NBA deal sets up Calgary fan data company for shot at the big leagues

News & Media

Feb 09, 2023


From CBC Calgary

At a time when tech companies large and small are struggling and laying off employees in droves, one Calgary business is marking a milestone partnership with one of the fastest-growing sports leagues in the world.

Last month, StellarAlgo, which uses rivers of data to help sports teams predict fan spending behaviour, said it had entered a multi-year partnership with the NBA, adding it’ll be working with all 30 teams in the league.

“It’s massive,” said Vincent Ircandia, the CEO and co-founder at StellarAlgo, describing the impact it will have on his company.

“We see a big growth opportunity with the NBA.”

The league’s investment arm, NBA Equity, took an ownership stake in the privately held company based in Calgary — an indicator the league is confident the business can help identify and reach fans in their growing, global fan base.

While no numbers were released on the NBA’s investment into StellarAlgo, Ircandia said the equity stake was “a significant commitment” from the league.

David Lee, the head of NBA Equity, told Bloomberg News the league saw exciting growth potential in StellarAlgo, noting the promise of improving the fan experience was the “most important part of the deal.”

Getting the NBA’s attention

Ircandia, who was born and raised in Calgary, co-founded StellarAlgo in 2016 with Joseph King and Sean Fynn — local tech industry veterans.

Among StellarAlgo’s early backers were Calgary’s InterGen and Thin Air Labs.

Prior to the NBA partnership, StellarAlgo had partnered with the Brooklyn Nets, the Milwaukee Bucks and the Portland Trail Blazers, for which Ircandia once worked as the No. 2 on business operations.

“These teams we were working with were just getting much more efficient and effective in understanding and nurturing fans with our software,” Ircandia said. “And the NBA took notice.”

StellarAlgo employs 80 people, up from about 47 people in the summer of 2021. The company’s last major injection of money came that year, when it received $16.5 million Series A funding led by Toronto-based Carallas Holdings.

Sandi Gilbert, the CEO and managing partner of investor InterGen, said what sets StellarAlgo apart from other tech companies is that it clearly understands how it adds value for its customers.

“When a company that has built a great leadership team here in Calgary can secure capital from a global franchise like the NBA, that’s very noteworthy,” she said.

Treasure trove of data

With five billion data points from 200 million sports fans around the globe, StellarAlgo’s technology uses machine learning to offer major sports teams a dashboard on who their fans are and what they might want at a given point in time.

“The fan connects to a lot of different touchpoints now,” Ircandia said.

“It used to be just ticketing, but now people are buying merchandise through e-commerce, they’re streaming games online, they’re playing fantasy sports. We have the ability to bring that data together to create a profile on the fan.”

This ability to put a microscope on fans’ habits allows StellarAlgo’s customers to quickly craft laser-focused marketing campaigns to specific groups, avoiding mass email or app pushes that might annoy some or be irrelevant to others.

StellarAlgo brings value to fans, Ircandia said, because they are more likely to be offered products in which they are actually interested.

“Then the sports properties are also happy because they’re much more efficient with their advertising spend, with their marketing efforts, because they’re only messaging those right fans that’ll bring impact,” he said.

Across North America, StellarAlgo has more than 100 customers, ranging from media companies such as Warner Bros. Discovery, to major league sports teams, including Canadian franchises such as the Calgary Flames, Edmonton Oilers and the Vancouver Canucks.

Big data and sports

The sports world is increasingly interested in big data, from tracking an athlete’s heart rate to displaying stats during a broadcast, and now to honing in on what fans want from teams, leagues and sponsors.

“It’s a huge component now of where sports is going, because the moneyball revolution has now evolved into an analytics revolution,” said Moshe Lander, a senior lecturer at Concordia University and an expert in sports economics.

According to Lander, even if some fans were to opt out of such an agreement for privacy concerns, that still won’t make them “invisible” to tech companies. Their silhouette, as it were, would stand out against the backdrop of those who opted in.

For years, privacy advocates have criticized how tech companies collect data on users. Such concerns contributed to Apple’s 2021 policy change to its iPhone operating system to curb the tracking capabilities of platforms such as Facebook, Snapchat and TikTok, leading to significant revenue losses for the social media giants.

Data collection on sports fans, Lander said, is the sports world catching up to the current state of digital advertising. Sports is a business, after all, and what StellarAlgo, the teams, the league and the advertisers all want is the same thing: more data.

“More data makes better decisions,” Lander said. “So I don’t see any reason why leagues wouldn’t want to invest their vast billions of dollars in revenue that they’re generating in companies that can deliver them those fine analytics.” Global ambitions

As sports becomes evermore woven into the fabric of modern life, its world-spanning industry remains sturdy even at times of economic uncertainty.

“There’s four billion sports fans in the world today, and they are 10 times more passionate than any other customer on Earth,” Ircandia said. “No one is painting their face to go to their favourite retailer.”

This insight into the context of the attention economy is what led to StellarAlgo’s creation, and, as Ircandia tells it, continues to propel the company’s growth, even at a time when the tech industry is experiencing tremors due to changes in the global economy.

For StellarAlgo, the NBA deal could be a ski jump into the broader global sports market in which an estimated $70 billion US was spent in sponsorships last year.

Ircandia envisions StellarAlgo one day being the discreet link between the world’s 1,500 major sports properties and the four billion people who might spend money on their fandom.

“We’re just scratching the surface now,” Ircandia said. “We think there’s a real winner-takes-all opportunity here. We want all of those properties to be using our technology.”

The mountain of fan data that StellarAlgo sifts through comes from ticket purchases, e-commerce and channels related to marketing, advertising and social media.

Put simply: when fans purchase a ticket to a sports game, they opt in to their data being collected.

More fans.

Better Engagement.

Stellar Results.

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