The European gambling industry, and further afield, has united this week to support not only their Ukrainian colleagues but everyone affected by Russian president Vladimir Putin’s full-scale invasion of his neighbour.
The images and stories from inside Ukraine have been nothing less than harrowing since war broke out on February 24, but they have galvanised a global movement to stand shoulder to shoulder with the Ukrainian people against Russian aggression.
In a LinkedIn post Monday, founder and CEO of BeyondPlay Karolina Pelc announced the ‘Gaming Industry supporting Ukraine relief’ fundraiser she and other members of the industry have put together.
“The Gaming Industry for Ukraine initiative aims to raise £250,000 to support Choose Love’s Ukraine Crisis Fundraiser, which supports projects providing vital aid to the refugees that are being created by Russia’s incursion into Ukraine”, she said.
CEO and founder of SBC Rasmus Sojmark, who is also behind the fundraising campaign, said: “The global gambling industry is a family and what has become clear over the past few days is the strength of responsibility it feels in providing assistance to the people of Ukraine. Most organisations employ people from the country, or have done business in the region, shared a drink with them and above all have made friends with them.”
Ukraine is a key player in the European gambling market, both in its domestic market and its role as a supplier to the industry further afield. The country legalised gambling on July 14, 2020, after a period of prohibition that started in 2009. One of the first operators to be licensed in the country after the market re-opened was Kyiv-founded Parimatch.
In a moving LinkedIn post yesterday, the sports betting firm said: “Our team still works in most regions and Kyiv. Someone now serves in the territory, someone helps block telegram channels with disinformation, someone has become a journalist for foreign media, someone has become a volunteer and helps with the resettlement, food and logistics not only of our PM people, but for all Ukrainians… We stay in Ukraine, we work here and we want to be here.”
It added that the firm had “allocated an additional UAH 30 million to help [Ukraine]. The money will be used to purchase the necessary protective ammunition, food and medicines.” It also pledged to cooperate with volunteer organizations, charitable foundations, and private businesses to address the shortage of necessary goods and problems with distribution.
CDC Gaming reached out to the chairman of the Ukrainian Gambling Council (UGC) Anton Kuchukhidze who said, simply: “All operators and UGC try to help the army in different ways, starting from money support to media activities.”
Anna Sainsbury, CEO and co-founder at GeoComply, posted on LinkedIn the day the invasion started to say, “Our Ukraine team has been an important part of the GeoComply family for over a decade. As we continue to monitor these unfolding tragic events, supporting and protecting our friends and colleagues in Ukraine is our number one priority.”
As these comments show, there has been less talk of business risk for operators in the region thus far, primarily because the clear and present danger is loss of life. Firms are concerned with keeping their teams, themselves and their families safe. Some European businesses and individuals linked to the industry have offered transport and accommodation to refugees, for example. Others, as above, are focused on fundraising.
However, commentators with the luxury of some distance from events on the ground have raised the spectre of business and economic disruption, particularly in the context of the massive sanctions being imposed on Russia by the West.
Gambling consultancy Regulus Partners highlighted the knock-on effects the conflict could have in a recent post. “One of the big issues that the creation of ‘pro-Russia,’ ‘pro-West’ and ‘attempted neutrality’ blocs raise is that the flow of money, people, and information services is likely to become much more restricted between them, much as in the Cold War. Online gambling, multi-jurisdiction businesses, and global M&A all rely upon the easy flow of all three to be either untrammelled or possible ‘under the radar,'” it suggested. “Western sanctions and Sino-Russian countermeasures to Russian military policy are likely to involve restricting the lifeblood of global gambling either as collateral damage or on purpose.”
Likewise, a recent Macquarie Capital report from the US highlighted the potential for the conflict to impact cyber security, cryptocurrency and cause outsourcing disruption for the many businesses that rely on Ukrainian suppliers.
“Outsourcing in Ukraine could be disrupted with ripples felt across verticals (e.g., technology, media, online gaming). We note some PE funds partner with IT services firms that have material Ukrainian presence to outsource portfolio company R&D. Conversations with our software coverage suggest limited R&D risk”, it said, but also made the point that “the impact on US companies is subtle, but could become loud.”
Meanwhile, there is one notable act of resistance to the events in Ukraine that gambling firms appear not to be taking advantage of. While sporting organisations across the world have withdrawn support for Russian events and teams, gambling operators are still accepting bets on Russian events.
As a piece by Bill Speros on Bookies.com highlighted, legal bets have been taken on live sports in Russia despite the country’s military action in Ukraine. FanDuel, DraftKings, BetMGM, PointsBet and Caesars Sportsbook offered in-match wagering on Moscow Liga Pro table tennis, while Bet365 offered live betting on the Russia Premier League Women’s basketball game.
While uniting behind the Ukrainian people and raising money to support relief efforts is the most some individuals may be able to do, a bigger and more effective gesture from the industry would be to suspend betting on Russian events and prove it doesn’t put profits before people.
