GiG Prepares to Split to Target US Sweepstakes Market
Gaming Innovation Group (GiG) is preparing to separate its platform and sportsbook divisions into a separate company in order to focus on opportunities in the US sweepstakes market.
GiG to split to target US sweepstakes market.
LISTEN TO THIS ARTICLE:The move aims to streamline operations and boost growth as the sweepstakes casino sector shows strong potential despite some regulatory challenges.
In its latest investor presentation ahead of the split, GiG showcased SweepX, its new social casino platform and said that it is key to expanding its presence in the market. The company believes its cutting-edge platform will help it capitalize on the US sweepstakes industry, which is expected to grow from $3.1 billion in 2022 to $6.9 billion by 2025.
GiG believes that SweepX is a unique solution for operators, offering features that enhance player engagement and retention. It includes AI-driven gamification, a dual-wallet system, and advanced prize store management capabilities.
Positive Results Already Apparent
The launch of SweepX is already delivering promising results. GiG’s business pipeline has significantly expanded, with annual sales projections reaching €50 million, a fivefold increase from the previous year. This growth is largely due to a partnership with Primero Games, a leading US sweepstakes operator, which plans to start using SweepX in the latter half of 2024.
Despite optimistic growth projections, the sweepstakes market is facing increasing scrutiny from regulators. This year, a number of sweepstakes companies, such as VGW and Stake.us, have encountered regulatory problems. This resulted in stop orders in Michigan and calls from the American Gaming Association for stricter oversight. As a result, the Social and Promotional Gaming Association was created with the aim of advocating for the industry as regulatory pressures mount.
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How GiG’s Split Will Work
GiG’s upcoming business split will create two distinct companies: GiG Software, which will focus on platform and sportsbook operations, and GiG Media, which will specialize in affiliate lead generation and media services. The separation is intended to improve the focus of each business unit and provide greater operational and financial flexibility.
GiG Software is set to begin trading on the Nasdaq First North market on October 1, with an ambitious target of generating €44 million in revenue by 2025, which would be an annual growth rate of 38%.
With 82% of its projected 2025 revenue already under contract, GiG’s platform division looks set to grow. This, combined with the company’s partnerships and the promising start for SweepX, puts GiG in a strong position to take advantage of the sweepstakes market, even if there are future regulatory issues to overcome.
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