I think you’ve hit the nail on the head, there could well be a fault line in Betconnect’s model.
According to Betconnect’s PR around their pre-launch, there are potentially three ways for layers to make profits with them.
Firstly, layers can do just that, and take on the risk of the bet themselves.
Alternatively, layers can match Pros’ bets and back the same stake with the bookies, hoping to profit from price boosts, BOG, free bet clubs, win by 2+ lengths boosts and various other bonuses.
Finally, layers can identify winning Pros and copy their bets, so if laying the Pro £25 at 4/1 the layer would bet, perhaps, £50 with the bookie at 4/1. BOG or other bonuses could help here too.
So, layers can hunt out and connect with ‘pros’ who are actually so bad that it’s profitable for the layer to stand their bets? Sounds great in theory, but why are such poor judges going to continue using Betconnect? They’ll throw in the towel sooner rather than later, probably when they run out of funds to lose. This is backed up by analysing the performance of the Betconnect Pros.
As of this afternoon, there are 84 Pros who’ve had at least one bet. The 84 have had between them 6,552 bet requests matched by layers for a total of 9,167 points, and are showing a small gross loss of 92 points, which is -1% ROI. Actual net losses will be higher, as Betconnect deduct their 3% commission from all winning bets.
A minority of the Pros actually win money, only 38 of the 84, which is just over 45%.
These 38 winning Pros backed 4,843 of the 6,552 bet requests, which is nearly 74%.
The 38 winning Pros had 872 connections with layers, which is nearly 71% of total connections.
For me these figures confirm what logic would suggest. Winning Pros are far more active, with nearly three times as many bets struck as losing ‘Pros’. The 46 losers, who account for nearly 55% of the 84 Pros, only have about 26% of the bets. They tend to just give up and quit using Betconnect after incurring their losses.
I don’t see much mileage in layers trying to identify losing Pros and connecting with them. By the time it becomes clear that a losing Pro really is useless and hasn’t just been experiencing a bit of bad luck, in other words when their sample size becomes reasonable, that losing Pro will probably be about ready to quit anyway.
Sure, if you’d layed each and every bet request to date you’d be showing a profit of 1% on turnover, but is that likely to continue into the future? I doubt that it will. The existing small number of winning pros will probably still keep betting with Betconnect layers, probably gradually ratcheting up their stakes as their banks grow. Over time, new Pros will join Betconnect and the Darwinian selection process will be repeated for each intake. The losers will go extinct, and the winners will stay with Betconnect, increasing their stakes over time.
So that leaves us with the winners, and to Derek’s point about bookmakers inevitably closing winning accounts. A layer who accommodates a winning Betconnect Pro will simply have to back with the bookies, as if they stand the bets themselves they’ll be cleaned out.
As mentioned in my post above, some firms such as Bet Victor now offer separate, ‘guaranteed odds’ books, where they’ll lay a horse to lose £500 to any customer. But those separate books rarely offer top market odds, which tends to be exactly what Betconnect Pros ask for.
Therefore, most layed bets will subsequently be backed on ‘normal’ bookmaker accounts. Once the account holder is identified as a value taker, restrictions will follow.
Absolutely correct there, Derek. Betconnect might become a useful outlet for the growing number of multi-account holders, particularly once the current 0% exchange commission war comes to an end, as surely it must....the only purpose for a full set of bookie accounts is to extort as much money as you can out of them, while you can. It has to be done quickly as it's a race against time.
One thing that Betconnect could do is to enable layers to make counter offers to Pro backers. There are still some line trackers among the Pros, who only ever ask for top market odds, often standout prices. This isn’t good for bookmaker account longevity, as their customer profiling algorithms will soon pick up on this behaviour. Why shouldn’t a layer be able to counter with what he feels is a more realistic price?
Currently, layers can only take or leave a bet request – too many of the latter, and the layer faces the risk of being shuffled to the back of the queue for future bets. I feel that this procedure is weighted against the layer – it’s got to be equally fair to both parties, or the Betconnect ecosystem won’t be in balance over the longer term.