Episode Transcript
[00:00:00] Speaker A: Welcome back everyone. This is Max. Let's continue our series. So you gentlemen understand how to start your online casino in the most efficient way. So you save yourself money, you sell yourself time, you start as fast as possible, right?
So today's topic is about aggregators.
Well, what is aggregators? How to choose one, whether you need one or probably you can avoid aggregators at all times because they are by all means an evil, but a very necessary evil that practically everyone wants. But before we move on, like subscribe under this channel, it helps a lot to algorithm of YouTube. It helps to recognize our videos to get a broader reach while we are building a community of well and nice people. And, and you know, our goal is to reach 100,000 subscribers. So we are just a couple of likes below that.
So let's say you are starting online casino right now, congratulations. But most likely you will need an aggregator.
And it really depends what to choose, which one is better, how to evaluate one. Because your choice of starting your online casino or will be based on three business models. So you can choose to have a white label casino, you can choose to have a turnkey, and you can choose to have what I call as an API integrations. So API integrations means it presumes that you are building your own platform. You just collected a group of well minded people and like minded people and you are working on your own platform. So you have a group of software development developer guys, you have an architect, you have senior software developers. So you have a really big team, let's say 50 or 100 developers. And you are investing tons of money to build your own platform. You're investing tons of resources, you're investing time, you're investing money, you're investing, you know, goodwill, everything. So you will spend the next 7, 12, 16, 18 months to create your own core and then you will decide, you know, how you want to integrate your games.
So let's get back to the first white label and turnkey because most businesses they start with white label or turnkey.
Now as soon as you will start, as soon as you will have your platform up and running, you will realize that you need games. So what is aggregator? Let me give you an analogy, right? So let's say you are going to the mall, you're going to buy yourself shoes. So this is a very simple example, right? So, so where would you go? Would you go to the mall, to the biggest mall in the city? Or would you spend your entire day going after shoes to one shop, to the second shop and then you would realize, hey, I Also need a shirt. I would love to buy myself a jacket. I want to buy my kid and ice cream. So you travel the entire day. So the most efficient way and also one of the best ways is to go to the mall. So what mall does.
It just creates a platform for all brands to come up together into one place where they will get the traffic. So the mall is there in the best place possible. It guarantees every brand traffic. And then there are thousands of different stores, boutiques and everything else.
And you can easily spend one hour and get yourself everything that you may like. You may get yourself shoes, you may get yourself self shirt. You may get yourself, you know, an ice cream or an ice cream to your kid, a coffee, everything that you need. No need to spend time. It's much cheaper and it's way more convenient. So you get yourself user experience.
Now let's get back to the aggregator. So what is aggregator? So without aggregator you would need to go to every brand to get yourself casino games. So you have a platform and a casino, but you don't have any offer yet. So there are multiple software development companies, multiple brands that create different games, tens hundreds of games per different software provider. So aggregator just collects all of these software providers under one roof and collects the biggest ones. It collects medium, it collects, you know, the most trendy ones as well. And then you connect this aggregator to your online casino and you can supply yourself thousands of different games. You can get your players the best experience possible. You don't need to go one by one or to start one by one where people would join and they would see, you know, a couple of games and they would realize, hey listen, I would rather go somewhere else because this one doesn't look legit, doesn't look serious enough. We want to see thousands of different games under one roof. So this is what aggregator is. Okay, so here's the thing. There are tens, dozens of different aggregators. So you can download the list of all aggregators just below this video, click it, download it. You also find out a checklist of all questions you have to ask every aggregator when you interview them to understand which one fits you the best.
But usually there are different types of aggregators. So there are separate aggregators, separate, separate brands that focus on aggregation only.
And then there are aggregation services that come with the platform, right? So what it means to you practically. So assuming you are starting with white label, assuming you are starting with turnkey, which is the most popular one, as the best one as well. So if you start with a turnkey, then you will need to choose a platform. And also there are hundreds of different platforms to choose from. We have that list as well. I will leave that link below. So here you are, you are discussing with the platform, you know, the cost you negotiate and the deal. You get yourself everything. And now you say, okay, guys, we're going to, you know, integrate games one by one, or we're going to choose a different aggregator than one that we like the most. So what is going to happen is that, you know, you will basically break yourself a deal because this is impossible. As long as you choose a platform, you also have to choose an aggregator from that platform, period. 90% of the platform is that build the brand that are more serious than other ones. They always offer aggregator as well. And you cannot choose anything else. Well, imagine Microsoft working on the product and Apple is two competitors, two biggest rivals. And now you go to the Apple Store, you say, hey guys, I like the design, but I would like to install the Windows platform on it. So give me a 50% discount. So what would Apple tell you? They will, you know, tell you, go, you know, lose yourself somewhere. So that's how it works. So brand, they build a platform, they build an aggregator, and then they offer both. So you choose yourself a platform and then you basically are tied to the aggregator that they already also offer. So that's why it's so important to consider both products as different products when you're choosing a platform. When you're choosing an aggregator, you want to check the platform. You also want to check aggregator to understand what the backend looks like, what are the percentages, what are the fees you're gonna pay. So all that you want to consider, it's not about the fees only. You have to add value to your business as well. So let me get back to the most important part here. So what is the, the disadvantage of having an aggregator?
Everyone speaks about advantages. You go to every aggregator, you go to every platform, they will describe you, hey guys. Well, aggregator is the best. One is this one or that one. And we are the best because you can do this easily, you can do that fast, which is all true, but believe me or not, but there are more disadvantages with every aggregator than advantages.
So, so let's start with the first one. The first big one is latency issues.
So how fast do you think the player will see everything rolling on his screen? So when you have a direct integration with a software provider with the brand that really produces the game, then there is your server, then there is their server, and then there is a player that joins your gang, right? That's it. There are no latency issues. You can choose where to set up your servers and what country depending on what your market is. But now we have an aggregator in between.
So now software developers sends all the information and the data where to aggregator. Aggregator then you know, consumes all the data and gets and integrates with you. So there is an integrate aggregator in between.
And you have to be really aware of where and how to store the data, where and how their servers are, what kind of technology they have in place.
So for example, you have your own casino in your market, for example, is Latin America. But now you figure that the aggregator has their own servers where. Well, let's say in China, right. Or somewhere in Europe, right? So that would probably cause you some really big issues because the latency would go up and your players will would not receive the same experience. So most likely they would leave. So this is the very first thing you have to think about, like how do they solve this issue, what kind of technology they have, where their servers are, how they optimize the speed and how they optimize experience for your customers. The second one is incentives. So you now you are a part of aggregation of aggregation services. So now you have an access to the backend of aggregator. You don't have any backend to individual software providers.
So in case, when you have an aggregator, you may have just a blank backend, nothing else.
When you go directly to software providers, incentives that they can offer you, well, you can generate 100,000 GGR and your revenue share will drop 1 or 2 points. You generate over 1 million, they will offer something else or bonuses, promotions. What they offer to their clients is very important. So you want to check what kind of aggregate, what services, what incentives aggregator also includes. Do they really, you know, get a look and they keep an eye on what different software providers provide, what services they incentives they provide. And then they also offer these incentives to their clients. So you have to check on it because it's very important.
You want to get the best out of everything. You know, every software provider, they produce games, they want their clients to be happy. So in case, if you install aggregator, you want to have something out of it as well. The third one is bonus systems. So let's say there is a software provider with 200 different games, right? Not going to mention any game, any brands here because of YouTube, they don't like this kind of promotion thing.
When I mention a brand, they just banned the video because they believe that I advertise something. Well, Here we go with bonus systems. So as I said, multiple games belong to one software provider. Today for example, as a Christmas time, right?
Or you know, the new year or Halloween, whatever. So during this moment, during this, you know, period of time of the year, different software providers may offer different bonus systems to their clients. They may open up free spins for one game and something else for the second game. And if you're using an aggregator, you may never have this bonus system at all. You may not even know that something like that happens because aggregator just doesn't care. They do not transfer that user experience from software provider into their aggregation system. They don't keep an eye on it.
So no one knows about this and you do not know about this as well. So the fourth one, the fourth one is the data.
So let's say you have a player that just want a jackpot and you want to really investigate on what is going on. So where is your data? Well, if you log in directly to software provider to one brand, you can check, well, these are the logs. You can make your own investigation of what just happened, what events were lost, what events, you know, just this player was lucky. So when you have an aggregator, even though aggregators they have to offer this part of the business, it's really important to understand to what level they offer. So when someone wins a jackpot, how will you guys investigate on what is going on? Who I have to speak to, when are these people are available Because I cannot waste time. I have to either pay to my clients or probably I should lock their account block and make an in depth investigation. So how this data problem is solved, where do I look to to get all this information that is required on one single particular event that just happened?
Good one, bad one, whatever, the fifth, the big one maintenance ever something goes down with aggregation services, they decide to do maintenance of their systems. Your entire online casino goes down. Busted. Doesn't work. People log in, cannot play any games, any games. So not just one, not just two. Maintenance means blackout for everyone. Someone hacked the aggregator, that's it, you are done. So this maintenance issue, ask your aggregator what is the uptime, how do they control the maintenance? Will they notificate you? Or you will have to find it somewhere in the middle of the night that your online casino is down. And then you have to call someone and they do not answer and basically you are losing money. Right? So this maintenance issue is really a big key disadvantage number six. So fees, how aggregators make their money. So software provider, they give you guys. So aggregator combines all games Together gives you one integration point. You connect everything through API. Now aggregator makes their own margin on top, softer provider, they give a 10% deal. Aggregator will give you 12, 13% deal, whatever that is.
So in most of the cases, aggregator will be much more expensive.
Not everyone though, and not in every case. So it's very worth, it's worth mentioning that some aggregators, in some software providers, they have this cumulative, cumulative mass.
So for example, I'm generating 100,000 GGR, I have to pay 15% to the software provider. Right now it's 15 of us. So now we are generating one and half million bucks. So now aggregator goes to the software provider and says, hey listen, now we generate 1.5 million bucks, give us a discount. So in this case, the software provider is understanding and if they, well, they're fine, probably they're in, in a development stage where they're still growing, they will give a substantial discount to aggregator and aggregator usually will offer you a better percentage.
And if you go directly, you may get yourself even a worse deal in most of the cases. Aggregator will be much more expensive though. So this is the point number six and the last one is that not every software provider works with aggregators.
The bigger the aggregator, you know, more likely they will stop working with aggregators. So they will consider, well, all the pros and cons working with aggregators, how they receive their profit and how much money they make, right? So the smaller the aggregator, the smaller software provider, the bigger chances are that they want to market their games using all channels. So they go to aggregators and they ask them to integrate all the games possible and do whatever is possible to promote them, right? So currently, you know, I've heard of several software providers that just said, hey, listen, we do not offer our games to any aggregator anymore. So it's only the oldest ones and the ones in the past, they can still offer our games, but the new ones, the business is closed because they became too big and now they can make their own rules. So now they're waiting for the direct customers only and these direct integrations, right? So they believe that this is more profitable for them, that this is a better for the brand, this is better for their image, for how they position themselves. So not every getter will, not every aggregator will have all the deals. So as you can see, you know, we have right now seven disadvantages. So you would say, hell, I mean, like, you know, really big ones and well, on earth would I then choose Aggregator to work with? I would just go directly, you know, integrate every game And I will be happy. I would have better fees, better service, all the data, everything is in there.
Don't hurry. Aggregators are there for the reason, there is a reason why there are dozens of them and why most of the business people, they still offer aggregators and they connect aggregators, even most experienced ones. I just recently had a conversation with a guy, 15 years in the business, he's building his own API, his own platform. So he says, well, we need, you know, a mix, we need an aggregator, but we also do some sort of integrations in between with the software development companies that we work the most. Right, so why is that? Well, there are four really key, big, big advantages what aggregators offer. So the first one is kyc.
So when you go directly to software providers, KYC is, you know, a huge process. You're keeping, you know, collecting all these documents, you know, you spend weeks and months and all that to build that KYC package for them, that evaluate and they can say yes, they can say no, you know, so basically you're spending your time and resources and energy collecting all the paperwork. Some people, they don't, you know, like doing that KYC thing. So they would rather do something simpler. So aggregation services, they offer you a simplified kyc. Yes, they have a KYC process in place, but it's way, way, way easier to get the KYC done with aggregators. The second one is time, gentlemen. So how fast do you want to start your online casino? So do you want to be up and running in three months? Then you have no choice to.
You don't have any choice. You have to choose an aggregator.
Most platforms that develop from scratch, they understand these risks and they have resources to invest, they have time, they have money, they have people who will work on integration one by one, so they can spend a year dealing with integration one by one, signing agreements. So it's a lot of time, it's a lot of resources.
So if you want to start as fast as possible, then aggregation is the only option.
The third one is money. So believe it or not, when you start, it's much cheaper to connect an integrator because you need your own software development guys, your IT guys who would do every integration separately if you choose to work directly. So one integration with every software provider is a pain, it's a painful process. You have to take or spend a lot of time. So a lot of resources, a lot of time of that software developer to integrate everyone single handedly. So that would cost you probably 2000 Euro per one integration. Multiply that by 30 you get yourself 60k to integrate 30 software developers get 50 hundred k, one more 100k, 100 developers, 100 software providers would cost you 200k. So, so do you have such a budget to start with or you want to start with and invest more money into your marketing? And then to decide definitely, you know, more software, more entrepreneurs, more business owners, they decide that they would rather keep that chunk of money and invest somewhere else instead of doing that integration one by one. And the last one is partnership. So every aggregator, if they are serious about their business, just they are not, you know, one day companies, what they do is that they have partnership teams in place. So what do partnership teams do?
So there are bunch of software development companies that want to work with aggregators. You know, I get such requests on every one event. We want to work with this one. Could you introduce us? We want to work with this one. So there are like hundreds of them who want to work with aggregators because it's valuable marketing channel for them. So partnerships, they evaluate every partnership. They ask right questions. They want to understand what games these software providers have, how they will add value to their customers depending on what region they work with and focus on. So basically they say no to 90% of software providers. You know, out of 100, probably they get 10 in a line that they integrate. Why? Because of some reason. Because if you integrate that in your online casino, then you would make more money, you would add more value to your people, people would spend more time in your online casino. That's the way it works. If they don't have partnerships, well then you are up to yourself, right? So partnerships really save that time and they really keep you updated. You don't have to keep an eye on the market all the time to understand what works. They do a lot of work. I mean these guys, they are busy from early morning and up till the evening because everyone wants to speak to them and you know, they don't have any blank spaces in their calendar, right? So if you want to speak to them, you have to basically make an appointment for, you know, two months before the event and then you go and you speak to them as a software developer. And then probably you will lucky if your games are good, right? So for you that's good because it saves a lot of time.
You don't have to keep an eye on the market all the time. That's basically it.
So these four key advantages, you know, they are really big and that's why in probably 80, 90% of the cases, even the biggest guys in the industry biggest dogs, they decide that they will work with aggregators directly, probably in the beginning, before they get cash flow and the normal evolution stage of every casino, of every brand, it should look like this one. What I observe is that, you know, my clients, they usually start with turnkey. So the turnkey is the first step platform up. Choose an aggregator, connect an aggregator.
Now start making money. This is the step number three. Prove yourself that you are a valuable partner. Negotiate yourself a better deal. When you have enough of cash, enough of mass you are now running and everything is working for you, start building your own platform. That will take you a year. That will take you two years. That will take you a couple of million bucks. As soon as you have that ready, now you are the boss. Now you can choose who you work with. Which aggregator do you want and which one will provide you the better deal, the better value. Probably you want to go, as my friend did. Probably you want to integrate 50, 50, you want to go, you know, with direct integration for 3, 4, 5 different software providers because they will give you a better deal. And for the rest, you want to choose an aggregator. You don't want to choose, you know, you don't want to spend any of your time integrating that one by one for other 50, right? So that, that's also the key. You just want to build a, you know, a volume of games. You want to show people that you're serious. But you know, to do that, you don't have to integrate everyone one by one. All right, that's it for today. As I said, download the list of all aggregators just below this video. I'll also leave a list of checklists. My team been working on this for you. What questions do you want to ask, what to consider, what do you really want to keep an eye on? And just before you leave, subscribe and like this video. If you do, you do. If you don't, no hard feelings. It's all good. Have a good day. This was Max. Goodbye.
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