IPO bound Nazara Technologies Limited (Nazara) is planning to launch sports betting, sports fantasy, Sports Arcade and Sports Real Money Quiz in Kenya, after acquiring a betting license in the country. It has set up a subsidiary called NZWorld Kenya Limited, in which it holds 70% stake, and has acquired the license from the Betting Control Board of Kenya.
According to Manish Agarwal, CEO, Nazara Technologies, “Real Money gaming is popular in African countries like Nigeria, Ghana, Cameroon in addition to Kenya, primarily on account of a well laid out and clear licensing framework.”
To start with, the company will launch a real-time social prediction sports game prior to the FIFA World Cup. The game has been developed by its investee company Mastermind Sports, where players can bet real-time among their friends. Nazara picked up 26% in Mastermind Sports in 2016. In the same year, Nazara also invested in HalaPlay, a Daily Fantasy Sports platform. Halaplay has been running a fantasy sports product in India for the last year, and plans to take it to Kenya, according to its CEO and co-founder Swapnil Saurav. This ties in with another set of companies that Nazara recently invested in: Nextwave Multimedia (World Cricket Championship (WCC)) and NODWIN Gaming, in line with building a network of companies for operations in India and other emerging markets across Middle East, Africa and South East Asia, and potentially targeting revenues from a mix of real-money gaming, fantasy sports, and competitive gaming tournaments.
On the Sports Arcade front, Nazara has an investment in MoongLabs.
Switch from VAS to Real Money Gaming?
Nazara has received SEBI approval for an IPO, and the fact that it is entering Real Money Gaming should boost its prospects of raising money: this was something that was previously unknown, as a part of its plans, although it mentions the possibility intent of investing in real money gaming companies in the draft Red Herring Prospectus. In the prospectus, Nazara points out that its esports revenues are fairly small for now, and it is primarily a subscription/VAS business, saying that “the increased availability and accessibility of smartphones, the increasing popularity of free-to-play and freemium games, the easy availability of mobile games content across platforms without the involvement of telecom operators and a reduction in payment barriers may all result in a decline of the Subscription Business.”
Real money gaming has the potential to be a significantly bigger source of revenue for Nazara.