Phillip Runyan, Founder and CEO of Hold Gaming, outlines the developer’s burgeoning interest in skill-based games, including a new genre of casino esports.
What was the inspiration behind the formation of Hold Gaming?
My background in gaming stretches back a decade or so to when I joined DoubleDown Interactive. Prior to that I owned the original Nintendo so to call myself a gamer would be a complete and utter lie. I came into the gaming industry through a love for casino games and having some friends who started a company made the decision easy for me.
Having seen the growth of the social casino industry first-hand, I have borne witness to its positives such as the opportunities that exist in pre regulated markets, as well as its inherent problems like a very low number of payers. There are millions of players daily, yet only two per cent actually spend money.
In 2012 when we sold DoubleDown Interactive, I was keenly aware that we didn’t need another social casino product in the market. Players didn’t need another variation of a slot or turn based game. Frankly, I was really bored with it all.
Around 2017, skill-based games popped up on my radar and I thought that what they were doing was neat to put it mildly. Being able to utilise skill based legislation, laws and rules, especially in the United States, and get the staking aspect of ‘I play against you instead of the house and in return the house is going to collect a small fee for running a tournament’, was an exciting prospect.
Many people love to play card and other casino games, so our thesis is they would also enjoy competing against other people instead of the house. That is how Hold Gaming started. We took a game that is predicated on math and probability, Blackjack, and made it into the first skill-based blackjack game that allows you to compete against your friends or other competitors in head to head challenges for real cash prizes.
Interestingly enough, we embrace card counters – we want people who can do math and probability faster than their opponent because they’re going to win, and it also encourages others to get better. In the two years since we launched the initial version of Blackjack Fire, we have players who have participated since day one and we’ve seen their trajectory from losing on a semi regular basis to sweeping a lot of the leagues we run.
In short, Hold Gaming provides agency to players to have some skin in the game, even for as little as $0.60. We encourage players through the micro transactional processes social casino players are already comfortable with in mobile games, but instead of winning free coins you can actually win some money.
Do you intend to continue with skill-based games in the mould of Blackjack Fire going forwards?
In December 2018, we launched a free to play version to test the waters of competitive gaming and round out some of the tools and features we were offering. It really wasn’t until March 2020 when we finally received the ability to collect credit cards and debit cards which was very frustrating for us. It entailed a lot of downtime and waiting but once we were able to things really took off. We’re hitting our KPIs that we expected to hit in the third year of our proforma.
We feel fully confident we’ve proven the model that people do want to play these games if they have easy means to get money into the game. Currently, we’re just beefing up our financing by going after another round so that we can continue to drive improvements at new games, content and partners.
What is casino esports?
Casino esports is really our genre. I think when people think of esports they think of Fortnite and PlayerUnknown’s Battlegrounds – these first-person shooters or fantasy-based games. Casino esports is where you’re playing casino content, competitively, against another player or players so we have PvP and PVE (player against everybody).
How can skill-based wagering expand its audience and operator base?
Skill-based games are not being marketed well and there aren’t a lot of products out there. For example, GameCo have released a couple of games into the land-based market that have done so-so with limited visibility. On premise in a physical casino, what’s currently happening is that skill-based games are placed right amongst slots and other floor games. It’s the wrong location because that is not where their demographic plays.
Gamblit Gaming has seen this (they have some fantastic IP – I absolutely love that Pacman game!), but it kills me to go to a casino and see somebody walking by, kicking the tires a little bit, and taking a look and not picking it up. You need to get a bunch of people together to play these games and make them fun. I feel that when these products are put on the casino floor amongst all the other standard fare they get lost.
The free to play model for a lot of these products has to be a hard requirement where you can get the game into people’s hands, they can get excited and then pave the way to get involved if they are in a state that allows for iGaming or in a local casino that has it. I feel like the lack of a free to play product is a lost opportunity. Every time these games go on a casino floor and are removed it just says these types of competitive games don’t work. It took us a little bit to get the necessary tools we needed to be able to prove our model, but we vehemently disagree with that assertion.
We know that people on their mobile devices really want to play these games. Our rounds last three minutes. We have players that play on average two rounds a session and play two and a half sessions a day. It’s on their time – they come in, play, leave and get notified of their win. They come back, they collect some free coins, they play. The level of engagement is incredibly high. We just need to stop telling people that if you want to do it you have to go to a casino, especially in the era of Covid. Even in normal times it wasn’t working, now it’s really not working.
What are some key differentiators between Free to Play social casino games and Hold Gaming?
Marketing costs for social casino are crazy high, targeting those 2-4% of players that transact. We can open up our targeting to a much broader group of people which brings all of our costs down. A swathe of social casino players has a “never spend” mentality of “I’m not giving you a dollar”. Players question why they should give money to not get anything in return. We are the answer to that. Because players have skin in the game, there is a cash prize for their game play, not just more virtual currency.
Players can go ahead and put in their $5 and have that last a day, week or month whilst taking part in month-long or daily leagues to achieve additional cash and virtual currency. We are a much better path to lower costs of acquisition, achieving higher revenues from our customers, and our rate of purchasers is much higher than any social casino product I’ve ever worked on. Ultimately, we are a better answer.
What are Hold Gaming’s plans and expectations for 2021?
I always like to joke that we are a heavily underfunded start-up. I’ve put in a sizeable amount of my own funds and we did a very small raise prior to Covid-19 taking hold. The pandemic made it difficult to be able to raise more funds as the markets were tanking, people were withdrawing and not investing – certainly not in skill-based games, let alone casino skill-based games.
We had a few negatives working against us that unfortunately did not equate to a positive. However, we are able to show traction through our numbers as they relate to what our trajectory should be, we’re confident that we’ll be able to secure the raise that we were looking for this past year. This will allow us to create more features and are anticipating the release of three new games for 2021.