Good morning, everyone. Welcome to day two of the Sidoti Small Cap Conference. My name is Ashish Shah, and I'm an analyst here at Sidoti. With me today, I have High Roller Technologies, Inc. It trades under the ticker ROLR. I'm happy to welcome Seth Young, Chief Strategy Officer. We have about 30 minutes today, including the Q&A. If you have any questions, please submit them at the Q&A section at the bottom of your screen.
Thank you, Ashi. I'm joined today as well by Ben Clemes, our CEO. Ben, I'd love if you wouldn't mind giving us an introduction, and then I'll do the same, and it'll kick us off.
Thank you, Seth. Glad to be here, and thank you, everyone. My name is Ben Clemes, CEO for High Roller Technologies . I've been in the online gambling industry now for over 20 years. I started my career, first half of it, running online casinos, mostly in the European landscape. In 2013, I co-founded a company, started its journey much like High Roller has today as an online casino. We grew that company into a company called Gaming Innovation Group, which was listed on the Oslo Børs, Swedish Nasdaq. I left that company in 2023, joined the investment firm Happy Hour. Happy Hour invests into online casinos, early-stage startups, does a lot of incubation innovative technology in the online gambling space. The second largest shareholders and founding partners of High Roller Technologies and I joined the board and management group as an advisor. I knew the company very well.
I loved what I saw when the opportunity came to become CEO. I jumped on the chance and took that position in January of 2024, went through the IPO process, and you know it's been an incredible journey, one that we're very much at the start of and looking forward to the future. Over to you, Seth.
Thanks, Ben. Hi, everybody. I'm Seth Young. I'm Chief Strategy Officer at High Roller. Much like Ben, I've been in the industry for just over 20 years now. I'm on every side of the table. Same as Ben, I've been on your side of the table as an investor, invested across the gaming ecosystem. I started my career as an entrepreneur, founded and sold a handful of companies, worked at Foxwoods, where I built and ran the interactive division, the App Tribe. After that, helped build a great business called Points Bet Sportsbook, which we took public on the ASX, topping it at about a CAD 5 billion market cap . From there, joined High Roller back in April, which is an amazing business. Couldn't be more excited about it.
I'll say there are three moments in my career where I've looked at a company and said, "This one is going to be incredible." This is one of them, and it's the perfect confluence of team, technology, and product. With that, I'm thrilled to give you this overview. Welcome to High Roller Technologies. Here we have the legalese and forward-looking statements, which we have to have. Look, High Roller is an online gambling business. We operate the award-winning online casino brands High Roller and Fruta. What that means is we have an online casino, and how we make money is we offer games of chance, slot machines, table games, live dealer games that are built with a mathematical house, built-in house advantage. Our brands are incredible.
I look at the High Roller brand, and for me, this is one of the only brands I've ever seen where you don't have to tell anybody what it is. We know this is an online casino brand. It's super powerful. Our secondary brand is called Fruta, which is Spanish for fruit. Really great brand. Operating a multi-brand strategy allows us to hit all corners of any market that we choose to enter. Our team is backed by very experienced founders and executives. The upshot is we've all been here before. This just happens to be a brand new company building at a very early stage. While we're microcap, I'm not certain that we think like a microcap company. We have a ton of upside ahead of us, which I'll get into with the numbers, and I hope you'll see the same. We have super strong technology.
It's best in class. We own our front end and middleware, so we can take our intellectual property and be quick to enter new markets and adaptable in many markets. It also means that we rent some of the underlying technology. We have a lean operating team, and we don't have to carry a tremendously large technology team, which is often quite costly, and we'll get into that a little bit too. This fourth bullet point you see, our partnership with the industry-leading iGaming acquisition company, SpikeUp Media, is perhaps one of our greatest unique selling points, and I really can't overstate this point. Part of our founding team are the founders of SpikeUp Media. I'll talk a little bit more about them, but they are one of the world's largest and most prolific customer acquisition and lead generation firms for online gambling.
They've worked with hundreds of operators across dozens of countries, and they offer us the opportunity to acquire new consumers for our brands, more or less close to cost. For the markets that we've chosen to enter, which are highly engaged, high upside markets with high player values, acquiring at a low cost with high value players means that we have quite a bit of margin potential to work with. For those of you that may have been following our story, some of you may be new to it. We IPO'd on the NYSE in late October, early November, and we were operating with a global profile under a handful of licenses. Since the end of Q1, or really in the middle of Q1, our company underwent a pretty large transformative shift where we reconstituted the executive team. We started focusing on high potential regulated markets with stable revenue streams.
We'll talk more about where the business is pointing and why it's a bit different and why we're so excited about what we're doing. We have our main headquarters based in Malta. We have just under 60 people. As a business, we have this corporate layer. We have our regional teams focused towards our market of focus and then our shared services layer. We get great operational economies of scale as we go from jurisdiction to jurisdiction. We also have one of the largest game portfolios in the world. This slide is a bit dated. We have over 6,000 games from more than 90 leading providers now. As a function of being within the gaming business for 20 + years, we have really strong commercial rates with our partners because we have a history of success.
We have one of the wider game portfolios that means we can engage not just a VIP consumer, but an aspirational consumer and really the everyday consumer. There's something for everybody on our platform, which is amazing. It's an incredible, incredible library. For those of you that have never seen an online casino product, this is what a good one looks like. It's super slick, super fast, intuitive. It viscerally feels good. It really just feels like a bit of a High Roller brand, right? It's nice. We have really interesting underlying technologies. We use a lot of AI and machine learning to offer personalization. It's a pretty thoughtful layout. Just a couple of screenshots, won't belabor the point. I do apologize. I am talking a bit fast. One, I'm from New York, and two, we have limited time, so please forgive me.
Our brands are optimized to be enjoyed on all devices. You can play them on mobile, on desktop, even on like Amazon Fire. If it exists, we can optimize towards it. Basically, we're taking a casino and we're putting it in your hands so it can be enjoyed from the comfort of your home. Here's what you came for. Here are some of the numbers. The global online, the global gambling business is massive. It's nearly a $700 billion market, maybe more depending on the analyst estimates that you look at. Depending on the analyst estimates you look at, you'll see the online share is huge too, and it's just growing. The online market today is worth $200+ billion . What we'll talk about is the portion of this market that we're addressing.
Though we're not providing any forward-looking guidance, I will try to give you a sense of how you might value a business like ours. The upshot here is that the $200 billion online gaming market has grown really rapidly. This $681 billion number is starting to bleed into this number. This number is becoming larger, the $210 billion one, as consumer consumption habits shift and online gaming becomes more prolific around the world. I touched on this. We're experts in customer acquisition. This is one of the lifebloods of any online gaming business. If you don't have customers, you have a ghost town. We're very lucky to have arguably the best group in the world doing our marketing for us across all digital channels in SpikeUp Media. This social relationship allows us the opportunity to acquire customers effectively across Facebook, Meta, Google, programmatic real-time advertising.
We're focused on surgical performance marketing, digital marketing, things that we can measure. To that end, I love and I hate this slide because it shows that we have a positive return on ad spend, putting in a dollar, getting nearly two. I love that, but I hate it because it's not necessarily indicative of where we're going. This slide is an amalgamation of our marketing spend from 2023 to 2024, where we spent roughly $30 million to make just under $60 million in revenue. This was in a lot of markets globally, whereas now we're focusing on a few markets as a business. The markets that we've chosen to focus on now are markets where SpikeUp, our partners, are particularly strong. It's not to say they weren't strong in some of these global markets, but they were less strong than the ones that we're leaning into.
We would expect this $1.93 number to go up directionally. We're not satisfied with this. That notwithstanding, it does show that we can spend a dollar to make a dollar, so to speak. For those of you that are not familiar with how our business works, we have slot machines, we have table games. These games are built with a mathematical house advantage. Directionally, for every dollar that a player wagers, we expect to make $0.05. That's on tables. It could be anywhere from 12% - 18% on average for every dollar wagered. It does vary, but high level, that's how we generate revenue. We have a really experienced board, really experienced executive team. You'll see Mike Grabari and Brandon Nichess. The top two are both Mike is our Chairman. These two gentlemen are two of the founders of SpikeUp.
Daniel Bradkey is a very prolific entrepreneur and investor in the gaming space. Kristen Britt in the bottom left is Vice President of People and Culture at Anaxi, which is the online gaming subsidiary of Aristocrat, a global online gambling giant, I think near a $30 billion market cap. Rounding us out, last but not least, we have Jonas Martinsen, former CEO of Mojang, which you may know better as the creators of Minecraft. David Weld, who some of you may know, he's a former Vice Chair of Nasdaq and effectively Wall Street Royalty. We have a leadership team here, and leadership was completely reconstituted after Q1. It was almost a clean sweep of the C-level minus Ben, our Chief Executive Officer, who somebody once said was punching above our market cap. I like that, and I think it's accurate. I think that goes for the rest of us too.
You have our CFO, Adam Felman, who joined us at the end of Q1 as we transitioned from one CFO to another. He's incredible, has public markets experience in gaming. Emily McAuliffe is our COO and Chief of Staff, really process-driven, has been instrumental in transforming our corporate structure. Then Sarah Stein on NameLee, who has a tremendous amount of experience in both regulated and unregulated markets as her Chief Legal and Compliance Officer. Two names you don't see here: Carlos Zapatichi, who's our Managing Director for Canada, and Sarah Nunes, who's our Managing Director and Chief Commercial Officer for Finland. Both markets have focus. Sarah used to be a pop star, actually. She was on Britain's Got Talent, had a great 10-year career in music, and has anchored that with a great 10+ year career now in online gaming as a country manager for a major brand.
We're lucky to have her. Licensing and compliance. Some people think this slide is boring. I think it's fun. We hold a couple of licenses, one in Estonia, one in Curacao. It's allowed us to operate in some global markets. We have a license pending now in Ontario, one of the markets that we're focusing on. We're also planning on entering under license Finland and Alberta. Let's talk about those markets. I'll start with Finland. This is a market today that we're in. It comprises about 60% of our net gaming revenue. The market's estimated to be somewhere around $1 billion, $1.2 billion. This could be low. Finland has historically been a lottery monopoly market, so it's in the process of regulating. Most global operators, including us, do serve Finland. Like Canada, there have been large pre-regulated markets served by many, many groups.
What these countries are doing thoughtfully is instead of banning these groups from operating in these markets, they're regulating the markets and bringing in the groups that are proven to make money so they can drive tax revenue for public policy initiatives. Finland is in the process of regulating. It is a market where we're particularly strong. We do not have to hyper-localize our product. We expect to be operating under license in Finland by 2027. One of the most interesting parts about Finland is that, different than the United States and how online gaming businesses work here, there's open banking, which means that customers can do their know-your-customer process, like the personally identifiable information, verifying their ID, everything like that, with their bank account. It's a relatively frictionless onboarding, which helps us increase conversion, optimize marketing spend, and provide a great user experience.
Canada is somewhat similar with their Interac product. These markets that we've chosen are thoughtful, and I'll tell you why after I tell you the numbers. Ontario is the next market we're entering. We do have our license application in with Ontario. It is pending approval. It's been signaled to us by the regulators that we should be launching, we hope, by October, November. We can't control government timing, but we will be ready as soon as they say go. This is the sixth largest regulated market in the world, and it's the fastest growing market of any market over the first three years in North America. It's about a $2.5 billion TAM. Directionally, 70% - 80% of it is casino. Last number a couple of months ago was 72%. That number is actually going higher.
As a casino-led brand, we are addressing the vast majority of where the revenue is in the market. Casino-led brands tend to do very well in markets that are typically dominated by sports-led brands, like the DraftKings, the FanDuel, that some of you may be familiar with. We're really excited about getting in this market. Like Finland and like Alberta, we'll have a 20% tax rate and should be relatively transformative for our business. This is a market where SpikeUp Media, our marketing partner, is particularly strong. We do expect to do well here. Same with Ontario. We're looking at Alberta next. Alberta recently passed legislation in May of this year to create a regulatory framework to license hopeful operators. They have said the market will go live in the first half of 2026, sorry, in early 2026, which I'm making the assumption is H1.
The estimates that you'll see from analysts range anywhere from $300 million - $750 million. I've got the number pegged at over a billion, but we lean on this. Like Alberta, excuse me, like Ontario, like Finland, and many other markets that have liberalized their online gambling regulatory structure, this was formerly a lottery monopoly that is now opening to a wider competitive market. Subject to licensing and approval, we will be in this market, and we do anticipate that we'll be able to apply for licensure after we get our feet under us in Ontario. Why these markets? I know a lot of people don't really talk about Finland. You might be thinking, why Finland? Finland is a market that is served by a lot of global operators, but not everybody knows how to hyper-localize there. Our team has great experience operating in this market.
Prior to High Roller, we have a number of brands in the Finnish market. We're launching a new one shortly as well, which we just mentioned on our Q2 earnings call. Canada and Finland together both have very large, historically gray markets or pre-regulated markets where you have an educated player that understands what a sophisticated product looks like. As we enter these markets, there's very little education we have to do. Our product should resonate quite well. All three of these markets I mentioned rank amongst the highest in the world in terms of player engagement and customer value. You pair that with the fact that our partner in SpikeUp Media is really strong here, and we believe that we can acquire consumers at a very efficient rate relative to our peers, and the player values are high.
We should have a business, in our view, that is operating with strong margin, and we'll use that as a ballast for expansion into future markets. That is where do we go from here? Prior to Q2, really, and this strategic shift, we had a number of global markets open. We wanted to focus our efforts and streamline our corporate structure to represent an operating profile that is focused and efficient, where we can be great at these markets rather than just good enough or just keeping up. These markets do represent opportunities where we believe we'll be great. We believe we can use the success to power our expansion, whether it's organic or inorganic. We can apply. There are three ways to enter markets. Like we're doing in Ontario and Finland, you can apply directly for licensure with the regulatory body.
Like in the United States, you could strike a market access deal. It's a commercial arrangement with a land-based incumbent that may be issued a license. Online operators are not able to get one directly. In some markets where there may be limited licenses and there are groups that have the right to operate online gaming but lack the knowledge of the digital landscape, we may have opportunities to JV. We will be opportunistic but judicious when it comes to exploring growth opportunities. Looking at markets like the U.S. and Latin America, these are really interesting to us. With our team and our experience and our length of time in the market, we all have very, very wide professional networks, which lends itself to having just about every opportunity to consider expansion. This is where we're starting. We talked about SpikeUp Media.
I don't want to belabor the point other than to say they've worked in dozens of international markets. They've spent more than $600 million in first-time player deposits, first deposits, from a third of that spend for a fourth of that spend. My math is bad. With more than 15 years of experience sending over a million players, more or less, they could send an endless amount of traffic to us. Just about in any market we're in, we're super excited about it. We do have some diversified revenue. We have an affiliate business that does offer us low-risk, high-upside revenue. We can use affiliate marketing, which is basically like being a club promoter. Let's say I wanted to send Ben to John's club.
John might pay me $100 when Ben walks in the door, or he may pay me 25% of what Ben spends when he walks in the door. This is basically how affiliate marketing works with online gaming. For us, this benefits us in two ways. One, it's an additional revenue stream. Two, it allows us to potentially enter markets that we may not want to enter on a B2C basis. It allows us to prospect and better understand what customer values look like and how it may back out with different kinds of operators and different kinds of products, which does allow us to more granularly forecast our own success. We do have some upside. It's not listed here, but we are a casino-led brand. We may choose to add a sports betting product in the future to our portfolio. It was listed there. Pardon me.
Talking about products, really what I want to highlight here is we have a very, very robust product solution that is built for regulated markets. We use a lot of AI and machine learning to automate a lot of functions that historically have been done by people. We do have a lot of efficiency. We do own our front end and middleware, so we can lift and shift it from jurisdiction to jurisdiction, which means that we're able to enter markets quickly and localize a product more efficiently. I'll leave it with this. We have some key takeaways. Online casino is somewhat commoditized. There are a lot of operators globally. For my money, we have one of the best brands, if not the best brand I've ever seen. It does matter, right? We are a casino-led brand.
Casino-led brands tend to do well historically in markets that have a lot of sports-dominated brands. We have an incredible team that has been here before and knows how to execute. We are operating within regulated environments and focused towards regulated growth, which has stable revenue streams and really removes the potential for adverse regulatory headwinds. Can't be overstated. Our relationship with SpikeUp Media is super important, very well experienced in the industry, and one of the widest game libraries in the world. We're super excited to be with you here today. We're going to open the floor for questions. If you want to learn more about our business, you can go to ir.highroller.com. We can be reached directly, but we're happy to take questions now. Thank you.
Thank you for the presentation, Seth. I really appreciate it. I would like to remind everybody in the audience, if you have any questions, you can submit them at the Q&A section at the bottom of your screen. Seth, I want to understand how do you expect the Playtech partnership to enhance your competitive positioning in Ontario? Can it extend to other jurisdictions? What do you think of partnerships in general? Do you plan on getting more of these?
Sure. Playtech, as some of you may know, is a publicly traded online gaming business. They're one of the world's largest, most mature online gaming platform providers. Their product is world-class. We're using the Playtech Player Account Management System, it's called a PAM, to power our entry into Ontario. We're taking that front end and that middleware that I mentioned and building it up on the Playtech platform, which has a tremendous amount of integrations with our content suppliers, gamification features, all the bells and whistles that enable us to offer a world-class product to the Canadian consumer. In a market like Europe, we do have a different platform supplier.
In other markets where we may choose to enter, the benefit of owning this front end and our intellectual property and brand assets is that we can choose any number of different platform providers that may be better localized for different regions. While we selected Playtech for Ontario because they're particularly strong there and they're already licensed, we may choose to use another provider, say, in Latin America, another provider in other European countries, because it just suits the market better. I hope that answers your question, Ashi.
Yes. In a crowded iGaming space, what makes High Roller stand out? Is it the technology, user experience, game variety, branding? How do you differentiate yourself from your peers?
It's all of that, for sure. I mean, the brand is strong, but really, I think a lot of people can acquire customers. I don't know that a lot of people can acquire them as efficiently as us. A lot of it comes down to how you keep them as well. With our operating experience, we know what it takes to effectively keep a customer engaged with our entertainment product. We're talking about bonusing them in real time, giving them the right kinds of offers when it's relevant to them. For example, if you're staying for a weekend at a casino and you've checked out in the morning, and six hours after you've driven home, you get an offer for $100 in free bets. Could you use that, maybe 12 hours ago, right? I think that's a good example of how we can differentiate.
We do very, very well with retaining our consumers because the brand is so good. The game library is so wide. It's nearly impossible to find something that exists in the online gaming space that we don't offer to our consumers. We try to do a good job of onboarding the consumers that will resonate with our product and then offering them games maybe on a personalized basis that we think will resonate with them and continue to keep their entertainment experience fresh.
Right. Switching gears a little bit and talking about the revenue and the financial statements, what kind of quarterly sales do you have to reach to be profitable? When could that potentially happen for you guys?
I appreciate that question. I'd love to be providing guidance. We're not providing forward-looking guidance, but the best way that I can try to explain how you think about a business like ours is, those three markets I mentioned, Finland, Ontario, Alberta that we're addressing, the total addressable revenue opportunity in those markets is a shade over $4 billion. Let's use a $4 billion number and then assume that's 2% of the $200 billion global online gambling opportunity. If you believe that with our team, our experience, our product, our technology, our marketing acumen, that we can achieve 5% market share across these markets, you're looking at a business that's a $200 million top line company. If a business like this operates at a 20% EBITDA margin, that's $40 million EBITDA. Let's say it trades at, I don't know, a 10x multiple conservatively. That's about 20x where we are today.
That's 5% of 2% of the global opportunity. I think that speaks to the upside that we have. You can make your own determination about whether a 5% market share is achievable for a company like ours with industry veterans and super sophisticated, strong product. We take it from there, right? I'm really excited about it. Maybe that helps get across why all of us are so excited about it.
Right. If you can just talk a little bit about your profit and loss, analysts have you generating a larger loss per share in 2025 compared to 2024. What's driving the outlook and the operating loss? Also, when do you anticipate being profitable? That's another question again.
Yeah, I'm not sure. I haven't seen that analyst data, but what I can say is, if you're looking at our Q1 results, you would have seen a pretty wide loss. We had about a $2.5 million loss. As I mentioned, we had a strategic shift and basically a transformation of the business between Q1 and Q2. In just one quarter, it was a massive turnaround where we cut our costs by 75%. We increased our revenue modestly while winding down legacy markets and leaning into one of our core markets of Finland. We increased our average revenue per user, and we had an adjusted EBITDA positive result of just under $400,000. I think going from that extreme to that extreme is really impressive.
With this new team and new strategy and optimized corporate structure, I think if you're looking at this business, looking at us from the perspective of Q2 is a much better way than looking at us from the perspective of Q1. We have a different operating profile, a completely different team. We understand that we have to have some more proof points in front of us, but we do have a lot of growth in front of us with the Ontario launch, the Alberta launch, and then some. Directionally, this is, you know, I think shows that we know how to operate a business and, you know, we're really excited about continuing to execute.
Right. Just on your cash position, do you have enough cash to go on for another 12 months- 24 months, or will you need any secondary offerings? How do you plan to raise money if needed?
We have $3.5 million cash on hand, roughly a little more than that, with about $1 million restricted. We have put out in our filings that we do not anticipate running out of capital within the next 12 months. We are considering any number of strategic opportunities. Part of the reason we're here at these investor conferences is to raise awareness of our business within the investor community. We're more than happy to speak with anybody that has an interest in our business. Right now, we haven't signaled any intent to have a capital raise so much as we're just having conversations.
Right. I would just like to end by asking if you can sum up the value proposition for investors who might be looking across the casino segment and how does High Roller help them?
Yeah, so we don't have any, we're a pure-play in this market. We don't have any comparables. There's no other business like us of this size in the public markets, maybe on the TSX, but that's a little different. So pure-play, industry veteran team, really, really strong team. Not our first rodeo. We built public companies before. Really strong technology, really thoughtful corporate structure, incredibly strong partnership with SpikeUp Media, which really is a big game changer. I don't know of any other company that has a similar relationship. It doesn't mean it doesn't exist. It just means I don't know of them. I have been in the business over 20 years, same as Ben. That is very, very powerful. We do think that will be a pretty big driver of our growth as we enter new markets. We're super early stage. We are anticipating to be relatively high growth.
Ontario is really a good inflection point for us as we launch into one of the world's largest markets, and we'll follow it up from there with some new market expansion. Early days yet. Great team, great product, great partnerships. Here we go.
Great, great. It's certainly an exciting market and certainly an exciting time for your company. With that, we're at time. I'd like to thank you very much for sharing your story with us. I'd also like to thank everybody here for listening and spending your time with us today. Thank you so much, guys.
Thank you so much.
Thank you.