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On a visit to Bucharest, NEXT.io‘s Sonja Lindenberg speaks to EveryMatrix founder and CEO Ebbe Groes about financial discipline, fear of failure, and the next steps for a company that just reported the best financial results in its 16-year history. 

A few years back, cashflow was tight at EveryMatrix.

The supplier was in the midst of a complete overhaul of its platform and products after recognising that to attract bigger clients, it needed to offer highly customisable and modular solutions. 

EveryMatrix began re-architecting its platform, so that each component integrated seamlessly with others, as well as with third parties and the in-house technology stacks of operators.

Yet, the road to success was riddled with obstacles. “We almost ran out of money,” recounts EveryMatrix co-founder and CEO Ebbe Groes. 

The primary reason was that timelines extended far beyond expectations. “What we thought would take 12 months ended up stretching to 36,” Groes says.

Despite the setbacks, EveryMatrix persevered. It was a race against time, but the firm managed to pull through and launched the first product just in time to “not kill the entire company,” he adds. 

Moreover, EveryMatrix saw that the strategy was working and applied it to other business segments in the following years, with the result that most products became highly customisable. 

This move paid off. “In 2017, we broke even, and by 2019, when we finished the entire exercise, revenue really started to surge,” Groes recalls. 

An office with a pool

Today, five years later, the firm offers software, solutions, content and services for casino, sports betting, payments, and affiliate management.

In January, EveryMatrix moved into a brand-new office in Bucharest, and the firm has just welcomed its 1,000th employee.

The six-storey complex was purpose-built for the supplier and its team of more than 400 staff based in Bucharest.

It includes a gym, a sauna, a yoga room, massage facilities, a garden, and a cafeteria with a dedicated play area for children. 

An indoor pool for staff is currently under construction.

Groes takes pride in the impressive new development hub (and in his office which has its very own set of DJ turntables), yet the journey for EveryMatrix began in starkly different surroundings.

The company’s origins trace back to a converted garage in Shoreditch, London, during a time when the area lacked the hipster appeal it enjoys today.

Returning to the location two years ago, Groes found a hotel restaurant occupied the same spot.  

“It’s quite a different site now, but back then, it was a dismal building with terrible acoustics. However, it served its purpose at the time – cheap and functional.”

Early days of the internet

In a sense, the inception of EveryMatrix was the result of a “series of random events,” Groes says.

Armed with a PhD in Economics from the University of Copenhagen, Groes started his professional journey as a post-doc researcher. 

“Those were the early days of the internet,” he recalls, noting that universities were among its pioneering users before its commercial explosion.

He eventually took on a position at the Copenhagen stock exchange and was tasked with developing a website for the exchange since he “knew something about the internet.”

However, fate took a hand when he met a developer friend.

Together, they set up a software development company and explored different paths, including creating an application that compared odds from different bookmakers.

“I saw potential in the idea,” Groes says. “So, I relocated to London to establish a venture solely dedicated to this odds-comparison concept.”

The affiliate business that emerged from it served as a stepping stone to eventually build EveryMatrix. 

“A couple of years ago, we sold off the odds-comparison part of the business to fully concentrate on EveryMatrix. After a few iterations, we suddenly have this company,” says Groes. 

16 years and counting

In FY 2023, EveryMatrix registered the strongest financial results in its 16-year history, including net revenue of €114m across all products, up 75% from 2022 and more than four times higher than in 2019.

Annual EBITDA surged to €60m for the full year, up 155% compared to 2022.

“It’s not a small company anymore, nor is it in its early days. This is something I am deeply grateful for,” he says. 

He adds that transitioning from a team of 10 to 20 people is one thing, but the leaps from 250 to 500, and then from 500 to 1,000 staff, mark significant shifts.

Groes acknowledges the challenges inherent in such growth, noting: “Many companies in this space reached certain thresholds and then failed. It doesn’t always work out.

“In fact, parts of our industry are littered with examples of people who one day thought they owned the world, and a few years later, their businesses were wiped out.”

Asked about any concerns regarding this potential outcome, Groes expresses a sober perspective. “It’s not so much fear of failure,” he explains, “but a recognition of the challenges ahead.” 

After all, he says it’s easy to grow your staff, but much harder to grow your revenue.

Our own money

Groes admits to experiencing sleepless nights during EveryMatrix’s reinvention, but points out that “when you come from nothing and it doesn’t work out, there’s not so much to lose.”

“We built this company with our own funds,” he explains. “When it’s your own money, the burden isn’t the same as when you have investors and external pressures. 

“You’re not failing others who trusted you with their money; you’re primarily failing yourself, and that’s something you have to live with. Still, we kept going until we saw some success.”

Groes says a lot of financial discipline was required at that time. “The relocation of our largest office to Bucharest from London also happened during those ‘cash-strapped’ days,” he adds.

“We had to watch every penny,” Groes recalls, “because that’s all we had to work with for many years.”

The need to scrutinise every expenditure during the formative years has instilled financial discipline. “It’s ingrained in us,” he remarks.

He contrasts this with experiences in other companies, including his first venture where external investors provided financial support. 

“The money comes too easily when you have investors,” Groes reflects, “and one might not necessarily have the financial discipline that’s actually necessary.”

Benefits of transparency

Despite being a privately-held entity, EveryMatrix openly shares its financial results. 

“We started doing this because at one point we thought of doing an IPO, and we thought it was a good preparatory exercise,” Groes explains. 

Although at the moment an IPO is not being considered, the business realised that financial reporting offered several benefits.

“It is one of the most efficient ways to communicate our company’s capabilities,” says Groes. 

Building trust

“A big, legitimate fear among operators is whether their service provider possesses the stamina to invest in and sustain a project over the long term, serving not only as a reliable provider but also an innovator five years down the line.

“Moreover, one of the primary reasons why B2Cs opt for insourcing are concerns about product quality – maybe not so much for the present, but definitely for the future,” he explains. 

Transparency builds trust, and this has worked well for EveryMatrix. Today the firm generates two-thirds of its revenue from tier-1 operators.

Furthermore, this transparency also aids internal operations, fostering a culture of openness within the organisation. 

“If you don’t disclose externally, you tend not to do so internally, driven by the fear of competitors obtaining sensitive information,” Groes emphasises. 

“I like the fact that the openness to the outside has created openness to the inside. This also means that if we have to make changes because something is not working – and the numbers show that – people understand it.”

What’s ahead?

“Our greatest opportunity lies in expanding beyond Europe. While our office footprint spans the globe, 85% of our revenue still originates from Europe. 

“We’re making strides in regions like Latam, the US, and Africa, but our efforts are in the early stages – it’s more about sowing seeds than reaping rewards,” says Groes. 

Groes is also looking to M&A as a source of growth. However, he reveals that negotiations can be tough. 

“Every time you enter discussions, you know there’s roughly a 10% chance that you seal a deal. I think it’s fair to say that in nine out of 10 cases, you disagree on valuation and part ways.”

He emphasises that, up to this point, EveryMatrix has financed all its M&A endeavours, such as the acquisition of DeepCI, exclusively through its own cash flow, avoiding any dilution.

“But for larger deals, that won’t be possible. It will be the next step for us,” Groes says. 

In the meantime though, the business has to finalise two ongoing projects. 

One, of course, involves completing the staff swimming pool. The other, evidently more serious, is establishing EveryMatrix’s live casino vertical.

Groes explains: “We launched with one table a month ago, and in two months, we plan to add another 10 tables. After that, we’re looking to expand into other locations.”

When asked which project excites him more, Groes replies: “I am thinking of combining both. But jokes apart, I’m a bit more excited about the live dealer product.”

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