FREDERICTON– A Fredericton-based software company that aims to help not-for-profits raise unrestricted funds is gaining traction outside the region not only among not-for-profits but in the commercial industry too.
The Lotto Factory is a customizable software platform that allows non-profits and charitable organizations to host 50/50 draws and raffles online. The company launched back in 2017.
“Things have been going extremely well. There is a tremendous interest in what we’re providing,” says Ric Cuthbertson, The Lotto Factory’s CEO. “Our goal still remains to provide charities and not-for-profits with an innovative, licensed, safe and secure vehicle for raising unrestricted funds. But we have attracted interest from the commercial gaming industry somewhat, which is kind of nice.”
Since launching, the Lotto Factory had gain not-for-profit clients in Quebec, Prince Edward Island and New Brunswick. These organizations include Luxor Shriners, the Mikinduri Children of Hope, the Fredericton Red Wings and The Lung Association. But the company has been getting international leads as well. Cuthbertson says they’re about to close an agreement with an organization on the Isle of Man, located between England and Ireland.
“We’ve got interest from other organizations further afield as well,” he says. “It’s shaping up.”
When it comes to charities and not-for-profits using The Lotto Factory platform, different jurisdictions have different regulations. Typically, if an organization would like to use a platform like theirs or run any kind of gaming-related fundraiser. For instance in New Brunswick, they would have to apply for a license from the government.
Cuthbertson says this was a challenge that the company realized early on. Many provinces and jurisdictions have not updated their regulations to officially permit online gaming, which creates a lot of hurdles for charities to get approval. To work around this, they decided to create a second “sister” company: TLF (The Lotto Factory) Global.
Based in Alderney, Channel Islands, TLF Global has an interactive gaming license from the Kahnawake Gaming Commission that allows them to operate and manage 50/50 draws pretty much anywhere in the world except for the United States. This means that if they wish, organizations can enter into an affiliate marketing agreement with TLF Global whereby TLF Global will run a 50/50 on the organization’s behalf.
“Many of the provinces still don’t have their online gaming regulations in place. New Brunswick specifically doesn’t right now, but they’re working on it,” says Cuthbertson. “That’s one of the reasons why we went looking for an alternative because we found that we built a wonderful platform, but it couldn’t be used under New Brunswick legislation.”
Yet the company still plans to seek approval in all Canadian provinces.
“Our priority is to become recognized in each province going forward. Make sure we comply with their regulations. We will provide the option to either use our sister company license or to use the provincial license,” says Cuthbertson.
“There are advantages and disadvantages to both. The provincial licenses tend to be very restrictive and they have to be in the province to play or from the province. Whereas using our license is really only restrictive to the U.S., we can’t sell into the U.S.”
For Fredericton’s new junior hockey team, the Red Wings, the Lotto Factory has provided a stream of revenue during the offseason. The team has been holding regular 50/50 draws every Thursday.
“In sports, 50/50s are popular. That’s what all organizations do to raise money. The thing with a 50/50 is you can only do it in-game at your home games, so it limits how much you can raise based on the schedule,” says Kent Murphy, general manager for Fredericton Growth Services, the company that manages the corporate sales, marketing and social media for the Fredericton Red Wings.
“What this technology allowed us to do is a weekly 50/50 not based on homes games. We can run it 52 weeks of the year. That’s a huge component for us.”
The funds raised from the draws go towards players’ education and community activities. Murphy says they have also found the weekly 50/50s as a strong promotional tool.
“We haven’t had junior hockey in Fredericton in 40 years. So we need to do everything we can to start promoting junior hockey in Fredericton during the time of year where nobody is thinking about hockey. That’s a challenge,” he says. “But do you know what people really love to do? They love gambling, they love 50/50 and they love winning money and they love supporting a good cause.”
The Lotto Factory’s software has gotten attention from the commercial sector as well. Cuthbertson says they recently signed an agreement with an online gaming company in Ontario, though they are keeping the name under wraps.
“We signed an agreement with a group in Ontario that will be using our platform in addition to their current online platform. It provides them with a really nice player acquisition vehicle because the 50/50 draws are well known and they’re easy to play,” says Cuthbertson. “It would give another online gaming organization a new vehicle to present to their clients or potential clients, which will introduce them to other games they have as well.”
The Lotto Factory’s innovation and promise recently got it named to the Branham300’s 25 up-and-coming companies list. Looking ahead, Cuthbertson says the company will focus on growing both commercial and not-for-profit clients.
“It will be a combination. The commercial market was a bit of a surprise for us, but a welcome surprise,” he says. “But our focus still does remain on the charitable and not-for-profit sector.”