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The Lessons of Online Casino Ownership

Have you ever wondered what it would be like to be an online casino executive? Imagine, having the ability to make millions of dollars simply by offering computer games on the internet for free. What cash cows online casinos execs must have found in order to create such business monsters. Even so, it is evident that online casino companies have often gotten a bit ahead of themselves in thinking that Easy Street came to them and would continue to go in their direction whatever the circumstances. By this, of course, we are referring to the lessons of the past summer which, as spring approaches, are always in danger of being repeated again.

By this, we mean the tendency of online casino companies to be a little too enthusiastic. Online casinos have in past months overvalued themselves and then, when another company decided not to buy the first online casino company because they saw it wasn’t nearly worth the asking price, the first casino company decided to sue. Before that, of course, came several initial public offerings, or IPOs, on the London Stock Exchange. Reports of the first transactions indicated robust support, and then suddenly less-than-stellar economic forecasts were released by an online casino company accustomed to not having reports like that damage its standing. And what happened?

The stock plunged, only to recover much later – in fact, all the gains made were nearly wiped out in a day. Suddenly, online casino executives around the world had to take note that Easy Street apparently had some speed bumps when you invited in fickle investors who don’t like hearing bad news and who are under little obligation to stick with a ship that has hit an iceberg and might not have the flood doors to stem the waters. Such is business, and online casino companies were taught a valuable lesson last summer and fall. Whether or not they truly learned from the experience we are sure to find out in the coming months.

OCA News Editor

Jenny McKinnley is OCA’s financial correspondent. After spending years on the trading floor in both NY and London, she offers insight from the inside out on world financial news and events.