Sports Entertainment Gaming Global Corporation · NASDAQ:SEGG
Sports Entertainment Gaming Global — Lottery.com — Q3 2021 Earnings Presentation
20 slides from Sports Entertainment Gaming Global's earnings presentation, Nov 15, 2021
Slide 1: Investor Presentation November 2021
INVESTOR PRESENTATION November 2021 Nasdaq: LTRY
Slide 2: Disclaimer Rider
2 DISCLAIMER RIDER This investor presentation (the “presentation”) is for informational purposes only and does not constitute an offer to sell, a s olicitation of an offer to buy, or a recommendation to purchase any equity, debtor other financial instruments of Lottery.com In c (“Lottery.com” or the
Slide 3: Key Investment Highlights
3 KEY INVESTMENT HIGHLIGHTS 1 2 4 3 5 Large Global Market Opportunity $398 BILLION 2020 GLOBAL TAM (1) Foremost Brand Name and Premier Provider of Global Lottery Data 13.0 MILLION UNIQUE VISITORS LTM 9/30/21 Strong User Economics $47.0 MILLION YTD Q3 2021 REVENUE INCREASE OF $42.8M YOY Strong Revenu
Slide 4: Consumer Shift to Convenience Is Inevitable
4 CONSUMER SHIFT TO CONVENIENCE IS INEVITABLE OLD MODEL NEW MODEL It has been proven time - and - time again that consumers choose convenience, no matter the industry.
Slide 5: Digital Transformation Is Coming
5 DIGITAL TRANSFORMATION IS COMING (1) Source: American Gaming Association: COMMERCIAL GAMING REVENUE TRACKER | State - by - state September and October handle and percent age online: USBets.com: https://www.usbets.com/october - 2020 - record - sports - betting - numbers/ (2) Source: https://www.pho
Slide 6: Growing Total Addressable Market (TAM)
6 GROWING TOTAL ADDRESSABLE MARKET (“TAM”) Note: Market sizes reflect the gross lottery ticket transaction value (1) Technavio: Lottery Market by Type and Geography - Forecast and Analysis 2020 - 2024 (2) 2025 TAM was calculated using 2024 TAM of $587B and 2023 - 24 growth rate of 11.1%, according t
Slide 7: Comparing Market Opportunity
7 NOTE: All Sources for data can be found in APPENDIX, COMPARING MARKET OPPORTUNITY SOURCE DATA $290B MARKET CAP $4B MARKET CAP $53B MARKET CAP $17B MARKET CAP $39B MARKET CAP $303B MARKET CAP $700M MARKET CAP $121B MARKET CAP 35% MARKET SHARE 28% MARKET SHARE 25% MARKET SHARE 27% MARKET SHARE 12% M
Slide 8: Lottery.com's Delivery Model
8 LOTTERY.COM’S DELIVERY MODEL Purchase • User purchases game from Lottery.com app or website • Lottery.com prints lottery game on user’s behalf • User receives digitized version of lottery game Safekeeping • Lottery.com securely safeguards all physical lottery games • No risk of losing, destroying
Slide 9: Diverse Suite of High Margin Products
DIVERSE SUITE OF HIGH MARGIN PRODUCTS (1 ) All margins estimated on end of year 2023 projections 9 17% - 33% GROSS MARGINS (1) B2C DOMESTIC LOTTERY • Selling official U.S. lottery games (draw games and scratchers) with a service fee CHARITABLE SWEEPSTAKES • Players donate to qualified causes and get
Slide 10: Strong Distribution Ecosystem
10 STRONG DISTRIBUTION ECOSYSTEM AFFILIATE PROGRAM • An open affiliate program allows traffic to Lottery.com's properties for a split on any proceeds those users generate for a limited time • Lottery.com has access to over 250+ Million users a month with its current affiliate partners API PROGRAM •
Slide 11: Lottery.com's United States Expansion
11 LOTTERY.COM'S UNITED STATES EXPANSION TX CA OR WA MN CO ND KS AR MI OH PA NY GA NH NJ DC CURRENT STATES NEAR TERM EXPANSION CURRENT STATES 2016 - 2019 • NH, TX, MN, OR 2020 • CA, CO, DC, GA, MI, PA, WA 2021 • OH Q4 2021 • AR, FL , IA, KS, NC, ND, VT NEAR TERM LAUNCH PLAN FUTURE EXPANSION CURRENTL
Slide 12: Lottery.com Executes International Growth Strategy
12 LOTTERY.COM EXECUTES INTERNATIONAL GROWTH STRATEGY (1) Acquired 80% of the equity in Agan a r and Juega Lotto on June 30, 2021 (2) Source: The World Bank ( 3 ) https://www.statista.com/statistics/1200292/leading - gambling - companies - mexico/ ( 4 ) Technavio: Lottery Market by Type and Geograph
Slide 13: Low Acquisition Cost with High Retention and Return
13 LOW ACQUISITION COST WITH HIGH RETENTION AND RETURN Note – All data excludes user purchases through B2B affiliates or API partners (1) Average from digital advertising cost per new customer in 2020 and YTD 2021 through Q3 (2) Average gross profit per customer for 12 months ended 9/30/2021 (3) Ave
Slide 14: Innovators in Blockchain
14 INNOVATORS IN BLOCKCHAIN (1) Pro rata amongst all token holders • Building a next - gen blockchain platform, Project Nexus, specifically to address the challenges with online gaming • Critical game mechanics such as player identity, digital tickets, and administrating draws are completely run on
Slide 15: Recent Highlights & Roadmap to Future Growth
Recent Highlights & Roadmap to Future Growth
Slide 16: Recent Highlights
16 RECENT HIGHLIGHTS Completed business combination $ 42.8 million in net proceeds and <1% redemptions Q3 revenues of $32.2 million Up $30.6 million year - over - year; driven by global affiliate marketing program and improved revenue per transaction Entered into affiliate agreement with Coinstar Co
Slide 17: Q3 Financial Summary and Outlook
(in millions, except percentages; unaudited) Revenues $ 32.2 $ 1.6 $ 30.6 Gross Profit $ 20.3 $ 0.9 $ 19.4 Gross Margin 63.0 % 54.9 % 8.1 % Net Income $ 11.2 $ (1.2) $ 12.3 Q3 2021 User Metrics (1) Three Months Ended September 30, 2021 2020 Change Transactions per user 12.4 11.2 1.2 Tickets per tran
Slide 18: Roadmap to Future Growth
18 ROADMAP TO FUTURE GROWTH Enter new markets Includes new U.S and international markets in 2021, as well as New York and New Jersey in 2022 Continue developing Project Nexus, a blockchain based gaming platform Includes launch of Lottery.com’s first proprietary game in 2022 Expand partnerships Add n
Slide 19: Appendix
APPENDIX
Slide 20: Comparing Market Opportunity Source Data
20 COMPARING MARKET OPPORTUNITY SOURCE DATA • All Market Cap data as of November 10 , 2021 • Total Addressable Market Data: • Sports Events: Change market cap from $29B to $4B and footnote representative of sale price in November 2019 | https://techcrunch.com/2019/11/25/ebay - to - sell - ticket - m