Golden Matrix Group plc (Nasdaq: GMGI) Chief Executive Officer Brian Goodman caught up with DirectorsTalk for an exclusive interview to discuss their business model & competitive position, why they chose to list on Nasdaq, how emerging trends influence strategic priorities, regulatory compliance, and the significant growth drivers in the short and long term.
Q1: Brian, could you give us an overview of Golden Matrix Group’s primary business model and its competitive position in the gaming technology industry?
A1: I think in coming from both sides, we’re a very diverse company. Most gaming companies obviously that are in the US and we’re a NASDAQ listed company are primarily focused on the US and have a very limited range of products or what they do.
So, the one thing about our company is we’re fairly diverse. We have sportsbook, we have iGaming as in online casinos, we have sweepstake products and it makes us diverse in terms of our product offering. We’re also we’re very diverse in terms of our regional footprint so we offer our services all across Europe, Latin America, Africa, and now in Australia and the UK through our sweepstake product.
I think that gives us a unique position in terms of who we’re competing with in financial markets, but it also allows us to have product synergies and things like that.
Q2: Now, you mentioned that you’re listed on the Nasdaq, what made you choose the US and would you consider listing elsewhere?
A2: So, there are companies that choose dual listings and in terms of the reasoning, I’ve looked at it and possibly thought that maybe in the future it’s something we’d consider.
What it does in terms of what I see the value is that it brings you to the to the indices. So in terms of what we have, we’re part of the Russell Index and therefore, we get an automatic buy-in from the institutions, and when you enter these other markets, if you do make the indices, you get more buy-in. So that’s one thing.
In terms of why we chose Nasdaq, there’s no doubt that the liquidity and the actual pricing, as in the multiple of our earnings or adjusted EBITDA is far higher for any of these gaming companies than it would be in, for instance, the UK markets. There’s no doubt about that.
I don’t want to mention names, but if you go and look at some of those companies that are listed on the London Stock Exchange, you’d find that somehow if they move to Nasdaq, I think they would get much better liquidity and much better valuations.
Q3: How do you see emerging trends such as mobile gaming or the expansion of online gambling influencing your strategic priorities?
A3: I think in terms of a very high level, a few years ago, it was all about grey markets and countries banning online gambling but now the whole world has moved towards regulation. So, this market is becoming regulated and therefore, we’re getting into a position where most countries in the world are beginning to regulate.
For instance, Brazil, we’re about to, hopefully to get a license, we’re on the short list in Brazil and it’s becoming regulated. So these are massive markets. They call them developing markets, but actually a lot of people confuse developing as in small countries potentially creating some type of regulation. But these are massive markets that are becoming regulated, and so that’s what we see.
We see the world becoming regulated and so we want to be part of that.
I mentioned initially, it’s important that we have a market that’s becoming bigger in terms of our global footprint and also diversification of our product range because different products are attractive to different countries.
Q4: You mentioned regulatory compliance, what are the main challenges that you anticipate in terms of compliance? How has the company prepared or adapted to that?
A4: In terms of technology, it’s very important to understand that I think we’re one of the only new technologies that has been recently been launched, we’ve rolled out to about 80% of our countries and we operate in roughly 21 countries.
In terms of operating in these countries, it’s quite complex because all the governments have different requirements, and unless your systems are built in a modular fashion, it’s difficult to give the governments what they want in terms of maybe they want to tap into your system and see what’s happening.
I’ll give you an analogy. If I was to ask you to go out and find a computer that was eight years old and I had a computer, that laptop for instance that I bought yesterday, you would see a dramatic difference.
In terms of sportsbook technology, 80% of sportsbook operators use third-party technology, they don’t have their own software, and the ones that do, I would assume the earliest would possibly be about eight years old.
So we’re competing against people who have eight-year-old technology that has band-aids, has been jigged up to somehow meet these regulations, and it’s quite difficult for them.
We believe we’ve got a market disruptor and also in terms of AI, it’s like a buzzword around town, but in terms of our iGaming, it’s extremely important. If your system cannot accommodate it, and there’s no chance of a system that’s eight years old engaging or having an integration of AI. A
So, in terms of all of those things, we believe we’ve got a very powerful edge, and we’ve been approached by some of the larger operators asking to acquire our software, but we’re not a seller of software and that’s the edge we have. We’ll continue to power on with that.
So, we’re introducing and have large components of our system are AI-driven and you can imagine what that means in terms of having online gamers that are sitting at home and playing, knowing what teams they support, what their habits are and in offering up, we’ve got bet recommenders, we’ve got very powerful tools that make the difference so yes, it’s quite important.
Q5: What would you identify as the most significant growth drivers for Golden Matrix Group in the near and long term? And how do you view the outlook?
A5: In the short term, core business is what we’re focusing on. So, we’ve got some considerable growth, we have our second quarter revenue was up 75%, and so we have double-digit growth in most aspects of our business. And we continue to drive the core business.
Also, we believe that we need to scale considerably and we’re out there making acquisitions or looking to make acquisitions. We’ve just recently made one in Australia, a considerable company, which is more in the sweepstake world but each of these products have synergy, and these sweepstake products have an ability to acquire players at a very low value.
We have a holistic approach. It’s not only that we’re focusing on sports betting or casino betting or sweepstakes for that matter, all of them drive each other and go hand in hand, and we believe it’s very important to have this diversity, and that’s where we are.
So in terms of long term, we would look to grow this business, not only in terms of core growth, but also in opening new markets, such as Brazil, as I mentioned, but in terms of acquiring profitable businesses, accretive businesses.
We have a few that we’re looking at and we would be hopeful that in the coming months, we would continue to acquire other businesses.
