you can day-trade the game has excited me maybe even more. These customers are hyper-engaged, tracking the value of their bets with our intuitive graphs and trading in and out during the game. Not only did we have 50% more bets in March than our previous high, but they are staying in the app for an average of 90 minutes per session! It’s super early, but we do believe these bets—paired as a second screen to watching live sports—will be the most engaging in the industry.

Q. A couple of fun questions for you: Is there still a chance that Tom Brady comes back for another season?

Yes, always. Why not? He was still at least a top 20 quarterback last year, so I am not ready to say with 100% certainty that he will never return.

Is Aaron Rodgers going to lead my suffering New York Jets to the Super Bowl, and if we were setting the line for number of regular season wins on a $0–$17 scale (per Mojo) for the 2023 season, would you go long or short $11?

I’m high on the Jets and I’m high on Aaron Rodgers. I would personally Go Long, but I know you Jets fans can be a glass-half-empty type of crowd, so you’d have to make that call for yourself!

I’m not picking them to win the Super Bowl—I’m a diehard Eagles fan—so I have that spot reserved for the Birds. But since we’re talking sports betting, the last time I checked, the Jets were +1300 to win the Super Bowl. I’d take those odds!

Q. It’s been a pleasure to have you as our first CEO interview in the Houlihan Lokey digital gaming series.

Thank you. I’m happy to be the first! Great to be with you.

Statements and opinions expressed herein are solely those of the author/interviewee and may not coincide with those of Houlihan Lokey.