Source: Knox Henderson for Streetwise Reports   05/07/2020

A quick update since FansUnite Entertainment Inc. (FANS:CSE) went live on Tuesday, May 5, because big things are happening in the industry, thus showing there is an enormous appetite for this kind of technology especially now, as we (very slowly) emerge out of this COVID pandemic.

On the sports front, Germany announced that its Bundesliga soccer will resume games in May, yet with tight restrictions and no fans. This is followed by the Turkish soccer league, which plans to resume playing on June 12. The Ultimate Fighting Championship (UFC), with a huge draw to the masses—the UFC 246 prelims averaged 1.767 million viewers on ESPN—will return at VyStar Veterans Memorial Arena in Jacksonville, Fla., on May 9, again featuring no live fans. So as more sports emerge in our "new reality," where will those fans be? Online, of course! In a fanless sports environment we're going to see a lot of online engagement no matter what sport or activity that may be. That's going to spawn even more online attention, which will likely hold firm even after we emerge from our home quarantine.

The industry is rapidly consolidating. On Tuesday we alluded to The Stars Group Inc. (formerly Amaya), which, according to Bloomberg, "saw record revenue in its first quarter as COVID-19 led to an increase in online activity starting in March. Indeed TSGI.T has had a great run from $18 mid-March to a high of $40 on May 1 after it confirmed shareholder approval of a friendly takeover by UK based Flutter Entertainment plc. (LSE:FLTR.L - News). The two create a £10 billion (US$12 billion) giant, according to Racing Post, and combine for more than 13 million customers, US$4.6 billion in revenue and US$1.7 billion in EBITDA.

Investors are getting on board

In our previous note we referred to DraftKings (NASDAQ:DKNG), which launched as recently as April 23, in the thick of this stay-at-home pandemic. After completing a merger with Diamond Eagle, a special purpose acquisition company, and back-end technology provider SBTech, its stock soared. DraftKings' stock jumped 14% in its first day of trading before closing up 10.38% at $19.35. The company was also able to add another half a billion dollars on the balance sheet at a time when it's not easy to raise money. That company currently has a $17 billion market capitalization.

Meanwhile there's been a noticeable correlation of trading activity in the industry from mid-March to the end of April:

• Prior to the merger with Canadian The Stars Group, Dublin, Ireland-based Flutter, trading as OTC:PDYPY in the U.S., had a good run of its own. Since mid-March it doubled from $31 to $64 by the end of April, despite any global sport-killing pandemic.

• UK-based GVC Holdings PLC (LSE:GVC) gained 23% in the last month, from $611 to $750, reaching a US$4.3 billion market capitalization.

• After falling from February highs of $30, Scientific Games (NASDAQ:SGMS) more than tripled from a $4 low mid-march to $13 by the end of April to again reach a $1 billion market valuation.

• Penn National Gaming (NASDAQ:PENN), now at a US$1.8 billion market capitalization, has a chart that mirrors SGMS. After February highs of $38, PENN rebounded through the COVID crisis. It also more than tripled from a low of $4.50 mid-March to a $17.80 high by the end of April.

• Score Media and Gaming (SCR.V,) with a market capitalization of $185 million, during that same period, ran from $0.32 to $0.42 mid-march to April 29, gaining 31%

• (are you starting to a pattern here?)

On the regulatory front, Colorado, became the next state to legalize sports bargaining following New Jersey, Nevada, Delaware and Pennsylvania. The state is poised to generate $6 billion in annual wagers and an estimated $400 million in revenue once the industry matures, according to Dustin Gouker, chief analyst for PlayColorado.com. According to the Denver Post, Colorado fans will have their pick of 17 digital sportsbooks currently licensed to operate in the state.

FansUnite Is at a Small-Cap Entry Point with Tremendous Upside.

It is in this environment that FansUnite launched on the Canadian Securities Exchange on May 5. "We are just getting started," said CEO Darius Eghdami. "We've bought a great asset in McBookie and will be continuing to focus on M&A." McBookie, the company's first acquisition, is a white-label sportsbook in the UK, focusing on the Scottish market. It offers 200,000 members active in sports and virtual games, and boasts over $100 million turnover cumulatively the last three years. "We want to be active in finding that next 'McBookie' operating in a niche market, looking at Esports assets and also creative ways to get into the U.S. market. "

After a financing at $0.35, the now-trading company rests slightly above that as a relatively new and unknown entity—so far—which is why now is great opportunity participate in a smaller scale, yet leveraged, consolidation play. "We have a great opportunity to use our stock as currency, and then grow and scale companies through our team and resources," says Eghdami.

"We also have great investors and support, a very experienced board and management team and a clear vision of how we want to be that next gaming giant. The path has been shown by other Canadian gaming companies such as Amaya, and we want to follow that path and execute on our vision."

It's an ambitious plan: a CA$25 million market-cap company, $2 million in the bank, with a consolidation plan to attack a $1 trillion online industry. Yet FansUnite comes out of the gate with strong financial backing led by board member Shafin Diamond, CEO of Victory Square since 2015, a venture builder that builds start-ups in web, mobile, gaming, AI and AR/VR. Diamond has launched 40 start-ups in 24 countries, employed more than 350 people, and has generated over $100 million in annual revenues.

Eghdami says the immediate plan is to strengthen its UK presence with McBookie and focus on M&A activity, while continuing to develop its software platform.

The games are just beginning.

Knox Henderson is a journalist and capital markets communications consultant. He has advised for a broad range of small cap companies in the resource, life sciences and technology sectors for more than 25 years.

Disclosure:
1) 1) Knox Henderson: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: FansUnite Entertainment Inc. My company has a financial relationship with the following companies mentioned in this article: None. I determined which companies would be included in this article based on my research and understanding of the sector.
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( Companies Mentioned: FANS:CSE, )

The role of guns in U.S. society is a subject of intense policy debate and disagreement.

Short-term exposure to current levels of ozone in many areas is likely to contribute to premature deaths, says a new National Research Council report, which adds that the evidence is strong enough that the U.S. Environmental Protection Agency should include ozone-related mortality in health-benefit analyses related to future ozone standards.

A new report from the National Research Council has upheld the listing of styrene as “reasonably anticipated to be a human carcinogen” in the National Toxicology Program’s 12th Report on Carcinogens (RoC).

A new report from the National Research Council has upheld the listing of formaldehyde as “known to be a human carcinogen” in the National Toxicology Program 12th Report on Carcinogens (RoC).

Efforts to convert civilian research reactors from weapon-grade highly enriched uranium (HEU) to low enriched uranium (LEU) fuels are taking significantly longer than anticipated, says a congressionally mandated report from the National Academies of Sciences, Engineering, and Medicine.

Today during the National Academy of Sciences 154th annual meeting, in her first speech to the members of the Academy, NAS President Marcia McNutt stressed the ongoing vitality of America’s scientific enterprise, and called on the country to strengthen its support for science and to continue to turn to science for solutions to the nation’s and the world’s most pressing challenges.

Recently, questions have been raised about climate science. The National Academies have addressed many of these questions in our independent, evidence-based reports. We are speaking out to support the cumulative scientific evidence for climate change and the scientists who continue to advance our understanding.

Last week, the International Commission on the Clinical Use of Human Germline Genome Editing held its first public meeting at the National Academy of Sciences building in Washington, D.C.

The first-ever Nobel Prize Summit, Our Planet, Our Future, will bring together Nobel Laureates and other world-renowned experts and leaders to advance new insights into global sustainable development and explore actions that need to be taken to ensure humanity’s future on a prosperous, stable, and resilient planet.

and how to organise them

; Credit: Beatrice the Biologist / Scientific American

Today's dryku:
Food budgets are tight
Droughts do raise vegetables' price
But don't make snakes bite

Food:

• The USDA released its monthly food price outlook. Looks like prices are going to be up at least 3.5%. Fresh fruit could go up by 6%. Bloomberg has a chart showing how produce is projected to hit its highest price in 18 years. (LA Times)

Critters:

• Southern California seems to be seeing a higher rate of rattlesnake bites this year. Despite the article's headline, experts in the story say it's not because of the drought. A shorter winter has brought snakes out of hibernation earlier, meaning a longer active season, meaning more need for anti-venin.

As of June 12, 128 people were admitted to a hospital for a snakebite and of those, 93 received doses of anti-venin, Heard said. In 2013, 269 Californians went to a hospital for a snakebite and of those, 166 received anti-venin, he said. Simply doubling the number of patients needing anti-venin treatment would equal 186, more than 2013. (Some patients get “dry bites” meaning no venom is injected and therefore do not need anti-venin, he said). (Contra Costa Times)

• It's been a mixed bag for salmon this year. Some have needed to be trucked out to the ocean, because their streams are too dry. In the case of coho salmon, the drought has actually caused a record number to enter the ocean. It's not all good news though:

Biologists say that only 206 salmon egg clusters, known as "redds," were counted in the Lagunitas this year, well below the 20-year average of 250 "redds." And the fish that headed off to the ocean may not fare as well. They are smaller than normal and could face more difficult ocean conditions due to the warming pattern known as El Niño, scientists say. (Chico Enterprise-Record)

Fireworks:

• Sacramento cops are out in force, looking for illegal fireworks. The sheriff's department will double its number of officers on the hunt. Starting this week, having the little fire starters can mean jail time. (CBS Sacramento)

Water jerks:

• Everyone seems to be at a loss on how to get people to start saving water. Beatrice the Biologist may have stumbled onto the answer — it's a mixture of shame and badges. I'm going to print out the car one and post it in my window. Maybe then people will stop judging me for my filthy Camry. (Scientific American)

How has your community been affected by the drought? Share your story with a photo on Twitter or Instagram. Tag it #mydrought. For more details on our photo project, click here.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Less water in Hoover Dam means less power coming from the Dam's generating units. ; Credit: Dawn Danby/via Flickr

Monday's fat stack of news also includes some views about what to do about drought and Western water supplies.

The New York Times has published six answers to the questions "What are the best ways to share the water? And how can we ensure it lasts for the foreseeable future?" Pat Mulroy, former general manager of the Southern Nevada Water Authority, weighs in, as do several other think tankers:

[N]ew energy and fuel production options have become more water intensive. Unconventional oil and gas production methods such as hydraulic fracturing have significant implications for local and regional water quality and quantity. Bioenergy consumes water at various stages of production (including irrigation for crops) and also has impacts on water quality and quantity...We should be pursuing cleaner energy and streamlined approaches to conserving water in order to truly safeguard our water supply. (Newsha Ajami/Stanford University)

An incredible 40 percent of the water consumed by Americans goes into meat and dairy production. Livestock must drink water and there is some water use at the farm, but most of this water is for the producing animal feed...Is this a wise allocation of the limited supply of freshwater in America? (Arjen Hoekstra/University of Twente, Netherlands)

• Closer to home, the Sacramento Bee has an ongoing series about drought solutions. Mariposa County resident Tom DeVries, who lives in forestland at 4,000 feet, offers his take:

Trees take water; a big one can draw 100 gallons a day out of the ground. All that junk forest in California is sucking up water that should be filling my spring and well and flowing downhill toward the rest of you. (Sac Bee)

• You know who else has good ideas about how to conserve water in drought? Australians. (KQED)
• Jay Lund from UC Davis modeled a "mega-drought" with his team and found that the economic consequences of a big drought event could be mostly managed through smarter water conservation policies. (California Water Blog)
• Falling water levels at Lake Mead are lowering Hoover Dam's energy production. Generating units have recently been "derated," meaning that they're expected to have a lower capacity for producing electricity now that there's less water to turn turbines. (EE News)
• Jason Dearen and Garance Burke report on "senior rights holders," and how poorly California accounts for water use by people who have rights dating back before 1914 at anytime, and how much that matters now during the drought. (AP)
• You're gonna see a lot of these stories all week: it's a terrible year for setting off fireworks. I bet rural fire chiefs have their teeth on edge already. (Merced Sun-Star)
• And we'll finish up in Southern California. In the first of a duo of Dana Bartholomew stories, the Daily News reports on Turf Terminators, a company that offers to leverage the recently-raised turf removal incentive and swap out homeowners' lawns for less thirsty landscapes...essentially for free, since the company's premise is that it can do the work for the price of the rebate. (Daily News)
• In the second, Bartholomew profiles a Studio City water-conservation demonstration at homes along Rhodes Avenue. (Daily News)
• And a UCLA project examining water use and conservation potential in territory served by the Los Angeles Department of Water and Power suggests that we're not pricing water well enough to encourage conservation. Authors of a policy brief with the California Center for Sustainable Communities say dual metering, for inside and outside, would also improve conservation. (Imperial Valley News)

How has your community been affected by the drought? Share your story with a photo on Twitter or Instagram. Tag it #mydrought. For more details on our photo project, click here.

This content is from Southern California Public Radio. View the original story at SCPR.org.

Julio Osorio stands in the Valhalla Memorial Park Cemetery near his mother's grave. (Emily Elena Dugdale/KPCC); Credit: Emily Elena Dugdale

The devastating Woolsey fire broke out one year ago. In Malibu, it wreaked havoc not only on hundreds of homeowners but also on the day laborers, housekeepers and gardeners who traveled to the city to work in its affluent neighborhoods.

This content is from Southern California Public Radio. View the original story at SCPR.org.

An image released by Google shows an early version of its driverless vehicle. The company has built several prototypes of the self-driving car.; Credit: /Google

California is one step closer this week to making the 1980s Hollywood fantasy of Knight Rider a 21st century reality because permits for self-driving cars issued by the Department of Motor Vehicles officially went into effect Tuesday. Now a handful of companies can test automated cars on public roads.

Buckle up — it's gonna be a wild ride.

John O'Dell is a Senior Editor at Edmunds.com, and he joins Alex Cohen to talk about what this means for the future of the driverless car industry.

 

The technical update on the asset, which Wheaton Precious Metals owns a production stream on, is explored in a CIBC report.

Mary Ann de Lares Norris is Chief Operating Officer of Oblong Industries. She brings her dog LouLou to Oblong's downtown LA headquarters.; Credit: Brian Watt/KPCC

KPCC recently reported on the tech world’s diversity problem. Technology firms face challenges in hiring diverse staffs of its coders, web developers and software engineers.

It’s also a challenge at nonprofits such as Southern California Public Radio,  parent of 89.3 KPCC, which has always sought to build a staff that reflects the region it serves. The section of that staff that develops the KPCC app and makes its website run is all white and mostly male.

But a small talent pool means the diversity challenge is even greater for nonprofits and even smaller tech firms.

“The first problem is that all of the people working for me are male,” says Alex Schaffert, the one female on KPCC’s tech team.  “I’m kind of focusing on maybe getting another girl into the mix.”

Schaffert can use the term “girl” because she happens to be the leader of the tech team:  KPCC’s Managing Director of Digital Strategy and Innovation. 

Why diversity is important

Schaffert recently launched the topic of diversity – or lack thereof – at a weekly meeting of her team. She expected a “stilted and awkward” discussion from the five white men on her team, but a few of them didn’t hold back.  

“Not having diversity represented on the team leaves us more susceptible to circular thinking and everyone sort of verifying each other's assumptions,” said Joel Withrow,  who was serving at the time as KPCC’s Product Manager. “It impacts the work. It limits what you’re able to build.”

Sean Dillingham, KPCC’s Design and Development Manager, said living in a diverse community is what attracted him to Los Angeles, and he wants diversity in his immediate work team, too.

“When I look at other tech companies, I will often go to their ‘about us’ page, where they’ll have a page of photos of everyone, and I am immediately turned off when I just see just a sea of white dudes, or even just a sea of dudes,” Dillingham said.

Big competition, small talent pool

Dillingham and Schaffert are currently recruiting heavily to fill two tech-savvy positions. When a reporter or editor job opens up at KPCC, Schaffert says close to 100 resumes come in.

"But if you post a programmer job, and you get three or four resumes, you may not get lucky among those resumes," she says. "There may not be a woman in there. There may not be a person of color in there."

In other words, the talent pool is already small, and the diversity challenge makes it even smaller. KPCC is competing for talent with Google and Yahoo and all the start-ups on L.A.’s Silicon Beach. 

Schaffert’s being proactive, mining LinkedIn and staging networking events to attract potential candidates. She’s also trying to make sure KPCC’s job descriptions don’t sound like some she's seen in the tech world.

"If you read between the lines, they’re really looking for someone who is male and is somewhere between 25-30 years old and likes foosball tables and free energy drinks in the refrigerator," Schaffert says. “So you read between lines, and you know that they’re not talking about me, a mother of two kids who also has a demanding career. They're talking about someone different.”

Pay vs. passion

Schaffert's challenges and approaches to dealing with them are similar to those of Mary Ann de Lares Norris, the Chief Operating Officer at Oblong Industries. Based in downtown Los Angeles and founded in 2006, the company designs operating platforms for businesses that allow teams to collaborate in real time on digital parts of a project.

“I think technology and diversity is tough,” Norris told KPCC.  She’s proud her company’s management ranks are diverse, but says only 12 percent of its engineers are female. “Pretty standard in the tech industry, but it’s not great,” Norris says. “We really strive to increase that number, and all of the other companies are also, and it's really hard.”

Like Schaffert at KPCC, Norris works hard fine-tuning job descriptions and communicating that her company values diversity and work-life balance. But sometimes, it just boils down to money.

"We have to put out offers that have competitive salaries,” Norris says, adding that she can’t compete with the major tech firms. "The Googles and the Facebooks of the world can always pay more than we can. So we attract people who are passionate about coming to work for Oblong.  And, of course, we also offer stock options."

KPCC doesn’t have the  stock options, but we’ve got plenty of passion. Could that be the secret recruiting weapon for both small tech companies and nonprofits?  

LinkedIn recently surveyed engineers about what they look for in an employer. Good pay and work-life balance were the two top draws. Slightly more women prioritized work-life balance and slightly more men chose the big bucks. 

Clinical Entrepreneurship professor Adlai Wertman says that, historically, nonprofits and small businesses actually had the upper hand over big companies in recruiting minorities and women.

"There’s a feeling that they’re safer, more caring environments, less killer environments, and we know that corporate America has been the bastion of white males," said Wertman. 

But Wertman says that advantage disappears in the tech world because of the "supply-and-demand" problem with talent. When big firms decide to focus on diversity – as some have recently — they have plenty of resources.

"They’re always going to be able to pay more, and in truth they’re getting access to students coming out of these schools in ways that we as nonprofits and small companies never will," said Wertman. 

Wertman worked 18 years as an investment banker on Wall Street, then left to head a nonprofit on L.A.’s skid row. Now he heads the Brittingham Social Enterprise Lab Enterprise Lab at USC’s Marshall School of Business. He believes that, early on, the big companies have the best shot attracting diverse tech talent. But in the long run, much of that talent will turn back to smaller firms and nonprofits.

"I think ultimately people vote with where they’re most comfortable, where 'my values align with my employer's values, and if I don’t feel those values align, then I’m going to leave,'" Wertman said. "Ultimately, I think, for a lot of women and minorities, there’s a lot of value alignment within communities that are doing good in the world." 

This content is from Southern California Public Radio. View the original story at SCPR.org.

Full Text:

Many people turn to the Internet to find a Mr. or Ms. Right. But lemurs just give their potential partners a sniff. A study of lemur scents has found that an individual’s distinctive body odor reflects genetic differences in their immune system, and that other lemurs can detect these differences by smell. From just one whiff, these primates can tell which prospective partners have immune genes different from their own. The ability to sniff out mates with different immune genes could make their offspring’s immune systems more diverse and able to fight more pathogens. Shown here: Fritz the ring-tailed lemur sniffs a tree for traces of other lemurs’ scents.

Image credit: David Haring/Duke Lemur Center

Full Text:

Scientists have recovered the first genetic data from an extinct bird in the Caribbean, thanks to the remarkably preserved bones of a Creighton's caracara in a flooded sinkhole on Great Abaco Island in the Bahamas. Studies of ancient DNA from tropical birds have faced two formidable obstacles. Organic material quickly degrades when exposed to heat, light and oxygen. And birds' lightweight, hollow bones break easily, accelerating the decay of the DNA within. But the dark, oxygen-free depths of a 100-foot blue hole known as Sawmill Sink provided ideal preservation conditions for the bones of Caracara creightoni, a species of large carrion-eating falcon that disappeared soon after humans arrived in the Bahamas about 1,000 years ago. Florida Museum of Natural History researcher Jessica Oswald and her colleagues extracted and sequenced genetic material from the 2,500-year-old C. creightoni femur. Because ancient DNA is often fragmented or missing, the team had modest expectations for what they would find –- maybe one or two genes. But instead, the bone yielded 98.7% of the bird's mitochondrial genome, the DNA most living things inherit from their mothers. The mitochondrial genome showed that C. creightoni is closely related to the two remaining caracara species alive today: the crested caracara and the southern caracara. The three species last shared a common ancestor between 1.2 and 0.4 million years ago. "This project enhanced our understanding of the ecological and evolutionary implications of extinction, forged strong international partnerships, and trained the next generation of researchers," says Jessica Robin, a program director in National Science Foundation's Office of International Science and Engineering, which funded the study.

Image credit: Florida Museum photo by Kristen Grace