American gaming investors, most of whom historically have stuck to the well-known domestic stock exchanges, have had reason to venture abroad in recent years.
Companies like William Hill, Playtech, Paddy Power Betfair and GVC have enticed many of them to the London Stock Exchange.
Except for Melco, all of the Macau casino operators trade in Hong Kong, as do a number of other gaming companies.
Additionally, stock exchanges in Australia, Japan, South Africa, the Philippines, Canada, Italy and Germany, among others, list a variety of gaming companies.
But if you want to play the emerging U.S. sports betting and online gaming industries, you might want to tread into a country not as familiar to many American investors—Sweden.
Sweden, best known in the American imagination for socialized medicine, Volvos and beautiful actresses and models, has become a haven for online gaming entrepreneurs. A number of those entrepreneurs have found themselves on the Stockholm Stock Exchange and now onto the shores of the United States.
There are several attractions to Swedish companies: 1) They practice transparent accounting familiar to American investors; 2) Sweden is a politically and economically stable country; 3) They conduct business in English, for the most part, making the companies easy to follow for foreign language-challenged Americans.
Perhaps best of all, many are large enough to grow into serious American players but small enough that US sports betting can be a needle-mover for their stocks.
Here’s a sampling of Stockholm-listed companies with American ambitions:
- Better Collective is an iGaming affiliate.
One of the early misunderstandings of online gaming was that it is a low-cost business without bricks and mortar, card dealers and hotel room housemaids. But iGaming has one very big expense – attracting and retaining customers in a world where players can surf the web for options and have little incentive for loyalty.
Affiliates are the companies that get a big share of that marketing money as they attract players to their websites and direct them to their online gaming clients.
Better Collective has been licensed in New Jersey since 2014 and says U.S. sports betting could exceed Europe.
Better Collective had around $17 million in first quarter revenue, nearly double last year.
- Catena Media is another affiliate. It plans to enter Pennsylvania this year and says the Keystone State alone can double the size of the company.
Catena did around $29 million in its first quarter revenue, 10 percent over last year.
- Enlabs is both an iGamer and an affiliate that may bring its BestCasino brand to the US.
Enlabs grew first quarter revenue 26 percent to around $1 million.
- Kambi. The provider of sports betting platforms says the U.S. is a top priority for this year.
The company has opened an office in Philadelphia and is supplying its platform to Mohegan Sun, which can offer free-play in Connecticut and will be able to handle real money bets when Pennsylvania goes live this summer.
If a strength of affiliates is recurring revenue, the strength of Kambi is something like the old gold rush bromide to make money by selling pics and shovels to the miners. Kambi will supply the sportsbook operators.
Kambi did round $24 million in first quarter revenues, 28 percent over last year.
- Kindred operates casino, poker and sports betting online. It has applied for a license in New Jersey and intends to launch with Mohegan Sun in Pennsylvania this summer using the platform of its former subsidiary, Kambi.
Kindred generated first quarter revenues of over $290 million, 7 percent over last year.
- NetEnt is a games provider with a history in the U.S. The company says it intends to be in Pennsylvania on the day the state goes live and sees New Jersey as a big opportunity.
NetEnt generated first quarter revenues of $43 million.
Interestingly, the largest publicly traded Swedish online gaming company, Betsson, has no U.S. presence. The U.S. is a long-term opportunity, CEO of Operations Jesper Svensson recently told Fantini Research Associate Publisher Ashley Diem at the Betting On Sports America conference. Her interview with him is at https://www.youtube.com/watch?v=iSrCa5_uyVs.
