Home In-Depth Lottery.com receives funding of $18.0m from Prosperity Investment Management

Lottery.com receives funding of $18.0m from Prosperity Investment Management

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Lottery.com, a lottery technology broker, has received an investment commitment of $18.0m (£14.2m/EUR16.4m), from the financial group Prosperity Asset Management.

Lottery.com says it plans to use the money “accelerate its strategic acquisition plan”. The investment in Prosperity will also support marketing initiatives for its Lottery.com, and Sports.com brand.

United Capital Investments Limited, a company that provides investment vehicles to Prosperity, will finance Lottery.com.

Matthew McGahan welcomed the financial support. Prosperity was described as an “ideal” partner in funding for the company by McGahan.

McGahan stated, “They understand the value of Lottery.com & Sports.com – and they are investing capital and resources strategically to benefit our organizations’ stakeholders.” The expertise of Prosperity and its network within high-profile sporting arenas offers a unique opportunity to engage consumers and expose brands.

This partnership will not only strengthen the balance sheet of the company, but it also allows us to take advantage of the global appeal and popularity that motorsport has for audience development.

Lottery.com & Prosperity: A chequered flag for both?

The world of motorsport is a significant area of interest for Prosperity. Two of Prosperity’s ambassadors, Sergio Perez & Alex Albon compete in Formula One.

Warren Mecal said that Prosperity founder is thrilled to be a part of Lottery.com’s resurgence. He also referred to the “genesis of Sports.com”.

Mecal stated that “Our company is unique in its understanding of motorsports.” Our motorsports representatives represent all major racing circuits and we’re excited to use them as part of Sports.com’s brand launch.

Lottery.com grew on that, stating in a press release that this collaboration is a pivotal step to expanding their footprint in international sports.

The group also acquired Nook Holdings in order to develop Sports.com’s brand across the Middle East. A partnership with former Elite Special Forces commander Ant Middleton was also formed to increase brand awareness.

Lottery.com stated that “These partnerships highlight the company’s dedication to integrating dynamic sports experiences with wellness. They align perfectly with the larger vision of Prosperity within the sports industry.”

McGahan’s conclusion: “This investment by Prosperity aligns strategically with the vision of our company.” This investment will help accelerate growth strategies, especially in rapidly changing digital sports and games sectors.

Lottery.com will redefine the landscape of the gaming industry, bolstered with the partnership between Prosperity and UCIL, as well as the new exciting ventures that are being launched under the Sports.com name.

Lottery.com could be on the verge of a turnaround

This investment is at the end of another turbulent year for the operator, but recent weeks have shown a shift in the company’s approach.

McGahan assumed the role of CEO at mid-December. McGahan, who has been acting CEO since July 2023, is now the permanent CEO. Mark Gustavson, who had only taken up the post in February of Lottery.com, left the company.

Gregory Potts has also been promoted as chief operating officer to join McGahan’s leadership team. Robert Stubblefield was also appointed as Lottery.com’s chief financial officer by the board.

Lottery.com also published their Q3 results this month. The company reported lower revenues but reduced losses. Revenue fell 59.9% to $285,523 (PS225,050/EUR259,359) but cost of revenue also fell 73.4% and operating spend was down 47.7%. Net loss was $3.4m. This is an improvement over last year’s $6m.

Wider concerns still linger

There have been some positive developments for Lottery.com over the past few weeks but there’s no doubt that this group endured a tough year.

Early in the year, Lottery.com announced changes in its management. In May, Lottery.com stated that it has “material weaknesses” due to non-compliance with accounting standards. The class-action suit was filed in August 2022 by investors and high-ranking former employees.

John Brier, Bin Tu and TinBu founders also filed a suit against Lottery.com. It was alleged that the compensation promised to them after their company’s acquisition had not been paid.

Lottery.com resumed ticket sales in Texas in April to help affiliate partners.

Lottery.com has also been able to comply with Nasdaq’s stock exchange rules, after previously falling out of compliance. Nasdaq’s listing qualification department confirmed in September that the broker had met minimum bid requirements.

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