Sheriff Olaniyan: Sport Betting Operators Pay €80,000 Monthly to European Providers

 Sheriff OIaniyan, founding partner of the sports betting company, Surebet247, has the history of the gaming industry in Nigeria at his fingertips. The GAMING TEAM had a lively discussion with him on all aspects of the business

That doesn’t quite describe your journey in the industry. Where was your first job? 

 I was born in Lagos but I grew up in Ibadan. I went to Methodist Primary School, Bodija. From there I went to Loyola College, and after finishing Loyola College, I got admission to the University of Ilorin. I did a four-year course in Geography and after graduating, I was lucky to find myself overseas seeking further education. After seven years, I came back to Nigeria and I moved into business.

I am the cofounder of the company SureBet247. We started gaming around 10 years ago, when the industry actually started. A couple of us were active players at that time, and up till now, we are still in the industry. I went to the University of Ilorin and studied Geography (BSc). I moved into business immediately after that. I travelled in between, and then I came back to Nigeria. I went straight into business and luckily, I found myself in this great industry, where I still play. 

We’re trying to find out your first job in the betting industry. 

There was no first job. When I came back to Nigeria, I was actually into construction. I was into thermoplastic road marking. We were one of the first companies to do the marking in Nigeria, with a friend. After that, a cousin who has a flair for football, spoke about gaming back-to-back, and we decided to go on the journey. Luckily, the first player in the industry was active then, but it was more online, and we felt okay, “We can duplicate this in the retail space as well.” Then we started that journey with research, calling the providers until we were able to start.

What company was that? 

That was NairaBet. 

The co-owner of NairaBet is your cousin? 

My cousin was working with a guy called Dotun Adegbile. Adegbile was with 1960Bet. And then he left 1960Bet. I think they had a startup together. They started a brand together, and then he left 1960Bet, and then we started our own, SureBet247. We were the number three industry founder in Nigeria.

Sometimes, we see SureBet; other times it is SureBet247. Are they separate companies?

It is one company. A lot of people kind of find it easier to say, ‘SureBet,’ but it is SureBet247. Because SureBet247 is owned by someone else, we don’t know where he is in the world. We couldn’t buy the domain name. So we had to coin ours as the word is very easy and straightforward to pronounce – SureBet.

We hear that the IT backbone supporting this industry is mostly domiciled in Europe, and it takes a good chunk of your revenue. Why is that? Is it that it cannot be done in Nigeria? 

Not really. But it takes experience and time. Yeah 90 per cent of the operators in Nigeria, to be precise, actually kind of rent a platform to operate on. There are different models to get this platform: It is either you rent outright, or you take their sportsbook, and then you create every other thing around it. In the beginning, we started with renting from the platform, and then later on realised it’s difficult when it’s not in their plan for the year or if it is not economical for them to do whatever request an individual wants, they will not do it for you. So, it will take forever. Meanwhile, a competitor is doing something different that is bringing in more revenue for them or more traction, and you need to do something similar to that, but your provider will take forever to do. So, we know it is difficult. 

Then we started seeking for who can do the same platform in Nigeria, but we realise, yes, we have brilliant minds in Nigeria that can start up with platform development, but it also requires experience and knowledge. Because if you look front and back, you see that this industry is over 75 years old in Europe, especially in the UK where gaming started. If you look at that trajectory of people, learning to code, making mistakes, refining it to date, the industry in Nigeria is just 10 years old. It’s not something someone would just wake up one day, being a super-programmer and just quickly put everything together. We have brilliant minds that are working on this. We might not know them, but I am very sure they will soon be out there. It is doable, but it takes time.

What percentage of your revenue goes into these platform providers in Europe?

This goes into models as well. Some people rent out; some do a revenue share model. Plus or minus, depending on the platform you’re using, you might be spending a minimum average, for a very wonderful platform, maybe €80,000 a month to providers. The reason is that these providers also have overhead costs they carry for you in terms of where your server is, the feeds. A lot of times, there’s something called feeds, which is an accumulation of different data on sports that we market to the people in Nigeria. You also need to have a humongous number of traders. It is trading, it is not just gambling. People think “Oh, we go into sports betting, it is gambling.” There are a set of mathematicians that are balancing your books, looking at, “Oh, there’s too much wager on maybe Chelsea to beat a third-tier group, if they happen to meet. They need to make sure that your feeds or they trade in such a way that you have a balancing out in terms of your risk. 

The cost to different people varies based on this element of traders, the number of traders that they use for you, and the type of feeds you get. We have an international company. What they do mostly is collect data from different companies, and when they do this, it is also at a cost to them. The collection of different things encompasses what we call a platform. That is what determines the cost that individual providers will charge you. Sometimes you can go to them at an average of, ‘Oh, I want a small platform with medium-sized feed’. That means you won’t be able to compete actively with people that are taking bigger platform with bigger pay. For us, it is around €50,000 every month to manage our platform. 

We had a break two years ago to reevaluate the space in which we’re playing and the cost implication, knowing fully well the incessant dollar rate fluctuations and the cost that it brings to the company. How much it generates in comparison to what you pay providers. We realised building a platform is the way forward, and it took us two years, precisely, to go out, and find a suitable partner, that we are going to have our feed with them, we’re going to have our development, what suits this particular country of ours, Nigeria. Most times, when Europeans bring their platforms to Nigeria, it’s totally not the same market. We always take time to see what suits the people and what is economically good for us. So, we went out, and we were able to build a platform for two years. Right now, we don’t rent a platform anymore. We own the platform ourselves. We only took a sportsbook, which is difficult to get in terms of people collecting data from different  

countries. So we took that, but we had to hire experts to do that for us.

Where is this platform domiciled? In Europe? 

Yes, it is.

Being the third indigenous operator in Nigeria must be a feat that you still exist. We like to know how SureBet247 came to be and your growth story. 

I would say it’s a bit of luck, but mighty hard work. I can remember vividly then when we started… If anybody says, “Oh, I know how to gamble” today, it’s the work of people like us because we’re training people from state to state, doing little seminars in the quest of onboarding agents because the model then was not to own all the outlets, but to give people the opportunity to also make out of what you make, meaning, spreading the gospel. We started clearly with an idea like, “Okay, this is what we’re going to do.” We didn’t have an office then. Then we created our first shop in Ajegunle; in a place called Tolu, which is the first shop for SureBet247. 

It was a fun time because every day you wake up, you’re interested in that journey going from your house. I live in Lekki. Every day, I moved to Ajegunle in the morning, seeking for people to come and play and then we made jingles around the neighbourhood, and then we started getting the traction, and people started coming into the shop. Before that, as I said earlier, we had NairaBet which was predominantly online, then we had 1960Bet, and then we had SureBet. The competition was more between SureBet and 1960Bet, which was one of the biggest brands at that time. We were competing day in, day out. 

We had our issues along the line. I will tell you no entrepreneur will say, ‘Oh, it’s always an easy ride’. There are a couple of times, I was supposed to be out of business. I have to pick up the phone, manage the providers and tell them we are expecting money. We were looking for N1 million as a matter of fact, that was 10 years ago. We tried to pay a provider at a particular point because we exhausted our money. I was the accountant, the admin, and my partner, Olasupo Badmos, was also multitasking. So being in front of the bank when we have winnings in our car, we went to the bank when they called, and we paid. Then we recruited two brilliant guys. They were working with us. We went from place to place. We put our equipment in the booth of the car, and when we saw someone that has a good shop, we talked to them and asked them to be our agent. If they were interested in being an agent, we set them up immediately. We’ll teach them and we’ll let the guys go there back and forth to also train them on how to place bets. 

It became like muscle memory for us on how to set people up, and at that time, people were going online. Honm Akin Alabi, the owner of NairaBet, came from England, as well to start the business. So we felt, ‘Okay. At this point in our life, if we’re seeing this traction, how do we raise money? How do we go out there?’ But trust me, we visited almost all the banks, they kept telling us it is not bankable, it is high risk. It was hard to explain to them, ‘Oh, there is a logic behind this. This is not just going into it and thinking you will make money overnight. You need to be consistent at this, there is a mathematical formula behind it. There is a level of exposure that you want to carry’. You might say, ‘Oh I’m available for 50 million, 100 million exposure’, whereas at that time, I’ll have to be sincere, not like we were even managing the exposure. People did not know how to bet at that time. They were only taking 1×2, which is: home, draw, away, and that is what they wager on. The winning was very low at that time, and we were gradually building the treasure chest until we were able… and we were going to seminars, now and then we travel, and we had to visit state- by-state doing seminars. There was fierce competition which was one way the industry grew aggressively. Then we also have people coming in from out of town, they want to visit the company, and we didn’t have an office. Remember, we were just moving around. We had to get a small office. We were in that office for eight years. We were constantly bringing people, training people, and getting people to know how to bet. 

At that time, we were seriously excited. It was hard. When I came back from the UK, I dumped all the UK paraphernalia off me: I had to go to Computer Village to carry printers, and desktops on my shoulder, just to deliver. I saw old friends, they would be like, ‘Ah, this guy just came from London, see you now’. But many years down the line when they see you pull in in different cars, they are like, ‘Oh, he owns SureBet. Oh, he is working for someone, he’s not the owner’, a whole lot of stories. Well, the journey was hard, to be sincere, and it was sweet. We built something this big. 

I believe the government should also consider people like us, which nobody cares about anyway. Considering the number of jobs that we have created in Nigeria. All the people that are supposed to be on the streets due to inability to get jobs, now have something. People wake up, they go to their shop despite the fact that the fuel is super expensive, they still buy so that they can earn. But, when you give out awards and National Honours, nobody cares about the industry founder of this particular sector. 

How has the landscape changed in terms of someone trying to come into this space, as well as established players?

I’ll give you two scenarios. One, anything nice is where you find a lot of people. Considering the journey from where you started to where we are now like I said, it was hard, it was nice, but it is a very wonderful story to see that the international community, bigger brands that are well-established all-over Europe are now coming into Nigeria to invest. First of all, don’t forget, we have 220 million people in Nigeria, whatever percentage are into the entertainment side of business, which is gaming, it is good enough for a whole lot of people. For these people to be bringing in dollars to invest in the market, it shows we have done something good, and these people are coming. 

Consider the local people as well, people like us that are in this particular space, you have to understand that we have also done it in such a way… considering the local landscape as it is now, a lot of people that have money and maybe it’s just sitting down with the bank, they now see it as an opportunity to invest in something.  

They don’t have to be the main operator, but they are renting multiple shops, which is indirectly growing the economy, and when they rent these shops, they get revenue from it. A whole lot of new operators are coming into this space now to play. 

Some people are making mistakes because of a lack of understanding of how the industry works, and you know Nigerians, whenever they hear something brings money, everybody goes that route and starts investing in it. I think it’s good. It’s wonderful. Maybe we used to be five or seven, I’m talking about sports betting in the past, but if you ask the gaming regulators now, maybe we are like 50. You need to understand that it’s growing. The landscape has changed dramatically. As a matter of fact, if you consider the punters as well, the punters are no longer playing 1X2 bets. The market is super sophisticated. When you don’t have a particular segment or type of games you want to play and coupled with the fact that the Europeans now open a lot of markets who were being conservative, ‘Oh, we are scared of winning. Oh, we don’t want them to win too much’, the platform was even open then, but now, the trading has to be more sophisticated. The platform has to be more sophisticated because our people, our punters, are very, very experienced now.

So, it has really changed from 10 years ago, or eight years ago, or nine years ago. I think that we are the biggest in terms of operating processes in Africa, apart from maybe, South Africa, if I am correct. Things have changed. A whole lot of states have now set up their gaming commission. In the past, we just thought of a federal licence, go into the space and you operate. But now, states are having their regulatory commissions to manage the process in which we operate in those various states. 

Is it easier for startups now than when you started? 

I will say 100 per cent because at one point, to make the story nice for you, we were about to be arrested just a day before we went to seek approval for the new licence. We didn’t know what to do then, we were just operating. Then we realised, ‘Oh, we have to go to the regulatory commission, we didn’t know how difficult it would be, what they will ask for, but we just had to go to meet them, and they told us, “See your file, we were just about to come and arrest you guys’. It was funny, I mean, but now everyone knows where the gaming commission office is. If you want something to do with the gaming commission, you know where to find them. Go to any state, you will see a gaming commission. It has changed, it’s easier for people to get in.

Bear in mind, there is a whole lot of information out there now, compared to when we started. An average Joe can wake up today and say, ‘Oh, I want to be a provider. I want to play in a particular segment of the gaming industry’ because it’s divided into different segments. Just like the way you have your company broken down into different segments. People make a lot of money from different angles, people stay online just predicting football, and they make money from it. Trust me, a new person coming into that space has enough information on their hands to start operating as an operator. It’s way easy now, but one thing out of it is, people do not seek the right information. They do not go for the right thing. It might be difficult to tell them or for them to start if they don’t equip themselves with the right data, the right information on operation. 

Can you give us an example of a memorable success story or an interesting milestone?

We are a living example of anything called a memorable success story. We started our operation with N5 million, ten years ago, and today, you all know what people say about the gaming industry, whether it is 100 per cent right or wrong, but we started with N5 million, and that N5 million grew to N50 million to N100 million, you know, it was growing. We were not spending a dime on ourselves at that time. We were busy reinvesting everything. When they say success stories, I am one guy that could go anywhere and tell them, ‘Oh, I grew N5 million to N1 billion in five years’, and they would be wondering how I did it. Remember, we were consistently reinvesting our money back into the business. If you have to look at our turnover, our revenue was N1 billion as at that time. We are a living success story! If you have to talk about milestones, every year is a different milestone. If you ask punters on the street, they will tell you, ‘Oh, we won N20 million’, our name becomes rhetorical, like, you want to go and bet, they would say, ‘I’m going to play SureBet’. So those are wonderful milestones. If you go to some parts of the East, people still say, ‘Oh, I’m going to play SureBet’, instead of saying that they are going to bet. 

SureBet became a household name. For me, waking up and seeing what is happening in Nigeria, the number of operators we have, the number of people who play, people you never thought would hold their phones to bet, with the advent of Chinese phones, a lot of people did. We created a monster of a success story. I think it’s a good thing. I feel good with myself every day that whatever happens tomorrow if we lose everything, My name will still be written in gold: Founding member of the gaming industry in Nigeria. I think we’re a perfect example for anybody. I always say, I wish I can start writing my book by now. People need to know that everything is hard work. People sit down and start thinking maybe Jesus will come. 

There was a time we were losing crazy money, almost N50 million, monthly, and we felt like we were going to collapse. You need to bring in professionals to also help at some point. At some point, we were audited by PwC and we were trying to raise international funds as well. But it got to a point we were able to raise this money, we raised €4 million, but unfortunately, COVID happened. A part of the workforce was from India and it also affected them a lot. So, nevertheless, we are still standing, we grew, we had to readjust our processes, we had to cut down a lot of people so that we can refocus the brand on how to grow again, and we give glory to God Almighty, we are here today.

There are stories about you not paying some winning. How did you resolve it? 

If you ask around today, there’s no perfect business. There’s something we call arbitrage, people trying to deceive the system or trying to play the game in such a way that is not ethical. Some people always look for loopholes in whatever they do. There will be good ones that are doing the right thing. The bad ones, which I won’t call bad, especially in our industry, because when people find a hole in your system, you have to block it. There is a company called SafareeBet in Ghana, we nearly bought the company. What happened was, they had someone play a particular game 270-something times. Maybe there was a glitch in the system and this guy played, the game had settled, and they know the outcome, and this particular guy played 200 and something times. The commission, maybe due to lack of information, they have to tell the guy to pay, but he couldn’t pay. Back to us, and then we’ll see a similar scenario. Maybe a game settles, or maybe the provider did not close the game early, and you’ve watched the game, it is the end of the game, some people are on their phones or maybe in the shop, and they will play a game that’s been settled, that they’ve seen the outcome of the game, and they would say, ‘Oh, I have won’. But when you trace the time of play on the ticket, and when the provider closes the particular game in question, they will tell you, ‘We cannot pay you, and that always lead people to go on Twitter. As a matter of fact, we have someone trying to sue the company from Ibadan. I think something funny also happened. We traced the backend, we checked our data, we saw the log, and there was no way we were going to pay. Some people have been to the office, we have to explain to them. Maybe they came with their brother or some other arms of law enforcement, we explain to them, “This is what happened. We show them the backend, and they will look at the complaint, and at the end of the day, most times, they always accept. Google any brand in Nigeria, there’s always one thing or another about them written online. It’s not that we don’t want to pay. You should ask the question about what was on their tickets, not that we don’t want to pay them. It’s a function of what happened at that time.

So, you’ve expanded way beyond Nigeria?

I will say authoritatively, we are one company that started putting our foot out there, like multiple footprints: we were in Ghana, Kenya, Cameroon and Benin. Benin had their gaming system, but we were the first company they gave the licence to operate. In Ghana, we set like seven shops when we went into Ghana. We were there for like two years. Well, things just didn’t work out. Regulations. Maybe, when we got the licence, we went out there to start processing to play, but at that time, Ghana, too, was growing. I have no issue with them. They were growing then and there are certain things. We did everything needed. But there’s always one thing or another that you need to do. At the end of the day, in fairness to them, we were able to finish that process and it was towards the end of the year when we’re supposed to start six, seven months before that we had paid. It was around $40,000 for a licence. There are other expenses we made: houses, shops, so I just felt maybe we were not ripe or we were not ready, or Ghana was not ready for us, so we had to leave. We didn’t leave at the end. Okay, we left that time anyway. Well, maybe a year along the line, I sold the company to another known guy in Nigeria, Jason Njoku. He started gaming as well. So, I sold the brand to BlackBet. So, we kind of had a deal for him, because he started operating in Ghana, so we sold our equity to him

Also, in Cameroon, we got the licence, but there were a couple of amounts [security deposit] that we had to keep with the gaming regulator. I mean, it happens in Nigeria now as well, that you have to keep X amount for them to know you’re serious. The amount in question was a lot more than what we planned. We just did not activate that licence. In Kenya, I was privileged to speak at a particular conference in the UK, and the gaming commissioner of Kenya was sitting right next to me. When we were ready after our previous two encounters: Ghana, and Cameroon, we went to Kenya. We were able to secure a licence, but the licence took almost a year because the first guy we met kind of played funny, and we sought justice. We were happy the Kenyan government helped out. We were able to, in collaboration with the home office in Kenya, get the guy, and we collected almost $100,000 back from the guy, and we tried to start over in Kenya. But it wasn’t what we planned.

A lot of things are always happening. It is not always about what you planned, especially when you’re using local money. Remember, not that we had any international funds then, so there is a limit to how you can expose yourself. At that time, we have to cut short and say, ‘Ok, let’s focus on Nigeria. Maybe when our peers are also ready to go out, we should go out then.’ We were in all these countries that I mentioned. If you don’t renew, the licence expires. The good thing is our name is already with them. If tomorrow comes, and we decide to open again, It’s just a walk in the park. We will ask them, and they will reactivate if they don’t have any new requirement.

Are these experiences peculiar to these aforementioned countries, or do you experience the same as an operator in Nigeria?

Any operator in Nigeria will tell you the issues of multiple taxation in Nigeria. Also, there’s no collaboration between the federal and the states. That is a big issue. There’s little I can say on this particular issue because we have the Association of Nigeria Bookmakers liaising… as a matter of fact, we had to take the matter to court for interpretation. A lot of things will always happen. It is not just outside, it also happens at home as well. Where you expect regulators to speak in one voice, in harmony, so that the operators can operate with ease, and maybe whatever is due to the government, we do what’s due to them. I mean, a whole lot of operators do CSR. We give out to the needy. If you go online and search for SureBet, you’ll see a whole lot of things we’ve done. And before they will even say, ‘Oh, stop doing international marketing’, we were the first guys that started giving ambassadorship roles to celebrities. We started onboarding them. We started with Basketmouth. We gave Olamide when he was in his prime. We signed Mr Latin. Countless. We had a little partnership with Reminisce, Lil’ Kesh, and a whole lot of them.

But then, there will always be challenges that you don’t expect the government to not interfere with or for the government to not partner with. You expect them to work together. That way, it’s always good and easy for anybody to operate in the clime. It’s not just peculiar to them, it is also happening within us too. I believe they are seriously working on it. We have the association of state regulators now liaising with the federal authorities on how to share the revenue generated from these and how to licence new operators.

We are interested in the fact that you’ve succeeded in partnership, not just once. Partnerships in Nigeria are usually problematic, so what are you doing right to be able to stay with another person as your partner?

The first thing anybody in business should consider is: to have a good lawyer and have someone that shares the same vision as you. First of all, apart from having a cousin to start with, everything was documented. It was in black and white, and in every other document we submit to regulators, government bodies, it is always in that document how we should operate, our modus operandi. Everything’s well-defined, and we work with that. I believe partnership is easy, even though sometimes it can be difficult, but the most essential part is, the definition of what needs to be done, who is supposed to manage… so, as I said, that will be the first and most important part in any collaboration, having a legal person. When you talk about partnerships in our space, you don’t have a choice but to partner.

First of all, there will be agents. You partner with an agent; they are not working for us. They are business owners. They partner with us to grow our business and we share revenue coming from their outlets. You have to take care of them. You have to give them the right commission from your margin. That is one partnership. You have to do marketing, you have to partner. Fair enough, you have to pay because a lot of time they might just dump your material and not do anything. A partnership that we have to do in terms of talking to newspaper companies like yours, requires partnership. You want to put something out there, you need someone to say it in such a way that people will see what we’re trying to put out there. You ask the right questions, we give you an answer. So, the partnership is continuous, it has to be. If not, you will just be in your company spending money without having the right outcome from your expense. Partnership is important,

How do you handle the privacy and security of user data?

At some point, we had our system broken into. Some people entered into the system and they try to steal data. Luckily, we have a partnership, like I said earlier, with a company called Cloudflare, and they were able to stop them at some point. Certain data got out, no doubt. From that moment, we wrote to all our online players that we had this issue and we are currently trying to fix the issue. Then we had an extensive conversation with the company that we were using then. They were the ones that first notified us of the issue. We wrote to the government. Then there was this protection body recently formed. It is still there. At that time I think it was pretty new. We wrote to them that we had this issue, and they responded to us that they are also looking into it, anything that we might need from them to help, we should let them know. Luckily we were able to curb it. There was a guy from South Africa that also wrote to us, he was putting it online that ‘Oh, there’s something wrong with your system.’ We didn’t even respond to him. From the way he warned us, we were not sure.

Initially, the people that tried to hack the system wrote to us that we should give them some money. They called: “Do you guys want this information about your system? We saw what leaked out,” and we didn’t respond. Immediately after that, we had that South African guy trying… Anyway, in a nutshell, there’s data protection, very strong now, and luckily, the new regulation about data protection in Nigeria is very high. Every time, there’s a body that you have to register with. If you check with the body, we’ve spoken to them as recently as, ‘Okay, where are we? What do we need to do? and when we complete the process of this data protection, we will be given the privilege to put the data protection logo on our platform to show that we have done that. It is also a work in progress because just recently they started reaching out to gaming operators that keep customer data, “Okay, these and these are the process you need to follow.’

You will soon see the logo on our website. It’s an important part of gaming. You keep a lot of people’s names, dates of birth, cards, and phone numbers. You don’t want anybody to get access. You know, we’re in the 21st century and data is everything. It is data war countries fight now, not even the normal shooting of each other or whatever they do. Now, it is about data. Data is an important element of our operation. When you are onboard, and then you do KYC as well, we verify who you are, because we don’t want money laundering. If you deposit and you try to withdraw on our platform, it is not going to be possible because that is for you to know that you can’t just put in money and take it out, and then say, ‘Oh, I won from a gaming company.’ We don’t want that kind of label on our company that will allow round tripping of funds. So, that is also another aspect that we are trying to protect customer data. If you have to take a licence, there’s SCUML, you have to also take that. if you don’t have that, the gaming regulators, are not even going to register you.

It’s good. Things are getting better. If you don’t have certain documents, you will not be able to progress to the next level. Anybody coming into the gaming space now, knows they have to do the right thing, do the right diligence before you get the licence to operate. Yeah, we started way before then, but now, they mandated it for everybody to go back and do those things before you move forward.

Which brings us to the question of how do you promote responsible gaming.

The number one law is, you do not allow underage to play in your outlets. Now, due to certain requirements for online, if you do not meet the age standard, we will block your account, even if you create an account. What are these requirements? Maybe any form of proof of age. We have to get it. Any government-issued licence. And in the betting shops, if you go to any of our outlets, you’re going to see +18 only, that’s an important aspect. For you to be an agent, even if you go on to SureBet, you will see 18+ below. If you are an agent, when you log in, there is a place we call marketing material, you click on it, you will see a big +18 banner. You see a whole lot of other banners that you can click. If you don’t have one, or something happened to the one we gave you on your module, you have to reprint and put it in your shop.

There will always be black sheep among agents as well, and also for online players, but when we notice that, we always give warnings. In our document, our agreement document with agents, they will have the first warning, and then we’ll follow through if they misbehave, because sometimes because they share part of the revenue, they always want punters underage to come. We can’t say, ‘Oh, we are clean.’ Even if the company tries to stop these, what about your agents? You have trained them on how to protect the image of the company, still, some of them will go around it. Sometimes this happens, but either way, we try to reduce this, and I believe recently, there is an organisation that is newly formed that tries to promote responsible gaming, as well. I believe that will also help.

The government also needs to take part in this responsible gaming. In the UK, for now, they ban advertising during the match because kids watch football. In some other countries, you can only advertise adult content products, maybe at night. I’m not saying we are at that level, or considering the number of people that can’t even afford DStv. We need to be sure we’re not copying and pasting wrong rules or models. But it is important to implement responsible gaming. Apart from the company, as a responsibility for them to do, maybe the society as well, you ensure they look out for kids going into a shop. There’s a number everywhere. You see posters, banners that people can also call: ‘Our kids in our neighbourhood and getting into your shop.’ Then it’s the responsibility of the company to act on such agents. But when we don’t get information, how do we act? Internally, we make sure that this is a priority for the brand to push the agenda of responsible gaming so that we don’t give people bad signs or bad information about what they should do as they grow up.

How do you ensure transparency and fairness within the organisation?

I think first of all when you speak to the regulator, there is certain information that has to be provided every month to them. We have software, there is nothing that the regulator needs to know that they cannot have access to; we plug into their platform. They know what you sell. They know what they want to see. If you talk about transparency, if someone wagers N250,000 on a ticket, it has to be in your report monthly. There’s nothing that the gaming operators can hide, especially when you have the government themselves taking the good stand of going and building their software to see your back end, to mirror what you do. This is what you would call in our space transparency, the government needs to know so that you will be able to pay the right revenue due to the government.

A whole lot of companies cannot hide. it’s software-based, and the codes don’t lie. When you put two codes together, it is what you put in that you get out. It is garbage in, garbage out. It shows them whatever they need to know. And most times, before you start, you go through a rigorous process: Government needs to know who you are partnering. They want to know what software you’re using. They want to know how many providers are plugging into your system so that they can also be able to watch this provider. There are always black sheep, people that will not go through this process, that would want to do it underground. But in terms of established operators, you have to be transparent, you have to be open about what you do. The government knows about everything that operators do.

What kind of support would you like to get from the government?

Let me use Europe to cite an example. In Europe, the gaming industry is bankable. You can use X assets or X process revenue to seek funds from the government. Bear in mind, the operators might not really need money. They only want to have that access, especially on those days that you see crazy wins, not that you will not be able to make the money back in the subsequent days, but you want to pay out this your big winning so that people will believe in your brand and whatever you promise in your advert, they know you are good for it. If the government makes the industry bankable or lets the banking industry do what is called ‘banking’, which is lending, a lot of times they just find a way around it, nobody wants to lend, ‘Oh, I will not get my money back.’ It’s a big issue. If the industry can be bankable, number one that’s good.

Then number two, what I want the government to also look into, is the issue of multiple taxation. You go to this state, they say it’s N100 million, you go to that state, they say it’s N50 million. A state that has 5 million people, it is only Lagos that has 25 million people, they will tell you to pay X amount in Lagos, they also want that. But if there is a collaboration among the states, we pay to the central, the central distributes based on your population or based on the activity of the company in a particular area. I think that will kind of help. And since there is federal government involved in licencing, there’s a federal licence you have to have, if you don’t have one, you can’t operate online, I think they should work together and make sure that the operators have a fair place to play. I think it lies more on the government to make this available, to make this process work amicably among themselves, so that operators and new entrants/operators will be able to have a soft landing, and it will really help the growth of the industry in Nigeria.

We are still scratching the surface, if I have to say. Go to England, there are too many things you see that are gaming-related, entertainment related, from scratch cards to general lottery to maybe slot machines, etc. So, I think these are things government should give us an atmosphere that is good and they harmonise their processes. It will be easier to increase your vertical by bringing in more products into the system. I think that will also create growth as well. I think they should work together.

Whatever happened to your investment in Yellow Lotto?

It was formed by four operators: NairaBet, SureBet, 1960Bet, and MerryBet, these were the companies. They are all local companies. We came together trying to put something in the lottery space. What happened then was, there was a back and forth with the government on whether number games should be allowed in the sports betting shop or should they have to take a lottery licence. We had to give a clear explanation that the number game in the betting shop is totally different from the lottery. It’s virtual. It is an animation that brings out X outcome for people to win. And also on the transparency level, there is something called RNG (random number generator}, you cannot control it, and this has to be certified in the US before you can use this RNG-based solution. Any operator that builds a platform that is a number game, must have that, just the same way for all other virtual products.

We came together when the up and down was ongoing, and we took a Lagos State licence. At that time we started. We started in Surulere, and things just didn’t go as planned. In Nigeria, people would see someone growing in a particular sector, you go in there, you jump in. If you look at what Baba Ijebu has done, Sir Kessington Adebutu, his lifework is in the lottery business. We are young, we just saw what he was doing, and felt, ‘Oh, let’s do it. We have our network and we will be able to capitalise on the market,’ but it doesn’t work that way. There is allegiance from the agents on the streets. There is love. If you look at the Red Terminal, there is no amount of terminal you put beside the Red Terminal, it is that Red Terminal people go for. It is years of labour.

We went in too early, or maybe we didn’t think through our model, or strategy that we intend using to capture the market, but we tried, and after a while, we realised, ‘Okay. Maybe…’ in us trying to find the product market fit, we decided different formulas among each other, we put the money together we pushed, but that didn’t work. Maybe if individuals were pushing on their own, maybe that would make it work. And then, out of that, we created Yellow Lotto, Sure Lotto, you will see the other guys, too, have theirs.

There were also reports that we only took one licence. So we spent quite a huge sum of money in trying to bring in this hardware, importing it, setting up, getting agents together, but everything kind of went down. In the future, we believe we are still going to raise it. We’ll begin with wage rises again and start over, but as we speak, the whole Yellow Lotto hardware that we bought then, we bought massive drums that were supposed to be for playing the games, rolling games out, we created a big open space for this game. We have everything kept in a container somewhere.

I believe the industry is also good. It is totally different from sports betting. I’ve been privileged to meet Baba twice, I sat beside him just to represent the other guys, and I mean, he’s done fantastically well. There’s nothing you can say about him or how the industry is. If you want to be there, you have to pay the price. I think we went in early and we are all paying the price as we speak, and I believe with time, we will still go there and try to pay the price, so that we can as well be where Baba is today.

In the product description of Yellow Lotto, there is a use of AI for its function. Can you speak more about that?

I spoke about our sports betting where AI plays a vital role. I don’t know now about the lottery. Remember, we closed our operation. But in sports betting, it is part of what we have to do. Why? For you to know what a team is doing, historical record, ‘Okay, this keeper was wounded from the last match. Would they score more on him? What kind of odds do you want to give this keeper? Is this guy going to be in the first 11 teams that will come on the table?’ So we have different algorithms and different AI logic that is processing data, and this data is what we feed into our number. When people see ‘home to win,’ the definition of this Home, Draw, Away, there are a lot of things to do with numbers. That number is what we give out. You see, at times they say home is 1.1, you put a N100, you get N110. You will see away as 30-something. In this case, the home is in a form better than the away.

Sometimes there’s live in-play, an AI process whereby you see an ongoing game, you can play on the next throw-in, next corner, and next red card. All these things are superfast, And it’s not just something you can be doing manually. That’s where AI comes in. Moreover, the industry, like I said, is growing in such a way that at some point, the industry might be scared of people being able to predict accurately. There’s human intervention in soccer, it is two teams against each other. Well, if they check historical data, they will be able to predict a possible outcome, which is already happening. So far, I believe, we are still not 100 per cent there, even for autonomous cars, they’re still not 100 per cent there, so not to talk about something that is based on human interventions. I believe it will take time, but AI is involved in almost everything now.

QUOTE

We created a monster of a success story. I think it’s a good thing. I feel good with myself every day that whatever happens tomorrow if we lose everything, My name will still be written in gold: Founding member of the gaming industry in Nigeria. I think we’re a perfect example for anybody