## Gaming Innovation Group’s Chief Executive Discusses the Initial Year of Their Business-to-Business Strategy – Administration – iGB

After concentrating on business-to-business activities in 2020, 2021 marked the year when Gaming Innovation Groups’ new strategy began to yield positive outcomes. For Chief Executive Richard Brown, this was merely the commencement.

**Gaming Innovation Group’s Chief Executive Discusses the Initial Year of Their Business-to-Business Strategy**

On February 15th, Gaming Innovation Group (GiG) reported that their revenue for 2021 experienced a 28.0% increase compared to the preceding year. This marked the company’s initial full year as a purely business-to-business entity following the divestment of their consumer-to-business operations in 2020. Chief Executive Richard Brown expressed satisfaction with the results, emphasizing that this represented the initial phase of the company’s expansion.

“We implemented the transformation in 2020, established the fundamentals, and commenced witnessing results in 2021. We recognized the presence of considerable work ahead, and as the outcomes aligned with the strategy, we genuinely felt we were progressing towards readiness.”

The company’s revenue for the year primarily originated from their media division, generating €45 million, reflecting a 31.2% increase from the previous year. Brown previously indicated that this segment of the business was at a distinct stage compared to their platform division, but he reiterated his belief in the substantial potential for further growth.

Following acquisitions in 2016 and 2017, the emphasis has shifted towards organic growth, with the media team expanding their service offerings and venturing into new markets.

This, in turn, paves the way for further natural expansion rather than reaching its zenith.

“I believe that in some regions we haven’t attained the standing we should have, and in others we can preserve and solidify our position,” he clarified. “The US is clearly a market we’ve been penetrating – website traffic has surged 94% annually. We’re still at a low point currently, but we’re gaining traction and will continue to construct and expand.”

He also mentioned that the paid media division has been “performing exceptionally well,” due to its capacity to deliver a return on investment and the opening of other markets. There are also areas where its products will be casino-focused, while others will see sports as the primary vertical, providing space for further expansion.

“I still believe that despite being a large entity and being in a mature phase, there are still numerous opportunities,” Brown stated.

The platform business has a longer path. Revenue increased 13.2% in 2021, or 40.8% excluding white-label clients. The department’s strategy has been to discover markets with potential, which continued in the fourth quarter with the launch in Buenos Aires City in collaboration with local operator Grupo Slots.

Brown remarked that the market has a long way to go before it matures, considering that online gambling accounts for approximately 4% of Argentina’s gambling revenue.

Buenos Aires’ goods are being enhanced and tailored to suit markets in other areas, like Colombia, which is the oldest online marketplace in the area.

Brown stated that the regulation of sports wagering in Brazil is “expected,” although it’s unclear when and how it will launch, but some of GiG’s Argentine customers are already eyeing that market.

Brown clarified that GiG’s expansion initiatives in Latin America reflect the company’s emphasis on securing strategic positions in high-potential markets. “I believe Argentina is a good illustration; we don’t anticipate it to be a groundbreaking market in the first year, but we expect strong growth momentum in two to four years as the market matures.”

This will be facilitated by the acquisition of the Sportnco sports wagering platform, which was agreed upon last December and will be finalized by the end of the first quarter.

“I believe we can also secure other positions in other parts of Latin America, particularly with the Sportnco product portfolio,” he remarked. “It tends to be a sports wagering-driven market, so having a product there that we can promote sports wagering with, and then introduce casino as the space develops.”

He continued, “We continue to adopt this strategy not only in Latin America, but in other regions where we can anticipate markets becoming active.” “I believe the challenge with [this approach] is the technological barrier, although we have repeatedly demonstrated that we can achieve it on a large scale.”

Its not effortless, but we strongly believe this is a very hopeful path, particularly with some developed markets in Northern Europe encountering a level of stagnation.

Germany still holds this potential, despite operators facing strict limitations and higher levies after the fourth state gambling agreement. While GiG reported a €700,000 revenue reduction in the nation for the entire year, it continues to fortify its presence there. In Q4, it signed an accord with a seasoned operator, whose name has not been revealed, and launched its platform for TipWin in January.

Regarding when they can anticipate seeing a return on their investment, Brown acknowledges it will require time.

“We are confident this market will be a profitable one, irrespective of the market conditions,” he stated. “Considering the scale of the casino market, there is a need to address channeling, and we have transitioned from a very robust market to a relatively weak one.

“But we are convinced we can reclaim that position by rebuilding the customer base, especially with local brands that have strong connections with customers,” he said. Germany is emerging from a year of regulatory upheaval, which sets the stage for this to occur.

The platform division’s integration pipeline currently has 9 brands, adding more brands from existing online customers to land-based operators entering the digital realm. There are presently 25 clients on the platform, active in 14 jurisdictions, with 5 more in the pipeline.

After the Sportnco takeover, GiG’s growth will speed up, broadening its reach to 25 markets and its customer base to 55. Brown has emphasized the significance of making sure a seamless transition.

He pointed out that GiG and Sportnco have already done a lot of groundwork before the agreement is finalized. “I believe we are a perfect match in terms of knowledge, culture, and framework, and I am very confident that the individuals responsible for the actual merging will be successful.

“This will be a thorough post-merger integration planning process, not a hurried job. We are very supportive of this deal, and we want to do it properly.”

GiG will then stop its current sports betting product, but the schedule for this process may be influenced by clients, particularly during the World Cup at the end of 2022. “These are all our faithful customers who operate on our platform, so we want to take care of them.”

With Sportnco joining its ranks, Brown believes GiG’s emphasis on its regulated market strategy will further speed up. This includes not only the United States, where sports betting regulation far surpasses online casinos, but also areas like France, which has become a substantial growth market in recent years.

Should 2021 be considered the year when long-term plans began to yield results, then, as these markets expand, the platform division could potentially surpass the media enterprise.

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