Expanding its reach: Cherry on the launch of its new B2B tech arm

Cherry has invested heavily in its technology capabilities in recent times. A driver for recent strong growth, the firm has taken the bold decision to open up its gaming platform and technology services to the market for the first time.

The launch of Cherry’s new technology business, XCaliber, will see the company bring to market its tracking software tool Omarsys, payments and fraud aggregator system and gaming platform, working closely with its existing online brands and new customers.

Cherry said the new business will strengthen its position as “an innovator and hub for entrepreneurs” within the egaming industry. XCaliber will be headquartered in Malta with a supporting tech team in Poland.

The launch of XCaliber was to be one of the last moves made by group CEO Fredrik Burvall, who announced last month he was leaving his role after more than 10 years with the firm.

Speaking with EGR Technology, Cherry’s former CTO Dario Arruda lifts the lid on why the company made the decision to offer its services to other operators and details the investment Cherry has made in its technological capabilities.

Dario Arruda, XCaliber CEO

EGR Technology: What was the thinking behind launching B2B technology business XCaliber? Why did you decide to offer your platform and technology services to your competitors?

Dario Arruda (DA): The decision to launch XCaliber was in line with the strategic approach we have been taking for some time now. We have invested heavily into our technology stack, and by that I mean the people as well as the system itself, resulting in a gaming platform and tracking software that is a cut above the rest. It is now at the point where it can be commercialised, and offering our technology to other operators puts us in a really strong position. Not only that but the revenues we generate from XCaliber will be pumped back into further development.

EGR Technology: How many people will be based at XCaliber’s Malta HQ and the additional Polish office?

DA: We have 21 people located at our Malta office and a further 23 in Poland. By the end of the year our headcount will have increased to around 60 employees across the two offices.

EGR Technology: Why did you decide to base your HQ in Malta?

DA: The reason for picking Malta was pretty simple – we already had an office there. Malta is where everything started for us; there was a pool of talent, especially when it came to technology and egaming. But we recognise that Malta is not a sustainable option in the long-term with competition on the rise and the talent pool starting to run dry.

EGR Technology: Was Sweden, where Cherry headquarters is based, considered as a location for the additional hub? Why choose Poland instead?

DA: We sat down and looked at the map and asked ourselves where we could hire the best talent but where market saturation was not an issue. Sweden has a population of six million, but has a lot of tech companies fighting over those people. In the end we decided on Poland, a country with plenty of tech talent but far less competition. It also works well from a logistical point of view, with direct flights to our office in Malta.

EGR Technology: Tell us more about the investment Cherry has made into technology in recent times, how does this help the company stand out in a competitive market?

DA: We have been laser-focussed on realtime engagement and personalisation. It is vital that our brands, and those of our partners through XCaliber, can respond immediately to the second-by-second ups and downs of operating an online casino. With that in mind, we have developed a set of tools that boost engagement and personalisation, things like reporting data in real time when it comes to instructing. It gives us the power to fully tailor the player experience by reacting instantly to any and all emerging trends.

EGR Technology: What improvements have you made to Cherry’s gaming platform and other technology services in recent times?

DA: We have been working hard to constantly evolve the platform and product. We have been adding in cutting edge features and functionality so that we can process more, faster, and with even greater resilience. At the same time, we know this is a business where growth and change can take place from one moment to the next.

Our core platform and other products like Omarsys and our payments gateway have been tweaked and improved to ensure they can handle these sudden changes in player traffic while still delivering the performance and resilience expected from a top-quality system such as ours.

“We have been laser-focussed on realtime engagement and personalisation.” Dario Arruda

EGR Technology: What are the advantages of having a gaming platform built in house? Could Cherry’s growth in recent times have been achieved without such investment?

DA: It really depends on your strategy, the time you want to take to go to market, and your appetite for risk. For those who want to enter the market quickly and without a great deal of risk, using a third-party platform is the right way to go. For Cherry, however, we wanted to have full control of our platform, and use it to drive the businesses into new areas. But there is a risk that comes with taking this approach – we have heard many stories of companies who spend millions of pounds on building out their own in house tech but then struggle to take it to the next stage.

EGR Technology: Which future facing technologies has XCaliber invested in recently and how does this benefit the firm’s gaming platform?

DA: We have invested heavily both on the core systems and in our front-end framework. We have moved the needle a great deal over the past three years, and we can now offer our brands and partners a truly bespoke platform. In essence, every online casino and sportsbook looks completely different and can have its own mechanics.

On the operator side of things, we have focused on automation and orchestration. This has enabled us to have smaller teams while still guaranteeing high resilience and availability. Online gambling is a 24/7 business and we can support that. It is not a linear business, either; one day you may have 10,000 active players and the next it may be double or triple that. It is important to be adaptable and flexible, but powerful. And we are all of those things.

EGR Technology: Which other industries inspire you from a technology point of view?

DA: We pay a lot of attention to the finance industry when looking at how to improve the transactional side of our business. Gaming, social gaming and entertainment companies like Netflix are other areas for inspiration as they are still well ahead of egaming. There is no good reason for this other than online casino margins used to be so good that the industry didn’t really need to innovate in the same way as gaming and social gaming. But things are changing, and now we need to push the boundaries and we can learn a great deal from what they have been doing. The ad serving industry is another we keep a close eye on. For instance, how they target and re-target customers, and monitor exactly what they are doing through analytics and data science.

EGR Technology: Is there a non-egaming company that you are influenced by when adopting new technologies?

DA: Valve, the company behind game platform Steam, is very interesting from an organisational point of view. They have a flat organisation and the motto that you don’t hire people to tell them what to do. They still have goals and deliverables, and achieve these through having the right people and structures in place. They have achieved great success in a short space of time, and their blueprint is something we have looked to adapt to our company.

From a tech point of view, we use a lot of features developed by Google and Facebook – tools for front end and orchestration are good examples. They have come up with some really innovative and cool stuff , features that have enabled us to take our platform and business to the next level.

EGR Technology: When recruiting talent, do you look for people with egaming experience, or prefer those from outside the industry who can offer something different?

DA: It really depends on the role. Previous experience is important to us, but it doesn’t have to be within the egaming industry. We look for people with the skills and attitude that align with how we work and what we want to achieve. Online gambling experience can help with some roles, but it can also bring bad habits and old ways of doing things. Overall, we have struck a balance by having a combination of the two.

EGR Technology: How is XCaliber looking to bridge the tech skills gap? How do you make sure XCaliber is an attractive company for a techie to work for?

DA: People want to work in a place that is enticing and allows them to grow their career. It is important to foster an environment where there is always room to improve, for controlled failure, and to allow employees to experiment with new ideas in order to move the business forwards.

Here at XCaliber, we do that by employing tech people with at least three to five years’ commercial experience. This is because they have already made mistakes as part of the steep learning curve that comes when entering the workplace for the first time and will bring these learnings to the team. We have a relatively small number of employees given the size of the business, so it is important they are at the top of their game. Essentially, every person counts.

“Online gambling experience can help with some roles, but it can also bring bad habits and old ways of doing things” Darrio Arruda

EGR Technology: In what areas do you think egaming can improve on when dealing with technology? Is the industry lagging behind other ecommerce industries in embracing new technologies?

DA: It’s still considered okay for platforms to have downtime, and this really shouldn’t be the case. With its due exceptions, game quality is still pretty average when compared to the likes of some MMO or social games.

Gamification is another area the sector is lagging behind; we have really picked up on this of late but there is still a lot to do. Again, we are looking to the social gaming industry for pointers as it is something they have been doing really well for a long time now.

EGR Technology: What is XCaliber’s tech roadmap for 2017? How will you improve your technical capabilities?

DA: We will continue to focus on developing the technology that allows us to have real-time engagement with the customer. It forms part of our ongoing efforts to offer the best-in-class system and service to our partners and players.