In the summer of 2015, executives of the newly christened Everi Holdings, Inc. gathered to ring the bell to open trading on the New York Stock Exchange.
In a decade that saw more mergers and acquisitions in the slot sector than any other time in the industry’s history, this ceremony capped the transaction that perhaps most stood out as unique. Multimedia Games of Austin, Texas was a growing and highly regarded slot manufacturer that most had assumed would be acquired by one of the big slot suppliers.
But the company that did acquire Multimedia was not a slot supplier at all—it was Global Cash Access, the leading supplier of ATMs, kiosks and cash-access and credit services to the casino industry.
While the acquisition was a surprise at the time, three years hence, it makes perfect sense, as casinos strive to find new and more convenient ways to fund the play of slot machines. Technology being produced for the payment side—now known as the Financial Technology Solutions division, or FinTech—has helped the slot side, and vice versa. Mobile technology is providing a bridge between the two sides, as Everi slots benefit from a growing number of options to fund play. Hardware technology developed on the slot side applies readily to the financial side in the form of kiosks and ATMs.
“Most of the significant advantages have been at the hardware level,” says Michael Rumbolz, president and CEO of Everi. “We’ve been able to share what we learned as a payments company with our slot manufacturing people, which means that our interfaces to systems that were worked out years ago for our payment systems are now cleaner and much easier through our slot machine manufacturing. It also gives us the opportunity to address a customer in many more ways than just the slot floor.”
But more important than synergies between the two sides of Everi’s business are the innovations coming from the engineering teams of both sides.
On the FinTech side, Everi continues to provide new ways to provide what Rumbolz predicts will be more than $26 billion in cash and credit services to fuel the games of casinos across North America this year. In addition to its industry-topping business as a supplier of ATMs and payment kiosks to casinos, Everi is spearheading the effort to provide mobile digital-wallet solutions and other innovative ways for players to access cash using smartphones, through deposit accounts and even through access to bank accounts via debit-card transactions.
On the games side, Everi continues to grow, recently augmenting its game development studios in Austin with facilities in Reno, Chicago and Las Vegas—five game development studios in four cities, headed by industry veteran Dean Ehrlich, executive vice president and games business leader.
The disciplines of Everi’s two legacy companies dovetail neatly with the company’s young interactive division, which is growing rapidly on both the B-2-B and B-2-C sides under another industry veteran, David Lucchese, who is executive vice president, digital, and interactive business leader.
Forward with FinTech
This year, Everi has made significant moves forward in all three of its business divisions, but perhaps none is pointed more squarely toward the future of the gaming floor than Financial Technology Solutions.
While about two-thirds of that $26 billion in funds being provided through Everi systems for play on casino floors still comes from ATM transactions, and a good portion of the remainder still comes from verification of good, old-fashioned written checks (“There’s still a large swath of Americans that prefer to deal in checks,” says Rumbolz), Everi is leading the charge in what will be the industry’s transition from these traditional services to a digital cash access ecosystem.
Rumbolz notes that Everi is adding an e-wallet system, called CashClub Wallet, to the financial solutions already offered by the company. “We’re in a pilot program right now, with a major customer,” he says. “We anticipate that once that’s concluded, we will start adding more and more customers to the e-wallet transaction line for us, and as we do that, I think more and more jurisdictions will look to their fellow jurisdictions, and see what questions we’ve answered and how we’ve taken care of their concerns.”
“Digital represents the ability to perform transactions through a number of different vehicles,” adds Darren Simmons, business leader, financial technology solutions. “Mobile cash access is an important vehicle. Making what we call our e-wallet available on an application through your mobile phone, on iOS or on Android is a big part of what we’re introducing now. And that’s going to be a fairly dramatic shift for our casino customers, just in terms of the experience that they’re providing back to their consumers in how they access cash.”
Just as applications like Venmo enable digital money transfers between personal bank accounts, Everi’s e-wallet solution enables customers to fund casino deposit accounts and ultimately move those funds to the credit meter of a slot machine.
“It will start as the ability to bring cash to your mobile device, through either an ACH transaction directly from your checking account or a debit or credit card transaction from your account,” says Rumbolz. “Once it comes to your wallet, then the placement into an operating system on a casino floor, the casino slot system, will allow you to fill your casino account with cash, and then use that account for gambling purposes.”
Rumbolz, a former chairman of the Nevada Gaming Control Board, anticipates little regulatory pushback to the use of e-wallets. “One of the reasons is that we are not offering, and don’t intend to offer, anything that isn’t already available to a patron on the casino floor,” he explains. “What we’re offering them is the ability to remove the friction of standing in line, or having to move from one device to another, to complete a transaction. We’re trying to make it much easier for patrons.
“And, we believe that as the casino industry starts looking at more and more sports wagering options, a mobile wallet that stays within the ecosystem of the casino that owns a sports book becomes an easy way for those customers to then make sports wagers on the applications that are provided by the casinos.”
Another part of the company’s digital offering is CashClub Concierge, which allows casinos to provide traditional cash-access services anywhere on a property using a mobile tablet.
“With our entire digital strategy,” says Simmons, “which is connected to our e-wallet, we’re trying to find ways for our casino customers to be able to serve their customers, wherever and whenever they want.”
The FinTech division, of course, also continues to improve and innovate in its core ATM and kiosk business. New ATM products have state-of-the-art security features such as a rear-facing camera to capture images of anyone who might be standing directly behind a customer accessing cash. “There also will be privacy glass,” says Rumbolz, “so that someone can’t stand to your right or left and lean in to look as you’re putting in your PIN. It’s not just to provide security and safety, but peace of mind to the patrons.”
FinTech also constantly works on improving Everi’s lineup of payment kiosks. At G2E, the company will launch its newest full-service kiosk, the CXC 5.0, which offers enhanced security features; the VersatileXchange, a versatile, cost-efficient kiosk; and Jackpot Xpress, an easy-to-use mobile tablet platform that enables floor staff to securely and efficiently process and pay jackpots.
Cabinets and Content
Hardware advances are just as important on the games side of the business. Ehrlich’s team continues to create new form factors, along with content specifically designed for the new cabinets, as well as a flood of content for all the established cabinets.
This year, Everi launches a new entry for the Empire premium cabinet series, called the Empire DCX.
“The modern casino floor has changed rather significantly,” says Rumbolz, “from the days of row upon row upon row of spinning-reel slot machines, that looked very much the same, regardless of who the manufacturer was. Once video technology really took off in the gaming space, you started to see manufacturers differentiate not just the product, and the product offering, but also the housing that that product sat in. And so, form factor became extremely important. And you’ll see companies that will be literally surviving off a particular form factor.
“Content is going to drive it.”
“We know we’ve got to have new cabinets coming out in order to be competitive,” says Ehrlich, “but even more so, we’ve opened a couple of additional studios. We are beginning to see these recent investments start to pay dividends with much stronger game performance.”
That content is taking a variety of forms this year (see page 52), and is designed to appeal to a lot of different types of players. “For the past couple of years, we’ve been expanding Everi’s offering to make sure that we were speaking to each of the customer sets that are attracted into casinos,” Rumbolz says. “For example, we now have wide-area progressives. The company never had that before.”
Other surging product categories for Everi include mechanical stepper slots, high-denomination video and branded games on the new Empire MPX cabinet, also known as the E43.
“As we have been growing, we’ve been focused really on the slot floor, and trying to make sure that the slot machine floor has something from us for everybody that’s coming into a casino,” Rumbolz says, adding that the company is currently considering whether to expand into the area of electronic table games.
Ehrlich says Everi’s concentration on new content is in line with a short-term goal of achieving a 10 percent ship share. “There’s constantly a new product launch—something different, whether it’s a new cabinet, new license, new theme or new play mechanic,” Ehrlich says.
Both proprietary and licensed brands will be available either for sale or lease at G2E, as Everi is known for making it easy for customers to put their products on the floor. “We offer flexibility for our customers,” says Ehrlich. “You have to get the product on the floor. It doesn’t mean giving it away, but certain operators have capital capabilities and others have operating expense opportunities. We make sure we really do our best to work with our casino partners.”
Rumbolz notes that his team at the newly merged Everi determined early on that Austin would remain the center of the company’s games division, a big reason being the steady stream of engineering talent coming from the University of Texas, located in the city.
“Austin has become, in no uncertain terms, really an extension of Silicon Valley,” Rumbolz says. “All of the giants that devour engineers on a daily basis, like Google, like Apple, and companies that are in our space, like Scientific Games, or adjacent verticals, like Zynga, are all down there, competing for the talent among themselves, but also competing for the talent that’s coming from the university, because they have an extremely strong program.
“For years, I think it was an advantage for Multimedia Games to be the only gaming company in town, and therefore one of the more interesting companies to go to work for. At the end of the day, we will be in Austin… Those engineers reside in Austin; they like living there. I don’t feel the need to drag them to Las Vegas, or force them to move. And we have people that have been with the company a very long time, both our company and the predecessor company, that have developed their own relationships in that marketplace.”
Meanwhile, the company’s interactive division, launched at the beginning of 2017 with the B-2-C free-to-play casino app Super Jackpot Slots, is growing rapidly. The B-2-C business will expand this year with a new social/mobile casino app designed for high-end players, called High Rollin’ Vegas.
On the B-2-B side, the company’s content is already live on both social and real-money internet casino sites, through remote game servers owned by partners Spin Games and GAN. “Through our technology partners, we are delivering content currently to a network of 32 sites,” says Lucchese. “We’ve been delivering games to Playtika, the largest social operator in the world, for six years. Our content is always among the top 10 games there.”
Marshall Adair, senior executive producer and director, adds that Everi content porting through the Spin RGS includes the No. 1 games in New Jersey’s real-money online casino market.
Later this year, Everi will release its own remote game server—currently before Gaming Laboratories International for certification. “Now that we have our RGS done, we’ll be able to control our path out to serve our customers and serve opportunities to distribute our content globally,” Lucchese says. “We have a very high success rate with what’s out there. Operators are asking for more Everi content, and we’ll be able to do that with our own RGS.”
The proprietary RGS is expected to have 20 titles available by the end of the year, and 50 by next year, according to Adair. “We’re pulling from the top of our library,” he says. “We’re pulling our best hits from land-based and using them to go online first, because we have some ground to make up in the space. We’re not pulling form the dregs of our library unless specifically asked for a game.”
Everi also is offering a “Remote Math Server (RMS),” developed by Adair’s team. “We’re basically taking our math and putting it on a server,” says Lucchese. “We can put our math out there and operators can add their own art and assets; our IP remains protected.”
Asked the benefits of forming a new public company three years ago, Rumbolz takes care to point out that what happened was that two former public companies merged into one new company.
“The important aspect of branding both the legacy Multimedia Games and the legacy Global Cash Access into a new name was really to let the industry understand that neither one of these is the old company that they used to deal with,” he says, “that it really is a new day, we have a new ability to have synergies across the casino floor—and that we’re going to be providing a new set of products that are going to address the slot player, but also how the slot player puts money into slot machines.
“So, the rebranding of the company was extremely important, to make sure that the industry understood that we are completely different than either one of our predecessor companies.”
Rumbolz says his goal for the next five years is for Everi to become one of the “big four, or the big three” slot suppliers in the business.
“My intention is to be there, to be shoulder to shoulder with the largest players in the space,” he says. “But more important to me is to be the supplier that the casinos have to have—that we will be producing the products that casinos will look at as essential to running a modern casino floor.
“I would anticipate that any modern casino operator over the next five years is going to look at our product set and realize that they have to have a relationship with us, and they have to have our products, in order to operate in this industry.”