After Robbie Morris helped build betting apps and sites he soon realised there was a growing market for helping larger betting firms to create more exciting and engaging content with their users. Here he explains how his company Two Up Digital raised capital to fuel growth, why he wants to enter the US market and the importance of a business mentor.
When was the company founded and why?
Two-Up Digital was founded in December 2016. Headquartered in Shoreditch, we specialise in providing truly innovative technology and digital services to the online betting industry.
Online gambling and gaming is a large but surprisingly stagnant industry when it comes to digital innovation – most sites have the same functionality as well as a similar ‘look and feel.’ We wanted to deliver excitement in sector that’s bogged down by a ‘one size fits all’ mentality and is laden with boring product.
Having studied for a degree in journalism, I learnt the publishing craft during an 18-month stint at an independent golf magazine. From there, I moved into a role curating and managing content at a specialist agency called Grand Parade that specialised in providing digital services to the betting industry.
During my time at Grand Parade, I moved into a more technical role; helping design and build the services behind betting sites and apps. After Grand Parade was bought by William Hill, I took that as my cue to start my own business. Here was an opportunity to build a fast-moving agency that could work with the industry giants to develop more innovative and differentiated services. Many of these brands rely on legacy technology platforms that can’t keep pace with their business ambitions. We knew we could build our own platform and, with it, define our own future alongside helping to shape the future of others.
How much initial investment did the company need to start and where did it come from?
I decided not to go down the VC route. Instead, the development of our platform has been self-funded, by way of revenue generation from two brands that really believed in what we were doing, so signed up to be early adopters of the vision and technology.
In total, £1.6 milllion has been ploughed into getting the technology to a level where it is scalable and can support biggest betting events of the year, such as The Grand National.
What marketing did the company employ to maximise exposure?
This is a relatively close-knit industry where marketing comes by way of word-of-mouth, networking and the relationship building. Our agency team works with multiple well-known brands across the industry on a daily basis, and the work that is produced and the relationships that are developed naturally push us into conversations about them adopting our underlying platform to host and deliver all their digital services.
For example, we recently built a content portal for a well-known UK bookmaker and, in the process, established a relationship with its external editorial agency. In turn, they introduced us to an American group to potentially build out the platform for an US audience. With the landscape in America about to change, it’s certainly an exciting time for us.
As we grow our strategy will change to include the major conference shows, PR around new product launches/operator acquisitions and continued networking through the agency business.
Talk about the company’s growth trajectory.
The company was founded off the back of establishing revenue streams from the two early adopters. These revenue streams cover our operating costs, which includes a team of 28, with a head office in London as well as developers in Romania and Moldova.
As new operators start using our platform, there will be an obvious need to scale this team, but the extra revenue driven by these new operators will make that possible.
Ultimately, the acquisition of new operators will drive profit. There will come a time – we’re predicting in around three years – when the team size is scaled to the optimum level and any new operator coming on board equate to pure profit.
How important is an inspirational figurehead to a scale-up company?
The inspiration may come from one person or a couple of figureheads, but I believe you need a great team ethic and the buy-in from employees if you truly want to scale a company. Initially it stems from a belief that the company’s vision will make a change to whatever industry they’re operating in. I firmly believe that we have the team in place that brings something different to a pretty stale industry and has the drive to keep innovating.
Ultimately, business is all about relationships. Life is too short to work with people that make it difficult for you and establishing friendly, working, relationships elongates the length of time you do business together. Our approach is to ensure our operators get the level of service that their customers would ultimately expect from them. They play into the decision-making process, we listen and understand their business needs and work with them to ensure we’re helping them maximise potential revenue.
While we provide software as our core business, the team’s experience and knowledge of the industry also means we act as consultants to the business needs. Having discussed this approach with a number of leading industry figures, the response has been one of a ‘refreshing change’.
When it comes to investment, containing the team sizes and keeping the team lean means we can build product faster than our competitors, and the lack of political challenges means we can discuss, debate and deliver innovative product without limitations. This appeals to advisors, investors, and ultimately partners.
What advice would you give to scale-up companies looking to build their company to exit?
Understand where the value can be added to the business based on your potential exit strategies. For example, if you are an agency business eyeing a potential exit strategy whereby you’re acquired by an operator or client, then personnel is key. Investment in your team and bringing in the right people will add major value.
An alternative exit strategy would be an acquisition by a larger agency as a new department to its business, and so revenue is key.
Think hard about the potential exits and keep your options open. Lean on mentors and industry experts for their advice and listen. They’ve been there and done that, there’s nothing new to scaling up a business and exiting, and there are plenty of people who will happily help you through it.