Do you have what it takes to make B2B successful?

Director and founder of full platform operator Offsidegaming Matt Jellicoe talks to iNTERGAMINGi about what it takes to make B2B successful

A plethora of business to business operations have launched in the last couple of years, from both new ventures and existing operators. However it still seems as if 90 per cent of business to buiness deals founder in reality. There are still many new entrants eager to invest in this space without sufficient knowledge and many fairly experienced new ventures struggling under increased competition and legal issues thrown up in Europe and the US.

With the failure rate so high and the pareto principle (or 80:20 rule) so appaarent, what are the key principles of getting B2B to work for your business?

Whether a software company or an operator moving into the B2B space, everyone is trying to achieve the same thing - to grow profitable long-term businesses. However, despite a fairly straightforward strategic objective, it is amazing how many different ways there are of going about it.

Software led companies

The pure software model is likely a relatively easy deployment where the software company charges fees to cover its input and protects itself with on-going monthly maintenance fees or monthly minimums. The reality is, however, that any operator entering European markets in the current time really has their work cut out. There seem to be many suppliers out there currently whose model is more based on getting £100,000 up front for a platform build, covering themselves with high monthly charges, with the majority of clients burning out after six months.

And here lies the fundamental issue. In today’s world launching an egaming business is tricky. You really have to know what you are doing.

Too many suppliers are willing to sell without too much analysis of the strategy of their intended partner. Questions need to be asked like; What is their strategy? What is their business plan? What is the finance and what are the team like? If you want a partner for the long term it is really important to do full due diligence on them.

Operator models

The other issue is that once a client is live what kind of support are you willing to give them. For example some of the operator led B2B operations have full marketing support, CRM, affiliate support and fraud departments. The chance of success is likely much higher when this kind of resource is brought to bear. An operator (as opposed to a software company) is also much more likely to really question your strategy, as operating profitable gaming markets is their day to day business anyway.

What happens if a B2B deal starts to run into issues? Most companies from the software side will effectively switch off a site if minimums have not been met. However an operator is likely to see this differently. Offsidegaming has a number of successful B2B deals, and in most cases we have had to get involved in the client’s operation in some capacity to put things right at the start. This can be at a strategic level or it can involve assisting with resource and people. In some cases it has also involved financing partners to get them to full profitability. When selecting a B2B partner you need to be as careful as if you are putting your own operation together. Is the team right? Is it good enough and so on. You will spend time and precious resources on these deals, there is no point squandering them. If you have done your due diligence correctly are happy with the strategy, are happy with the team and happy with the opportunity, you have to be prepared to get stuck in and drive the venture forward if things don’t go according to plan.

This in my view is the key to getting B2B to work for you effectively – only 10 per cent of deals out there are worth doing, finding them and supporting them is the key. Be very selective and as strategic as possible so that the deals fit with your own strategy. Treat them as part of your own operation.

Personally, I think this is where operators have the chance to be better at B2B than traditional software companies.  Why do I say this? Well, operators are aligned commercially and operationally and have much more resource to make the relationship profitable.