Moving home

Well, not me. But my blog. It's not the reason that I haven't posted anything for a week: that's for a combination of being very busy, and not having anything particularly interesting to write!

But in the interim, my blog has been moving. You can now find it at www.markxdavies.com, complete with cheesy photo. Not all the links on it are working at the moment - it's work in progress - but I'll be updating it there from now on.

Many thanks indeed to Nick Garner for having worked tirelessly to help me out.

Sharpe, and not so sharp

The news today was full of the fact that it is 25 years since Live Aid, but every bulletin I heard neglected to mention that yesterday was twenty years since the American jockey Chip Termini was suspended for 30 days for dropping his towel as he emerged from the shower at Louisiana Downs in full view of a 'jockette'.

You think I'm kidding? It's 100% true: and I know it because it's the 'Strangest Event' listed in the Racing Almanac given to me this afternoon by its author, Graham Sharpe of William Hill. He was kind enough to invite me out following news of my heading for pastures new ten days ago, and we ended a very agreeable, anecdote-filled, lunch with him signing a copy he had brought along specially. I've been perusing it ever since, and very interesting it is too.

I went from lunch to chew the fat with an old friend in Westminster, who was full of interesting snippets himself. Much of the hour-and-a-half we spent together over a mid-afternoon bottle of wine was split between bemusement and amusement at the latest public offering from the BHA, published yesterday (apparently in a fit of pique) and entertainingly written up in today's Independent by James Moore, who clearly read the press release with an eyebrow raised in the manner of his namesake. The 'it's everyone else's fault!' approach also seemed to be the much-derided subject of most of the discussions I joined last night at Windsor, where many racing stakeholders were the guests of Arena Leisure at their annual world-beating barbecue. Making friends and influencing people, I think it would be fair to say, the BHA is currently not.

Previously-unpublished posts today, if you care, are put out here and here.

Clients and back catalogue

It's been an incredible week. This time seven days ago was my last day employed by Betfair.

I have finally replied to the mails that I was sent, and this morning will embark on the voicemails which I have not been able to get around to yet. And I'm running off this morning to meet a potential client - my third in two days - so, fingers crossed.

With all this running around, I'm resorting to previously-unpublished posts on subjects which remain current, for those wanting something new to read.

If you're interested, you can see them here and here.

Swamped

I've been totally swamped by kind messages following my posting with news of my resignation on Friday, and I will be spending my morning trying to answer the 400-odd e-mails I've received before I head to a lunch.

It's been really extremely flattering to receive so many messages of support, both from people inside the company and outside; and both from those I have always known to be good friends, and from others who have traditionally been on the other side of the divide from me.

Tim Ryan, who famously once tried to get me arrested in Australia on the grounds that I was apparently running an illegal gambling operation (a blog for the future, perhaps), sent a note wishing me good luck; and first on the telephone at 9am was Ralph Topping to say all the best.

Wags will doubtless suggest that he was calling in delight at seeing the back of me, but nothing could be further from the truth: in fact, he was extremely kind and generous in his assessment of my Betfair career. Not that that surprises me about him: Ralph was the subject of one of my unpublished posts from my back catalogue, which I have today posted here. Another old post which I couldn't publish previously has gone up here.

So, the first working day of my post-Betfair career is going to be an even more e-mail-filled one than was my time spent there. Which means, not a lot of time to blog. We'll save that for later in the week.

Dorset Rise

There was a certain irony to the start of my day yesterday. I went to a Social Mentoring briefing at KPMG's offices, which meant walking up the hill between Tudor Street and Fleet Street along a small road called Dorset Rise.

It was on that very street, in December 1999, that my senior salesman at the time chatted to me, unknowingly, about the multiple moonlighting from JPMorgan that had seen me taking numerous days off over the previous few months to fulfil commitments with BBC Sport and the Daily Telegraph.

He put his arm around me and said, "Mark: can I just say, as we head into the new year and a new decade, that I hope your luck changes... I've never known someone suffer so much illness, the loss of two family members, and the death of so many friends in one year." It was at that moment that I realised that doing two jobs alongside my main contracted one was untenable in the longer term, and I resolved to quit.

So it was ironic that I should have found myself on that same street yesterday morning, the very morning that I quit the job that I went to from JP, at Betfair. Ten years on from last resolving to do so, I have resigned.

It's been fun. But in recent months I haven't been able to offer Betfair as much as I'd like to of what I think I am best at; so I think it's time to move on to new things.

I have set up a company of my own, Camberton, which will offer to a broader church (i.e. I'm on the look-out for clients!) the sort of thing that I have been responsible for at Betfair over the last decade: reputation management, public affairs, PR, communications, and external stakeholder management. It's something I have talked about for a long time and now is the time to do it. And I'm pleased that Betfair think I still have a role in offering that kind of thing to them, because they are my first client! Many of the challenges that I have worked on for them remain, and I will be continuing to advise and work with them on those for at least the next twelve months.

On that, I've had various thoughts, which I have been jotting down but not publishing, on many of the industry issues in recent months. Now that it is clear that the thoughts are mine and not an official Betfair position, I'll stick them out over the coming days and weeks for those who are interested, in the order I wrote them, starting here and here.

Technology

Not that it's my usual style to comment on corporate stories, but the news which has been published on various blogs, and formally announced on the official website, of a deal which puts Betfair onto Samsung televisions, is one of the more exciting releases I have seen in a long time, and in my view a huge personal success for the amiable and extremely capable head of Betfair TV, Simon Miller.

The wider picture here, though - following on so soon after the equally exciting launch of Betfair's iPhone application, which was downloaded 20,000 times in the first month - is the same as I was making when I was interviewed the other day as part of the BBC's coverage from the Aegon Championships at Queen's. Asked by John Inverdale what should be done about people betting on laptops court-side, I commented that there is little point in dealing with any 'issues' perceived to be associated with betting by trying to hold back technology. It's far better to address them through transparency and co-operation.

On that track, I recently spent some time with a number of sporting Chief Executives, who gave up some of their time to come and understand how betting is tracked today. I think it is fair to say that they were wide-eyed about what they described as 'almost anti-terrorist style' means of tracking any problematic betting. We agreed that the biggest deterrent to malpractice is getting the message out there that the proliferation in online betting has tipped the risk/reward ratio dramatically in favour of risk, by virtue of the trackability, and not - as is commonly perceived - in favour of reward.

The more sports leaders who understand that, the better for all of us, because the message will be easily communicated to the players and officials (who are the only people who can genuinely impact the outcome of a sporting contest). I'm very encouraged that organisations like the Professional Players' Federation and the British Athletes' Commission are so willing to engage in the subject. It's good news for everyone - except the would-be corruptors.

Name and logo

I did the presentation to our new starters the other day, in which invariably I get myself lost in stories of the olden days rather than sticking to the corporate script, and I was reminded, as I mused, of the very first 'focus group' that we had as we got Betfair up-and-running.

'Focus group' was something of a misnomer, given the people who were involved: our group of six comprised mainly old university footie mates of mine, not known for focusing on an awful lot other than the bottom of a beer glass. But they fitted the bill (i.e. they had nothing better to do), and we sat them in a room to ask them questions about how people might react to the proposition we were about to launch. We started by presenting the six of them with a single piece of paper which we placed in the middle of the rectangular table around which they were sitting.

All it had on it was our proposed name and logo. We wanted to know what came to mind.

The first two comments that were made as the piece of paper was put down will stay in the memory forever, I think.

"Well that's pretty stupid," said one. "Betting isn't fair, is it?"

There was a pause.

"Oh - but look" piped up a second. "They recognise that. Because there's a great big arrow going in, and then just a tiny little arrow coming back out..."

The Oaks

So here we are, then - back to where it all started. Our actual anniversary may be 9th June, but philosophically, it will always be Oaks Day, because Oaks Day 2000 it was, and the Oaks was our first ever market. Love Divine won it. From memory, I think about £3,400 was matched.

I can well remember the thrill of the first few bets being matched - compounded, perhaps, by the technical difficulties we had had on the three occasions we had showed off the product in the days before launch. Two of those were launch parties, and rather public; the other was in the privacy of my parents' house in Datchet, to the Times' racing correspondent, Alan Lee.

I forget now why it was that I had called Alan. I suspect it would have been that he had formerly been the Times' cricket correspondent, and the previous year I had got myself a gig working in the Press Office for the Cricket World Cup, based at Lord's. I think - although neither of us can remember for sure - that we must have met there; and that, just under a year on, with us both having moved jobs, his was the only name in the racing press that resonated. Whatever the reason, and however cold the call, Alan responded with great interest. He'd be fascinated to see it, he told me. A date was set. Bert and I rocked up to my folks' place, which was a happy half-way house between our Putney office and Alan's Cheltenham home.

We talked him through the product. Bert, in his customary shorts, wilder-haired than he is today (there was a touch more of it then), extolling the virtues of his baby - this exceptional product that had gone from drawing board to launch pad over a period of many months. Alan was wide-eyed at the explanation. Come on then, let's see the real thing. Here it is! Look! Oh no... Sorry... The system's crashed...

The first of our launch parties was in Covent Garden, targeted at (I think) 24 people who we had chanced upon through friends and friends-of-friends as potential clients or potential investors. We went to a small bar which was bizarrely lit in blue, on Shelton Street, I think it was. I can't remember if there were really fish tanks there or whether my memory has now just imagined them, but the whole place had a feel of being under water. It was an unfortunate metaphor, given that before we had even started, we were.

There they were, the High Rollers (as we thought of them then); gathered together in hushed expectation, enticed by news of a ground-breaking product which they were going to be first in the outside world to see. Twenty-four computers set up around the room; state-of-the-art not-quite-flat screens (it was ten years ago); the eerie blue light adding just a frisson of excitement. "Gentlemen, thanks for coming. What you're about to see is going to change the world of gambling. Err... Sorry. The system's crashed."

A day later, we were at the Sports Cafe on Haymarket, showing a rather larger crowd. Anyone we knew from the City was asked along to an evening which we had decided would best generate interest if we staged a mock demonstration outside.

Many people remember our mock funeral which made the front page of the business section of the Sunday Times, when we paraded a coffin around Finsbury Circus and its environs proclaiming, "the bookie is dead - make your own market!". Far fewer remember the demo we arranged outside the Sports Cafe, where a rag-tag-and-bobtail group of actors donned mackintoshes and flat caps, and held up placards saying "stop the launch".

The irony was two-fold: first, some who were invited that night never made it, turning away as they approached and telling us later that there seemed to be some kind of a demonstration going on, and they thought they should keep clear. The second, of course, is all too obvious: at the time, the idea of traditional bookies protesting our existence was all tongue-in-cheek. Little did we realise just how much the bookmaking industry would genuinely line up against us in the years ahead in protest at how competitive we were.

The Sports Cafe launch was the 'official' launch, but it wasn't a whole lot more successful than the private one. Most of my former brokers who came along were baffled by what I'd left JPMorgan for: despite their deep understanding of markets, they didn't see what the demand would be for our product, and told me it would never be more popular than the spreads that they loved (Sprouty, Stokesy - hang your heads in shame!). The system that night was up and down - more up than down admittedly, but it still felt hairy. We were heading towards D-Day with some trepidation.

But D-Day went like a dream. Alan wrote a back-page piece for the Times heralding the start of a new dawn which, he advised in words that went entirely unheeded, people in racing would be wise to notice. The market was posted, and prices went up, in fivers and tenners. We all stood around the computer screen as they appeared and disappeared, placed and matched with slightly more of a delay than they are today. By the time Love Divine was in the winner's enclosure, we were all jumping around in glee. Betfair was up and running!

Funny to think, really.

Betting in cash

I was at the SportsAid quiz at the end of last week, which, I can't resist mentioning, my team won for the fourth year on the trot.

But boasting aside, the most interesting part of the evening for me came before we had even started with any questions, when I fell into conversation early on with one of racing's most amicable and sensible Chief Executives.

Inevitably, conversation turned almost straight away to the levy, which has fallen to £77m this year, which takes it back to where it was about six years ago, if memory serves me right. I think much of the world is where it was six years ago - the price of my house certainly is, for example - but of course this drop has led to a lot of wailing and gnashing of teeth. As Ralph Topping has pointed out in his own inimitable way, the racing industry seems to believe that in the face of the biggest recession in a generation and amid calls for austerity measures from everyone, its funding ought to hold up.

But we weren't actually arguing about the rights and wrongs of the levy. Instead, I suggested a solution to the 'problem' which I had presented to me, which, specifically, was punters using hospitality boxes at racecourses to trade 'live'.

This is, of course, racing's new bugbear. It is evidence, they seem to think, that Betfair punters are trading 'in the course of business'. It is muddled thinking if ever you came across it, and I thought it was about time I tried to explain why.

When it comes to the levy debate, I personally have no argument about 'professional punters'. It just has an argument about professional punters being singled out at one operator specifically. As the Weekend FT as amply demonstrated this weekend, professional punters are not limited to one platform; and it is irritating that racing should attack successful punters on Betfair and not anywhere else, just because Betfair tracks what its customers do.

I pointed out to the said CEO that if I were racing, I would give up arguing, bogusly, that guys who are prepared to spend money in order to try to give themselves an edge are 'in business', when they clearly are not. They happen to be at differing levels of professionalism, but that is an entirely different thing. The minute 'having an edge' makes you in business, then all Racing Post readers are in the net. It's an absurd argument that will never stand up to any challenge, so they might as well drop it and find something that might.

All this I told the CEO, and he asked me what, therefore, I would do about the fact that nobody else tracks betting. And, like our Australian CEO Andrew Twaits did recently, I suggested that if I were racing, I would be making the case to government that betting should be made account-based. It would solve all sorts of problems at one fell swoop.

First of all, it would deal with all the problems which exist in an environment where large amounts of cash change hands: money laundering and fraud would be reduced dramatically.

Second, it would provide data for problem gambling research, which government always says is so bad (without much evidence), and it would save separate and less accurate data collection exercises for prevalence studies.

And third, it would allow us to see how punters made or lost money across the board. If you made money on Betfair but lost it on Ladbrokes, you wouldn't be taxed on your winning portion without being able to offset your loss. And if you made money on one platform, you were not discriminated against relative to someone who made money on another.

People will argue that this is pie in the sky. But is it? I'm not advocating that betting has to be cash-free (although I don't agree that a move away from cash is so difficult, myself... The move out of cash to card-based transactions has been embraced by the younger generation, at least). I'm just suggesting that you swipe your betting account card at the moment you place your bet. It's not difficult; it takes no time at all; and it provides fantastic data for marketing purposes which any other industry would embrace (indeed, most other industries incentivise you to use a card precisely so that they can get that data: do we all think Tesco give us points out of altruism), but which racing and betting seem to think is somehow so problematic that they won't entertain looking at any solutions around it.

Anyway... that was the argument. You can take it or leave it, and I am sure far more will disagree with it than think it has merit. But the response? I kid you not: word for word, it was this:

"But what happens about the person who comes along with £20 grand cash in a briefcase?"

I think my jaw hitting the ground took him aback slightly, because even before I'd had the chance to comment that of all the possible reasons for rejecting the idea, this was not a great defence, since there is only one reason why someone comes along with £20 grand cash in a briefcase, he went on: "People like to be able to use cash without it being tracked. I do it. I pay my builder in cash. That way I save 17.5%!"

I'm not for a second suggesting that my companion is the only person who has ever done that, but there was a certain irony in hearing one of racing's most senior figures arguing against a solution designed to capture so-called 'levy-evaders' by commenting that any move towards greater traceability of funds would make it harder for people to avoid tax that is due.

Change of view

Many of you have asked me why the 'view' of my blog title has changed geographical location from my office to my home, and why I've suddenly cut down the amount that I'm writing.

The reason is that with my job at Betfair having recently changed so that I have responsibility for regulation but no longer for our public positioning, I have been asked not to blog about industry and company issues. Rather than stop writing completely, I have only been publishing things which cannot be construed to be a Betfair view.

This blog has been a useful communications channel for me in my role running our external affairs, but for some people it has now become a cause of confusion as to whether it is an official Betfair channel of communications, or just my blog.

With responsibilities changing, it's now the latter, and is therefore confined to non-industry issues for the time being.

So if you've kept coming back in the last ten days wanting to know my thoughts on David Zeffman's article about betting exchanges; the Ways and Means hearing in the US; the sports integrity survey in PR Week; Paul Roy's interview in the Racing Post; the reaction in Australia to calls from Betfair's Andrew Twaits for betting to become account-based; apparent evidence of the growing black market, judging from EU Commissioner statements; the latest with regard to France now that legislation is in place; or rumours of an attempt to get horsemen to strike; I'm afraid that I didn't publish my view on any of them, but instead merely wrote them up for my own record. Maybe my draft blogs will be like the Beatles' long-undiscovered back catalogue, and one day will all get published at once!

In the meantime, I'm afraid you're confined to anecdotes about where I've been and what I remember from my past, which will no doubt please those of you who have asked for less corporate-speak and more stories!

Olswang: Once more unto the breach?

I haven't yet commented on the article written by David Zeffman in the Racing Post on Tuesday, which was followed up on Thursday.

The more eagle-eyed among you will have noticed that I did, briefly, put up a post entitled 'Olswang' that said, "I won't get into the ins and outs of the piece by David Zeffman in today's Racing Post. I do find it curious, though, that an article flagged as a 'news special' on 'betting exchanges and the law', and headlined 'Frank Exchanges', should be written by someone whose firm is currently acting for the BHA in matters relating to the levy and betting exchanges - but the fact should, inexplicably, not be mentioned." But in the end I took it down.

I did so for a number of reasons.

First, I thought that the Racing Post, which was apparently not aware of David Zeffman's link to the BHA, would do the decent thing and make it clear themselves that what purported to be a full-page article was in fact, through no fault of their own, not much more than a free advert; and I didn't think there should be any suggestion that I was pre-empting that.

Second, I rather took the view that this is a technical legal argument which has, frankly, been done to death. David Zeffman can have his view; he's expressed it before, as I have mine. But the thing is that every time to date that there has been an independent assessment of it, no-one that matters has agreed with him. I'm all for having the debate again, but I thought it was easier to have it in full with the people who will have to decide. As David Zeffman proved, you can't make a watertight case on one page of the Racing Post. Writing statements like, "it seems very likely that some users are conducting themselves as a business" might be enough to persuade people who really want to believe something, but it clearly isn't based on any evidence. It might once have seemed very likely - indeed, for a very long time and to an awful lot of people - that the earth was at the centre of the universe, but saying so repeatedly didn't actually change the facts.

But those caveats notwithstanding, I'm afraid that today I can't resist. The follow-up piece in this morning's paper is surprising, at best.

Consider the facts: a lawyer who is retained by a given organisation which has long been in dispute with a given company on a matter which over the years has repeatedly been considered by various government departments, writes a full-page newspaper article, without declaring his interest or connection, relating to the dispute in question. That this has happened is pointed out by the given company to the newspaper in which the article was published.

Two days later, the paper uses the original article to headline a renewed call by the client of the lawyer to re-open the much-considered issue, on the back of the fact that there has been an article by a lawyer which suggests it could be done. The connection between the lawyer and his client is only included in a quote from the company which is the target of both the original article and the follow-up, in paragraph 9 of an 11-paragraph piece. Paragraph 3 of the article, meanwhile, repeats the unfounded comment deemed by the lawyer to be 'very likely' mentioned above; while paragraph 5 quotes the client using the unsubstantiated view of his lawyer to state that, "we are not just going to sit here and watch professionals operating on the exchanges, in business, negotiating and taking bets when they are not licensed and not paying tax and levy."

You will no doubt have your own view on whether that constitutes journalistic balance. I guess that only if the HBLB were suddenly to open up a consultation exercise on the issue on the back of the article, might the view that it was wittingly or unwittingly kicking off a campaign be reinforced.

But aside from that, let us consider the argument.

Mr. Zeffman claims that "the accuracy of my analysis is not affected by whether or not I'm instructed by a client."

Let us accept that this is true. I have commented above why you should not just believe something that is generally-accepted just because it is generally-accepted, so I will assume that there is not actually any truth in the the generally-accepted notion that lawyers do what you pay them to do.

I therefore accept without question that the accuracy of Mr. Zeffman's analysis can absolutely be unaffected. But on that basis, it can also be not very accurate, whoever is paying his bills.

Let's consider it.

The law is absolutely clear that two things have to be established for someone to become liable for levy as a bookmaker: that they are negotiating or receiving bets, and that they are doing so in the course business. Mr. Zeffman says that the 'key question' is the latter, and it is true that this is the point on which most debate has raged over the years. But let us not forget that it is a two-stage definition, and Mr. Zeffman predicates his entire argument by dismissing the first part with the boldly-stated and entirely unsubstantiated opinion that, "There is no doubt that an exchange's customers are receiving or negotiating bets".

Mr. Zeffman will not be unaware of the response to this opinion of his, since the BHA had were sent it, in full and in writing, eighteen months ago. Let me quote directly the answer they received responding to the question, "Is any party ‘receiving or negotiating bets’ on an exchange?":

"The fact that a betting exchange customer has the flexibility to request a price different to that available, provides no determinative answer because so does a betting shop customer and a racecourse punter asking a bookmaker for ‘the fractions’. All gamblers, whether betting on an exchange or with a traditional bookmaker have the ability to ‘negotiate’ the odds available. It seems to us that no gambler ‘negotiates’ a bet; the arranging of the rules which govern the placing of the bet (and indeed all consequences following therefrom) is conducted by the betting operator (whether Ladbrokes or Betfair).

There is nothing ‘received’ by any customer on a betting exchange – or at least nothing is ‘received’ by a betting exchange customer that would not similarly be ‘received’ by a betting shop punter (a betting receipt, winnings in some cases etc). If the word ‘bets’ in the context of the 1963 Act means ‘stakes’, then of course the stakes are received (and held pending the outcome of the event) exclusively by the exchange operator. If however ‘bets’ equates not to ‘stakes’ but to the standing of loss, then even the exchange operator does not appear be covered by the definition within the 1963 Act.

In short, we do not believe that any exchange customer is ever ‘receiving or negotiating bets’. However, if this interpretation is wrong and the unique nature of exchange betting means that customers are ‘receiving or negotiating bets’ then it is strongly arguable that Betfair (as a pure intermediary) does neither. In this case, what is the justification for Betfair continuing to account for Levy and on what basis has HBLB been accepting Betfair’s Levy payments over the past 8 years?

The argument that both Betfair and its customers are ‘receiving or negotiating bets’ is symptomatic of a ‘cake and eat it’ attitude from the BHA."

Now, whether you agree with this analysis or not, one thing is undeniable: when David Zeffman says that "there is no doubt that an exchange's customers are receiving or negotiating bets," he is clearly, 100%, wrong. There is a doubt. And it would need him, or his client, to persuade a judge that his version of the argument is right, and Betfair's is wrong. This is what the BHA has been trying, unsuccessfully, to do for the last eight years, just as it has, equally unsuccessfully, the whole argument about 'can you be in business purely on an exchange?' - another whole debate which we've repeated continually and can of course repeat again, in my view with the same result. The BHA clearly believes that in doing so, it is not wasting its time over matters it cannot and will not win, when so many other things under its control are being ignored.

"Behind all the myths, the legal reality is relatively straightforward," Mr. Zeffman wrote on Tuesday - a quote repeated in today's article as if it supports the BHA's argument. Anyone would think that in making their deliberations in the past and coming down on Betfair's side, the last government decided to ignore the law, rather than base their analysis on it.

In the Racing Post today, BHA Chairman Paul Roy suggests 'a new approach to a new government', just as racing has made a new approach every time there has been a new Minister, or a new Shadow minister, or a new set of officials at DCMS. Every time, the BHA gets knocked back, because what they need is not new people, but a new argument that actually falls in line with legislation; or, failing that, a new law.

Personally, I don't mind which it decides to work on creating. But continually pretending that their existing position, expressed unsuccessfully for so many years, suddenly becomes true when you tell it to someone who hasn't heard it before, is just insulting to that person's intelligence. Any in-coming administration will have to look at the issues in far greater detail than could be afforded to Mr. Zeffman even in a double-page spread of the Racing Post, and it seems unlikely to me that careful and objective analysis of the position as it stands will come to a different conclusion from any reached to date.

So if I were Paul Roy, I would be deciding what it is I actually want - levy from betting operators, punters, traders, backers, layers, successful backers, successful layers, or professional punters - and then trying to get a law which secures that. Any administration that thinks that reworking a 2005 law deemed to be at least to some extent future-proof makes sense three years after it was actually implemented, can then write a new one.

If that one, as is true now, is consistent in its treatment of the individual interest groups (betting operators, punters, traders, backers, layers, successful backers, successful layers, or professional punters) whoever their customers are (if they're operators) or wherever they choose to place their bets (if they are customers), then Betfair will be quite happy. But you can bet the exact same argument will rage, because this was precisely the debate, held between 2003 and 2005, that led to the perfectly sensible law we've currently got.

People and places

I think, when I left my last job at JPMorgan 10 years ago, that if someone had told me where the next decade would take me in terms of who I would meet and the places I would walk into, I'd have been hard-pressed to convince even my mother that I was anything but a fantasist.

But last night, as half of my friends were updating their Facebook statuses either with glee or in mourning, I was adding a name to my list of People I Never Expected to Meet: sitting immediately to my left at dinner was the controversial Conservative Party donor Lord Ashcroft.

And as a result, as David Cameron moved between the Commons, the Palace, and his new home, I got thinking about just how many people and places I have met and seen during my Betfair adventure. It really has been a spectacular world tour, the like of which you might expect to have to hold some serious Office of State to achieve.

OK, so the House of Lords and the Commons are perhaps somewhat run-of-the-mill; so, too, the European Commission. But St. James's Palace; Buckingham Palace; Clarence House; Number 10, Downing Street; the Office of the Majority Leader of the US Senate, where Lyndon Johnson brokered so many unlikely deals; the floor of the Senate itself at the signed invitation of the current incumbent (I still have the ticket!); the Australian Parliament; the Office of the Australian Prime Minister... All are places I never expected to see inside.

Nor did I ever think it likely I would sit next to a Prime Minister at dinner, as I did Down Under (John Howard wears a hearing aid in his right ear, I discovered when immediately to that side of him; that's presumably why he always cocks his head slightly when on camera, so it can't be seen); shake hands with the Queen or the Duke of Edinburgh (a story that merits telling another time for what the Duke said); or be kissed by a Princess. But the last ten years have, I realised as I thought about it heading home around midnight, brought all of the above.

Last night's dinner was held under Chatham House Rules. To be honest, I'm always slightly confused by what that means: if a dinner party comprises company and conversation, can you reveal either one or the other, providing you don't reveal both? Or does reeling off a guest list set you up for the firing squad?

I'm not sure. But, tempting though it is to relay the names of some of the fascinating people present - Ashcroft, though the most high profile currently, was certainly not the best-known in the room - I shall err on the side of caution in the interests of not upsetting my hosts.

Suffice it therefore to say little more than that in a crowded field, it was the most interesting and educational political evening I have spent in a long while, in part because of the obviously fortuitous timing for such a gathering, and in part because of the breadth of views expressed.

A leading politician was asked to grade his party's election campaign on a scale of 1 to 10. The question, 'is it better to have principles without power, or power without principles?' led to vigorous debate. Some present were significantly exercised and outraged by City remuneration packages, and demanded that others justify them. One person genuinely suggested that you are more likely to be over-paid as a bus driver protected by a union than you are if you're a hedge-fund trader protected by no-one; another argued eloquently that the obvious requirement for any government was to pluck its wealthy geese for as many feathers as possible without actually killing any of them off.

On which note, I was sent the following by e-mail the other day.

I think it's rather elegant.

Suppose that every day, ten men go out for beer and the bill for all ten comes to £100.

If they paid their bill the way we pay our taxes, it would go something like this...

The first four men (the poorest) would pay nothing.
The fifth would pay £1.
The sixth would pay £3.
The seventh would pay £7..
The eighth would pay £12.
The ninth would pay £18.
The tenth man (the richest) would pay £59.

So, that's what they decided to do..

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve ball.

"Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by £20". Drinks for the ten men would now cost just £80.

The group still wanted to pay their bill the way we pay our taxes.

So the first four men were unaffected. They would still drink free of charge. But what about the other six men? The paying customers? How could they divide the £20 windfall so that everyone would get his fair share?

They realised that £20 divided by six is £3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each man's bill by a higher percentage the poorer he was, to follow the principle of the tax system they had been using, and he proceeded to work out the amounts he suggested that each should now pay.

And so the fifth man, like the first four, now paid nothing (100% saving).
The sixth now paid £2 instead of £3 (33% saving).
The seventh now paid £5 instead of £7 (28% saving).
The eighth now paid £9 instead of £12 (25% saving).
The ninth now paid £14 instead of £18 (22% saving).
The tenth now paid £49 instead of £59 (16% saving).

Each of the six was better off than before. And the first four continued to drink free of charge. But, once outside the bar, the men began to compare their savings.

"I only got a pound out of the £20 saving," declared the sixth man. He pointed to the tenth man,"but he got £10!"

"Yeah, that's right," exclaimed the fifth man. "I only saved a pound too. It's unfair that he got ten times more benefit than me!"

"That's true!" shouted the seventh man. "Why should he get £10 back, when I got only £2? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison, "we didn't get anything at all. This new tax system exploits the poor!"

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat down and had their beers without him. But when it came time to pay the bill, they discovered that they didn't have enough money between all of them for even half of the bill.

More AFL stuff

In a similar vein, I thought this was an interesting piece. Again, I have a view; but I don't want it to be confused for an official Betfair one, and I know that some recent posts have been seen by some of my readers to confuse the two, so I shall leave you to guess at it!

http://m.theage.com.au/afl/afl-news/afl-penalties-on-gambling-a-fair-hand-20100508-ukyx.html

Happy Anniversary

It's been three thousand, six hundred and fifty-two days, which is 87,648 hours, or two days short of 522 weeks. More traditionally, it's exactly ten years: Tuesday, 2nd May 2000 was the first day I walked, as an employee, through the door of a tiny office in Putney, along from East Putney tube station, to begin the adventure that has been Betfair. It seems incredible to think it.

I'd spent the previous two months reluctantly working my notice in the City, having signed a contract with two enthusiastic Founders on the back of a prototype idea whose execution was eye-poppingly brilliant, and a long-standing desire to get the hell out of a job that didn't suit me. The two Founders, in turn, had spent the same period furiously trying to raise money, and hiring people. Jojo Primrose - the best-named girl outside a Bond film - had agreed to join and started straight away, such that she already had a couple of weeks under her belt; and the picture that has always stuck in my mind of that first morning is of the 6ft 6in Jon Cumberlege, his head almost touching a protruding beam in this tiny and largely empty room, extending a long arm in welcome. He had, it turned out, arrived about ten minutes earlier; but somehow, at the time, he already seemed like an old hand.

The adventure we were embarking on was completely different from anything I ever thought I would do, and despite a naive confidence that we were going to be building a business which we would one day sell for a billion, my expectations were not high that I would be there very long. Partly, that's because Betfair was only meant to be a stepping stone to my goal to be a broadcaster; and partly because this was, after all, the dot.com era: I'm not sure anyone in those days had a time horizon longer than about 36 months.

When I went through the five-year mark and realised that nothing I had ever done in my life had lasted as long as that (five years at pre-prep school; five years at prep; five at senior school; five at university; and four-and-a-half at JPMorgan), I was surprised to have stayed for as long as I had. But now here I am, a further five years on: not quite the old man of the company, but probably a little bit wiser than the 29-year old who walked into the converted Edwardian building called Dunkerry House on Upper Richmond Road, opposite a branch of the Tote that we used to joke (as we went to get our lunchtime sandwiches across the road) had no idea what was about to hit it.

Within a fortnight, it wasn't just Jon who didn't seem to fit in the space we had, and we moved to larger premises at 45, Russell Square. There, there was a room on one floor of a townhouse for the contractors who were writing our code, and then two more upstairs for us: one became an office shared by Jojo, Jon and me; and one had Ed, Bert, our first finance director Sean Paterson (who started as a consultant before signing full-time after our launch), and, a few weeks later, our first legal director, David Williams.

Jon, Jojo and I would joke that theirs was the serious room and ours was the fun one, and on regular occasions they would complain that we were doing nothing but giggling, and say that none of them could concentrate because of the noise coming through the wall. Bert would wander through occasionally and say he wanted to change seats because it sounded more of a laugh with us, and we would throw paper balls at him and tell him to go back to the library.

People often ask me what I think was the secret of Betfair's success, and aside from the obvious answer about the brilliance of the product and its execution, my view is that we had the happiest and arguably most fortuitous combination of people, whose various strengths came to the fore at crucial moments. Whether Ed, who did all the hiring (to the extent that Bert would sometimes wonder if any of his own contacts would ever get a look in), realised just what a combination he was putting together, or whether we all fell into it by chance, I honestly don't know. But what is clear to me is that the complimentary skills of that Founder Team was crucial in making the business a success.

My own contribution in the early days was pretty well zero. The key player, in my view, was Jon, whose can-do attitude and set of organisational skills - both the legacy of his army career - were the main driver, I always felt, in making the first year as effective as it was. Jon had energy which I suspect matched the rest of us put together, and his enthusiasm was infectious. So, too, was his sense of irony and his black humour. The day, late in 2001, when those of us who hadn't been working overnight to try to bring the site up from its longest and most painful outage ever got into work to the unhappy news that we were still down, will never be forgotten: with his hands in the air and his body falling forwards in the mock-dramatisation of a man being shot, Jon greeted us with words, "That's it! It's all over! We're totally and utterly f*cked!"

After the first eighteen months or so, Jon's mantle as the most important player was, in my view, passed to David Williams. I've often been credited with the company's public positioning from late 2001 into '02 - principally with the Morning Line appearance from Lingfield which many have kindly said was transformative in our development, and subsequently in the run-up to the Gambling Act 2005 and the various battles that have come since - but the reality is that I was just a mouthpiece: David had all the ideas, nailed all the arguments, and did all the work. When he first arrived on the scene, we didn't get on terribly well (he even fished Ed out for a drink to ask him why the company didn't just fire me, given that I was adding no value: a fair enough shout, frankly), but we ended up a good double-act: I've never been briefed as effectively as I was by him, and to this day I have his voice ringing in my ears whenever I explain anything about the actual mechanics of our system relative to the marketed product. He set the standard which our exceptional legal department has continued to this day: I don't think we have ever made a bad legal hire.

Of course, the caveat I put at the start ("aside from the obvious answer about the brilliance of the product and its execution") is a huge one. It's easy to forget, now, just how ground-breaking it was; and I've lost count of the number of people who tell me that they'd had the idea before, as if it's something that anyone could have come up with, and Bert just happened to luck out.

It may well be true that plenty of people were thinking about it: the idea that you can effectively (although not actually) take out the middleman and therefore deliver better pricing is hardly revolutionary, and five other competing products being released in a six-week period around our own launch prove that it was front and centre of many minds. But they also prove that it's not the idea that matters, but the way it was executed, and that was Bert's genius. His eureka moment has been well-documented, and probably needs no further embellishment from me.

So, too, has Ed's role, and the tale of how the two of them got together. Ed's biggest strength is analysis: in the face of some now serious competition from some of Betfair's current commercial team, he remains the best analyst of a business that I have worked with, and he'd be the first person I'd speak to if I wanted someone to look at a spreadsheet and point out the cell with the error in it. His attention to strategic detail is microscopic and impressive: it's easy to feel stupid and ill-informed in front of it.

Ten years on, none of the members of that Founder Team remain in an executive capacity, other than me. Ed is our non-Executive chairman, of course, and is often around; and Bert is a non-executive director, although that makes him a very rare visitor. But the others have all moved on.

Jojo, who was behind the coffin-carrying launch that I will perhaps blog about next month when we hit our birthday, left in 2003 and is now a full-time mother in Shropshire, actively supporting a number of charitable causes in whatever time her children leave her spare. Sean departed the same year, and has since spent his time between London and Monaco; a business angel.

Jon went in 2004, and briefly helped a start-up called Glasses Direct before embarking on a new career teaching maths at Whitgift School. And after briefly coming down to Australia, to help Ed and me get the business licensed and set up down there, David left in late '04 to go and work with homeless children, first in Mexico and now in Thailand.

Their replacements, today, have taken up their legacy, inasmuch as Betfair continues to be an exciting and vibrant place to work.

Of course, it's a very different place from that first week: we now have a global headcount north of 1800 people.

But as I celebrated my ten-year anniversary on Friday by taking our Events team out for a long and enjoyable lunch to thank them for having done a brilliant job at Cheltenham this year, I was reminded (if indeed I'd ever forgotten) that while it might be different, Betfair is still, because of its people, what it always was: a lot of fun. The Founder Team can be confident that from the bottom of the company up, their legacy is in good hands.

For my part, I go through ten years much as I went through five: surprised, in a way, but still loving the place and the people I work with. It might be a long time since we started the company, but in relative terms, we're really still only just embarking on a journey. There's a long way for Betfair to go yet.