There can be few companies whose rise has been so stratospheric. Bet365 announced its profits for the year end 2015 with an operating profit of £406 million. Admittedly there was a modest payment to the Bet365 foundation of £10m compared to the £100m the year before and there has been a sharp increase in tax paid. Nevertheless Bet365 continues to march on and trounce all of its rivals.
Out of the combined operating profit of GB£ 882 million for the major firms in the sector, 46% is attributable to Bet365. In the current financial year Bet365 is likely to make one hundred percent more profit than the newly combined entity made up of Paddy Power and Betfair.
How did they do it? Was it because they stayed out of London and set up their headquarters in Stoke on Trent? I do not think so. Was it because they decided to create a commercial disadvantage for themselves by not going offshore (until recently) and to stay in the UK and pay gross profits tax at fifteen percent and corporation tax on all profits, when their competitors went offshore? Hardly.
The starting point to success in my view starts with Peter Coates. He set up Provincial Racing in Stoke on Trent. Peter had the good sense to ensure that his children Denise and John had a good education. Denise got a good degree in statistics and John a law degree. They both joined their father’s business with John running a catering business and Denise the betting shops.
It was Peter that provided the bookmaking DNA. Working in the betting shops Denise and John learned about the gambling customer, the people they are, their preferences, likes and dislikes. Bet365 has always been close to the customer and that in my view is one of the key elements of their success.
The online business was started in 2001 and Denise and John were joined by Will Roseff from Backhouse Bookmakers. Will is the most amiable man in the business, a chartered accountant and a good bookmaker. He understands punters and still loves standing behind the counter of a betting shop participating in all the banter that goes on. He became Bet 365’s finance director.
John with his legal background was able to offer good counsel and became the chair of the Remote Gaming Association, the industry body that provides “air cover” for operators.
A powerful combination: a statistician, accountant and lawyer all with their bookmaking DNA. All were driven but none more so that Denise Coates.
This is a remarkable woman. I recall the first time I met her when I was chair of the British Betting Office Association (BBOA).
Provincial Racing had just joined and they had about 40 shops so they were immediately granted board status. Denise, in those days, was a young timid girl, one who did not speak unless spoken to, she took notes but rarely offered an opinion. The entire board was male dominated so it must have been a daunting task even to be present. At the time Denise was a chain smoker as was Will Roseff, after every meeting my clothes went to the laundry! Denise rarely missed a meeting, she was hungry for knowledge.
After a few months she began to participate in discussions more. Her contributions were always relevant to the topic and you could see that here was someone who was not only very bright but very principled. She has a strong belief in what is right and wrong and always wanted to do the right thing. The setting up of the Bet365 foundation was no surprise to me at all.
The best thing about Bet365 is that it is a world-beating British company, a family business, whose chief executive is a woman, in an industry that is still male-dominated.
by Warwick Bartlett