Recent findings from consultancy Rokker indicate that the UK prize draw market is evolving, transitioning from a fragmented industry of small players to a more cohesive and professionally managed sector. As of now, M&A activity in this market has exceeded £220 million.
In their April report, Rokker previously estimated that the UK prize draw market generates £1.3 billion in annual revenue, with an active player base of 7.4 million and over 400 operators currently active. The updated report identifies 14 significant B2B platform providers supporting the industry and suggests there are now more than 1,000 operators hosting prize draw competitions, a noticeable jump from the 401 operators recorded in government research earlier this year.
However, amidst this growth, only 195 operators have opted to sign the newly instituted Voluntary Code of Good Practice since its launch on May 20, 2026. In addition, 31 other relevant service providers are also signatories. This means that less than 20% of the sector's estimated operators have committed to the code, indicating limited adoption so far.
Implemented by the Department for Digital, Culture, Media and Sport (DCMS), the voluntary code aims to encourage self-regulation within the prize draw sector, which currently falls outside the Gambling Act 2005 and is therefore not regulated by the Gambling Commission. Legal experts emphasize that the code is beneficial for operators looking to enhance their reputations and prepare for potential mergers and acquisitions as it establishes a compliance framework that buyers may consider during regulatory due diligence.
The tiered membership fees for the code vary based on an operator’s turnover: £24,000 for those exceeding £50 million, down to £250 for operators with under £2 million in turnover, while associate service providers pay £2,500.
The consolidation trend in the market is illustrated by prominent acquisitions, including Winvia’s purchases of Best of the Best (£45.3 million in 2023), Click Competitions (£16.4 million in 2025), and Rev Comps (£11.8 million in 2026), along with Jumbo Interactive's acquisitions of Dream Car Giveaways (£65.8 million) and Dream Giveaway USA (£28.3 million) in October 2025.
ZEAL Network recently made headlines for acquiring SevenCanyon and its related businesses for £38.6 million in July 2026, marking the company's entry into the UK—identified as Europe's largest market for digital prize draw products. SevenCanyon operates established platforms like 7days Performance and Redline Competitions.
The report also highlights the emergence of affiliate and directory websites that connect players to prize draw operators, although this affiliate sector remains underdeveloped compared to regulated iGaming, lacking transparency in operator relationships and payment models. Rokker anticipates continuous consolidation, driven by substantial market players employing both acquisition and organic growth strategies. Smaller operators lacking investment in compliance and tax management may face pressure to seek exit strategies.
Ben Gale, a partner at Qualstels, remarked that the voluntary code has created a regulatory benchmark for buyers. “They are using the code as a ready-made framework to assess whether a business is genuinely prepared for greater scrutiny,” he noted.
In February 2026, the prize draw landscape faced new challenges when HMRC clarified that paid-entry prize draws with a free-entry option are not eligible for the VAT exemption that applies to certain games of chance. HMRC asserted that VAT at the standard rate of 20% should be charged for these entries, prompting operators to reassess their historic VAT stances. At least one major operator is opposing this HMRC position in a tax tribunal, with hearings expected in autumn 2026 and a verdict anticipated in spring 2027.
DrawHouse, a B2B prize-draw platform, estimates that the VAT reinterpretation could reduce margins for operators by 25% to 30%, exposing them to significant retrospective tax liabilities. This uncertainty, alongside the potential for future regulations, is likely to affect the valuations and terms of deals within the sector. For example, ZEAL Network reportedly agreed to a lower acquisition multiple for SevenCanyon after considering future VAT obligations and arranging insurance-backed indemnities for past tax exposures. Rokker's analysis underscores that firms with robust legal, tax, and technology capabilities are well-placed to navigate these challenges and implement effective buy-and-build strategies.
