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PowerSet sold to the Evil Empire for $100 million.

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UPDATE: Interview.

UPDATE: ValleyWag.

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Barney Pell, then an “Enterpreneur In Residence” for a VC, co-founded PowerSet and became its first CEO —and then moved on to another position at PowerSet. (Barney Pell was probably a minority investor in PowerSet.)

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In a 2005 blog post, comes the explanation on how the prediction market virus disseminated into Barney Pell‘s body and mind:

I have been interested in this idea ever Robin Hanson (the founder of the field of prediction markets) and I were summer students in the AI Lab at NASA Ames Research Center, both working under Peter Cheeseman. This was right around the time when Robin wrote his first papers on the topic: “Idea Futures: An idea whose time has come?”, and “Could gambling save science?“. In order to match the work its NASA funding, Robin created a demonstration of how a set of Mars Rovers could place bets on the presence of scientific interest at different locations on Mars. The result would be the emergence of consensus beliefs that could be more accurate than the knowledge of any individual.

I also remember the time Robin hosted Murder Mystery evening with a prediction market as an added twist. Like a normal such party, actors would read out each scene. But in Robin’s version, the audience members would then place bets on the identity of the murderer by buying options. Based on the market dynamics, a ticket marked “This ticket is worth $1 if Professor Plum was the murderer” might start out having equal value as the other suspect tickets (so that you could be the whole set of them for $1), but then the price would fluctuate as [events] unfolded until the prices ultimately went to $0 for all but the actual murderer. It was really fun, an improvement on the original version.

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However, observers suggest Mr Packer’s expanding casino empire has presented issues difficult to reconcile with Scientologist beliefs. Scientology’s founder, the science fiction author L. Ron Hubbard, denounced gambling. “An obsessive gambler is a psychotic just like a drug addict or an alcoholic,” Hubbard wrote in 1977.

Wikipedia

Old BBC story

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Have you ever competed with friends on sporting knowledge? Ever made a bet with them on the result of a sporting event? Enjoy playing the office sweepstake or the occasional flutter?

If so, you’ll love Pikum. We’re a social network where you are able to create your own games that you can play versus friends and other people you meet online. Play for fun or money, it’s your choice.

still in beta

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They’ve just received VC money. They will be legally based in Gibraltar. [CORRECTION: "Pikum will legally offer gaming services through Pikum Worldwide Limited, which is based in Alderney and will hold an Alderney eGambling license. We will not be offering gambling services through a Gibraltar company or license."]

The founder wanna to attract sports talking heads, thru sports agents —if I understood well, but be sure the check the post for yourself.

Here is one pic of the founders and employees.

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I’d be curious to hear your thoughts on that “gambling social network”. [To those who publish a comment below, I'll show you a picture of France's First Lady... completely naked.]

Interview – MP4 file

Pay attention about what he says on giving away things (free software) and how to monetize that. This 24-year-old CEO is a wise man.

Technical Note: You will hear Matt talking about “WordPress.com” and “WordPress.org”. For your information, Midas Oracle is powered by the blogging software provided by “WordPress.org”.

However, just in time for Super Tuesday, I’ve finally stumbled onto a totally different, and to my mind much more compelling societal benefit of political prediction markets (the real-money kind, like Intrade or Bet2Give). It’s based on sound science, but has nothing to do with information, prediction accuracy, or the usual economics/decision-support suspects:

Participating in political prediction markets may be good for your health by virtue of reducing the killer stress caused by aggravating political outcomes over which you have very little control as a voter. In essence, you can hedge against despair, and thus reduce your political “learned helplessness”. I present this idea more completely, and the science behind it, in NewsFutures’ blog.

The interesting thing is that it should be relatively easy to test, say as a senior psychology research project, but the consequences of a positive result would be huge. Who could argue against the legalization of something that saves lives?

So let the word go forth on this day that if there’s someone out there who would like to run such an experiment, the industry would gladly help out, either through the PMIA, or through individual stake holders like NewsFutures. And if you’re in an economics department, please reach out across the social sciences aisle to your psychology colleagues and spread the word! This, by the way, is especially aimed at Justin Wolfers who happens to share the U. Penn campus with Martin Seligman, the founder of Positive Psychology himself, and the inventor of “learned helplessness”.

• Matt Mullenweg, WordPress Founder
• Alex King, Designer, Developer, WordPress Guru
• Craig Newmark, Craigslist Founder, Community Builder, Entrepreneur
• plus many more…

Alex King’s advice to companies:

Don’t let the person who writes the press releases anywhere near the corporate blog.

#1. The founder of RedFin believes that serial entrepreneurs are likely to do worse, not better, than start-up newbies. Guy Kawasaki agrees.

#2. Google’s Melissa Mayer was on CNBC to talk about the You’Re The VC website.

Dr. John Nafeh – Director

John Nafeh is the Founder of HedgeStreet. He combined his expertise in decision analysis and risk management, his experience guiding Internet-related start-ups, and his vision of an Internet-based mass market for risk-hedging financial instruments [*] to create HedgeStreet. As Managing Director of Pareto Partners, a venture capital fund, Dr. Nafeh has demonstrated extensive expertise in start-up financing, strategic planning, marketing, and mergers and acquisitions. He was involved with Atari and Apple Computer during their start-up phases, founded PC and database software companies in the mid-1980s, and earlier held management positions with Ford Aerospace and General Electric. Along with a BS in electrical engineering, Dr. Nafeh holds an MS in management science and engineering and a PhD in decision and risk analysis from Stanford University.

[*] a flawed vision?

2007 revenue: £185,933,000

2007 group revenue: £181,928,000

2007 gross profit: £143,207,000

2007 EBITDA: £31,968,000

2007 profit: £19,388,000

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Edward Wray (Non-Executive Chairman):

I am delighted to be able to report on another year of strong performance for your company. Like-for-like revenue, excluding our joint venture in Australia, grew by 30% to £182 million and the business continues to be extremely profitable and cash-generative. We remain firmly on track to deliver all of the key components of the 3-year plan that we outlined to shareholders a year ago.

As foreshadowed at our shareholder presentations over the past 12 months, the last financial year represented a year of heavy investment for Betfair. This investment has seen us establish very strong foundations for our business internationally, with core parts of our business now operating from both Australia and Malta, and with our customer base becoming increasingly international. In addition, this investment has enabled us to broaden our product range with the addition of new products like Multiples and Casino.

The nature of investment at Betfair means that we often bear the whole cost of an investment in a single year, while the benefits from that will continue to flow for many years to come. Certainly, the very strong trading performance in the first few months of our current financial year is evidence of the benefit of this investment programme.

The last year has seen a number of well-publicised regulatory developments around the world, which allow Betfair to continue to differentiate itself positively from its competition. In the United Kingdom, the Gambling Act has finally come into force and we are very well-positioned to capitalise on the opportunities that will open up as a result. Elsewhere the regulatory situation is less complete. Betfair has a long-standing policy of operating only in countries where it is legal to do so. As a result, we have not been affected by the fallout from the United States. Our future plans are not in any way predicated on accessing any non-legal markets. However, we believe that new markets will open up and we continue to be best-placed to work with regulators around the world in the future.

The impressive progress of the company during the last year would not have been possible without the extraordinary efforts of everyone at Betfair. The most important part of my message, therefore, is to thank David Yu, his senior executive team, and all of their staff in the company, in all of our offices around the Chairmanworld, for their amazing hard work, dedication and professionalism throughout the year. Together they are continuing to build an outstanding company.

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David Yu (CEO):

[...] Substantial investment in system capacity means that we now process, on average, almost five million transactions per day and serve over four billion page impressions per week. This is more than all the European stock markets combined. [...]

BetFair used to brag that it handles more trades than the New York Stock Exchange, but an investigation by Steve Roman for Midas Oracle revealed that it is not the case. (Midas Oracle will publish soon a more complete analysis, which takes into account not only their betting exchange figures but also figures from their gambling exchange, i.e., BetFair Games.)

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Via mister Niall O’Connor, this comment from the founder of the order-entry software Bet Angel:

[...] Looking over the detail it seems that over the year Betfair grew revenue around 30%. Of course the vast majority of revenue is commissions paid by you and I. Last year we paid somewhere around £180m in commission to Betfair. If we make some very broad, probably inaccurate, assumptions and say commission was levied at an average of 3% that would mean that Betfair customers won somewhere in the region of £6b last year. Unfortunately that also meant others lost £6bn, but no doubt traders accounted for a fair amount of money shuffling around in those figures. These figures are a bit of a stab in the dark but give you some idea of the scale that Betfair has reached. [...]

Previously: The BetFair 2006 Annual Review

Gambit is destined to be intellectual playground for all those in the gaming, gambling and gamebling [???] industries. Initiated by Cass Business School’s Executive MBA alumni, Gareth Wong, founder of GamBond, our aim is to provide a space for networking, mental stimulation and exchange of views on an industry that’s highly innovative, always controversial yet gaining further legitimacy and respects everyday. Gambit already attract interest from around the globe and we are passionate about creating an eclectic mix of business, legal and technology professions with an interest in debating industry trends and developments. Our mission is to bring value to the sector, and our fees are mainly to cover our cost. Gambit is unique and will continuously innovate and lead by example by spotting trends, pioneering new formats and focus on the specific needs of our sector. Gambit is the chosen network & platform for people that want the best our sector has to offer. A great opportunity to get in on the ‘ground floor’ is to attend our future public events. We also have the Gambit Leadership Forum, which is an invitation only series of closed door discussion of issues that matter most for Chairman/CEOs/Directors/Owners of major firms, and governments from around the world.

Their list of events and meetings.