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GAN Limited (GAN 0.36%)
Q3 2021 Earnings Call
Nov 11, 2021, 4:30 p.m. ET


  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:


Good day, ladies and gentlemen. Welcome to your GAN's third quarter 2021 earnings conference call. All lines have been placed in a listen-only mode, and the floor will be open for your questions and comments following the presentation. [Operator instructions] As a reminder, today's call is being recorded.

At this time, it is my pleasure to turn the floor over to your host, Robert Shore. Sir, the floor is yours.

Robert Shore -- Vice President of Investor Relations and Capital Markets

Thanks, Linda, and good afternoon, everyone. GAN's third quarter 2021 earnings release was issued today after market and is posted on the Company's website at ww.gan.com. With me today are Dermot Smurfit, president and CEO; and Karen Flores, CFO. Please note that we provide a set of PowerPoint slides that accompany our prepared remarks.

You may access these slides on the Investor Relations section of our website, and we will start with Page 2 with our safe harbor disclosure. We'd like to remind you that except for the factual statements made today, the information contained in this conference call including any financial and related guidance provided consists of forward-looking statements that involve risks, uncertainties, and assumptions that are challenging to predict. Words and expressions reflecting optimism and satisfaction with current prospects, as well as statements in the future tense identify as forward-looking statements, but their absence does not mean that a statement is not forward-looking. Forward-looking statements should not be interpreted as a guarantee of future performance or results as such statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements.

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Certain important factors that could cause such differences are discussed in the Risk Factors section of GAN's annual report filed on Form 10-K on March 31, 2021. Forward-looking statements speak only as of the date the statements are made, and the Company assumes no obligation to update forward-looking statements to reflect the actual results, changes in assumptions, or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws. During the call, there will be discussion of some non-GAAP financial measures. A description of these non-GAAP financial measures is included in the press release issued this afternoon.

And a reconciliation of these non-GAAP financial measures to the most directly comparable U.S. GAAP measures are included in the appendix of the investor presentation and press release issued this afternoon, both of which are available in the Investor Capital website. With that, I'll turn the call over to Dermot for opening remarks. Please go ahead, Dermot.

Dermot Smurfit -- President and Chief Executive Officer

Thank you, Bobby, and good afternoon, everyone. Please join me on the fourth slide of the presentation released earlier today to discuss third quarter performance for our consolidated and operating segment results encompassing our B2B enterprise software segment and our international B2C sports betting segment. I'm pleased with the third quarter performance, particularly with B2B delivering 5% sequential growth and the all-important take rate on gross operator revenue moving upwards driven by continued strength in iGaming together with overall strong consumer demand in the U.S. market.

Quarter-on-quarter growth has been delivered by our B2B division despite the third quarter being the seasonally slowest of the calendar year and granting our B2B divisions significant momentum in the current fourth quarter. I'm also excited to announce today our second client for omnichannel GAN Sports being the Island View Casino Resort in Southern Mississippi, which will be a new state for GAN and will shortly become our 10th state into which we have operationally deployed our technology platform. And so, we have now entered the seasonally strongest operating period of Q4 and Q1. And at this midpoint of the fourth quarter, I'm satisfied that B2B will continue delivering top-line growth as we move into 2022, which will actually be our 10th year operating our technology platform right here in America.

Since the beginning of the third quarter, we have shown strong execution of new B2B client launches and with Arizona's September sports betting launch and Connecticut's iGaming launch last month. GAN's technology platform is now powering online gambling in nine states nationwide including New Jersey, Pennsylvania, Indiana, Michigan, Tennessee, Colorado, West Virginia, Arizona, and of course Connecticut. Additional incremental launches in Louisiana, Maryland, and Arkansas are anticipated in the coming months, which together with Mississippi will see GAN's technology platform live across 14 states up from just three states literally this time last year. And with each state, our capability increases as does the scarcity of our technology platform and therefore, its inherent value.

In fact, GAN remains the only major B2B provider with a proven one account, one app multistate capability, which is contributing significantly to our sales pipeline and contributed greatly to our recent major client win of Red Rock Resorts also known as Station Casinos, which remains a standout opportunity to demonstrate our omnichannel sports betting capability, and which I'll comment on further later in this presentation. Shortly after our highly successful G2E conference and securing a number of coveted B2B industry awards, we held a strongly attended investor event, setting out the multiple pathways to serve as the basis for us targeting $500 million to $600 million in top-line revenue by 2026 together with long-term adjusted EBITDA targets in excess of 30%. As we move through the last quarter of 2021, our B2B division remains in robust health with a strong sales pipeline of significant multistate opportunities for both iGaming and omnichannel sports betting across multiple new and existing states with a fast-expanding engineering capability here in the U.S. ably led by our COO, Mr.

Don Ryan. And so, turning now to our B2C International division. And following a standout performance in the second quarter, the third quarter saw active customers increasing 6% quarter on quarter. As expected, B2C revenues were impacted by a quieter third quarter international sports calendar without major sports tournament events, but we experienced strong substitutional engagement by sports gamblers active within the online casino.

Our B2C division, ably led by Mr. Anders Karlsen also scooped a number of coveted international industry awards in the period including Mobile Sports Product of the Year from International Gaming Awards. Record levels of B2C customer activity has continued into the fourth quarter with active customers reaching an all-time record in October. And looking forward into 2022, we are preparing for incremental launches in Latin American markets, which are complementary too and will build upon our existing strong market position in that region.

Moving now to Slide 5. Despite having personally missed G2E courtesy of COVID, I'm happy to report the rest of the GAN leadership team was in full and healthy attendance at this major annual B2B conference for both our Super RGS and GAN Sports omnichannel offerings were extremely well received by executives of potential B2B clients. We're in the final stages of launching our first major B2C operator client of Super RGS and the first portfolio of Ainsworth online slot games have just received regulatory sign-off in Michigan and will be live by the end of this month. We are now at the contract stage with nearly all tier 1 B2C operators all by gaming.

And based on this strong commercial demand, we believe the substantial majority albeit as the operators of iGaming here in the U.S. will become clients of our Super RGS in relatively short order. As a reminder, GAN's exclusive content portfolio already represents a must-have collection of online flexibilities of retail slot machines, which we believe are critical to optimizing any B2C operator's cost of online customer acquisition, customer retention, and therefore, extending lifetime values. We have observed a growing market awareness that iGaming sits at the heart of B2C operators' pathway to future profitability and high quality, instantly recognizable online slot content such as GAN's exclusive and substantial Ainsworth content portfolio has a critical role to play in supporting B2C operators' profitability by lowering the cost to acquire the highest value players of online casino games.

Also, at G2E, we demonstrated our omnichannel sports betting solution with physical kiosks and over-the-counter capability demonstrated alongside our award-winning and fully U.S. localized mobile sports betting experience. We believe our sports offering demonstrates a superior user experience for both retail and mobile sports betting as evidenced by a recent major new client win of Station Casinos set at on the next slide. And so here on Slide 6, several months ago, Station Casinos initiated a request for proposal subsequently evaluating all major vendors of sports betting technology with a view to upgrading the sports gambling experience currently available in both retail and online in Nevada.

At that time, GAN had been serving a Station's provider of simulated gaming for more than four years demonstrating operational excellence, transparency, and that we deserve their trust as technical custodians of a substantial database of their online patrons, many of whom have linked their Station's retail loyalty cards to their online accounts in reliance on GAN's patented iBridge framework. This factor gave GAN a series of competitive advantages in seeking to extend the relationship from just simulated gaming to a mission-critical part of their operating retail business, their sportsbook. We are trusted by stations, we are respected by them, we have operated online successfully together for years. We also have unique intellectual property, the value of which was clear to the Station's Executive group, and we have a long-standing technical integration into the casino management system enabling reward cards to be linked to online accounts and reward points to be triggered by online activities.

Furthermore, GAN has completed the acquisition of Coolbet at the outset of the year and was able to demonstrate the merits of a modern sports betting technology system designed to render a modern omnichannel social sports gambling experience to cater to veteran and recreational sports gamblers of all kinds. Finally, Stations also had the option to execute against any iGaming opportunity which might arise from regulation of online casino in Nevada, which leading on-strip casino executives have been calling for in recent public statements. GAN believes its platform is the largest U.S. platform for iGaming, and I'm happy to state today that in the event Nevadan iGaming becomes a reality beyond just online poker that we will be serving as Station's exclusive provider of iGaming via GAN's platform, not just sports betting.

To our knowledge, there were two other major sports gambling providers at the table, and I'm proud of our sales executives for securing competitive commercial terms for the full provision of omnichannel sports betting technology together with custom-managed trading services and risk management. Stations is not only our first U.S. retail casino operator client of GAN Sports, but actually, Stations represents a rare market opportunity, not just to demonstrate our sports betting capability, but to demonstrate it at considerable scale in arguably the most complex regulated market environment in America. The Las Vegas Locals market is $125 million-plus existing retail and online sports gambling market with Stations being the clear market leader.

Their business will be operating on GAN's technology in the second half of 2022 with the upside of iGaming with the market leader in the increasingly likely event that iGaming comes to pass in Nevada, possibly limited to holders of retail reward cards, which will play to GAN's intellectual property in that specific domain. Our intellectual property in this area is highly valuable, has been licensed many times, and we believe delivers extraordinary value to online operations when seamlessly and automatically linked to retail reward programs. We most recently licensed our intellectual property at $75 per card link, and there are a reported 150 million retail reward cards in active circulation. Finally, it's worth pointing out the strategic value to GAN of partnering with Station Casinos in Nevada, which many perceived in the industry to be the inner sanctum of retail gaming here in America.

Not only do we have the privilege of having a major retail casino group as a sponsor for GAN's gaming licensor in Nevada, but we have the opportunity to further enhance and optimize our omnichannel sports solution by working with one of the most sophisticated sports gambling executive teams anywhere in the United States. I have little doubt that GAN Sports will not just be proven at scale, but greatly optimized by the operational experience and associated learnings we will inexorably develop during a substantial multiyear contract. This major strategic relationship should place GAN Sports on a glide path to becoming the leading omnichannel sports betting solution for all retail casinos in America. And I'll take this opportunity to congratulate our teams in Estonia and the U.S.

who secured for GAN's shareholders this massive opportunity, which further validates our $200 million acquisition of Coolbet first announced this time last year. And so, moving on to the final slide in support of this opening narrative and serving as a summary recap of the investor event held last month and still, of course, available in full online at gan.com. We continue to experience strong demand for our battle-tested B2B technology platform and related services here in the U.S. market, evidenced by our recent slew of new client wins, our state-by-state expansion with existing clients, and a densely populated sales pipeline.

We'll also be expanding into Canada as part of a major expansion for an existing B2B client relationship. We will also be launching Super RGS this month and commencing the work to bring our omnichannel GAN Sports offering to life in Nevada for Station Casinos. Overseas in international markets, we will continue to benefit from B2C operations in Europe and Latin America and anticipate annual gains in operating leverage as both the B2B and B2C divisions continue to scale. We believe both the B2B and B2C opportunities represent continuing major total addressable markets, respectively here in the U.S.

and select international individual markets principally located in Europe and Latin America. GAN remains the very definition of a technology-led growth story in our view, and we remain committed to execution on the path toward our 2026 revenue target of between 500 and $600 million of revenue, coupled to our long-term adjusted EBITDA target margin range of between 30% and 35%. And with that, I'll pass the discussion to our CFO, Karen Flores. Karen?

Karen Flores -- Chief Financial Officer

Thank you, Dermot, and good afternoon, everyone. Some brief housekeeping items first. My comments today around our consolidated results will once again focus on sequential quarter-over-quarter comparison given the effect of the Coolbet acquisition on January 1 of this year and the resulting impact on comparisons to prior-year operations. Additionally, as the SEC is closed today in observance of Veterans Day, our 8-K and 10-Q reports will be on file tomorrow.

Starting with our consolidated financial results on Slide 9. Third quarter revenues of $32.3 million were down 7% from Q2. Our revenue performance was driven by growth in our B2B segment while we observed seasonality and lower sports hold rates against the backdrop of strong underlying customer trends in our B2C segment. B2B segment revenue of $11.2 million was up 5% sequentially as our development services and other revenue increased 84% or $1.1 million quarter on quarter.

The increase was driven by hardware sales in advance of upcoming new client launches, which will convert into recurring SaaS revenue in the future. Our global recurring SaaS revenue declined 6% during the quarter, primarily due to the impact of seasonality and lower revenues in our Italian operations as a result of the reopening of retail venues as COVID restrictions have eased. Our core U.S. business has observed sustained strong levels of online iGaming activity with no change in quarter-over-quarter casino SaaS revenue and year-over-year growth of 80% as compared to the third quarter of 2020.

B2C segment revenue of $21.1 million in the third quarter was down 12% or $2.9 million versus Q2. B2C results were primarily impacted by a 7% decline in sports turnover due to the seasonality of the sports calendar, as well as a 280-basis-point decline in sports hold, resulting from a higher mix of player-friendly event outcomes. Looking forward, all key sports are running from the end of October, and we are already observing acceleration of player acquisition and engagement trends with the first week of November setting a number of records including for the highest weekly turnover and net gaming revenue. B2C casino was also very strong in the third quarter with casino turnover up 17% or $58 million from Q2.

Before I move on to comment on our net loss and adjusted EBITDA, I'd like to point out that we incurred a number of unique expenses during the third quarter totaling $1.5 million. These include a $600,000 increase in our tax provision expense, $500,000 related to FX, and $400,000 related to a year-to-date adjustment of amortization of intangible assets as we finalized the purchase accounting for the Coolbet acquisition. Operating expenses increased by $1.8 million or 7% sequentially to $27.8 million. This included $900,000 related to FX and purchase accounting as I just mentioned.

The remaining portion of the increase was attributable to a 6% or 35% headcount increase in our global personnel to 639, increased facility costs associated with the opening of our new Miami tech hub and relocation of our London office, additional marketing spend for our B2C segment, and increased professional advisory services incurred in connection with the upcoming anticipated launches of new jurisdictions for both our B2B and B2C segments. With the revenue impact of the B2C sports turnover and hold rate, as well as the unique items around tax, FX, and purchase accounting adjustments totaling $1.5 million, our net loss for the quarter increased to $7.9 million. Adjusted EBITDA was breakeven this quarter and year to date, our adjusted EBITDA stands at $6.4 million for an adjusted EBITDA margin of 7%. Our balance sheet remains strong with a cash balance of $50 million at quarter-end, a slight decline versus prior quarter of $1.8 million primarily related to payments for exclusive rights for leading online slot content related to the upcoming launch of our Super RGS product offering.

We continue to remain debt-free granting us a clear path to focus on high-growth initiatives, securing additional market share, and delivering the best platform technology to the market. Moving on to our key performance indicators on Slide 10. B2B growth operator revenue from our clients declined 3% quarter on quarter to $215 million. Total U.S.

iGaming gross operator revenue was roughly flat versus the prior quarter and up 99% year over year from $96 million in the third quarter of 2020 to now $190 million. Our quarter-on-quarter market share was down slightly from 21% to 19%. Turning to B2C. Key performance indicators remain at exceptional levels across the board with active customers up 6% to nearly 200,000.

The total marketing spend ratio increased to 15% of revenue in the quarter, and cost per acquisition increased from $30 to $45 as spend became less efficient for a period of time while these marketing metrics are still well below industry averages. Wrapping up on the next slide, Slide 11. While we are pleased with our continued progress this quarter, we are laser-focused on ramping the profitability and ultimately cash flow of the business. To reiterate some of my comments at our virtual investor event last month, G&A is our single largest cost category at 37% of revenue year to date, which is down from 62% of revenue for the same period last year.

We are getting more efficient, and we anticipate that our G&A cost as a percent of revenue will continue to decline over the next several years toward the 10% steady-state environment. We are building the product and operating infrastructure to support our operations in a number of new jurisdictions. We recently partnered with FanDuel in Connecticut for iGaming in mid-October and are pleased at the speed with which this market is ramping, up 10% versus the launch results observed in Pennsylvania for the same period when we first launched that state. Although it will take some time for new markets to develop and our operations to achieve efficiency, we are excited about our near-term growth strategy with new offerings, including GAN Sports and Super RGS, which will increase our recurring revenues and enable a higher take rate of operator revenues.

And we are committed to delivering improving margins on an annual basis, operating margin profitability by 2023, and long-term EBITDA of 30% to 35%. Finally, I recently returned from beautiful Estonia, headquarters for our B2C segment, and I couldn't be more impressed with the team, their strategy, and the outlook for growth across Latin America and Europe for our B2C business. At this time, we are reiterating our full-year revenue guidance of $125 million to $135 million. The variability in our results for the full year will be determined by the sports hold rate, which we anticipate to range between 7% to 8% in any normalized quarter.

A repeat of the sports hold rate of 6.8% that we observed in both Q1 and Q3 of this year will put us in the midpoint of this range, and each percentage point up or down roughly equates to $1 million of revenue. I'll now turn it back over to Dermot to conclude our remarks. Dermot?

Dermot Smurfit -- President and Chief Executive Officer

Thank you, Karen. Wrapping up, we delivered 5% sequential growth in B2B. We've demonstrated again the excellence of our B2C international product, driving all-time record customer activity, and explained what we believe is the necessity of investing to accommodate expected growth in demand for our B2B technology and services here in the U.S. After the seasonally weakest third quarter, strong results should now follow the seasonal U.S.

ramp throughout the key NFL sports betting season with forthcoming client launches coming in the next few months in Canada, Michigan, Louisiana, Maryland, and Mississippi, continuing to enhance our growth profile and demonstrating projected operational leverage in Q4 and Q1. In 2022, GAN will deliver a highly scalable and recurring revenue business model, which will maximize value for all of our stakeholders. That concludes our remarks, and we will now open the line for questions.

Questions & Answers:


Thank you. The floor is now open for questions. [Operator instructions] And our first question comes from Chad Beynon with Macquarie. Please go ahead.

Chad Beynon -- Macquarie Group -- Analyst

Good afternoon. Thanks for taking my question. Dermot, Karen, I wanted to ask about Super RGS and the launch. I believe you said in Nevada we're going to start seeing that this month.

With respect to other deals that we expect to see on the tape, I guess a dual-parted question. Firstly, when should we start to see these announcements come out? Secondly, after the deals are announced, how long does it take to integrate? And then finally, is this factored into the guidance for this year? Thanks.

Dermot Smurfit -- President and Chief Executive Officer

I'll let Karen deal with the last part of your question, Chad. Just to be very, very clear, the Super RGS content business, we've seen exceptionally strong demand from all the major operators of our gaming. I mean, Ainsworth is a very, very respected, instantly recognizable suite of retail slot machines available online exclusively through distribution by the GAN platform. And that is the Super RGS.

So, what typically happens is you have an experience I can describe as order taking. So, you're not in the consultative, combative, competitive multi-month sales cycle that you associated with platform sales, you are literally calling up the major commercial operators and asking their casino management teams, OK, how much are you prepared to pay. You negotiate the key term, which is typically the percentage of net gaming revenue and the definition between what is GGR and what is net gaming revenue. All those conversations have taken place already with nearly all of the tier 1 B2C iGaming operators here in America, the demand is extremely strong.

We then go into technical integration. We'll be launching the first Super RGS client actually in Michigan, not Nevada. So, Michigan is obviously a very exciting market for iGaming. So that will be launched before the end of this month, which is going to be an excellent inflection point for us.

And these technical integrations tend to start in advance of the contracts being consummated. The contracts tend to be multi-month associated workstreams, so you tend to get the agreement in place, start working in good faith on the technical integration, and then you get to the point of launching. And typically, when the integration is done, that is the forcing factor to sign the contract and make the announcement. So, it's as simple as that.

These things happen in parallel. We don't wait for the contract to close, then announce, then start work on the technical integration. You agree the key commercial terms then get busy on the technical side. Karen, would you like to comment on guidance?

Karen Flores -- Chief Financial Officer

Yes. With respect to the guidance, it would be upside for anything received in the year. It's not included in 2021.

Chad Beynon -- Macquarie Group -- Analyst

That's great. Thank you both. And then my follow-up, just with respect to some of the M&A that we've seen in the space, two large B2B, I would call them competitors of yours, were announced to be sold in the quarter. And then separately, we saw the vertical integration of Caesars and William Hill, and you talked about winning something like Station.

So, given everything that we're seeing out there, how does this change how you view your position in the space? Is it better, worse, the same given some of this activity? And yes, just wanted to understand that as you kind of focus toward some of the targets that you put out there. Thank you.

Dermot Smurfit -- President and Chief Executive Officer

A couple of aspects there, Chad. I think the corporate transactions taking place simply increase the scarcity value of our technology. So not necessarily unhappy by any of that activity going on. Secondarily, corporate transactions like Caesars coming together with William Hill actually spits into the market a bunch of competitive replacement opportunities.

And in fact, we just picked up one, the one we announced today in Mississippi, the Island View Casino and Resort. So not necessarily unhappy about the consequences of that specific M&A transaction. Beyond that, I don't think I'd offer any other insight other than we're very, very happy with the reception of GAN sports. We are now legitimately a one-stop-shop solution where every single part of our one-stop-shop solution is of extremely high quality.

And I know that certain other direct competitors of ours here in the U.S. have actually divested themselves of certain assets, which mean they are no longer a one-stop shop, and it's worth pointing out that we are the only one-stop shop proven at considerable scale active here in the U.S., and it speaks to our very active sales pipeline. And of course, the very recent major win of Red Rock Resorts, which is a multi-month due diligence processed by Red Rock Resorts or Station Casinos, and we're extremely happy with not just the shape and value of the commercial terms, but the very clear market message that it sounds.

Chad Beynon -- Macquarie Group -- Analyst

Thank you very much. Appreciate it.


Next, we go to the line of David Bain with B. Riley. Please go ahead.

David Bain -- B. Riley Financial -- Analyst

Great. Thank you so much. I guess my first question would be, looking at the strength of the balance sheet and your strategy for exclusive or unique content from partners, do you stick with the more established content like Ainsworth, Incredible? At this point, do you look to studios? And then based -- like what Chad was mentioning on some of the competitive moves, are proprietary tables or live dealers or other elements or other types of content, is that on the map? Just trying to envision what the content strategy looks like going forward.

Dermot Smurfit -- President and Chief Executive Officer

OK. Well, we've been bulking up in our internal development resources, David. So, we have been looking at a very small number of effectively acqui-hires, very cost-effective, not substantial, or in any way you can describe them as a bolt-on. We are, of course, looking at iGaming content portfolios of all kinds.

You got to remember, a lot of iGaming content that exists overseas has got some compliance and intellectual property infringement issues associated with them. So, I kind of broadly describe them as European and Asian slots that may not necessarily translate well here in the U.S. and there are a number of very interesting, small, medium-sized Class 2 or Class 3 equipment manufacturers that are actively testing distribution opportunities in the online channel, and we're engaged in a number of conversations. So, we really like retail slot machines available in various markets that we foresee iGaming will come to eventually, and we will continue to press for exclusive content distribution deals in order to leverage our balance sheet strategy.

Beyond that, Karen, would you like to offer any additional comment?

Karen Flores -- Chief Financial Officer

No. I think that pretty much covers it, Dermot.

David Bain -- B. Riley Financial -- Analyst

OK. Perfect. And then the last would be -- or my follow-up would be -- I don't -- not sure you want to opine on any specific iGaming state that may liberalize near-term like Illinois or Massachusetts but what I'm hoping to understand or at least confirm is that what kind of -- what new states need to go live with iGaming specifically, if any, for the 2023 guidance set out at Analyst Day to be met? Is that incorporated anywhere within that?

Karen Flores -- Chief Financial Officer

It's hard to have a crystal ball in terms of the sequencing of states, but certainly, we've assumed new territories, new states going into the 2023 guidance. And so, there is a ramping proportion of new opportunities that are built into the long-range forecast of $500 million to $600 million. In the 2023 time frame, you could assume it's at least several new states.

David Bain -- B. Riley Financial -- Analyst

OK. In iGaming, correct?

Karen Flores -- Chief Financial Officer


David Bain -- B. Riley Financial -- Analyst

OK. All right. Great. Thank you.


[Operator instructions] And we'll go next to David Katz with Jefferies. Please go ahead.

David Katz -- Jefferies -- Analyst

Hi. Good evening, everyone, and thanks for taking my question. This may be a bit sort of off -- a bit off the grid, but I wanted to ask about New York, which we've talked about in the past. And since it's topical of the week, do you expect that there could be sort of second bites at the apple or incremental opportunities to participate there, you know, going forward? And what might -- what, if any, might those look like? 

Dermot Smurfit -- President and Chief Executive Officer

David, thank you. Yes, we do. In fact, I have written down in front of me a second bite at the apple. We very specifically go out of the way.

We saw an environment where consortiums were being formed where the underlying technology providers were being asked to stump up as much as 50% of the upfront license fee, and we just couldn't make those numbers pencil, and we're not in that specific business. But we do have continuing opportunity with multiple consortia members that have been announced and also tribal gaming operators in the state of New York. So yes, New York is still very much a viable state for GAN, not just upfront, but also, we do foresee in alignment with most of the operators there and the executive groups active there that iGaming will come to pass in New York within two to three years of sports betting launch.

David Katz -- Jefferies -- Analyst

All right. I apologize if you've talked about this already, but in terms of further M&A or incremental tuck-ins, we've certainly seen in the public markets a bit of a calming down, I don't want to say downturn, but certainly a little bit of calming in valuations. Are you finding that when you look at tuck-ins out in the private market as well?

Dermot Smurfit -- President and Chief Executive Officer

Well, yeah, the market was extremely frothy 12 to six months ago, David, and I think the assets available for sale are somewhat more realistic today than they were. Particularly on the content side, I think there were some very, very high-profile and expensive-seeming acquisitions being undertaken in the industry generally. So, we have no particular interest in getting engaged in that particular game. But yes, I wouldn't disagree with your perspective.

David Katz -- Jefferies -- Analyst

And I suppose what I was getting at was, should we expect that there might be some more tuck-ins for you going forward as a result of that?

Dermot Smurfit -- President and Chief Executive Officer

So, at this point in time, we are definitely -- we have an active radar. We're pinning. We're speaking with numerous different opportunities, lots of assets come on to the market. There was a live dealer asset that came to the market a few months ago that I believe has just traded, but we couldn't get comfortable with the compliance profile and the fact that 50% of their historical revenues had come from Turkey, which had obviously financed the development of the technology assets that we deemed it to be rather tainted.

So, we are looking at live dealer solutions, but really that would be tech plus a team acquisition versus even a modest transaction describable as a bolt-on.

David Katz -- Jefferies -- Analyst

Understood. Thank you very much.


Thank you. There are no further questions. At this time, we return to Dermot Smurfit for closing remarks.

Dermot Smurfit -- President and Chief Executive Officer

Thank you all for joining today for our third quarter earnings. We now have the clients required to prove out a complete and high-quality one-stop-shop product offering, and are continuing to build the engineering bandwidth, we believe will continue to help even the largest B2C operators execute on their stated get-to-market-first strategies. We have the iGaming content portfolio, which will ensure the success of our Super RGS and the key clients in Station Casinos whose success will ensure GAN's B2B market leadership with GAN Sports over time. We have firm visibility over our domestic and international growth strategy to support the versable bandwidth required to continue delivering for our clients.

And accordingly, we look forward to strongly executing in the current fourth quarter as we exploit the seasonally strongest period in America's fast-growing and faster regulating online gambling industry. Thank you all again, and stay safe wherever you are.


[Operator signoff]

Duration: 38 minutes

Call participants:

Robert Shore -- Vice President of Investor Relations and Capital Markets

Dermot Smurfit -- President and Chief Executive Officer

Karen Flores -- Chief Financial Officer

Chad Beynon -- Macquarie Group -- Analyst

David Bain -- B. Riley Financial -- Analyst

David Katz -- Jefferies -- Analyst

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