Footytips.com.au picks another winner
Friday, 22 August 2008
Last Updated: Tuesday, 26 August 2008
By James Thomson
The humble office footy tipping competition has taken to the web seamlessly, and footytips.com.au founders Nathan Isterling and Heath Kilgour are set to ramp up their site’s capacities.
Selling your business to Australia’s biggest public company would be a thrill for any entrepreneur, let alone of pair of young blokes in their 20s.
But footytips.com.au founders Nathan Isterling (pictured) and Heath Kilgour, who sold their business to gaming giant Tattersall’s in 2001, found that working within a big company wasn’t all they had imagined.
In January 2007, they bought their company back from Tattersall’s for $650,000 and set about transforming it from a staid corporate division into a booming, independent business.
The next challenge for the pair is to take their rapidly-growing green advertising business from start-up to success.
The footytips.com.au concept (which now operates under Isterling and Kilgour’s umbrella company ExtraCorp) was created in 1998 and the first online tipping competition started in 1999.
In a small way, the service revolutionised the humble office footy tipping competition, which until then had usually been run with a whiteboard, some tatty footy fixtures and a petty cash box. The site allows companies to automate and manage the tipping competition – players register and pay up at the start of the year, log on each week to put their tips in and then receive an email on Monday telling them how they’ve gone.
There are tipping competitions for the AFL, NRL, cricket and soccer leagues and special competitions are arranged for big sporting events such as the World Cup.
Revenue comes from two sources. Office tipping competitions on footytips.com.au are free to conduct and participate in, but ExtraCorp sells advertising on the site and in emails sent to tipsters. ExtraCorp also receives fees for operating branded competitions for big companies (including media companies such as Yahoo and Ten Network and the leagues themselves, such as the AFL). There are more than 340,000 tipsters using the company’s services.
Isterling says revenue increased from $1.5 million in 2006-07 to just under $2 million in 2007-08.
He and Kilgour have pushed the business hard since buying it back from Tattersall’s. Isterling says that while operating as a part of Tattersall’s taught them some valuable lessons – particularly about negotiating with tough, high-level executives – the structure of a big corporate stifled creativity and growth.
“It was very much a restricted space to work in,” Isterling says. “We didn’t have the budget to invest and expand and even improve the site. For a lot of years we were stuck, and not even changing the features of the site.”
Since January 2007, ExtraCorp has doubled staff numbers from seven to 15, adding three more developers to bolster the site’s capabilities.
Perhaps the biggest change was the decision to bring advertising in-house. Not only were Isterling and Kilgour keen to get 100% of the advertising revenue, they felt their unique advertising proposition needed to be carefully sold. “We felt we were doing ourselves an injustice by having an agency represent us. We just weren’t getting the cut-through we liked,” Isterling says.
He also says having ad sales in-house allows them to be a lot more creative with their pitches. He gives the example of a targeted campaign the company ran for Ford, whereby ExtraCorp was able to send emails to tipsters with information about their local Ford dealership as well as the Ford brand. “We can do more beyond-the-banner-ad approaches to our sales,” Isterling says.
The next big challenge for ExtraCorp is to ramp up the social networking aspects of footytips.com.au. While Isterling points out that footy tipping could be regarded as an old-school social networking activity, he says adding more features that will allow users to interact with each other will help increase the stickiness of the site and its attractiveness to advertisers.
“What we are about is creating an office social network, which is what our advertisers want. By integrating all of these things we think we can increase people’s session times and have them staring at the screen longer.”
The other challenge is to get visitors coming outside the football seasons from March to September. To this end, ExtraCorp plans to build up its tipping competitions around the English Premier League and Australian A-League soccer seasons, and also the cricket.
“Our aim is to become the biggest sports site in the country. We’ve got a long way to go, but we are clearly in the top five,” Isterling says.
As well as working on footytips.com.au, Isterling and Kilgour have just launched ClickGreen, a website that allows people to offset their carbon emissions by signing up for an email full of advertising and then clicking on the ads and earning credits, which are then used to fund tree planting (ClickGreen donates half of the revenue it receives from the advertisements to tree-planting company GreenFleet).
The site is in its infancy, but more than 10,000 people have signed up to receive the email full of ads since the launch at the start of August. “Email was a very easy way to get people to consume advertising but it also offered a way to measure and reward people,” Isterling says.
But while he is pleased to be helping the environment, he is keen to point out this is no charity venture. “It has great spin-off benefits, but at the end of the day, it’s going to make a profit.”
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