Streaming TV service Fubo TV announced on Tuesday it had acquired Balto, a software development company that builds tools to allow users to launch sports contests.
The deal comes less than a month after Fubo TV executives said the company intended to offer a sports betting feature to complement its sports-centric streaming TV service.
“Our goal with wagering is to develop a new revenue stream for Fubo TV, and one which we believe will be an important contributor to our business,” a company spokesperson said in early November. “We expect to share more tactical details as appropriate. And, of course, we expect to continue to grow our subscribers which will positively impact any decision we make on wagering.”
On Tuesday, part of that plan was laid out when Fubo TV said it had acquired Balto, a Y Combinator-backed software development firm that makes applications and other tools for the $150 million online sports betting industry. Financial terms of the deal were not disclosed.
Balto had five employees as of November, according to a listing on the Y Combinator website. None of the three Balto co-founders listed on the Y Combinator page were still with the company as of mid-2020, according to LinkedIn pages reviewed by The Desk on Tuesday. A website and several social media accounts that were once linked to the company were also unavailable.
“Excited to see Balto, the team and Fubo TV finish what we started!” Nicholas Montana, a Balto co-founder, wrote in a LinkedIn post.
Balto’s remaining team members are expected to join Fubo TV when the acquisition closes. A Fubo TV spokesperson said Balto’s software is expected to be integrated into the service to drive “the company’s expansion into both free to play gaming and online sports wagering.”
“The acquisition of Balto Sports will enable us to build a first class, free to play experience that brings consumers the best games around live sports,” David Gandler, the co-founder and chief executive of Fubo TV, said in a statement emailed to reporters on Tuesday. “e see a natural progression to layer on real money wagering in regulated markets complementing Fubo TV’s live streaming video for a highly engaging user experience within our platform.”
Gandler said the company believes there was “significant synergy” between customers who want to watch sports on Fubo TV and those who want to bet on games.
“One of our goals with wagering is to expand our total available market,” Gandler explained, adding that the company hopes it will develop “another important revenue stream for Fubo TV as we are doing with our growing ad sales business.”
In Novmeber, Fubo TV said its ad sales had increased 155 percent year-over-year, with the company bringing in $7.5 million in ad sales.
Fubo TV has 455,000 subscribers who are willing to pay $65 a month for sports channels that live alongside general entertainment, lifestyle and news channels. The company has agreements with the Walt Disney Company (ESPN, Freeform, FX), Comcast’s NBCUniversal (NBC Sports, CNBC, Bravo), ViacomCBS (CBS Sports Networks, Comedy Central, MTV) and Fox Corporation (Fox Sports 1, Fox News), among others.