Playing to win

THE Everywhere Man strolls past a photograph of himself that stretches the breadth of the wall without batting an eyelid. He's seen it all before and not only in the mirror, but also on television and online, in newspapers and form guides. He once paid $70,000 to plaster his pale face over a tram in Melbourne.

THE Everywhere Man strolls past a photograph of himself that stretches the breadth of the wall without batting an eyelid. He's seen it all before and not only in the mirror, but also on television and online, in newspapers and form guides. He once paid $70,000 to plaster his pale face over a tram in Melbourne.

There may still be a few Australians who can reliably claim to have never seen a Tom Waterhouse TV commercial. The rest of us know too well the smart suit, neat, short hair, elfin smile and promise that "I know what punters want". Does he ever get sick of seeing himself? "You become oblivious to it," he says. "It's just what you get used to."

Rugby league fans will be seeing more still of Tom Waterhouse after reports this week that he has become the new gambling partner of the NRL, in a five-year deal thought to be worth close to $50 million. Waterhouse is understood to have paid about five times the existing partnership deal held by TAB Sportsbet. He is expected to make a similar play for partnership rights to the AFL when they fall due in two years' time.

He has reportedly signed a separate $15 million deal with Channel Nine for exclusive ties to this year's NRL and AFL footy shows, as well as rugby league match broadcasts. So if you think you've watched a lot of Tom Waterhouse lately, you ain't seen nothing yet.

The big cash splash comes on top of the $20 million his company is thought to spend on advertising each year, including paid appearances on some news and sports shows. In little over two years - since launching his eponymous gaming website in Kings Cross in October 2010 - the fourth-generation bookmaker has become the most recognisable mug in sports betting.

He can afford to pay over the odds, having inherited a share of an estimated $100 million property portfolio from his grandfather and horse trainer Tommy Smith. But his lavish spending has raised eyebrows in an industry that knows a bit about big bets and bluster.

Some in the industry wonder whether there's any more to 30-year-old Tom Waterhouse than what you see on TV. "He's more promotion than substance," says one. Another insider compares him to a prospector bragging about a big claim before finding oil.

No one knows yet whether he will strike pay dirt or just dirt. You can't talk about the rise and rise of Tom Waterhouse without including a question mark, for now at least.

Bookmaker Con Kafataris, who recalls fondly his time working alongside Waterhouse in Sydney and Melbourne, says he was a big gambler in the betting ring. "Whereas not many bookmakers are punters as well, Tom played both sides of the horse."

Now he's spending big on a stake of the sports betting market, which is increasingly busy with overseas players. Kafataris, who reportedly reaped a $110 million windfall from selling Centrebet to London-listed Sportingbet in 2011, says Waterhouse's strategy could pay off. "I've seen that type of spend and large media asset purchasing in other parts of the world, but you need to have very deep pockets to make it work in the long term and a very strong commitment," he says.

Waterhouse's father, Robbie, says his son will become the country's No. 1 online bookmaker in the next three years. "He is quite happy to gamble and quite happy to take risks, and he has been very successful at it."

For his part, Tom Waterhouse says his long-term plan is to crack into the lucrative Asian market. His online business has attracted more than 150,000 clients at home by creating as many markets as possible for punters (anything from this year's Oscars winners to the first country to leave the eurozone).

The softly-softly approach no longer pays off in the sports betting industry, he says, since the easing in 2008 of regulations governing cross-border betting and advertising. Sports betting has grown more than 13 per cent a year to about $3.3 billion in Australia (still a shade of the $20 billion wagered on racing). "There is a lot of our competitors out there trying to get that market share and unless you're willing to compete, well, then all of the overseas people will come in and, yeah, it's a land grab."

We're sitting around the boardroom table of his sixth storey office in North Sydney, where he works when not based in his "bunker" at Moonee Valley in Melbourne. He plans to move his headquarters to Sydney in February, after the birth of his first child to wife Hoda (who is eight months' pregnant).

He dresses like he is standing in the betting ring, today wearing a trim navy suit, striped shirt and dark tie. "I have a lot of ties," he says. "People give them to me all the time."

But he hasn't been to an Australian race meeting since 2009, reflecting a broader trend away from on-course betting to online. "In 2008, over four days of spring in Melbourne, we held $20 million and out of the favourite in one of the big races you could get $500,000 to $600,000 cash off the ground from people betting money," he says. "Within one year the money on the ground had completely dried up, people had gone to the internet or telephone and I just went [with them]."

All around him are testaments to his impressive pedigree of horse racing, wagering and showmanship. Framed pictures of his granddads - bookmaker Bill and trainer Tommy - are on the walls. There's a portrait of Waterhouse's similarly successful mother Gai at the track, while reclining on the carpet is a magazine cover of his younger sister Kate, a Sun-Herald columnist, in her underwear.

Tom's picture is in the main office room and the largest by far, such that his light blue eyes follow you around the room. It's his face but this is very much a family affair. Pushed up hard against each other are desks for three generations of Waterhouse bookmakers. "Everything we do is a family business," he says. "I speak to my dad, my grandfather every day, multiple times a day, because you need to listen to different points of view and advice."

Father and son still eat lunch together when Tom is working in Sydney. Such closeness has prompted speculation that while Tom's on TV, Robbie is the one who really runs the show. The elder Waterhouse dismisses such claims as "rubbish". "I bet if you speak to any of Tom's [more than 100] staff, you wouldn't find one person who'd say that," he says.

Racing NSW boss Peter V'landys compares Waterhouse to a young James Packer. "It's not the money so much, it's the fact that they want to be successful," he says. "From what I could see with James, he wanted his father and his family to be proud of him, and I think Tom is a bit the same."

Waterhouse's greatest ability, he says, is understanding the tastes and needs of younger punters, who are driving the business online. His greatest strength, V'landys adds, is winning over people with lashings of charm and chutzpah, traits the racing boss attributes to Gai. "[Tom] is building a brand, building a company, building an asset . . . I think his end game is to build up a massive sporting company, either to float it or sell it."

The appearance of success in wagering often leads to the real thing, says Neil Evans, head of public affairs at Luxbet, the TAB's corporate bookmaker business. "The PR side of it has always been big, it is probably bigger now because it is so much more driven by money and deals."

He compares today's gaming industry to the Wild West, with a bonanza of cash and overseas companies like Ireland's Paddy Power and Britain's bet365 and William Hill hitching their wagons to the rising Australian star. "I don't know what his ultimate ambition or aim is with the business. But let's just say it's a big saloon in town and there are plenty of players sitting around the bar, and not an Indian in sight."

Waterhouse politely declines to detail his business plans, his dealings with the NRL, his ad spend or whether his business is turning a profit (despite telling the Australian Financial Review last October he was not yet profitable).

Those who know him note his pleasant demeanour and unfailing manners. Indeed, he insists on carrying the Fairfax photographer's bag to the photo shoot. In a less favourable light, he can come across as bland.

My offhand reference to his appearance on Dancing with the Stars in 2006 prompts an earnest discourse on the workings of the television industry. "I did the cha cha, the quick step and the jive. The jive was my undoing," he says.

In an industry that has had its fair share of dirty deals, the Tom Waterhouse brand is consciously clean cut and wholesome. "In many respects, he has to paint that image given the Waterhouse history, he has to be cleaner than clean otherwise a lot of ghosts and shadows of the past will come up and haunt him," says media analyst Steve Allen.

The Waterhouse name is still tarnished by links with the 1984 Fine Cotton scandal - where a handy sprinter named Bold Personality was substituted for a weaker horse called Fine Cotton. Bill and Robbie, who had put money on the horse, were charged by the Australian Jockey Club with "prior knowledge" (something they have always denied) and banned from racetracks for 14 years.

Tom was only two at the time and recalls enjoying having his father spend more time at home. But given such lineage, some insiders question whether Waterhouse has the street smarts to beat the odds against bigger global players. "His father and grandfather would spend $1 million to make $1. They are tough, ruthless," says one.

His grandfather Bill seemed to relish being known as a "leviathan bookie". Tom Waterhouse shies from the prospect. "I just want people to want to bet with me, I don't think I want to be this grand scale."

Similarly, he says he has no plans to float his business "at the moment". Nor does he have any intention of doing anything but punting. It's instructive that when asked for his favourite horse, he nominates So You Think over the country's most beloved sprinter. "Black Caviar is great, but I get more excited over 3200 metres than 1200 metres up the straight. I love the theatre of the big races," he says.

Where he will finish his own race is too close to call, for now at least. "Everyone's in the game, whether it's a punter or a bookmaker, you're in the game to win," he says.

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