ADAM GREENBLATT: WE’RE PUTTING OUR MONEY WHERE OUR MOUTH IS

IN A CONVERSATION WITH SBC LEADERS, BetMGM CEO Adam Greenblatt takes us on the journey of his career as he discusses his experience in international markets and the ingredients it takes to be a true BetMGM-er

BY ERIN GALLAGHER

Accounting and betting are not two industries that jump out as being intrinsically connected with one another. So when BetMGM CEO Adam Greenblatt walked SBC Leaders through his previous roles, it came as quite a surprise to hear that he started out in auditing.

This formed the first stepping stone for Greenblatt to join Rothschild’s M&A One Team, which oversaw all things leisure and entertainment. During his time in the City of London, he helped build the gaming practice at Rothschild.

Greenblatt began: “Fast forward 10 years, and one of my clients - who was the then-CEO of Ladbrokescalled me up and said ‘come and join the party! There’s lots to do, I have reorganised my PLC board, there are three roles that would suit you perfectly’. So I took that leap into the operator side of gaming.”

Whilst the transition from a financial institution to the B2C side of gambling is somewhat of a switch in career, it wasn’t long before Greenblatt found himself climbing the rungs of the ladder at LadbrokesCoral in the UK. But when the opportunity at BetMGM came up, Greenblatt packed up his bags and relocated to the US to take up the role as CEO. In this position, he noticed some key differences between the US and Europe - one of which is the sheer scale of the market.

He said: “At a player level and a market level, we’re seeing players who will regularly bet seven figures - simply because they can. It’s a reflection of their ability to participate in gambling activities. In the UK, and elsewhere for that matter, there isn’t really that depth of wealth that we’re seeing here.

“This depth of wealth is both on an individual level and a market level. We’ve all seen the reported numbers from players and the number of companies entering the market. The depth of the market is truly eye watering!”

With 33 states plus Washington D.C. now open to sports betting, the momentum at which regulation is being introduced gathered pace from 2018 to 2022 - with three more states launching this year, all going to plan. This leads us on to the second differing factor for Greenblatt.

“There is also a pace here that is much faster than we are seeing in Europe - whether that’s the number of states adopting sports betting legislation, customer onboarding, the pace at which the market is growing and even analyst coverage. Everything is just supercharged here,” he continued.

“Social media is also playing a more central role in marketing efforts here in the US. It’s a sentiment driver. You see a lot of the leadership and following actions - where’s the best bonus? Who’s offering what? Social media has been the driving force behind some of our communications going viral and driving new customers to our site.

“As a means of communication, social media is much more central to how people live their lives here, how they make decisions and gather information. It’s really a function of how customers interact with brands and products. Ultimately, it also offers an outlet for thought leadership and decision making.

“The other difference, which seems somewhat obvious, is US sports centricity. More than 80% of our offering is focused on US sports. With that comes the increase in products available - parlays, player props, inplay betting.

“Interestingly, US bettors have a bias towards pre-game bets which speaks to the relative immaturity of the market. In-play betting is slowly getting there, and will eventually reach the same popularity as pre- game. As of late, we’re also seeing a growth in micro betting.”

Showing who we are

As we all know, the outbreak of coronavirus presented a unique set of challenges for companies across the world. In the betting sector, we saw sportsbooks and casinos alike close their doors to the public for the best part of a year.

Similar to many other industries, the sports betting and casino sectors shifted towards the digital space and employees took to working from home. Greenblatt noted that this was arguably the biggest hurdle that he faced as CEO as he sought to preserve the BetMGM identity.

He told SBC Leaders: “I think that the pandemic was something of a defining moment for our business as we transitioned to remote working. At that time, we were still a relatively small business with only 135 employees. Since the beginning of the pandemic, we have increased our headcount 18 fold.

“What this has meant is we had to cultivate and disseminate what it really means to be a BetMGM-er. We had to show who we are, what our values are, what we stand for. I think that was a primary challenge for us.”

Greenblatt was arguably doing something right, however, as the company recently announced a new accreditation which he believes is a testament to the work culture and employee satisfaction at BetMGM.

He continued: “Over the last few weeks, we earned an accreditation with an organisation here in the US called Great Place to Work. What has truly been the mic-drop moment for me is that 92% of employees at BetMGM say it’s a great place to work compared to the US average of 57%. There’s a lot to be proud of.”

With new accreditations under his belt, Greenblatt told SBC Leaders that the challenges his company faced gave him a new perspective on what makes a ‘good leader’.

“My key takeaways for leadership have been to communicate more than you think is necessary. Be transparent. Also own up to your mistakes - these missteps are an essential and healthy part of growth for both a company and an individual. Leaning into your mistakes, exposing the flaws within your leadership and talking about it shows that we’re all human. How we respond to those issues is also very important.

“This concept of authenticity is a big one for me and for the business. You have to show up in an authentic manner. The other thing that we’ve really embraced as a company is showing up in the moments that matter - especially during your colleagues’ times of need. Doing this signposts the type of behaviour that you would like to see from everyone within your business, and can also engender loyalty.

“For me personally, the key challenge I had was that shift in perception from being a GVC person to being perceived as a BetMGM person by MGM Resorts, our other shareholder. That was a journey that I personally needed to navigate and I am delighted with where that relationship is today. I also had to establish credibility as a first time CEO which came with its own set of unique challenges.”

Lessons learned

Given his experience in Europe and the time he has spent with a US-facing company, Greenblatt highlighted a number of key lessons that he has taken from his career so far.

One of the biggest lessons, he explained, has been speed to market and the roll out of best-in-class products. The way to achieve this is to survey your player base to “truly understand the opportunities and pain points” that they face and adapt your offering accordingly.

Something that he highlighted as being unique to the US market, however, is the internalised culture of responsible gambling efforts. Arguably, this comes from witnessing what has taken place in European markets that have been left “unchecked” - Italy, Spain, Sweden and the UK to name a few.

“The thing I’m really focusing on right now is the whole topic of

THERE ARE MORE THAN ENOUGH EXAMPLES FROM EUROPE WHICH SIGNPOST THE RISK TO SUSTAINABILITY OF THE SECTOR, THE TAX CONTRIBUTIONS AND THE PREVENTION OF THE BLACK MARKET. THIS CANNOT BE IGNORED responsible gaming, how we organise ourselves and how we invest in that area,” he commented.

“We also need to manage our stakeholders - customers, regulators, lawmakers and the media. There are more than enough examples from Europe which signpost the risk to sustainability of the sector, the tax contributions and the prevention of the black market. This cannot be ignored.

“You'll see, one of the features of the US market has been that we as an industry have leaned more into ensuring that we have the best player protection measures in place from the get go. We’re very encouraged by our colleagues within the gambling sector who have leaned more into doing this alongside BetMGM.

“This is happening much more quickly than it has in other markets. The US market is still in a stage of relative infancy, but the conversations around responsible gambling and the actions being taken by gambling companies are way ahead of markets around the world. I take encouragement from that.”

So how do you ensure that the industry continues to operate in the best interests of player protection? For the BetMGM CEO, this comes in the form of industry-wide initiatives and a codified list of principles.

Discussions soon turned towards the launch of the 12 Principles of Responsible Gambling, which aims to highlight the tools available for player protection - including a unified, toll-free helpline, socially responsible advertising and player education initiatives.

“We’re also investing in research - we’re putting our money where our mouth is. So we've given a grant to the International Center for Responsible Gaming, which operates independently from BetMGM. They will conduct research on safer gambling.

“What we want to do is create a credible research benchmark for the impact of advertising on problem gambling because, ultimately, we’re a data-led company. What we want to do is create a data framework against which we can evaluate trends from across the industry.

“We can ascertain whether problem gambling is increasing, decreasing, and the role that advertising plays in this. But the only way to know if we’re effectively combating problem gambling is to measure it against a baseline.”

In addition to the responsible gaming tools, Greenblatt acknowledged that education and training is fundamental. To do this, the operator partnered with UKbased EPIC Risk Management to deliver training that focuses on lived

Gambling. And just a few weeks ago, we announced an extension of our relationship with GameSense who are an excellent partner. We think that they have one of the world’s leading programmes in player education. They have excellent resources available to help players gamble responsibly. We’re proud to offer their tools across our retail and online channels.”

The future of igaming

At the time of writing, BetMGM is live in 26 states with its sports betting offering, and five states and provinces for igaming.

experience and the precursors to problematic gambling behaviour.

This training is complemented by ARC - a tool starting to be used across the BetMGM platform that analyses changes in player behaviour and flags any potential risks.

“We’re also a platinum member of the National Council on Problem

So when pressed on the company’s plans for expansion of its igaming offering, Greenblatt pointed towards the disparity between the speed of legalisation of the two verticals.

“In time, we expect 80% of the US market to have access to some kind of sports betting offering, and 38% to have access to igaming. We do think that igaming is moving slower at the moment, although there are promising shoots that we’re beginning to see in states such as Illinois, Indiana, Maryland and New York.”

Whilst legalising igaming can have commercial benefits for companies looking to offer new products to players, it can also bring with it additional advantages in terms of player protection and tax contributions.

So what’s causing the delay in regulation? “The reality is, you can search on Google and find illegal operators available right now. But something to remember is that these operators do not offer the player protection benefits nor the tax contributions that licensed operators do.

“When you consider that there will likely be requirements for more tax revenue over the coming years as a result of the pandemic, and then acknowledge that the groundwork is there for the igaming market, you begin to ask why states have not regulated igaming at the same speed as sports betting.

“I think that the protectionist behaviour of some of the landbased operators combined with some political opposition has posed some challenges. [abg: this was an observation about the pace of future sports betting legislation: But despite this, I do see igaming gathering momentum but it will be slower than it has been already. By definition, once the first state legalises, it becomes more difficult as you get to the back of the queue. But we do see some positive signs from a handful of the new sports betting states in the next 12-18 months.]” newcomers looking to enter the market. “You need to position yourself for the future. I think there is going to be a shake-out of B2C operators coming. There are some big trends affecting the outlook of B2B players too,” he said.

“We’re going to see more consolidation of the market around the top end. So BetMGM, DraftKings,

Online casino has been somewhat of a growth area for BetMGM, with its igaming products helping to deliver a more enhanced omnichannel experience for players.

Greenblatt told SBC Leaders that in 2022 alone, the company saw a 120% growth in omnichannel first time depositors - an increase that he showed great pride in.

In defence

Talk soon turned towards the CEO’s predictions for the gambling industry, and more specifically, the advice that he would give to

FanDuel. The leaders are bringing more and more tech in-house. So if you’re not one of the leaders within the B2C space, the costs of entering and participating in the US market are incredibly expensive. I’m not optimistic about the outlook for the longtail of operators here in the US market. It’s just too onerous.

“If you’re a B2B player, make sure that the thing your business is providing has its own solid USP but can also act as an add-on for one of the leaders in the B2C space. Selling to the longtail doesn’t really help if the market is consolidating.” •