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iGC explained

August 17, 2015 — by Admin0

iGamingCloud is an independent subsidiary of Gaming Innovation Group. In addition to managers, sales and operational people, it primarily employs techies and designers with a passion to create great Software-as-a-Service.

It’s quite a product giving you the tools and licenses you need to launch and operate a casino. We’ve focused on making a robust, reliable, scalable and high-availability platform. More importantly we put the end-user experience in focus. Casino players are tired of things like choppy spins, the lag that spoils winning spins at Net. Entertainment games, or the dreaded error-0 message on MicroGaming. There has been a wealth of these types of issues in our industry due to poor and outdated technology and this annoys players, as well as providers.

On iGC the games are performing great. After migrating Guts.com to the platform we’ve seen improved player values and with no downtime, people do not close their accounts in frustration when the site goes down during a bonus round. Since spins do not lag, they get to play more of them per hour.  As they enjoying it more, they play longer. In fact, following the migration of Guts.com to iGC, the rise in revenues due to increased player values seems to supersede the fees Guts.com will be paying as a user of the platform.

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Co-Founder Frode Fagerli, and Business Intelligence Analyst Stefan Schumann. Frode was visiting the Malta office to work on the integration of Income Access to iGC.

Great user experience is one important value proposition out of numerous others and possible the most important; Flexibility. And flexibility is why we have an open and connected philosophy.

It means we will integrate any required app to our core platform service. That could be a casino game provider, CRM software or an affiliate system. If you need it, we’ll scope it, and do it. We are calling all these integrated apps an application economy. We will neither charge the client or provider for the integration. Our profit comes from a small share of the revenue. The operator keeps the lion’s share.

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Providers of these apps typically charge a royalty. So if an end-user loses EUR100 with a game, hosted by an operator, the game provider would invoice the operator, for instance, EUR15. These royalty contracts are tiered based.

Our goal is to be a lean technological layer meaning we want to be a value-adding partner, rather than a cost-increasing middleman. So how do we do it?

By bundling the volume from our internal brands, with those of the clients, we are reaching respectable volumes allowing us great rates with providers. As such we are able to offer our application economy at a very competitive price point. From the provider’s end he gets to access a client ecosystem through one single integration and relationship. Hence we are saving the provider and white label time and money by leveraging technology and scale.

Our minimum contract value is EUR 120,000 annually and we charge a setup fee. When the revenue share based royalties exceed the minimum revenue share, we earn more. We also offer volume based discounts to our clients.

On the clients part they will save a programming department of some dozens of people, the time required and the extensive risk involved with creating and maintaining such a powerful platform themselves. In other words, we are significantly lowering the threshold to start up an iGaming business, while having the potential to provide larger operations with significant advantages of scale.

Contract lengths are typically five years rolling with a possibility for early termination upon six months notice. We want to retain clients on the merits of the product and the price offered. If they can do it better and/or cheaper, they should, and will, leave us.

We’ve had a goal of signing up between 5-10 clients to iGC this year. We’re on track to reach this goal and it is truly inspirational and rewarding to see the industry welcoming our product and business model. We will continue our work with creating a truly disruptive platform, as well as improving the price-point we can offer for the platform. Ultimately, it is about providing the greatest advantage of scale for our clients, which is why our mission is; «To make iGaming lean».

 

 

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iGC: iGaming made lean.

April 10, 2015 — by Admin0

You jump off a cliff and assemble an aircraft on the way down

Linked-In CEO, Reid Hoffman

During ICE London in February 2015, Gaming Innovation Group(GiG) revealed iGamingCloud(iGC) to the wider industry. iGC is the client management platform of cloud computing services company, iGamingCloud ltd. This product has the potential to be a real game changer for the wider community of the iGaming industry as its two core functions are to eliminate technological bottlenecks and significantly reduce costs for operators and whitelabels alike.

The vision of iGC is to make the iGaming industry lean and connected. It was hatched out of the pain and frustrations that our founding team experienced while profitably growing a b2c operator (www.Guts.com,) from inception to scale.

Guts was founded on the backbone of innovative ideas and a passion for the customer experience. Our value proposition was to not only change the gambling industry but also the perception of what gambling is. We wanted to do this by improving the core services and its user friendliness towards customers. Then we wanted to spice it up a bit by bringing some innovation. In other words we applied a lot of common sense and our perceived success would very much be vested in our ability to build a very efficient operation with a customer centric ethos.

Our message was well received with customers who showed up in droves. Having wind in the sails we figured our biggest challenges moving forward would be to maintain focus on the core proposition, continue to improve the product and operation while innovating, all at the same time Oh boy, were we wrong.

As the operation grew in numbers, the complexity rose, sparking numerous problems:

  1. The whitelabel platform we were based on was not robust enough to scale with our growth. It was not flexible enough to meet our increasing expectations and business needs.
  2. As we expanded our reach into new markets and required additional outsourced services, the ability to rapidly contract, integrate and offer new providers, turned into endless skype logs and month long sales and integrations cycles.
  3. As we grew from a small to medium sized operator, our ability to compete with medium to larger size operators was reduced to excessive overtime and creativity, as margins did not scale with the turnover.
    In 2014 Guts paid in excess of 50% of it´s revenues in direct expenses, excluding all marketing. That´s a lot of overtime.

So what do you do?

A famous startup quote by fellow entrepreneur and Linked-In CEO, Reid Hoffman, said “You jump off a cliff and assemble an aircraft on the way down”.

And that’s what we did.

We decided to go on a rather ludicrous mission of creating a leading cloud computing services firm for the iGaming Industry. Our sanity check was along the lines of:

“Why should iGaming be any different from the US West Coast tech scene?”

While we were struggling with problems belonging in the last decade, we observed in frustration the continued emergence of cloud based Software As A Service(SaaS) technology wonders such as Salesforce and Shopify thriving in a far more hostile environment in a galaxy far, far away.

Having branched out from the competitive online performance-marketing field into user interfaces as an operator, GiG had grown a very confident and capable tech team who knew the whole customer journey by heart. We were confident we could create awesome cloud based SaaS´s.

Their approach to accomplish this was to write the application from the very first letter of code in C#. To create a truly high performing and flexible application, tailored to the specific needs of iGaming, this is the only way to do it. Scrapping third party integrations, even for functions such as e-mail and livechat, sounds rather frisky, however you save the maintenance and are always familiar with your code. Our process proved us right.

After investing significant time on the architecture and the building blocks, we picked up an extraordinary pace.

Six months after the first letter of code, with good help from suppliers embracing the idea, we had completed the integrations with most game and payment vendors while developing all features and functionality needed.

Our hard work came to fruition with the launch of Betspin(www.Betspin.com) in February. They have grown to some thousand actives and given us good data. Server loads are looking amazing. There have been few bugs and best of all, the very much underestimated problem of game performance for the end user, lag and choppy spins which every casino player hates but unfortunately has to endure almost everywhere, has been solved.

With most of the trudge work done, we have finally reached the phase we always dreamt of where we can work efficiently on innovation and product development. These days we are working on breakthrough platform features and design while looking to expand into offering more product verticals.

 

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Having successfully built and launched a robust and lean operation, we can offer our services at a remarkable price point. This allows us to earn less on more. We picked up a lot of interest, some dozens of companies have inquired, however will hurry patiently ensuring the satisfaction of each and every client.

Innovation often comes from the grassroots of the ecosystem. By lowering the barriers to entry we are enabling innovation. In a time of increased regulation, taxation, and competiveness, iGC is what is needed to drive the industry forward. We need to plan for the future. If you like our vision, then contact us at [email protected] We´re starting selling it this month and we´d love to partner with you and bring more lean services into the iGamingcloud.(.com)

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The NIO and GiG merger.

February 27, 2015 — by Robin Reed0

Gaming Innovation Group (GiG) recently signed a share exchange agreement with NIO Inc. (NIO) I have since received requests for information. GiG believe in a transparent approach. This blog will be used to share information about GiG, and function as a window into our company life. In this first blog post i will be reasoning over the merger with NIO and share some stats and input on our business model.

Why Merge?
A couple of weeks back we signed the Share Exchange agreement with NIO after heavy considerations.

In the years leading up to this offer, GiG had progressed well. We had gone from MEUR2 in revenues in 2012 to MEUR 13 in revenues for 2014.  It was quite hard.

In 2013 there was significant startup cost associated with Guts. We initially had no marketing budget and margins were slim due to expensive supplier agreements. In 2014 we made major investments into obtaining our own remote gaming license and development costs of iGamingCloud, while still being on expensive supplier agreements for the good part of the year.

In the end, we did not only sustain, but excelled.

In  2014,  we signed very competitive rates and terms with most of the major suppliers including Net.Entertainment, MicroGaming,  IGT, WorldPay, PayPoint, Neteller, Moneybookers, and many more.
Once all these  business partnerships were in place,  and integrations was fully tested and complete, we launched our b2b platform. This platform is our most ambitious project to date and all our hard work came to fruition with the launch of Betspin and early results are positive.

We also obtained significant interest for this platform by exhibiting the beta at the largest trade show for iGaming , ICE, in January.

We are now finalising features and some design work  and will then be able to share the technology with the wider industry from April and onwards. Having branched out from marketing, to operator, and platform provider, we were on target with our roadmap.

When accepting to sell to NIO these were our considerations;

  • With Betspin as a platform customer, we had the opportunity to follow them closely. We were really impressed with the direction they wanted to go, particularly with their vision for interaction design and customer centric operation. They have a great team.We have been following the launches in iGaming over the last years, and their launch was good.  Still early on, but it is looking very promising, particularly in the very important mobile space.
  • CEO Kjetil Aasen. His knowledge and network in sportsbetting also impresses us. Getting the best people in the most important fields is tremendously important, and his community is a type of talent that is very hard to find.
  • NIOs GridManager application and their automated data driven approach to price up markets and risk were attractive both for our plans with iGamingCloud and b2c brands.
  • With the platform we are in a great position to invest and consolidate. The stock exchange listing provides a powerful tool to accomplish such transactions. The Letter of Intent with Spaseebi AS, a very exciting digital marketing firm for iGaming, is an example.
  • The new management of NIO shares our values and to get onboard their project to turn the company around really intrigued us.  Together we will seek to make NIO a transparent and credible company, known for best practice and customer orientation.  That challenge inspires us.

Business Model
This would be the first iGaming company listed on the Oslo Stock Exchange. Following the release by NIO we have observed several wrong assumptions and we would like to defend our stand on the two most important ones;

1.      There are not enough funds to finance the business and the growth.

GiG is self sustained and through the due diligence we have confirmed the financial position of NIO. It is sufficient to execute the business plan of Betspin. We would not have merged our business and locked up our shares if there was financial uncertainty.

To further explain our business model;

Our income is from the deposits made online with cards and other payment methods. We have been fortunate in signing excellent settlement terms with leading providers. As such we can collect deposits rapidly, allowing us to pay winnings immediately.  As we are paying royalties to game vendors in the following month, we are collecting incomes before some of the major expenses occur.

Then there is the marketing;

Henry Ford had a great quote: “We know half of our marketing is working, the mystery is which one”.

In conventional above the line marketing this is true. However we have grown our business through affiliation and performance marketing by applying very precise online targeting and tracking techniques. As such, we are only paying for advertisement that is proven through accurate data points.  A lot of our marketing is also paid pro rata, hence after income has been generated.

By utilising a lean model for cash flow management and a precise marketing, we have been able to scale our business. If we chose to raise additional funds after a merger, it will be used to scale faster by opening new distribution channels, not to cover existing costs.

2.      GiG is not profitable and a merged GiG/Nio would need to raise funds.

A fair point, in 2013 and 2014, we were been running break-even. Why?

The more volume we generate, the more we earn per EUR1 in sales due to tiered royalty deals.  Hence a new customer makes a current customer more profitable. This model significantly scales and a smaller change in margin on the top line results in a huge difference in the bottom line.
Better margins allow us to return better products, services and price points towards our customers. We have ideas and technology we believe are pretty disruptive and would like to pursue these on a large scale.

Finally I would like to mention that all shareholders in GiG have actually agreed to lock up most of their shares if the transaction is approved. Those shares that are not locked up are to provide shareholders with means to pay taxes and other commitments. Shares will be locked up for the next couple of years.  If this merger would not take place these would be liquid assets. When doing so it is because we are very confident in both company’s ability to grow.

Some KPIs:
In January we had 12000 players signing up with Guts. Over the last few months we have had 24693 unique real money players. These are records. Deposits made through mobile phone in the last three months was up 308% over the same months one year ago.

It feels great to be writing about this and I am looking forward to posting  frequent updates about our company. E-Mail me at [email protected] if you have any questions.