iGaming Academy M&A workshop provides key insights for industry professionals

David Gravel November 15, 2024

SiGMA news

iGaming Academy M&A workshop provides key insights for industry professionals

Key figures from SiGMA’s management and M&A team recently attended an expert-led workshop by the iGaming Academy that explored the complexities of mergers and acquisitions (M&A) in the iGaming industry. The comprehensive three-session course covered everything from deal structures to integration processes, providing participants with valuable insights into the strategic and operational elements of M&A.

Understanding M&A beyond the basics

For many iGaming companies, M&A is not just about financial transactions; it involves a strategic combination of creative deal structuring, human factors, and integration planning. The workshop reinforced these ideas, focusing on why companies pursue M&A and the diverse methods available to structure deals successfully.

Zakariah El Maaroufi, head of M&A at SiGMA, found the course beneficial in providing a holistic view of the M&A process. “Connecting people is not enough. You need to understand why companies engage in M&A and what should happen in a deal from start to finish. The integration part, in particular, was eye-opening. It can make or break a deal,” he explained.

Vinícius Moraes de Carvalho, Investment Partner at Ikigai Ventures, emphasised that M&A requires both strategic thinking and creativity: “It’s not just about signing a cheque. The decisions behind an acquisition must align with a company’s broader strategic goals.”

Key course components

iGaming Academy divided the course into several critical components specifically designed to address the complexities of M&A in the iGaming industry. Participants engaged in interactive discussions and practical case studies, which deepened their understanding of these components.

Reasons for M&A: The workshop began by exploring the key motivations behind mergers and acquisitions. For iGaming companies, the strategic reasons might include entering new regulated markets, acquiring new technology, or consolidating operations for greater efficiency. “Understanding the ‘why’ behind a deal is essential,” Vinícius explained. “You need to know how an acquisition fits into your long-term strategy, whether it’s about growth, innovation, or competitive advantage.”
Types of M&A: The course covered different types of mergers. Vertical, horizontal, and conglomerate, each presenting its own challenges and opportunities. Zak noted that while this was familiar territory, “It was a good review of how these different approaches apply in the iGaming sector, especially when we consider expanding into new markets.”
Buyers – Buy and Sell Side M&A: Participants examined both buy-side and sell-side M&A activities, learning how both parties prepare for transactions. Zak pointed out, “This was especially helpful in understanding the motivations behind both sides of the table. Knowing how each party prepares for and negotiates deals adds another layer of strategy.”
M&A Buyers: The workshop also addressed the various profiles of M&A buyers, such as private equity firms, strategic investors, and venture capitalists. Each type of buyer has different goals, whether they are after market share, technology, or regional expansion. SiGMA M&A Associate, Marieke Janssen, found the case studies helpful and commented, “The real-life case scenarios were better than textbooks or reading from presentations. It gave a better understanding, and some cases shared were good for looking at pros and cons and different directions too.”
Valuation and Financial Ratios: Valuation was a topic that some attendees found challenging, especially those without a strict mathematical background. Zak, however, found that the course demystified key financial ratios and valuation techniques. “The examples we worked through made it much clearer,” he said. “Valuation wasn’t as hard as I thought it would be, and I now feel more confident in assessing a company’s worth.” Vinícius added that while the workshop provided an excellent introduction, mastering valuations requires practice. “This is a complex area, and while the workshop gave us a solid foundation, it’s something we’ll need to continue refining,” he concluded.
Legal Considerations and Term Sheets: The workshop highlighted key legal aspects of M&A, such as what to include and avoid in term sheets. Vinícius pointed out that this is an area where mistakes can be costly: “You have to be careful with the legal side. Understanding what’s in the term sheets and what’s missing is crucial in preventing complications during negotiations.”
M&A Deal Structure: The structure of an M&A deal can significantly impact its success, and this was a key focus of the workshop. Participants discussed various deal structures, including asset purchases, stock purchases, and mergers. Vinícius noted that “The creative part of structuring deals is crucial. Once you understand the financials, how you structure the deal can make all the difference, especially in the iGaming industry, where technology and intellectual property are often key assets.”
Case Studies: Real-world case studies were a highlight for many attendees. Marieke remarked, “Seeing real-life examples of what went right, and what went wrong, was much more effective than simply reading presentations. It gave us practical insights into the complexities of M&A.” These case studies allowed participants to see how strategies can play out and what pitfalls to avoid in future deals.
M&A Integration Process: The post-acquisition integration process was one of the most discussed topics during the workshop. “Integration can be the hardest part of the deal,” Vinícius observed. “It’s not just about financials. You’re merging two company cultures, operations, and teams. If you don’t plan for this properly, the deal could fail.” Zak agreed, adding, “Integration was the most relevant part for me, given where we are with some deals. It was invaluable to explore this in depth during the workshop.”

Interactivity is the key to engagement

A standout feature of the workshop was its interactive format. Rather than sticking to slides, the course leader engaged directly with the participants, encouraging questions and discussion. Marieke noted, “The interactivity made all the difference. It wasn’t just a lecture, it was a real conversation, and we were able to apply the concepts in real-time.”

Vinícius echoed this sentiment, saying, “The ability to discuss and challenge ideas in real-time made a significant difference. It allowed us to apply what we were learning directly to the issues we’re facing in our own deals.”

Tailored for the iGaming industry

The workshop focused on addressing the unique challenges and nuances of M&A in the iGaming industry. Zak explained, “In iGaming, you’re dealing with different regulations, fast-growing tech companies, and a rapidly evolving market. This workshop helped us focus on these industry-specific issues.”

Despite the workshop’s strengths, Zak, and Vinícius both felt that incorporating more practical exercises, especially in areas like valuations, would have enhanced the experience. “It would have been useful to apply some concepts in hands-on exercises,” Zak noted. “This would have been a good way to test our understanding.”

The importance of ongoing learning

Both Marieke and Zak emphasised that M&A is a field that requires continuous learning. There is no one-size-fits-all approach, and each deal presents unique challenges. “There’s always something new to learn in M&A,” Marieke said. “It’s important to keep up with new strategies and stay adaptable.”

As the iGaming industry continues to grow and consolidate, M&A activity will only increase, making workshops like this one a valuable tool for professional development. “M&A is a long-term game,” Vinícius concluded. “This workshop gave us a solid foundation, but it’s clear that ongoing learning is essential.”

Alison Askew, Director of Operations at iGaming Academy said, “The response to our initial M+A workshop has been extremely positive. It’s clear there’s an appetite for this dedicated training, specifically for the iGaming industry. ?We are committed to enhancing our workshop even further, using attendee feedback to shape future sessions.”

To be the first to know when the next workshop is scheduled, drop an email to the iGaming Academy.

*iGaming Academy provides efficient and effective training for the global online gaming and gambling industry. They help operators and suppliers meet regulatory requirements in every major jurisdiction, minimise risks and keep their business, staff, and customers safe.