A recent video interview with Ivan Montik, the founder and CEO of the iGaming company Softswiss, was released on Oleg Artishuk's YouTube channel. The speaker talked about his journey in business, from being a schoolboy who sold champagne to creating the largest iGaming platform in the industry, valued at over $1 billion.
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The interview discussed the company's business model at the start and its current state, as well as the company's brands and products, clients, competitors, and partners. You can read the most interesting highlights from the two-hour video in this article in just 5 minutes.
Briefly About the Speaker
Ivan was born in Minsk, where he later graduated from the Belarusian State University. In 2016, he moved to Berlin, where he still resides. He earned his first money online at the age of 15. During his university studies, he founded his own web design studio. He worked at a bank, co-owned a car wash, and managed the Belarusian branch of the Ukrainian information website bigmir.net.
In 2009, Ivan founded the company Softswiss, which initially engaged in outsourcing in the German, Austrian, and Swiss markets. In 2012, Softswiss began developing a platform for online casinos. Today, the company is a major player in software development for the iGaming industry.
The Softswiss brand ecosystem now includes:
- Softswiss Platform: Software for complete management of online gambling businesses.
- BGaming: A game studio.
- Softswiss Game Aggregator: An aggregator of gaming content from 185 providers with a monthly turnover of €10 billion.
- Affilka: An affiliate marketing platform.
- JackPot Aggregator: A service for setting up jackpots on any project.
- FinteqHub: A platform for aggregating and managing payment solutions.
- CoinsPaid: A B2B solution for cryptocurrency payments, a global leader in Bitcoin transaction volume.
The group of companies employs over 2,000 people, and the client network includes 800 iGaming brands. Softswiss also enables the turnkey establishment of a betting business that can fully operate on the holding's services.
Reasons for Creating the Ecosystem
Initially, Ivan had no plans to create an ecosystem that would close the entire iGaming business cycle. Many processes for the company were outsourced to third-party services. For example, one of Softswiss's partners was a German acquirer who processed their clients' payments. Initially, the payment service was developing successfully, which suited Montik. However, it later stopped responding to Softswiss's requests to implement new payment methods, such as Ethereum, claiming to only support Bitcoin and having no plans to introduce others.
Faced with this problem, Ivan decided to create his own payment solution. He realized that in the end, the investment in his own project would pay off as it would address many of his clients' needs.
A similar situation arose with the affiliate program. The Softswiss team saw that well-known brands' solutions for their clients were, in fact, makeshift. Additionally, these brands were in no hurry to collaborate with Softswiss. This led to the idea of creating the Affilka project to address this issue for their clients, online casino owners.
About His First Businesses and Jobs
While still in school, Ivan and his classmate bought several cases of champagne at wholesale prices for the New Year. They then sold it at retail prices to their classmates' parents, earning their first money.
Upon enrolling in the University of Applied Mathematics, Ivan started his own web design studio. He and a friend created websites for restaurants and other Belarusian businesses. However, he saw limited prospects and growth in this direction.
Ivan had the idea to enter the foreign market and develop an online service. He proposed seriously pursuing this business to his classmates, but they all declined. Ivan then transferred to the Economics and Management faculty, freeing up a lot of his time. He temporarily put aside his idea of working online and opened a carwash with a friend.
At first, Ivan and his friend washed the cars themselves. As the business became profitable, Ivan decided to build a car wash network. However, their visions for expanding the business with his partner diverged. Montik bought out his share and exited the venture.
After completing university, Ivan worked as a credit manager at a bank. According to him, this job provided him with valuable skills in analytics and forecasting, which later proved useful in his business. He also gained the necessary contacts and learned how 'not to manage people.'
To dive deeply into the IT field, Montik's experience at bigmir)net was instrumental. However, the Ukrainian company found it challenging to compete with Belarusian competitors, so Ivan decided to focus entirely on creating his own project.
The History of Softswiss
The speaker began his new IT business by cold-calling German companies, presenting himself as a Belarusian startup. He offered various services related to website creation, IT feature development, and more.
At that time, the company had no employees on its payroll. Ivan made an agreement with his former colleagues from bigmir)net that they would join the team if there were orders.
'I had a very good command of the German language, which I decided to use to develop my business,' Ivan explained.
Having no language barrier, the speaker decided to build his business in Germany, Austria, and Switzerland. For this reason, he combined the word 'soft' with the name of the richest country in the German-speaking triad in the company's name.
When a client visited the Softswiss website, they saw Swiss mountains and associated the company with businesses from that country. The services offered by Ivan's company in its early years mainly included:
- Website development
- SEO
- Contextual advertising
Softswiss served both small companies and large holdings. For instance, they developed drivers for Volkswagen Bank and created software for the police in Hamburg.
Transformation from Outsourcing to a Product Company
From July 2009 to the beginning of 2011, Softswiss primarily provided outsourcing services. Then Ivan learned about the growing popularity of auctions in Europe. These auctions worked like this: an auction would list an iPhone for sale at $0.01. Participants could actually buy it for that price, but they needed to purchase bidding packages worth several euros. With each new bid, the auction time increased by 15 seconds. As a result, an iPhone might be sold, for example, for $100, and the auction organizing company would profit from selling bidding packages that collectively exceeded the device's retail value.
In early 2011, a client approached the team with a request to develop software for the aforementioned auction. He made an advance payment, but when the product was ready, he claimed he had no money left to pay the remaining amount. Ivan reached an agreement with the client that they would give him the product, but the rights to it would remain with Softswiss.
Montik's team advertised the developed product, and orders for similar software started pouring in. The team gladly worked on these projects, earning $10 000 from each client. However, as it turned out later, none of the projects were successful.
This experience made the team realize that a product-based approach was much more profitable than outsourcing services. Although the auctions eventually disappeared, Ivan gained an understanding that products related to gambling were a profitable venture.
Another motivation for Ivan was the sale of the Belarusian company Viaden Media, which developed casino platforms, to a major player in the industry, Playtech PLC. This had a significant impact on the Belarusian IT market. Ivan decided for himself:
'If they can do it, why can't I?'
About Partners Who Tried to Take Over the Business
When things were going somewhat normally in the company, people approached Ivan with an offer to invest in the business and help set up a company in Germany. They made all the necessary arrangements and started working together. At some point, one of Softswiss's employees informed Ivan that their new partners had paid everyone's salaries. It turned out that they had stolen the auction codebase and decided to push Ivan out of the business.
As a result of this scheme, some employees left with the code and the new partners. Ivan was in despair, but his friend, who had been with Softswiss since the beginning, suggested jointly lifting and scaling the business. Ivan agreed, and they continued to develop the company as equal partners.
Softswiss Transition into the iGaming Industry
The sale of Viaden Media kept haunting Montik. After discussing it with the team, they decided to create another competitor for Playtech PLC, hoping that they would also be bought for a substantial amount.
The strategic goal for the team was to create a product and enter it into an IT competition in London. They managed to create a platform and six game slots.
The London competition was a success for Softswiss. The team found clients to whom they offered their solutions in the form of a platform and games. Everything else, such as payments, licenses, and clients, was handled by the clients themselves. The collaboration was based on a RevShare model.
'We provided clients with an engine that allowed them to manage users, finances, reports, and more,' Ivan said about the first product in the iGaming niche.
Introduction of New Products
All the Softswiss holding services, which currently exist, operate as autonomous platforms connected through APIs. Their emergence, as mentioned earlier, was a response to the need to address specific business requirements. Ivan shared the backstory behind the creation of some of them.
FinteqHub was established by the team after several months of struggling to aggregate payment solutions through a specialized Swedish firm. At one point, its manager called Ivan and informed him that the company would be on vacation for two weeks. According to him, it was customary in Sweden for companies to close completely during the vacation season. Montik was shocked by this statement since he was responsible for the quality of the service for his clients. He simply couldn't explain to them that payment services would not be available for two weeks.
Based on the platform used to develop games for the London IT competition, they later created a full-fledged game development studio. The most popular game slot from BGaming today is Elvis Frog.
The team, along with partners, also created Popiplay, a slot service provider for the iGaming industry. In addition to this, they have a jackpot aggregator and several other services. Ivan considers CoinsPaid, their cryptocurrency processing service, as the most significant project in their portfolio. Essentially, it serves as the holding's proprietary payment system.
'To make it easier to understand what CoinsPaid is, you can draw an analogy: CoinsPaid is like Visa or MasterCard, but in crypto,' Montik characterized his service.
Team Structure
Today, according to the owner, over 2 000 people work in the Softswiss group of companies, with 500 of them being developers. Most of the employees have professions such as:
- QA engineers
- DevOps engineers
- SecOps engineers
- Security engineers
- Project managers
- Analysts
- Account managers
- Marketers
- HR specialists
Each company within the group has its own top management. Ivan is also actively involved in the holding's management. In particular, he is responsible for strategic planning and the overall development of the entire group. The founder shares his responsibilities with the co-CEO, who manages specific business areas.
Company Values
Montik talked about the values of his company that are instilled in all employees and help the holding to grow. The main values are presented in the screenshot below.
Expanding into Other Markets
Currently, the Softswiss holding covers all the needs of its clients — online casino and bookmaker owners. The owner sees the expansion of the business in entering other markets. In particular, he mentioned regions such as:
- Africa
- Asia
- North America
Profitability and Purchase Offers
'If everything is done correctly, business profitability can reach up to 80%,' Montik revealed his secret.
He estimated the turnover of his business to be in the tens of millions of dollars. However, not all investors adequately assess this business, according to Ivan. For example, he mentioned that representatives of a non-profile IT company recently approached him with an offer to buy Softswiss for $100 million. Ivan declined the offer because a similar company with lower turnover had recently been sold to an American investor for $1.2 billion.
In addition to purchase offers, Ivan also shared information about attempts to raid his company. In particular, influential American businessmen pressured him to let them have a share for very insignificant investments. When they received a refusal, they used their criminal connections to put pressure on the Softswiss owner, as well as engaged in black PR tactics. Currently, the situation has been resolved, but Montik initiated a series of legal actions to hold the wrongdoers accountable.
Final Answers to Questions
Have you ever attracted external investments for your company?
No, never.
Who is the current owner of Softswiss?
Myself and a few of my partners. The entire holding belongs to me and my business partner, Dmitry. In certain companies, we brought in co-founders who help boost those areas.
Under what conditions did new partners approach you?
They entered into a share of the business without investing money, solely with great ideas that they are now successfully implementing.
What is your business model?
We provide turnkey solutions to run online casinos or betting businesses. We earn through RevShare for this. In financial transaction processing, we earn through a monthly subscription fee. It starts from €3 000 and increases with the number of transactions.
Can you say how much money you spend per month?
I live quite modestly. Monthly family expenses do not exceed $5 000-7 000. Well, I don't take any long trips or vacations into account.
Do you live in your own house?
No, I have a large apartment in a Berlin building built in 1905. I really like it.
How much did you buy this apartment for?
I bought it in 2019 for €1.6 million. However, with all the taxes, it cost me almost €1.8 million.
What kind of car do you have?
I have a five-year-old Tesla Model X. I plan to replace it soon; I'm just too lazy to go through the process of searching and choosing.
What do you spend large sums of money on?
It's mostly related to reinvesting in the business. We also spend a significant amount of money on charity. Last year, we spent €1.7 million on charitable projects.
How do you feel about branded items?
Not at all. I consider it bad taste to dress from head to toe in Louis Vuitton, Gucci, and the like. If I like something, I'll buy it. But I won't go to a branded store specifically to buy something from there. I have several very expensive wristwatches. The most expensive of them cost over €100 000. But I didn't buy them; my friends gave them to me for my 40th birthday.
