Solo session led by Melissa Blau

1. Place Your Bets: Hear the Experts
Discuss Operating as a US iGaming
& Betting Affiliate

2. States with legal sportsbetting or Active Bills
14 months of Progress!

3. States with legal sportsbetting (or pending this month)
• Live today (10 states)
• Likely end 2019 (7 states)
• Legislation introduced in
2019 (16 states)

4. • Live today (10 states)
• Likely end 2019 (7 states)
• Legislation introduced in
2019 (16 states)
• Online Gambling Legal (3
states)
States with legal sportsbetting (or pending this month)

5. State-By-State Daily Fantasy Sports

6. Basics of Online Gaming Market in USA
• Online Gaming consists of five distinct verticals, each regulated very differently
1. Casino
2. Poker
3. Sportsbetting
4. Bingo
5. Lottery
• Online gaming is strictly a state by state initiative (10th amendment)
• There are three different types of entities that are authorized to operate and/or
administer sportsbetting and online gaming
1. Commercial casinos
2. Tribal casinos
3. Lotteries
• In USA, each state has taken a different approach to sportsbetting and online
gaming when it comes to operating entity and product vertical

7. Basics Facts of iGaming Affiliate Marketing
• Land based casino operators have used ‘affiliate’ like marketers for decades
through the form of junket providers
• Affiliates are paid by revenue share or CPA (deposit only)
• Online gaming for commercial casinos is only legal is two states
• New Jersey (2013) and Pennsylvania (2019)
• Nevada offers ‘variant’ mobile wagering but requires in-person signup
• West Virginia false start with Betlucky. Expected to relaunch with FanDuel by NFL
season
• Lottery: Michigan and Pennsylvania offer revenue share and require no
license

8. Basic Facts of iGaming Affiliate Marketing
• Casino was launched in New Jersey in 2013
• Sportsbetting was launched in New Jersey in August 2018
• Mature Markets: Casino represents 50% of the revenue but sportsbetting represents 70%
of the players
• Affiliate marketing is a highly regulated business for online gaming for commercial casinos
• Requires a license issued by each state
• The costs depends on size/complexity of organization and type of license
• Ranges between $2,000 and $50,000 (estimation)
• Both New Jersey and Pennsylvania offer the same licensing regime
• Ancillary Service Industry Provider. Revenue share. Performance based on a percentage of revenue less
agreed hard costs deductions (tax, promotions etc)
• Cost per Action (deposit): fixed

9. Licensed Affiliate Options
Industry Service Provider
• Revenue share of 30-45%, of NET
revenue or CPA
• For each depositing player
• Gross to Net: hard costs expenses
(taxes, promotions, maybe other)
• Term: TBD min of 2 years to indefinite
• Allowed to act as a super affiliate
(needs to be flushed out)
• Very onerous licensing: 5 years of
taxes, all monthly statements, no
access to safety deposit box etc.
• Higher Licensing costs
Vendor Registration
• CPA: Cost per acquisition
• For each depositing player
• Range varies by vertical: Casino higher
than sports and poker
• Range: $175 - $700
• Depends on total number of depositing
players and quality of traffic
• Lower costs for licensing and much less
invasive questions

10. Size of the Market

11. Size of the New Jersey iGaming Market
$5.2 $93.8
$125.1
$167.1 $220.3
$277.3
$495.9
$8.4
$122.9 $148.9
$196.7 $244.6
$352.3
$751.2
$-
$100.0
$200.0
$300.0
$400.0
$500.0
$600.0
$700.0
$800.0
2013 2014 2015 2016 2017 2018 2019
iGaming GGR Revenue New Jersey
Casino Poker Sports

12. Opportunity: Sports Betting is a Game Changer
• In New Jersey (where legal) mobile represents the vast majority of the revenue
• Online is 80% of the revenue for sports betting New Jersey (where both are legal)
• Retail only states will need to expand to offer online to be successful
• Sports betting drives online casino revenue
• Online casino doubled since Draft Kings launched its casino
• New opportunities on numerous fronts: more states, new brands, addition of
casino or sports betting
• Increased competition from affiliate community with introduction of sports betting
82.0%
18.0%
Online Dominates NJ Sports Betting GGR YTD
Online
Retail

13. DFS Brands Have Dominated New Jersey
• FanDuel and DraftKings has 80% of the sportsbetting market
• Negative: Bad for affiliates as they are only compensated for new depositing
players
• Positive: incumbent and other brands need affiliates
• As new states open or expand to add online, non-FD/DK brands will need to
include affiliates
83%
17%
NJ Online Only Sports Betting Revenue
FanDuel/DraftKings Rest of New Jersey
80%
20%
NJ Total Sports Betting Revenue
FanDuel/DraftKings Rest of New Jersey

14. Pennsylvania is Still Too Early to Tell
• FanDuel Retail has 9% market share (located outside Philadelphia)
• Online only launched in May with one online sportsbook (Sugarhouse)
• Now three online sportsbooks with several more expected to open before
NFL start
• FanDuel and Draft Kings have not launched their online sites
• Online Casino not live yet
Retail Sports betting GGR Pennsylvania

15. Steps to become a licensed affiliate

16. Tips and Process to Becoming iGaming Affiliate
• Hire a gaming lawyer or professional regulatory person in local market
• Each affiliate must be sponsored by a local casino in the state
• This must be completed first
• Complete the forms
• Have your regulatory lawyer review everything before submitting
• Ancillary license: requires on site fingerprints (not sure about vendor
registration)
• Contact the Casino or Sports books affiliate managers
• Read the restrictive terms and conditions before doing anything

17. How Big is the Opportunity
Source: Eilers & Krejcik, iGaming Capital

18. Operating as an iGaming Affiliate in the USA
• Licensed activity – need license to operate
• Very content driven mainly dependent on reviews and articles
• All contracts must be approved by Gaming regulators
• No ability to pay any company supplying services to affiliates based on any performance metric
tied to gaming
• E.g. Revenue share, CPA, depositing new players, signups, active players
• Sub-affiliate (if licensed with super affiliate) required to have Vendor Registration license (paid on CPA)
• Only metrics allowed are monthly, hourly, annual fee – solely not tied to performance
• Restrictions on message to players monitored by casinos and regulators
• Periodic valuation forms that describe your acquisition strategy and marketing message
• No ability to advertise on Google in a straight forward manner
• Facebook permission is difficult to obtain and may be taken away at any time
• Outside of external marketing tools, not entirely well managed at this time but getting better
(cookie stuffing etc)
• CPAs and Revenue share can be very lucrative especially in new markets

19. Thank you!
Melissa Blau
Founder & Director
iGaming Capital
melissablau@igamingcapital.com