Deloitte Technology Fast 50: No. 4
Probability Plc develops and distributes mobile gambling software applications such as slot machines, caller bingo and lottery services direct to consumer. The London AIM-listed company has seen a growth rate of 7785 per cent over the last five years, taking fourth place in the Deloitte Fast 50 2009.
Formed in 2004, Probability was originally founded in order to run a charity lottery for mobile users in partnership with T-Mobile. However, the original strategy was only partially successful, according to CEO Charles Cohen: "People weren't interested in playing for the same price as the National Lottery game in games with the same odds, but for smaller prizes - even on their phones. However, we also launched instant win lottery games at the same time, and they did phenomenally well. These are essentially an electronic scratchcard, dressed up as a fruit machine, which made us realise there was an opportunity here."
This motivated the acquisition of a UK gambling licence and the development of a one-armed-bandit fruit machine game in Java (J2ME) which would run on most mobile phones. The app was a free download through a mobile portal and came with Ł2.50 credit. Users connected live to Probability's servers to play, allowing payouts to be made seamlessly. "We thought, 'if 100 of these are downloaded over the weekend, we've got it made' – 5000 had gone in that time, and we haven't looked back!"
The business floated on AIM in 2006, not for the funding aspect, according to Cohen, but due to the additional trust and transparency involved: "Trust is vital in our business, as we're dealing with the Government, regulators, the FSA, so being a plc simply gives us a lot more credibility."
Probability saw a 58 per cent increase in revenues as of the last financial year, with around 90 per cent of this coming from the established b2c business, which now offers more than 30 game titles. However, a nascent move into b2b distribution has seen Rank Group plc and News International white label the technology.
"We've been in the right place at the right time to some extent," concedes Cohen, "mobile networks changed their business model in favour of data a couple of years ago, and customers are increasingly searching for mobile content. We're increasing R&D spend to harness the b2b market, as well as get onto the iPhone next year, but the biggest challenge we're facing is recruitment. We're interviewing for two roles a day on average – it's tough to find the right people."
