Michael Bauer, Greentube’s chief financial officer as well as chief games officer has a dual role that is unique. But, he tells iGB there are many transferable skills to an industry increasingly driven by data.
Michael Bauer says that although his roles may seem to contradict, they are actually complementary. Bauer has been the chief financial officer for Novomatic’s digital gaming division since 2015. He oversees everything from M&A to accounting.
He took on his second C-level position in 2017 as Chief Games Officer, where he is responsible for the overall strategic direction of all the company’s games, which includes production, sales, and operations.
Greentube peers tend to have two separate positions. Bauer says there is a common strategic theme that connects the two.
He explains that, despite his background in finance and operations management, he has focused more on the strategic aspects than daily activities. This means that I’ve dealt with M&A or new market entry from a finance perspective.
These skills and experience complement the CGO’s requirements.
The supplier began expanding its business into new markets in 2017. He adds that “every time this happens, there’s a lot to do in terms of determining the potential and size of the market and the landscape of operators, as well as obtaining licenses.”
Bauer will need to create a plan for each market. It must assess the competition, set revenue targets and determine client satisfaction.
This same data-driven knowledge is required for his product role. He says, “I’ve always had a keen interest in analysing the performance of each game.” Certain game types perform better on some markets and this is a numbers-driven approach.
My expertise is in reading statistics, which allows me to quickly identify the mechanics that players on a particular market enjoy.
Innovate or die
Gil Rotem, of IGT, told iGB in 2022 that, when it came to game development, “content was king”, but, “data was queen”. Bauer shares the same view: closely analyzing and interpreting data allows slot providers to design games that are tailored for specific player groups.
It’s important to not just play the biggest hits. Greentube allocates a portion of the budget it spends on new games and platforms to innovations. He admits that the new ideas it introduces to the market can “flop completely”. They can also offer a great player experience, which disrupts the industry and attracts consumers.
Bauer loves the simple games in downtown Las Vegas casinos. He says, “It’s amazing how many games you can play with only a couple of reels and paylines.” These games are just as thrilling as video slots. They may not have the slickest animation, but they have that repeated play appeal due to their strong mechanic.
Video slots like Light & Wonder Rich Little Piggies or Invaders of Planet Moolah are also popular with him.
It’s a good idea to copy successful games from competitors, as long as they are supported by mechanics that appeal to players in multiple markets. This could generate some decent revenue. Bauer cautions, “you will not have a big hit.”
Greentube doesn’t want to play it safe. It wants to determine how the market will develop. This means investing in new technology, new games and mechanics. The approach should be well-balanced and include only a small percentage of the new releases. Otherwise, financial risks will become too high.
How does Bauer motivate his team to create market-defining content for Bauer?
Greentube’s cooperative culture
Bauer has worked in many industries. He began his career at one of Big Four Audit firms, working in consulting for multiple industries before moving to the construction industry. After a short stint at the German Stock Exchange, he worked briefly in the automobile industry before moving into the gaming world.
He has learned the value of hard work through his career. After all, gaming is an industry that’s driven by results. He also wants his employees to be happy with their jobs.
He says: “We strive to achieve the objectives set, and if this is not possible then we must come up with an action plan for rectifying it.” We always strive to improve and our collective efforts enable us to do so.
This is an important element, because your competitors will overtake you if all you do is sit back and wait for past success.
He argues that having fun at work is as important as achieving a good balance between your career and personal life. Unhappiness or boredom in a job can cause someone to lose sleep and reduce their free time.
Do you think he has achieved the right balance in his life? He says, “I’m a father of three and my kids all want to have a little bit of me. I limit the amount of work travel and try to make sure that it is only necessary.”
Let’s assume I am not just travelling for pleasure. “It’s still a lot to do and doesn’t give me as much time for my family or bedtime as I would like, but the balance at this moment is good.”
The best and worst in game development
Bauer is aware of his responsibility towards the players and the company’s balance sheet. He finds the role to be fulfilling. He says gambling can be perceived by some as predatory.
Greentube, as a developer of slot machines, is one step away from the consumer. He’s also aware that Greentube is part of a larger company, Novomatic. Bauer is aware of the efforts made to establish clear, strict rules regarding responsible gaming, accessibility and marketing promotion.
He explains, “Over the past few years we’ve built up a large team and efficient processes.” We make sure we don’t target players with gambling problems or those who can’t afford to gamble. “We go the extra mile to keep problem gambling at a minimum.”
Since the days of dot.com, there has been a lot of progress in this industry. Operators and suppliers are “light-years” ahead with new methods of detecting problem behaviours and affordability checks.
Greentube’s Global Expansion Drive
Greentube, for example, has a lot of new business opportunities as a result of the shrinking dot.com gaming industry. North America is now an important strategic market for suppliers, following the repeal of PASPA.
Canada has also become a major battleground. Ontario’s open and competitive market was launched on the 4th of April, 2022. Greentube has already launched in Ontario with partners and Entain was the first to launch.
Greentube’s reach is growing through partnerships with British Columbia Lottery Corporation (BCLC) and Loto-Quebec. Bauer has high hopes for the future of Greentube. He says that local relationships, networks, and content are the keys to success.
Bauer urges people to be patient in the US, where there are only six states that have legalized igaming. Rhode Island will follow. He stresses that the US takes much longer to complete processes, including licensing and signing contracts with customers.
He adds: “When you wait longer for something, it’s obvious that you will need to spend more in the interim.” The US has a lot of opportunity, which makes it worth the effort to get through all the challenges.
The public’s opinion of gambling in the United States is quite different from that in Europe. There, gambling is first seen as a form of entertainment.
What to expect in the future: disruption, consolidation and surprises
Bauer’s view on the market is that it will take some time to develop. Bauer admits that it is difficult to predict the future of this market, because technological advances can cause a rapid change.
New competition could have a greater impact. Imagine the disruption if Microsoft, Google or Amazon entered this market,” says he.
They could enter the gaming market by launching a completely new product or acquiring some of its leaders. Bauer believes that consolidation will continue even if these brands remain on the sidelines. M&A will allow the biggest brands to continue growing.
It won’t just leave less players, though. He says that when this occurs, employees will leave these companies and start new ventures.
If they create an USP successfully, they’ll be again successful. Even if there is a consolidation, a level of competition will remain. This puts margins under pressure from a supplier’s perspective. The challenge, therefore, is to overcome this by embracing innovation.
There could also be a sudden change in Europe, America or Latin America, where Brazil’s regulation of betting and online gaming will take the focus off the industry. There could be new regions or markets opening up. After all, the United Arab Emirates was not expected to become regulated.
Bauer, who is responsible for Greentube’s financial strategy and its games, has a position that allows him to be ready for any upheaval.
He adds that “new market dynamics form all the time.” It’s the responsibility of suppliers such as Greentube to address these challenges.
