Betfair CTO Tony McAlister puts bets on R&D

Despite the reduced budgets and increased pressures the world economy has experienced since the collapse of Lehman Brothers, some sectors and companies have performed well and in fact have even benefited from the slow-down. One such company is online betting exchange Betfair, which this year announced that it has over three million customers and reported revenues in 2009 of £303m – even in this supposed depression, there are still many individuals with money available to bet on everything from football and horse racing to politics and the winners of reality television shows.

Tony McAlister became CTOin January­ 2009, replacing Rorie Devine, now CTO at Yell.com. We met McAlister at his R&D headquarters in Marble Arch, London just before speculation began of the planned flotation of Betfair in the form of an IPO. R&D is close to McAlister’s heart and he chose this location for our meeting to demonstrate the value it has to Betfair.

Revamping Betfair Research was one of the first tasks McAlister set about on his return to Great Britain to take the CTO role at the company. Originally called the Advanced Technology Group, McAlister felt a simple renaming would focus the department on the brand it represented and its basic role – research and development.

“I spend tremendous amounts on R&D, but the generation­ of revenue from it is ­indirect,” he explains. “We are now focusing on mobile usage and event processing. In mobile we are working with partners so that we can allow 5000 people at a ­major match to place a bet at the same time. That is something that mobile operators can’t do at ­present, so I’m talking to the US ­military who have done similar things.”

McAlister is passionate about R&D and there is no question of its value to the business in the mind of this witty and relaxed American from the Deep South.

“There are not the tax advantages there should be. I’m taking advantage of some in the US, but even without a tax advantage, there is always a product advantage out of it, so my research turns into a product and gives me a business advantage and I would argue I could do more [R&D].”

Betfair has continued to grow as an organisation despite the economic fear stalking certain corridors. The slowdown in economic activity has benefited McAlis­ter, who has seen his team outgrow the ­organisation’s Hammersmith HQ.

Read the full CIO interview with McAlister's predecessor

“Central London is good for recruitment,” he says. McAlister hasn’t only been securing the talents of Britain’s IT experts; his hiring policy has been truly global.

“I wanted to find the best talent. We are a web company, but we operated as an IT company,” he says of the distinction.

“We have to operate at web speed. I told the board: the best talent is in Silicon Valley, so we are hiring there. The time expansion is good for us too,” he says of how his geographically widespread technology division follows the sun across Eastern ­Europe, Britain and on to the US to guarantee­ maximum uptime.

“To globalise you need to grow the physical footprint of the business,” he says of the expansion out of the UK. “But we will carry on developing in London.

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