Edward, tell us a bit more about your experience in the gaming scene. From consulting to operators, to running an affiliate network, and now running the brand Codeta.
I have been in this business ever since 2002 and started off on the operator side of things and one has to say the early days of igaming in general. Back then the opportunities were both very big in terms of reach, but also limited in terms of the market place itself and various legal obstacles to take into consideration. Not because the law was extremely clear, on the contrary, most geo-markets had outdated laws but no one knew how to interpret them into .com-terms.
It was a very innovative time back then, where the winners were the fast-paced and innovative companies and individuals that quickly understood the massive opportunity that was in igaming (post .com-bubble). I was on the operator side of things up until 2009 (final position was at MD of Ladbrokes Poker) until I, along with my family, decided to move back to Sweden. I didn’t intend to set up a consulting company as such. As a matter of fact, the intention was purely for myself to be able to work with gaming companies from a legal perspective (again!) based out of Sweden. However, I quickly identified a need and an opportunity of the affiliate (management) background I had (as Affiliate Director of PokerRoom.com and also PokerStars.com) as all igaming companies were still desperate for customers and the ones that could surely provide them? Affiliates. And I know them. So I started to hire people with similar background and similar unique network of contacts within the affiliate industry. Quickly operators started to appreciate our way of business, which is basically a brokerage, rather than running a network.
The difference being that we broker a deal between affiliates we know and operators we know (to be suitable for the same affiliate). Once deal is done, affiliate gets introduced to the operators affiliate program and management. Hence, full transparency and the relationship with affiliate is being handed over so not solely relying us getting involved. Affiliates appreciate our expertise in the market place, ie knowing what brands to trust, which brands converts well in certain markets and also able to cater to their requirements in terms of price, material and customer management. Since we have grown into a substantial player on the market, we have also become a force within it. So for instance in case of a situation where an operator don’t do right for themselves versus the affiliates we have referred to them, we are able to put pressure on them.
It has happened a couple of times, most recently with 10bet/Comfortlink-brands not doing right for themselves and paying what is owed. And now they are paying the price for it by having basically no affiliates in the Nordics promoting them, all due to greed. If there is anything I certainly know from being in this industry for 14 years, is that it is a still a small one and your biggest asset is your reputation. If you are willing to gamble with that, you are most likely looking at a short career within it as the most accurate description of our industry is “what goes around comes around”.
Now, ca 14 months ago, I finally decided, after watching on the sidelines for too long, that it was time for me/us to set up a proper brand. What I believe we did very differently from other (casinos) is that we did hell of a lot research not only so much regarding the market (place) as we felt comfortable knowing that, but into consumer insights. Once we had done that, we decided what we wanted to do and how; Codeta was born and so was our positioning; to become the leading global table games casino
We were told you are the majority shareholder in this up and coming brand. What makes it unique? Combined years of experience?
Ihre Consulting and associated co-founders own some 60% of Codeta, whilst external investors owns the other 40% stake in exchange for €2m in investments.
Our positioning and ambition of becoming THE table games casino. I would actually go as far as saying that actually having and stating a positioning is unique. Perhaps with the exception of LeoVegas (and having stayed true to their positioning of being THE mobile casino, at least until the diversified into sports…), we are unique.
What also makes us unique are:
- Our research and consumer insight knowledge. We KNOW our customers and target group in terms of what drives them, what they want, how they want to be perceived. As important is to also know (which we also do) what DOESN’T drive them or how they wish NOT to be perceived.
- The fact that we had the people creating our whole digital experience including website etc, participated the entire above process, so once we got into execution/production phase, they know EXACTLY what to build and deliver to the players
- Few brands have ever started with such an experienced management-, and affiliate team
With so many mergers and acquisition, affiliation is becoming more and more expensive! Do you think this is still the way to go in your case? You have a lot of experience in this field.
Yes, we certainly feel an initial affiliatestrategy is suitable for us, but as you say, it is expensive and it is not for everyone. You need an even more experienced affiliate team now in order to find the value in a lot of deals, as there is definitely value out there. We will use our experience, our contacts and funding to initially get proper traction for Codeta. We will already after the summer, start doing more traditional marketing investments, in the Nordics in particular. Like previously stated, our aim is to build Codeta into a proper brand and naturally, I don’t believe you can build that brand via affiliates alone as they naturally are more focused on customer acquisition, whilst building a proper brand, you need to also do more traditional above the line marketing (as well)
Under which platform will you be operating and which markets will you be focusing on? Why did you go with this platform? Would you exclude working with other live tables besides Evolution?
We chose after careful research that Everymatrix provided us with the best solution so we are using their API/Platform. We will initially be focusing on the Nordics + English speaking markets (CAN, AUS etc) and then launching UK and DACH in September.
We work both with Evolution Gaming and NetEnt in terms of live casino offering. We most likely will others that we deem to provide a top-quality live casino experience. We have chosen to be very picky with live casino-providers as we want our customers and those consumers that we introduce to try out potentially live casino for the first time, to have a great experience rather than a less-than-great one.
Table Games. Is there a large market for it? Can you give us some numbers?
During our research-phase we did find out that there was VERY little reliable data/stats to get access to. We did manage in the end (after several months and numerous consultants/agencies involved) to estimate how big this was. I have attached a slide showing some data.
Was it easy raising 2M? What made the investors trust your startup? A long working relationship? Family and friends? Do you have any feedback to give to budding entrepreneurs who would like to take off with their own venture?
Considering that we/I have never raised investments before, I would say yes! We managed to secure the investment round in less than 4 weeks. The investors relied their decision on several factors, but the most important ones where:
- Trust in my/Ihre Consultings experience in the market place
- Our positioning and research backing that up
- The other parties we had involved in the project that added the expertise that Ihre Consulting were less strong in
The majority of investors are friends & families, but the last couple of investors that came in (once the rumors started to go around) are from the industry and have invested more than the average investor
You also engaged LynxEye Brand Consultants. Has this been an integral ingredient so far?
Yes, they have been and still are. We used them to conduct the research into our target group and understand them properly in terms of what drives them (to play), what they seek, what they miss etc. Once we had that, we have worked closely with them to fine-tune our positioning and understand what we need to deliver and focus on. This is continuous work and Lynxeye is and will be a long-term partner of ours
You are based in Stockholm. Ever thought of relocating to other jurisdictions? And if yes, which cities do you find attractive as a base for gaming?
Yes, we are based here and will continue to be based here at least until we get our own license (we now use Everymatrix license). I also think that the more we can have the people with and for Codeta gathered under one roof, the better as our journey has only begun, as a company but more importantly as a brand. We do also use resources sitting remotely in London, Tel Aviv, Prag and Bukarest.