
Off the beaten track: Betsson firmly plants its flag in untapped and emerging markets
As Betsson’s latest results hit new highs, Pontus Lindwall lifts the lid on geographic diversification, why the German market is "a big failure" and why there is “no secret sauce” to growth

It is 14 months since Pontus Lindwall was unceremoniously sacked as CEO of Betsson AB by then-chairman of the board Patrick Svensk. At the time, in September 2021, Lindwall had been at the firm’s office in central Stockholm preparing for an upcoming strategy meeting when Svensk approached and bluntly informed him that he was to be fired. The CEO incredulously questioned the decision, yet an unwavering Svensk reiterated that Lindwall’s second spell as CEO of Betsson – which began in September 2017 – was over once a replacement was appointed. The Stockholm-listed operator put out a press release at 11.05am CEST on 17 September announcing Lindwall had completed the so-called ‘Back on Track’ assignment for the business and that the search was on for the “next generation of international leader to further develop Betsson”.
The trouble was the chairman hadn’t consulted with the company’s major shareholders, which includes a group of influential Swedish families. In fact, Lindwall’s mother, Berit, has a stake in Betsson as her late husband and Pontus’ father, Bill, co-founded in 1963 what was at the time a land-based gaming business (Cherry). Once news of the popular and respected CEO’s impending departure broke, a revolt among the biggest shareholders ensued, Svensk was sensationally ousted as chairman after a no-confidence vote, and Betsson later announced Lindwall would remain in the top job.
“It was quite a turbulent period,” reflects a smartly dressed Lindwall on a video call while sporting his trademark lime green-framed spectacles. “Luckily enough, I could put it behind me very quickly and start to look forward, and this is what we have done – we have come together as a company and moved on.”
And moved on Betsson certainly has. The operator, which boasts 20 brands including the likes of Betsafe, NordicBet and a host of casino sites, has been on quite the roll of late, racking up solid year-on-year (YoY) growth and breaking its own records for headline performance metrics. The firm posted its best quarter ever in Q3 2022 as it hit all-time highs for revenue, operating income (EBIT), customer deposits, sportsbook turnover, casino turnover, sportsbook revenue and casino revenue.

Pontus Lindwall, CEO of Betsson AB
In fact, overall revenue was up 35% organically YoY to €200m while EBIT climbed 38% to €38m and customer deposits swelled 24% to €943m. Sportsbook turnover and revenue jumped an eye-catching 29% and 45%, respectively. What’s more, eight of the 10 best-ever days for sportsbook turnover at Betsson have occurred since the start of Q3. All this growth came hard on the heels of record revenue in the previous quarter of €186.3m – an organic YoY increase of 13% – and revenue of €170.2m for the first three months of 2022 (up 14% organically on Q1 2021).
And while publicly listed heavyweights like Flutter, Entain and 888 have endured a torrid year in terms of their share prices and market caps, Betsson’s stock on the Nasdaq Stockholm has reflected the firm’s financial performance and is up 58% in the past 12 months to SEK82.59 (£6.51) at the time of writing. So, what does the CEO put all this impressive momentum down to? “It can be partly attributed to the fact that we have a geographically diverse portfolio of markets – we are not as sensitive to headwinds in certain local markets,” he replies. “And given that we have such a broad portfolio of markets, we can reallocate our resources – not only marketing but also development ones – to focus on the markets where we see traction and better opportunities for the near to mid-term. That’s how we manoeuvre in this kind of bumpy landscape.”
Brands such as Guts, Jalla Casino and Super Casino helped online casino account for 73% of the company’s revenue in 2021, followed by sportsbook on 26% and ‘other’ on 1%. Casino’s share shrunk to 68% in Q3 2022 as sportsbook rose to 31%, giving Betsson a more balanced product portfolio mix heading into the World Cup. Certain operators have looked to M&A to ensure they aren’t too reliant upon one vertical for revenue and provide alternative user acquisition channels and cross-sell opportunities, yet Betsson’s CEO is quite happy to remain a gaming-led operator.
“We are not at all ashamed about our mix,” Lindwall asserts. “This company comes from the casino side of the industry with its heritage. Nevertheless, we are going more down the sportsbook route as we normally do that when we go into a new market. You can see that sports betting’s share of revenue has increased over time and I expect it to continue. Then again, if we see a market that is crowded on the sports side and there is potential to operate casino in a very good way, we might go with [just] casino.
Greenfield opportunities
The region known as CEECA (Central and Eastern Europe and Central Asia) has proved to be an engine for growth. In Q3, CEECA accounted for 39% (€78.8m) of revenue, an increase of 48% on Q3 2021. Besides Q3 gains in Georgia, driven by the casino offering, and growth in Estonia and Lithuania, markets like Croatia and Greece are performing particularly well. Despite entering Croatia just two years ago, the firm’s Rizk brand has secured a top-three position in the market. In Greece, Betsson recently renewed its sponsorship of the football’s second division, Super League Greece 2, and sponsored motorsport’s WRC Acropolis Rally in September. It hasn’t been all plain sailing in the CEECA region, though.
Earlier this year, Betsson took the decision to withdraw from Belarus after the country’s president, Aleksandr Lukashenko, openly supported Russia’s invasion of Ukraine. The autocratic and combative leader, a close ally of Russian president Vladimir Putin, allowed Belarus to be used as a launchpad for missile strikes on Ukraine and as a gateway for the Russian military.
Betsson had around 20 staff based out of an office in Minsk, the capital of Belarus, following the launch in July 2021 of online sports betting, casino and poker under the Europebet brand. The gaming licence was relinquished on 16 March and the operation mothballed. “Operations were affected but, fortunately, the people working at our [Minsk] office were very understanding of our decision, even though they were probably not happy about it,” Lindwall explains. “From a revenue perspective, we hadn’t been able to build up a large revenue stream by then, so it didn’t have a big impact on the run-rate for the company.”
Meanwhile, Betsson continues to make inroads into Latam, a region which accounted for 19% of group revenue in Q3. The company has one of the larger footprints of all the European operators present in Central and South America with its organic and M&A growth strategy. Indeed, Betsson snapped up a 70% stake in regulated Colombian operator Colbet in 2020 and later rebranded the operation to Betsson.co.
Inkabet, a leading sports betting and casino operator targeting the western portion of South America, was acquired in August 2021 in a deal worth up to $34m, or 3.8x Inkabet’s EBIT for the trailing 12 months to June 2021. The acquisition preceded Peru’s president putting pen to paper in August 2022 on a new gambling law in the country with online GGR tax set at a reasonable 12%.
Betsson has also soft-launched in regulated Mexico and, back in February, Betsson.com.ar was rolled out for the City of Buenos Aires and Betsson.bet.ar in the province of Buenos Aires. A licence application has been submitted for the Argentinian province of Cordoba through a partnership with Casino de Victoria.
“Every local market is different from other local markets to some extent,” says Lindwall when discussing the diverse and complex nature of Latam. “One reason for being successful in those markets is we have strong local knowledge and people on the ground who understand the market and find opportunities for PR campaigns and things like that.”
Payments have historically been a challenge in this part of the world, yet the situation has improved somewhat of late. Incidentally, a Betsson subsidiary last year acquired 50% of the shares in JDP Tech Ltd, the owner of a proprietary platform that processes payments in Latin America.
And then there is Brazil. With a population of 214 million, or half the population of South America, industry eyes are fixed on this football-crazed nation now the long-awaited sports betting regulation should soon come to fruition with the presidential election done and dusted. Betsson has a foothold in the country, having purchased a 75% stake in Brazilian horseracing operator Suaposta in 2019 and later rebranding it to Betsson. Meanwhile, former Brazilian football international Zé Roberto was recently hired on a three-year contract as a brand ambassador. “Brazil isn’t our biggest market in Latam at this point, but given the size of the market and the interest in sports, we believe it has a large potential for the future. We look forward to the regulations and what is going to happen there,” Lindwall notes.
In hindsight, you could say the decision by Betsson’s management to focus on untapped regions like Latam and CEECA and not to go all guns blazing into the US in the aftermath of PASPA’s repeal does seem a shrewd move. European igaming companies that have ventured across the pond to America have found themselves feeding on scraps falling off the top table now the leading trio – FanDuel, DraftKings and BetMGM – have cornered around 77% of the market between them based on GGR, according to recent data published by Eilers & Krejcik Gaming (EKG). With the need to secure access deals with land-based properties, stump up for online licences and locate servers in each state, the 31 US jurisdictions with sports betting up and running today behave like 31 separate countries.
It’s why the US is now often labelled a money pit and why some companies aren’t anticipating profitability there for another three or four years. Betsson is live with Betsafe in Colorado, the state which has attracted the most online sports betting brands – 26 at the time of writing – due primarily to its favourable regulatory regime. Although this launch, in May 2022, was more about providing a shop window for the firm’s B2B capabilities, EKG recently revealed Betsafe had climbed seven spots quarter on quarter to 11th in the boutique analyst firm’s US sports betting app rankings report. Betsafe’s “slick, intuitive front-end” was singled out for praise. Lindwall suggests the fact online casino is still limited to six states had a bearing on the operator’s US ambitions.
“The US is going to be an amazingly big gaming market at some point, but it is going to be highly competitive and not a walk in the park to operate in all those markets with different regulations, different taxes and different product offerings,” he remarks. “Seeing that competitive landscape and acquisition costs, we decided to hold back. That doesn’t mean we will not go into the US with B2C on a broader scale at another stage – there may be opportunities but when we made this decision at the time, we saw better opportunities elsewhere.”
Lindwall adds: “Betsson is a company that has been giving dividends on shares as long as I can remember, and we wanted to remain quite profitable, so it was an impossible combination to do that and go into the US and take a sizeable market share.”
With inflation in the Eurozone hitting a record high of 10.7% as consumers feel the pinch from rising food prices and energy bills, the industry is trying to model how discretionary spend could be impacted. The crux of the matter is whether igaming customers continue to play like normal or if they tighten their belts to pay for the essentials. “We’ve been through a number of different challenging times, but nothing is similar to the last one – and this is a new one as well,” says Lindwall.
“It is too early to say how it is going to play out but so far, we haven’t seen any downturn. We have a lot of normal consumer players who don’t play for high amounts. It’s a cheap, fun thing to do. I wouldn’t say Betsson is vaccinated against these sorts of problems but there are other consumer goods that will get hit before we do because they are expensive and leave a bigger hole in the wallet, like travelling or renovating your kitchen, buying a new boat or summerhouse. There’s a different price tag on these compared to putting €5 on a soccer game.”
A rough ride
The “bumpy landscape” Lindwall referred to earlier continues to be largely closer to home. Revenue for the Nordics rose just 0.7% YoY for the three months to 30 September as Norway and Sweden revenue declined, despite Denmark’s all-time high revenue in casino. Western Europe revenue plunged €15.5m (29.7%) in the same period due to reduced casino income and the decision to exit the Dutch market in Q3 2021 ahead of regulation and to stand a better chance of being granted a licence. Betsson has applied to the Dutch regulator for online licences, including for brands Casino Winner and Loyal Casino, yet Lindwall is tempering expectations.
“I’m not so sure,” he responds when pressed on how soon his company can realistically regain its position in the Netherlands after being unable to accept Dutch customers for well over a year now. “Today is a different story in that market from when we left and there are new companies that were not there before. We will start a little bit from scratch even though we have some brand equity. Internally we don’t think, ‘When can we be back to the same revenue as before?’ It’s a new game and we will do the best we can. We have good brands and a product we know is working well in that part of the world.”
In neighbouring Germany, Betsson operates horseracing site Racebets (acquired in 2016) and holds a sports betting licence, although the latter isn’t being utilised right now. The firm was previously looking to be granted three slot licences but has since re-evaluated the situation and decided to apply for just one licence for the Rizk brand. This speaks volumes about Betsson’s hopes for igaming in Europe’s largest economy.
“We have not-so-high ambitions in that market right now,” Lindwall concedes. “It’s sad in a way because Germany is a powerful market with lots of people, a quite healthy economy and modern infrastructure. Everything is in place to have a very functional, controlled and taxed gaming market, but the government and the administration decisions are fuelling the black market. We want to remain in Germany but with less interest and efforts than before.”
Rules such as the €1,000-a-month deposit limit, the €1 stake cap per spin and the sky-high 5.3% turnover tax on slots, which forced the industry to slash the RTP on slots to around 90%, mean the country has arguably the most restrictive igaming regulations in the world. For Lindwall, the status quo is unsustainable due to the level of leakage to unlicensed operators. “It’s like liquor regulations and drinking underage, or speeding limits or tax laws. If you have so many people in the country acting outside of that regulation, how can you come to the conclusion that regulation isn’t a big failure? It is a big failure. I don’t see how the German authorities will sit there, just watch this happen and still feel satisfied with the situation. The regulation is unsustainable because it needs to be changed for the better.”
Finally, Italy was described in Betsson’s Q3 results as “a shining star” in the Western Europe region as the company’s subsidiary there continues to grow faster than the market. Italian revenue and deposits reached new highs aided by a new sportsbook recently launched under its local StarCasinò brand (StarCasinò Bet). To boost its presence, the operator has also amassed six football sponsorships with clubs spread throughout Italy: AC Milan, Roma, Sassuolo, Torino, Palermo and Salernitana.
“We have an amazing Italian team who understand the market,” Lindwall says. “There is no secret sauce; it’s hard work, understanding the market and trying to cater to what the customers want.” And with online occupying not much more than 20% of the Italian market, this boss agrees there is plenty of runway for growth. “I’m sure online will continue to take market share despite the culture [in Italy] with land-based [betting].”
Career ladder
Next year will mark 25 years since Lindwall was first appointed CEO of Betsson, a spell which lasted until 2011 when he was elected chairman of the board. The phlegmatic Swede has had a ringside seat on igaming’s birth and evolution over the years after deciding to enter the space in the mid-1990s when exploring sectors that could be transformed in cyberspace. Fascinated by the internet and having studied technology at university, he contemplated various e-commerce ventures such as selling books or CDs over the web shipped from warehouses rather than stores, in much the same way Jeff Bezos did with Amazon.
Realising the potential for gambling on a PC over the internet, albeit sluggish 56-dial-up connections back then, Lindwall received financial backing of Cherry to found Net Entertainment in 1996, a startup that became known as NetEnt and went on to become a leading casino supplier (now owned by live casino giant Evolution).
Lindwall soon became a key figure in the nascent, unregulated years of the industry as Sweden emerged as a breeding ground for igaming businesses. Today, Betsson AB, to give it its official title, is the parent company for Betsson Group based out of Malta where more than half of the company’s near-2,000-strong workforce are located, and which remains one of the online industry’s leading lights, underpinned by a bulging stable of brands and proprietary technologies. And right now, the focus is on Q4 growth and the World Cup in Qatar, an event that management believes could be the largest-ever sporting event in the company’s history. “We expect big activity,” Lindwall confirms.
Plenty of bookmaker-friendly results could very well send Betsson’s share price even higher. “I’m happy to see the share price has moved upwards during a period when the stock market in general has, unfortunately, gone down,” Lindwall comments. “We have been performing relatively well compared to others in our industry and to other industries as well, and maybe investors look to companies that have done well in other problematic times. The dividends can help as well. The shares that have really taken a hit are the ones where you invest and hope for the future – you don’t have any revenue and you definitely don’t have any profits. They have suffered the most.”
Clearly, investors are confident in Betsson’s strategy of geographic diversification and not putting all its eggs in one basket. The operator handed back three of its four UK licences in 2020, leaving only the Rizk brand, and has conspicuously taken a more restrained approach to the US. While Germany still causes regulatory headaches and it’s a case of playing a waiting game where the Netherlands is concerned, Betsson has demonstrated that it’s a big wide world out there. CEECA and Latam are bearing fruit, while Africa looks to be one for the future; the company holds a licence in Kenya where Betsafe operates and is the majority stakeholder in Nigerian bookmaker betBonanza.
“We have this geographic diversity which means we can quickly refocus and put efforts and activity into markets to sustain our revenue and profitability,” Lindwall proudly states. Leaning into unexploited markets should, in theory, maintain the company’s impressive winning streak.
€556.7m
Revenue for the first nine months of 2022
1.1 million
Active customers in Q3, a rise of 7% YoY
19
Number of jurisdictions where licences are held
39%
Share of revenue derived from the CEECA region
1,948
Employees representing 60 nationalities across the group
Source: Betsson