Online gaming is a segment of the global gambling industry that has gained a lot of popularity over the past several years, with the introduction of new and more innovative products and services both for desktop and mobile devices. With the surge of Internet gambling, it would be interesting to look into this exciting world and some of the people that have contributed to its current state and will certainly keep on working towards its further growth. Here are some of the most powerful people in the industry and a little more information about their deeds.
The Scheinberg Family
Online poker (and Internet gambling in general) would have never been what it is now, if it had not been for the Scheinbergs. But who are these people and what exactly do they have to do with the constantly growing world of online gaming? Isai and Mark Scheinberg are Israeli-Canadian businessmen, father and son, who are best known as the founders and former owners of PokerStars and the former owners of Full Tilt Poker. The two websites are currently the most popular and profitable online poker rooms in the world.
The two Scheinbergs are people with technological background and wide general knowledge and this is why the fact that they have managed to create an online gambling empire of a sort is not such a big surprise. PokerStars was founded in 2001 and was initially headquartered in Costa Rica. The Scheinbergs had a majority stake in Rational Enterprises, the company that owned the online card room. PokerStars’ headquarters were then moved to the Isle of Man.
PokerStars and its owner – the Rational Group, as it is known now, gradually turned into a prosperous business with millions of registered players. In 2011, the card room’s operations across the United States were shut down and Isai Scheinberg had a criminal indictment filed against him. The executive was accused of allowing his company to continue providing gambling services while courts were testing the interpretation of the country’s online gambling laws.
In 2012, PokerStars and the U.S. Department of Justice agreed that the card room would pay the amount of $731 million in order to settle the charges. However, it did not admit any wrongdoing. As part of the settlement, Isai Scheinberg was barred from taking any executive posts at Rational Group. In addition to this, the Isle of Man-headquartered company had to buy rival card room Full Tilt Poker, which was facing the same charges.
Despite the legal challenges and other issues the Scheinbergs have faced over the past decade, they managed to create a brand that truly changed not only the face of online poker but also the gambling industry as a whole.
David Baazov
Up until August 2014, David Baazov was Chairman of Amaya Inc., a little-known Canadian company with several assets in the gambling industry. After August 2014, the 34-year-old businessman was still Chairman of Amaya, but the company was no longer that obscure. Something has changed and Mr. Baazov had a great contribution for that big change.
In August 2014, Amaya completed the purchase of Isle of Man-based Rational Group, including PokerStars and Full Tilt Poker, for the amount of $4.9 billion. The deal became the most expensive one in the history of online gambling. It turned Mr. Baazov and his company into owners of the world’s biggest poker rooms and Mark Scheinberg, who owned a majority stake in Rational Group at that time, into one of the world’s youngest billionaires.
The deal’s price was not the only thing that made it that notable. During the months prior to the announcement that a takeover would occur, Mr. Baazov had the difficult task to convince the former owners of the two card rooms, a number of hesitant bankers, and top Wall Street investors that the deal would be a profitable one for all involved parties. Eventually, Amaya ended up with both PokerStars and Full Tilt Poker, after selling $1.7 billion of its stock and securing a $1-billion investment by Blackstone’s GSO credit division.
Here it is interesting to note, that GSO had never before invested such a large amount of money in a single deal.
Mr. Baazov’s achievement was unprecedented, as he managed to do the unthinkable within the course of a relatively short period of time. At the time it bought Rational Group, Amaya was a publicly traded company with annual revenue of no more than $150 million. And it took over the much bigger Isle of Man-based gambling giant generating average revenue of $1.1 billion per year.
And with its new owner, PokerStars and Full Tilt’s chances to return to the US online gambling scene have increased significantly. US lawmakers and people interested in the matter had formerly pointed out that the world’s biggest poker rooms would really need a new owner, if they wanted to have their operations reintroduced in the United States.
And the first steps towards the great return have been made in October, when Amaya announced that the New Jersey Division of Gaming Enforcement has given the green light to the two poker rooms to launch their operations within the state’s borders. The Canadian gambling giant said that this is likely to happen sometime in the first half of 2016.
However, a nation-wide relaunch of online poker is not likely to occur anytime soon as there are a lot of people, and quite influential ones, that have long been preventing this from happening, with casino mogul Sheldon Adelson being among them.
Teddy Sagi
Israel-born billionaire businessman Teddy Sagi is a major figure in the world of online gambling with its software developing company Playtech. The business was found in 1999 and has gradually turned into one of the biggest software developers and providers of products and services for the constantly growing Internet gambling industry.
Listed on the London Stock Exchange, Playtech is providing B2B customers with various online applications, including poker, casino, bingo, live gaming, and sports betting ones. What is more, the company offers a cross-platform management system that allows international gambling operators to take advantage of innovative tools for maximizing yield, cross-selling opportunities, and player loyalty. Over the past 16 years, Playtech has partnered with major gambling companies such as William Hill, Betfair, Paddy Power, bet365, etc.
Mr. Sagi has managed to built a software development giant with operations worth more than $500 million. Over the years, the businessman has sold the greater part of its shares in the company in order to fund other acquisitions and currently holds a 33.3% stake in it.
Earlier this year, Playtech announced that it was making its first foray into the world of online forex trading with the purchase of Mr. Sagi’s TradeFX for the amount of €208 million. The Isle of Man-headquartered software developer also expressed interest in buying Plus500 for £460 million and AvaTrade for £69 million. Both deals, however, never got completed due to regulatory concerns. Despite the terminated takeovers, Playtech is still expected to establish itself in the world of online forex trading as it has done in the constantly growing and highly competitive online gambling market.
Conclusion
The above-mentioned people are only a few of the many influential and powerful figures that have contributed to the current state of online gaming, turning it into the billion-dollar industry it is now. They are all people with innumerable skills, a natural flair for business, and a strong will for achieving their goals. And the presence of such people in the world of Internet gambling will most certainly drive those particular services to further popularization and growth.
