In this interview with CalvinAyre.com’s Becky Liggero, Charles Gillespie of The Gambling.com Group gives tips on how smaller affiliates can easily be acquired.
More companies are now recognizing the importance of affiliates in terms of driving new customers to their space. The increased reach offered through affiliates opens up merchants to a consumer base who they may not have been able to target through other online avenues.
Many affiliates, however, still find it hard to be acquired by established companies despite the latter’s interest in these platforms. Charles Gillespie of The Gambling.com Group pointed out that the problem of these affiliates lies in their profit and loss (P&L) statements.
He said that companies always take a cautious approach in terms of acquisitions, even if the affiliates look perfectly well on the outside. Most companies, according to Gillespie, put the P&L statements of affiliates under the microscope before deciding on whether or not to make the purchase.
Gillespie believes that there is a higher chance of an affiliate to get acquired if it has a clean P&L statement.
“A very clean P&L together… so like a profit & loss statement of the assets you are selling. The revenue of the assets of course, but crucially, the costs that went in producing that revenue so they can make an informed decision about how profitable the business is. Most of these deals are based on multiple of earnings. Step one is to agree what the earnings of the business are and that obviously comes from the P&L,” Gillespie told CalvinAyre.com.
He recalled that Gambling.com, which was founded in 2006, started as just one of their websites. The Group, according to Gillespie, has succeeded in doubling the size of the company in the past year without any acquisitions.
But Gillespie said the company made two significant acquisitions for a total of EUR 14 million at the start of 2017.
One of the Gambling.com Group’s acquisitions was AndroidSlots.co.uk, a UK mobile casino affiliate who had an existing relationship with Gillespie’s group, making the negotiation easier.
What caught Gillespie’s attention was the site’s particularly strong player database with a handful of high rollers and a focus on Gambling.com’s home market, the UK.
“We have this incredibly unique asset in Gambling.com and, for a while, it was just one of our websites. Over time, it has become the biggest website. We just want to take and make full use of the assets. So we are trying to put our best foot forward with a new name, Gambling.com Group,” he said. “There is an opportunity for affiliates to go out there and grow by acquisition.”