Jumbo Interactive Partners With Gatherwell Limited
Back in November 2019, Jumbo Interactive Limited made a surprise move by venturing into the United Kingdom. The firm announced that it has entered into a conditional partnership to acquire lottery manager Gatherwell Limited, a private limited liability company. Gatherwell was founded in 2013 and is located in Oxford, United Kingdom (UK) as a lottery firm to support local causes and educational institutions across the UK.
The acquisition was locked in at the price of 5 million pounds (9.1 million Australian Dollars). Presently, Gatherwell has around 80 local authorities and 1000 schools as consumers, dispersed across 5,000 causes and selling up to 130,000 lottery tickets annually. Relative to the UK national lottery, smaller-scale lotteries are favoured by the public due to their support of local causes.
As one of the companies being featured in Brisbane Top Companies in 2019, Jumbo Interactive will fork out $5.4 million in cash on acquisition for the UK firm, with subsequent payments of $3.7 million payable should Gatherwell meets revenue and profit targets. Likewise, Gatherwell was announced as a winner of the “Lottery of the Year” Award at the Lotteries Council Annual Conference and Networking Event 2019 in Warwick.
Meanwhile, founder and CEO of Jumbo Interactive Mike Veverka was of the view that the acquisition will speed up the company’s expansion of its software as a service (SaaS) business in Europe. Additionally, the move marks a significant step in building the Saas Powered by Jumbo Business segment and its ultimate goal in achieving $1 billion of ticket sales made through the platform before 2022.
Mr Veverka and Jumbo Chief Financial Officer David Todd will join current Gatherwell directors Martin Woodhead and Ben Speare on the board of the UK company following the completion of the acquisition. The news appeared to have occurred at an appropriate time, given that the market size is expected to increase. This is because of the announcement made by the UK government on 16 July 2019 where amendments were made to the limits of large-scale lotteries. For instance, the individual per draw sales limit have been increased from 4 million to 5 million pounds.
More recently, Jumbo Interactive Limited has produced record results for the six months leading up to 31 December 2019. Total Transaction Value soared 25 per cent relative to the previous year to arrive at $185 million. Specifically, the firm attributed the significant improvement to the increased consumer loyalty and engagement as a result of its new software platform.
This is evident in the number of active customers sitting at 848,621, a 118 per cent increase over two years as well as a dip in dormancy rate – more than 40 per cent decrease since 2018 to that of 16.9 per cent. As a result, it is clear that the firm has embarked on the right track in creating a platform where customers are happy to play and return more frequently.
By Caroline Wong
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