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SBC Leaders Podcast is a series of interviews with CEOs and decision makers at some of the betting and gaming industry's biggest, best and most innovative companies. SBC's Kelly Kehn is the host who asks the questions.
Andrew McCarron (00:06.252)
Welcome to the Leaders podcast. I'm Sue Schneider. And today we're going to be talking with Brian Goodman. Brian and I met many, many years ago. I'd say multiple decades, actually. And again, what we're doing with this podcast is kind of taking a retrospective look at the industry. And when I first met Brian, he was an operator in Australia. And Australia, I would tell people, was really a trailblazer.
They were probably further along with how they did sports betting and some other events. And there were also some offshore operations that were in Vino Attu at the time. So it was really an interesting time and really there was no regulation, to be honest, just about anywhere else, even in Europe yet. So, you I wonder, Brian, if you could just give kind of a little history of when you got in the business, how you got in the business and
how you saw that region, that Australasian region at that point in time. Well, thanks for having me, first of all. yeah, we certainly go back a long way. But actually, in terms of our operations, we go back more than 25 years. We're one of the original pioneers of online gaming. I guess you remember, Sue, in those days,
when you were a gaming operator, you didn't have much choice. You could either go with the likes of Playtech in those days or micro gaming. And if you were to go with one of those system providers and game providers, then you were exclusive to them. So you would find in those days that if you were operating an online casino, that you only carried their games and then you were on their system. They didn't allow you
to use other people's games. like today, when you operate a casino, you get to choose which games and which products you wanna carry. And lot of most people obviously have their own systems and marketing stuff. And so in those days, actually, we operated on the Playtec platform in our initial days. And yeah, the market was,
Andrew McCarron (02:32.142)
Certainly in terms of America, it was gray up until I think it was 2006 or 2007, there was an unlawful Internet Gaming Act came along. then at that stage, operate up until then we operated in the US and we had some sizable businesses. We had casinos as well as poker. And then at that stage, we were obviously forced to close once the law was was clarified and it came through.
And then we looked to Europe, we operated in Italy and Spain and France. And then the taxation, I guess, regime became punitive towards us. And so we decided that we would go back and focus on the Asia Pacific. And pretty much that's a summary of where we went. We also bought an interest in a junket operation in Macau.
And that was an interesting concept because we didn't know a real huge amount about, all we knew was that Macau was at the time five or six times the size of Vegas. And we thought that was a good place to be in. So we had this junket operation within the MGM hotel and we operated it for a while. And then we realized we needed to go back to online. And so we built a system and
the journey continues in terms of, I wanted to monetize the technology that we built over the years. And in order to do that, I realized that I needed to have a public company and that's how I would monetize it. And then I anticipated that the world would become regulated as opposed to prohibition. And everybody thought I was, you know.
losing my mind that nobody's ever going to allow gambling in a lot of these countries and certainly not in America. But I decided that I would list the company in America, the technology, and then we'd build a business. And so what we did was I managed to get my hands on a pink sheet company on the OTC markets and
Andrew McCarron (04:51.091)
I put in this technology and we started to provide a B2B operation where we provided systems to two operators and we were resellers of third party games such as macro gaming and Playtec and whoever else. And that's how we started that business. And my intention was always to take it to a bigger market such as NASDAQ or New York Stock Exchange.
everybody also thought I was crazy at that stage. There were no real online gambling operators on American exchanges because it was, there weren't any states that really allowed it. But anyway, I went forward with it and then a couple of years ago, we were putting an application to Uplist from the OTC markets to NASDAQ. And because of the success of the company and the profitability of it,
and the strength of its balance sheet, were accepted by NASDAQ and we didn't IPO or use a spec or raise money and we never had any debt. And we just naturally qualified, we met the listing standards and so we moved on to NASDAQ and then later on we started acquiring companies and one of them being our latest acquisition, is Meridian.
But we have other acquisitions that are very interesting to the market, which are these raffle ticket type businesses, which are people look at them and find them quite strange, but they're very, very profitable and very interesting products. But that's my journey and that's where I'm at now. Well, I noticed your theme was people kept thinking I was crazy.
But that's what happens when you're a pioneer. talk back about how you originally, how and when you originally got involved and what led you to the decision to, you know, take a crack at doing something that was probably crazy at the time. So. Well, it may sound a bit even crazier than I used to say to people.
Andrew McCarron (07:01.376)
I used to sell drugs, now I'm in gaming. But actually the reason being is because by qualification, I'm a pharmacist and I own some drug stores. I lived, originally I'm from South Africa and 35 years ago, I immigrated to Australia and I re-qualified as a pharmacist. That's how I got into Australia, but I never practiced again. I sold my drug stores and I...
I was at a loose end. was looking for something to do and my family have a fairly large discretionary trust business in the UK. It's a large business that looks after people's money and forms, holding companies and whatever else. And I'll say to my brother one day, I'm looking for something to do and what do you suggest? he said, well, out of all these kinds, the people who doing
the most amazing business or in the gaming industry. And I thought, well, that's a good idea. And so that's how started. And I went off to Playtech and I said to Playtech at the time, they hadn't even listed yet Playtech. And I said to them, can I have a casino please? And then they said to me, I'll see you out of your mind. Get lost. What experience have you got? You're a pharmacist. You're counting pills and you don't really know what you're talking about.
we can't give you a casino. I said, I'll buy one. And they said, well, maybe that is your only way of getting one, in buying an existing one, because we're certainly not going to build one for you. got no idea what you're talking about. But anyway, as the journey carries on, I did find one that was for sale, and I bought it. And that's how I entered the market. It was my first one, and we ended up with multiple brands.
That was my entry into the market. bought this small casino and we operated it. And when was that? 1999, probably. Yeah. Just say the year 2000. So that was my first operating casino. And that's 25 years ago, basically. it's been a journey. And an exciting one, as you know. I mean, we all knew each other in the industry. We go to shows.
Andrew McCarron (09:20.206)
You know, everybody knows each other. Even today, most of the operators or the people even in public companies that are running these organizations, we all know each other and we all have a long history of, you know, one thing or another. And it may be that some of them are B2B providers, game providers, know, poker operators, whatever it may be, we all know each other.
And it's like a family to a certain degree, but yeah. I always say it's a small town and it really is still. It is, yeah. And I already learned something. I didn't know about your pharmaceutical background. you did make a leap. Did you, what did you, as you look back on the beginning years, other than trying to convince Playtech that you should be a casino operator, what were some of the biggest challenges that you experienced during that period?
Well, I guess, yeah, the challenges were in fact a simple formula, which I always tell people and they, it doesn't oversimplify, I don't want to oversimplify the running of an online casino, but the challenge is always for any operator is the difference between the price you pay for a player and the lifetime value of the player. And that's how simple it gets in a casino. It is what it is. And if you're paying more for a player,
then you're getting back from him in his lifetime, then you have a serious problem because obviously the more players you bring on, the less money you have because you start losing money. And a lot of these big operators, certainly in the American market, that's why there's a whole graveyard of people who've tried and failed, is because the dynamics of recouping the money that they spent on acquiring these players was negative. And so the more...
they grew the business the worst they became. there are companies obviously had that as part of their strategy because they had unlimited money and they wanted to take market share and it didn't matter how much they paid for their players because ultimately they wanted to secure the market. And so there are different strategies. But in terms of our challenge was to try and get traffic at the lowest possible cost and then to bring these people on board and then to have the right tools to
Andrew McCarron (11:45.134)
to keep them loyal and right now, in terms of even our existing company, we are known for our loyalty tools because these are things we built over the years and even though we might get a player in, know, at whatever cost it is, we need to maintain that player because he has other options and it's a two-sided coin, if that's the phrase I could use. In terms of...
In an online environment, it's a very powerful environment. You know a lot about players and you know a lot about your customers. And certainly now, that's also our strength in terms of what we have in technology. We believe we have the strongest sportsbook technology in the world right now because of our AI capability. And everybody throws around AI as a buzzword. But in terms of online players,
We know where they live, how much the house costs, basically what it's worth, what their movements are, what teams they like to support. These are all things that are very, very valuable when you're dealing with a client. In terms of a land-based casino, they know very little about their players. A lot of them have loyalty clubs and things. They try and get more information about them. And they spend very short terms in these casinos. So they may come for three days to Vegas and then go home.
But in terms of online, it's very, very powerful because you're in the person's living room and you know everything about them. And so if you have the right tools and you can communicate with the person and give them what they want and understand what makes them happy, then your value for that player is incremental. And now with AI, you can imagine
what AI does, it's like a sponge. It absorbs all this information and our systems have better recommenders. They act on the information that they have on that person and they provide a better experience for the player, but also it gives us much more power. But in answer to your question, our challenges were to increase the lifetime value of these players and to acquire them. And in the initial stages,
Andrew McCarron (14:09.985)
mentioning names, what took us to another level was we used to buy data from people in Las Vegas and they used to sell us this data of these players and it was very, very valuable. In old days we used to mail out DVDs or CDs. I don't know if you remember, they used to arrive in the mail and they used to have $100 free come and play.
Those lists of players, we used to buy them and they were very, very valuable. Today, obviously those things don't exist anymore, but we have other mechanisms. We have our loyalty program, our gravel ticket businesses, as I mentioned. They look like, they're very profitable businesses, but what they are, they're recruitment tools. We can recruit players at somewhere around two pound 50.
to acquire a player, can use them, we can cross-sell them into other products and whatever casinos, I would assume online casinos, at a guess. In America, anything between $600 and $800 per player is what it's costing them. So it gives you an idea of that formula is very important and if you can somehow recruit at a low cost and you can create a higher value for that player, well that's...
you've got a recipe for success and you know, it sounds simple but the technology behind it is what drives us. In those days, we relied heavily on third party technology but today we have all our own technology, our own technology stack and that's what gives the company the value. Well, and you bring up a good point that I think people that are newer to the industry don't realize that it started out as downloads either
you know, through a very painful process through your internet connection with all the little noises that it used to make or through the CDs, DVDs that got sent out. Finally, the innovation was browser-based, you know, games, which was really kind of amazing. So you bring up a good point that I think probably people that are newer don't realize it. It started out very primitive.
Andrew McCarron (16:28.974)
Exactly. And then the way we also recruited the players, because it was more of an 80-20 rule, or could have been a 90-10 rule even in those days, that 20 % of your players contributed 80 % of your income. And those 20 % were, we said, high rollers, we classified them as. But in terms of getting them on board and then keeping them, also was quite a big job. It was, we used to physically go visit them. We used to go and bring them a gift or
or go and sit face to face with them. And so there was a lot of that going on today. That doesn't really happen. It's more probably a 50-50 rule because a lot of the regulation prohibits you from having these high rollers in terms of the amounts they spend and whatever else goes on.
Yeah. Well, and your point related to player acquisition is interesting. know, I finally recently, I had a company from 95 to 99 called Rolling Good Times Online. And as I look back, it was really one of the first affiliate sites because we would run ads, we would send, you know, traffic. But when you're talking about getting in to begin with, there really wasn't an affiliate system going yet. And talk a little bit about
you know, when you saw the growth of that as a mechanism for bringing in players, because again, that didn't exist at that point in time. Yeah, so as I mentioned, CDs were the best way for us to track incoming people. So they typed in a code and then that code gave them their free gift. And then that's we knew where they came from because they had to type in the code. But then obviously the affiliate systems became
you know more sophisticated and and they started tracking you know and and you know that also became a challenging period because affiliates used to deliver traffic and then those cookies you know people were were stealing each other's players and all the affiliates were delivering the same players to multiple people and and then
Andrew McCarron (18:48.686)
the requirement for more sophisticated technology in terms of lifetime cookies so people couldn't kill them, couldn't move players out of, because a lot of the affiliate compensation was based on a CPA, an upfront amount of money for a player, as well as a trail of a profit share. And in terms of that,
There were casinos out there that paid upfront and profit share for a month or two and then took the player away. And then the guy, the affiliate, you know, lost that ongoing income. But then over the years, obviously those affiliate programs have become an instrumental part of any system because in order for the affiliate to feel comfortable that he's getting his compensation for bringing the players.
the casino also needs to be able to accurately track these. But in terms of that, we're taking another jump because right now we have the Google and the Facebook and all of the Twitter and the influencers. This is where the bigger traffic is coming from in the bigger end of town businesses because that is highly sophisticated and it's also AI driven.
it's a person looks at an online casino in Facebook and then from that point onwards, every time he goes into Facebook, he's getting multiple images of other casinos or whatever it may be. And in terms of our tournament products, as I mentioned, which are amazing businesses and we scaling them heavily. We just bought another one in Australia recently.
They are heavily influenced by influencers in Google and Facebook because the prices themselves are what drive the people. So in the one in the UK that we run, the interesting part of that is they have value cars mainly. We did a house the other day, a holiday home, but normally they're Ferraris or Lamborghinis or something like that.
Andrew McCarron (21:05.944)
People buy tickets and then they go into a draw and then they win this item. But generally they're looking online at a Ferrari or a nice car, whatever it is, may be following expensive cars. But then from that point onwards, Facebook and Google is sort of chasing them down to bring them to us as clients. And we obviously pay for that, but that's how they end up and that's how we recruit them at such a low cost.
they become valuable clients and that model is a very good model because as I mentioned, it's dual. actually gets players in at a very low acquisition cost, but it's also highly profitable because those tournaments, they're like a raffle. We put up a vehicle, we sell tickets, and then actually it's a very interesting fact that when the person wins the Ferrari, for instance, most people don't want it because
It's expensive to insure, it's cost money to service. mean, it's nice to win it, but at the end of the day, most people want what's called a cash alternative. So we have an alternative that they can take a lower amount in cash and they give the car back to us. And we never offer up the same price twice, but we sell the car back into the industry. But a lot of people cannot afford, I mean, they spend two or three pounds on a ticket.
and then they win this item, but they cannot maintain the item. mean, they're not allowed to drive it out the showroom without insurance because otherwise, you know, it would be a disaster. So these are all very, you know, interesting things. And as we discussing, we came from here and now we're there and how much technology has changed. And I think it goes to our system, even our sports book system. We probably, or are,
The youngest generation software and that's why we can do a art up Communication and and react on an AR basis the the newest software that we see out there compared to us is probably eight years old Yeah, I mean if I if I gave you a computer laptop that was eight years old and I had one that I bought yesterday in terms of technology It's like light years
Andrew McCarron (23:30.674)
You know, it's it's it's it's it's there's a huge difference between technology that was built maybe three or four years ago. Never mind technology was built eight years ago. So in terms of our company, we believe that our strength and we continue to drive forward. We operating 21 countries now, licensed jurisdictions. And we bring on new ones every few months. We have new licenses. We obviously
confident that we're getting a Brazilian license in the next few weeks and we continue to roll out this new generation software and you know that's where we're at. So that's all proprietary that you've over the years built your own then? Everything's proprietary. that's great. You know, like I say, these software's cost millions of dollars to put together but it's now rolled out to 80 % of our operations and it
we can already see how effective it is in terms of what it's delivering. If you look at our performance as a company, our growth is higher, double digits, you know, in terms of quarter on quarter, we had this massive growth and we would believe that we would continue. And it comes down to, like we discussed early on, it's basic principles, but in order to...
to implement those basic principles, you need the technology. And even in terms of sports book, it's not like a casino. A casino is much easier to run because it's a statistical business. Ultimately, it delivers a result. Sports book is a lot more difficult because it's something that has risk control, odds. In terms of sports book, it's very competitive in an outcome.
event, an outcome of the game, where who's going to win and lose. There's not much money to be made in those because it's very competitive because people can go and compare those to other rates that have been given. so in terms of what we have, and other people, it's not only us, but we believe that also we have an edge in that.
Andrew McCarron (25:49.844)
It's the in-play betting where the money's to be made, the exotic bet. Who's gonna score the next touchdown? Who's gonna do this, that? Who's gonna whatever. And that's because it's an emotional type of bet. People in front of the TV screen, they're watching the team that they like, they're making bets while the game is on. And in order to deliver those odds, you need extremely sophisticated software. We take in all feeds from different feed providers and we spit out
could be a thousand lines of bets during a football match, could be even more than that. And in order to do that in real time, you couldn't do it physically. You need systems that are generating these odds in real time. that's where the money is to be made. I'd like to bring you back to Australia for a minute because again, they started early and were really, you know,
Doing the template for online sports betting. They've still never really got them gotten that involved on the casino side So as you've gone global when you go back and you look at Australia and how they've evolved What perceptions do you have of where they're at now? I think you know, it's a difficult one. I I'm not quite sure that Personally that there's any difference between offering sportsbook or sportsbook and casino
But the government here in Australia has two sides that it needs to consider. One is the effect of having online casinos, which are totally, they're not allowed, they're banned in Australia. You can only do sports book, you cannot bet in online casinos in Australia. And so in terms of protecting the population, because Australia has, I think, one of the highest per capita spends on
on betting, on wagering in the world. It has the highest per capita amount of slot machines in the world. So the government, I think, is concerned as to what opening up online casino would mean to the population in terms of them not being able to manage the traction, or what if you wanna call it, but the flip side of that is,
Andrew McCarron (28:14.518)
The slot machines that you see in Australia, they are casinos, they're land-based casinos, but very few of them. There's generally one in every capital city. But in terms of, we call them RSLs, they're Returned Servicemen Leaks, which were built for returning...
military people in the day, where they could go and have a meal, a sponsored meal, or go to a club in a social environment. And those clubs are driven by their slot machines. That's where their money comes from to support these clubs. And I think that is the biggest concern of the government right now, is if they were to allow online casino gaming as in slot machines, then those institutions could be affected.
and they would no longer be able to exist. Yeah, they are like many casinos, really. Yeah, so they are, I mean, they're huge. mean, they've got thousands of slot machines, and most of the slot machines are within these clubs. And so I think those are the challenges that the government has. I think they would like to get the taxes from the online world, but that's why they've always kept it to sports betting and never allowed casinos.
It's a consideration that, you know, it could harm these clubs that serve a purpose. And on the flip side also, they need to take into consideration what the public would do because the public already is at the highest level of any participation in the world. And it has been for decades. Really. It's part and parcel of, it's in the DNA of an Australian too.
to get out there and have a bet on something, a horse race or whatever it may be. And so it is. And as you mentioned, when you started out that a lot of these big, and I don't include myself in this, but a lot of the big successful operators and some without mentioning names, some of the most successful and richest operators in the world exist in Australia.
Andrew McCarron (30:30.254)
or resident here. So it's an interesting concept, but yeah, it is what it is. Well, I really appreciate the history you've offered and your candor and it's so pleasant to see how you guys have grown and gone global and gone into other products. So we wish you continued luck with the growth of that. And with that, we'll wrap it up.
Thanks, Sue. And just so that if you mentioned, but the company's name is called Golden Matrix. It's goldenmatrix.com and the ticker symbol is GMGI if you want to learn more about the company. And thank you very much. And hopefully we get to chat again on some other news. And it was a pleasure.