Optimizer Invest Q&A: Optimal Approach

Go back

As online gaming entrepreneur Simon Collins (now with Gaming Realms) once told GamCrowd, if you want to know who the movers and shakers in the Scandinavian markets are then you have to go first to Malta. It is the jurisdiction of choice for many of the leading Swedish and Norwegian-facing offshore-licensed operator are based and where many of the leading gaming entrepreneurs have set up a home.

This is certainly the case with the investment firm Optimizer Invest which though thoroughly immersed in investments in Scandinavian-focused online gaming has been based out of Sliema in Malta since 2012 when the company was formed. You may not necessarily have heard of the company before, but anyone with even a passing interest in how the Scandinavian markets are developing will be well aware of the brand names that Optimizer and its founders have either previously been involved or are currently invested in.

The people behind the company are the renowned Scandinavian entrepreneurs Henrik Persson and Mikael Riese Harstad from Sweden and Norwegian André Lavold. Between them, they helped found such well-known brand names as Nordicbet, Betsafe and Bestpoker, the first two of which were both bought by Betsson in multi-million euro deals.

The company was most recently in the news when it converted a 10% investment in Betit Group into a holding in Gaming Innovation Group (GIG) which acquired Betit in June. That deal means that Optimizer now has holdings across a wide spread of operators and suppliers including the Betit brands Thrill.com and SuperLenny to GIG’s Guts.com and Hero Gaming as well as affiliate consolidator Catena Media and cloud computing provider iGaming Cloud.

In between a hectic schedule, GamCrowd managed to catch up with Otimizer Invest chief executive Carla Vella about the company’s plans for the future and how it sees the online gaming market developing. But first we asked about the company’s formation and its founders.

GamCrowd: To start with Optimizer Invest’s track record in gambling start-ups, can you detail some of the companies you have been involved in funding?
Carla Vella: Our history in funding gambling start-ups goes beyond the Optimizer Invest brand, as our founders were involved in the early stages of Nordicbet, Betsafe, Bestpoker, Bestcasino and Bestbet. As Optimizer Invest we have invested in Catena Media, Hero Gaming, IGC, and in its start-up days, Casumo. Further to this we have been involved in funding the three brands under Betit Group: Thrills, Superlenny, Kaboo which were sold to Gaming Innovation Group last week. This deal has now extended our investment into GIG so we now add Guts, Riskz, Donkr, Oddsnet and Innovation Labs to our portfolio of investments.

GamCrowd: Do you think the circumstances surrounding gambling start-ups differs from other industries/sectors?
Carla Vella: I think gambling starts-ups are challenging and exciting just like start-ups in different industries. What I like about the gambling industry is the level of creativity which is driven by competitiveness and a lot of growth hacking.

GamCrowd: What knowledge/expertise with regard to gambling does Optimizer bring to its gambling-related start-ups?
Carla Vella: We are really the full package. Six out of our nine team members have hands on experience in gaming. Together we know what it is to found, operate, grow, staff up, monetize and sell a gambling brand.

GamCrowd: Do you think the gambling start-up area is under-serviced in terms of both investors and advisers?
Carla Vella: No, I don’t think so, outside the Optimizer Team I know some excellent, skilled and experienced individuals who are involved in investment and advisory for this sector.

GamCrowd: Why have you set yourselves up in Malta? Are there specific gambling-related reasons for using the island as a hub?
Carla Vella: We are in Malta because it is simply an amazing place to be. Malta is situated within the EU, its bilingual, there are good international schools, decent infrastructure and over 300 days a sunshine.
Obviously it goes without saying it is common knowledge that the Maltese government strongly support new companies to start up on the island and offer great tax benefits which are not just subject to the gambling sector.

GamCrowd: What do you view as the opportunity in online gambling right now? Is Optimizer more interested in B2C opportunities or B2B?
Carla Vella: Without sounding clichéd, the opportunity in gambling is not much different to opportunities in other sectors. I personally feel there is still massive opportunities in mobile, real-time, data-driven automation and AI/machine learning for the gambling industry. For this reason, Optimizer is interested in both B2B and B2C opportunities. We are keen to see as many proposals from start-ups who have a working prototype of something innovative be it customer-facing or service providing to operators.

GamCrowd: Do you view the opportunities in online gambling as geographical i.e. is Scandinavia a particular focus and why?
Carla Vella: Legislation has a lot to do with this because but no I do not see opportunities as being purely geographical. It would be a mighty shame if we have amazing products and technologies that end up limited to a specific geolocation. If something is great let’s share it with the world.

GamCrowd: What are the biggest threats to the industry right now?
Carla Vella: Legislations will always be the factor that will continue to limit and suppress what you can and cannot so within the gambling industry. The challenging yet exciting part about this is aiming to innovate and work towards changing a mindset around the sector and the governing parties.

GamCrowd: What other sectors does Optimizer Invest get involved in?
Carla Vella: We are broad in terms of sectors and investment. Today our portfolio consists of ecommerce, shopping, technology, payment gateway technology, wearables and fintech.

GamCrowd: What role does technology play in Optimizer’s investment philosophy?
Carla Vella: It is key. We won’t invest in a company that doesn’t have technology at its core. We want to be involved in digital companies that drive and influence society by means of strong technical solutions.

GamCrowd: How does Optimizer raise cash? Is it at an institutional level?
Carla Vella: We don’t raise cash. We are a fully founder funded investment firm. We make money from smart successful investments and we put it back into our fund to put towards the next opportunity we believe in. We do at times invite other investors into investment rounds, but this is normally because we want the company to benefit from more skilled individuals to mentor and assist the company’s growth strategy.

GamCrowd: Do you have set exit strategies with your companies?
Carla Vella: When we get involved in a new company, we work with that company to achieve its founders’ goals. Exits are exciting and a great long-term goal. Most entrepreneurs who we speak to have within our holdings have an exit strategy in the back of their mind one day, but it is rarely their first objective. Growth and hands-on support is normally why they come to us and exit strategies are just part of the experience and the result of a successful growth strategy. When the time is right we stand by the holding company and help them strategically positon them to make that move in the best way for the founder, company and acquirer.

GamCrowd: How vital are the personnel within a start-up? Do you invest in people or the idea?
Carla Vella: In the VC world, they say some VCs invest in ideas, some in people and some in the market opportunity. We don’t invest in ideas, an idea is nothing unless it is implemented. We invest in working concepts of technology, ideally ones that have some level of engagement and traction from their potential users. Further to that, knowing that a founder has pushed forward to make this happen we automatically invest in amazingly skilled and driven individuals and are overjoyed to bring such individuals into our network of similar minded community of individuals within our holding.