Gaming giant Supreme Ventures founded by Paul Hoo, Ian Levy and Peter Stewart is celebrating its tenth anniversary this month and there is plenty to be happy about. Formed at the turn of a new decade in a new century and millennium, it has become undoubtedly the leader in its field while at the same time, turned into one of the most recognised brands in the country. Its largesse as a corporate citizen particularly stands out although its chairman Paul Hoo and CEO Brian George would rather not blow their own trumpets as far as that is concerned. They choose instead to focus on nationhood and play a participatory role in the development of Jamaica.Caribbean Business Report from Kingston earlier this week Supreme Ventures’ Chairman Paul Hoo recalls those early years: “When we started out we felt that we had discovered a vacuum in the gaming market in that it was not fully utilised. We then proceeded to study other jurisdictions to see what was being done and with the help of GTECH who has provided technological support services to gaming organisations the world over, started off being very optimistic as to what could be accomplished. GTECH made a considerable investment in our operation and it was gratifying to have them share our vision. At that time there was an upsurge in the use of modern technology in Jamaica and if you can recall it was about the same time that Digicel launched its operations in Jamaica.Drop Pan

Speaking with

“I don’t think in our wildest expectations we could have envisaged where we are now ten years later. I continue to look at the business every year as a success. We continue to find new areas in which we can build the business. I am very satisfied where we have reached from our ninth to tenth year with the expectation that in year eleven and twelve, we will continue to grow the company and diversify into new areas. In this country there are some long standing corporations like the Gleaner ,Red Stripe and J Wray & Nephew and from my own perspective I would like to see us also become a long-standing company with our businesses.”

For the financial year 2010, audited accounts show Supreme Ventures posting revenues of J$25.4 billion with a gross profit of J$2.9 billion and EBITDA of J$855.6 million Total assets came to J$4.639 billion with earnings per stock at 0.16 and a net profit of J$421.2 million.

Supreme Ventures has popularised a number of games in its ten years , none more so than Drop Pan. There are only two lottery jurisdictions in the world that operate a single-number game namely Trinidad and Jamaica. Drop Pan has a particular cultural standing in Jamaica and that was a major factor in bringing the game to even more national attention. It also has a high level of winnings because it is only one in 36 numbers. Though no jackpot is life-changing, it is exciting and very popular with Jamaicans.

On Drop Pan, George said: “Back in 1995, I was with GTECH in Trinidad and I did a presentation to Paul (Hoo) who even back then was talking about Drop Pan in Jamaica. It is very similar to the Whe, Whe game we have there which is marketed as Play Whe. The real issue was how extensive was Drop Pan in Jamaica and could you make money from it. Lotteries can be a seductive thing because many people think of it as a high profit business because lottery games tend to have a 50 per cent pay out. The idea of having a 72 per cent pay out then becomes a scary proposition particularly when you have to consider what one has to also payout in commission fees to the agents as well as gaming taxes.

Again the risk quotient goes up when you are saying I am going to operate a business where the price point is ten dollars which means the guy washing cars on the street corner can afford to be my customer with a high degree of frequency, now that is where the vision really comes in. Drop Pan has existed in Jamaica for a hundred years, Whe Whe has existed in Trinidad for a hundred years. Commercialising it as a business for Supreme Ventures is an indication of the foresight and acumen of Paul and the other directors because many other lottery operators would consider it too risky and volatile and would have run a mile from it. Because of the nature of the game there are days where you are paying out 300 to 400 per cent of what you have taken in . If you don’t have the stomach for it, it can really cause some terrible ulcers. Again that’s where the vision comes in. how do you commercialise and monetise such a game? Hats off to Paul and the other directors.”

Three amigos

Paul Hoo, Ian Levy and Peter Stewart were clear from the very beginning that there was a need for more games on Jamaica’s lotteries landscape. Stewart and Hoo were involved together in other businesses and formed a good working relationship. Hoo discussed the prospect of going into the gaming business with Stewart thinking that if they were able to acquire a gaming license, put in the investment and find the international expertise then they could make a go of it. It took them seven years to get that license. Ian Levy was a close friend of Stewart and joined the company as one of the major shareholders.

Hoo recounts, ” There is no great business secret or model in how we started. Things gelled and ideas sprang forth and we went from there. The making and success of the company does not necessarily have to totally do with the vision the founding shareholders had, but rather the people who have made a contribution to Supreme Ventures. Brian (George) has been with us since day one but then he was with GTECH and that company took a lead role in advising us.

“Back when we started our main competitor was Jamaica Lottery Company who had as their main supplier Canadian Bank Note, whose primary business was as the name suggests. They were in a number of jurisdictions throughout the Caribbean and had a reputation as being very above board. We simply inquired who was the leading lottery service provider operating in the world by picking up the phone book and was directed to GTECH’s regional vice president, Dave Senerchia. I then spent some time with Brian who took me through how the technology works and we have used GTECH’s expertise ever since.

“Brian was very instrumental from day one and he eventually joined the company. Without his expertise and understanding of the market and the business, it would have proven a lot more challenging for us.

George had experience with lotteries in Trinidad and says as far as Jamaica was concerned he was largely guided by Hoo who took him around the country and showed him how Drop Pan was played including the markings on street walls.

“We did extensive research but it didn’t prove too helpful because only 14 per cent of those surveyed admitted to being Drop Pan players. We really did take a leap of faith. Lotteries as a segment of gaming was very new to Jamaica back then. The parameters set by the regulators were also somewhat new. Back then we didn’t have a big weekly lottery game and we had to get the regulators to see the merits of a real time, online game and how best to regulate, audit and protect the consumer. That meant they had to now upgrade their personnel and software.”

The Supreme Ventures brand

Developing the Supreme Ventures brand was a critical step in getting the company into the country’s collective consciousness. While the registered name was Supreme Ventures, the trading name was suppose to be Win Jamaica Lotteries. In fact an injunction was filed where it had to be ascertained whether the name ‘Jamaica’ and ‘lotteries’ violated the name of our main competitor at the time, the Jamaica Lotteries Company.

“I thought that Supreme Ventures was a great name and I was all for going back to our registered name. The real challenge came when we had to change all the printed material and had to go back to the drawing board while looking to launch at the same time. The pressure to get the name Supreme Ventures out into the market triggered a bond between GTECH, Supreme Ventures and Print Tech who operated out of Puerto Rico What we sorted out was potentially a mini crisis and today we look back on it with a great degree of pride. We got through that period and it was fun.

I can tell you the original name for the first game was Cash Pan because we wanted a name close enough to Drop Pan. People think it’s all about turning on a switch and selling tickets but it really was an experience in innovation and fortitude. That is want really tested the believe in everyone involved.

Supreme Ventures has paid out over $100 billion in prize money in ten years

Over the last decade, Supreme Ventures has paid out over J$100 billion in prize money and contributed over J$125 billion to the Jamaican economy.

Speaking as the special guest speaker at a Rotary Club luncheon in Kingston in April of this year, George said: “Over the last ten years of our operations we have contributed over J$6 billion to the CHASE Fund. We have paid over J$8 billion in gaming taxes and over J$1.5 billion in fees to the Betting Gaming and Lotteries Commission(BGLC).”Part II NEXT WEEK.