The Next: Volume 22 with XST Capital Group

XST Capital Group presents The Next, a recurring series featuring founders, CEO’s, and key industry thought leaders to discuss the companies shaping innovation with the digital gaming sector. In this edition, XST Capital Group founder Joel Simkins speaks with Sean Ryan, CEO and Co-Founder of Zoot. This interview originally appeared on the XST Capital Group website.

“You launched ZOOT at the start of last year and have experienced remarkable growth in a short time. Could you give us some color on the genesis of ZOOT? What inspired you to found the company, and how did you approach the initial development of the ZOOT brand?”

My Co-founder John Cahill and I have been in and out of traditional video games for 30+ years, starting with us meeting at online gaming pioneer SegaSoft Networks in 1994. We later started a white label social casino company called Open Wager, where our LuckyLand Slots product was created, but later sold to VGW after we had investor issues. Sweepstakes was on our "white board" of ideas when we went back to doing start ups as we thought we could bring our video game expertise to iGaming, and it was a fast growing sector, unlike other parts of the video game business.

“Your remarkable 25+ year career in the gaming industry, including nearly 11 years at a major player like Meta, speaks volumes. How has this extensive background informed your founding of ZOOT and what has been the single most valuable lesson from your past that has proven particularly beneficial in your current position?”

One of the advantages of being a bit older is that I've seen patterns repeat over my career, especially in games, both at Facebook with the rise of social games, as well as earlier work in the console and early online gaming sectors. I believe the Instant Game genre is in its very early, Pong-like era, and that there are opportunities to introduce higher fidelity audio and graphics, as well as more interactivity - we have seen this in every new game platform in the past 30 years, from console cartridges to today's massively multiplayer games.

“Given the rising popularity of the sweepstakes model, how is ZOOT distinguishing itself within the market? What are the defining features or unique attributes that set ZOOT apart from the competition?“

We focus on 2 areas:

1. Games: As with any console producer (Sony, etc), we have a robust internal gaming studio that has produced 50+ of the most innovative games in iGaming, from DJ Crash to Beer Pong.

2. Platform: Unlike many competitors, we built our own gaming platform from scratch, so we can easily modify and evolve it with new features vs. using a white label provider. For example our SQUADs (Teams) feature is unique in that it enables our players to progress as a group, a feature we borrowed from traditional video games.

“Could you outline ZOOT's approach to platform and game development? As the company grows, how are you prioritizing development in these key areas, and what are your primary development goals currently?“

First focus is increasing the interactive features and overall polish of our internal games, while using AI tools to increase team productivity. This enables us to follow real world events, and quickly create relevant games (e.g. Dubai Chocolate Tower), as well as integrate brands and celebrities into the actual games (influencer Griffin Lazlow in "Yard Sale"). Second is starting to offer those games out to other iGaming sites, both in sweeps and in crypto casinos around the world.

“With your growing portfolio of original games, ZOOT's dedication to in-house creation is clear. How do you strategically decide when to integrate third-party content vs. investing in the creation of your own proprietary titles?“

Our internal studio (zootstudios.us) specializes only in Instant Games (Plinko, Mines, Crash, Tower, etc) as that's where we believe we see the "Blue Ocean" of lower competition/greater opportunity, but we realized we need to have Table Games, Slots and Live Dealer to complete our consumer offering, so we work with 3rd party suppliers for those genres.

“With so many competitors now in the sweeps space, what is ZOOT's strategy for acquiring and retaining users while competing with other operators?”

We believe that marketing differences will normalize over time, so that the differentiating factors for gamers will be access to compelling 1st party games, as well as innovative platform features (chat, jackpots, Squads/Teams) - otherwise it will be a race to the bottom on bonuses.

“What is your perspective on the current state of the sweeps market within the broader gaming industry, and what do you believe will shape its future?”

It's hard to know for sure, but if you look at the history of DFS as one guideline, we'll see some US states ban sweeps, some regulate/tax them, and some ignore the entire process as a low priority issue. That means that the sweepstakes addressable market will be large for a long time.

“What are your thoughts on the increasing scrutiny from regulators on gaming operators, and how do you see this playing out?”

We rigorously follow standard iGaming practices as laid out in our Legal Opinion (KYC, AML, GeoBlock, Exclusion), as do most of our sweeps colleagues, so the idea that we don't as a sector is factually wrong, as the critics actually know. However, I think the regulators are missing the point that Stablecoin adoption is going to make iGaming easier and easier on a global basis, so I would recommend they spend less time trying to ban legitimate sweeps operators and more time trying to regulate/tax them.

“What are the biggest opportunities and challenges you foresee for ZOOT within the competitive gaming market?”

The biggest opportunity for ZOOT is the rise of Stablecoin adoption in the world, the impact of which I believe is wildly underestimated in the US and Europe. Once hundreds of millions of people in 2026/2027 can easily send stable digital currencies anywhere in the world, I believe we will see an even greater surge in iGaming, which is where we are focused for next year. The challenge for ZOOT and all gaming operators will be navigating the regulatory challenges in each country, as we saw recently in India where the government banned all Skill/Luck-based real money games out of the blue.

“Tell us about the roadmap for ZOOT long-term. What can users expect to see in the next 5 years, and how do you see ZOOT shaping the market?”

Users can expect to access a version of the ZOOT site anywhere in the world on any platform a gamer can access, and that our impact is that more sophisticated game expertise helps drive higher quality Instant Games into the market, which then brings a new set of gamers to these platforms.

“While I'm sure most of your time goes into building ZOOT, what's something you're genuinely interested in or enjoy pursuing outside of your career?”

Outside of focusing on my family and spending a few months a year at our place in Barcelona, my personal passion is attempting to help drive affordable housing production in the NY region. Lack of housing is a key issue in almost every city in the world, and if we don't help address it, we'll see greater challenges as a society.

Thank you for taking the time to tell us about ZOOT, it has been fascinating hearing your take on the sweeps model. With all my questions for you, I think it would only be fair to switch it up. Go ahead and ask me anything you want on the industry.

Joel, you've been in this sector far longer than I have - what is your biggest surprise in the last year that you didn't see emerging?

Like most folks, I had my eye on the predictions market for some time and following the national election. I assumed that the winds around some form of federalized sports betting might be a risk/opportunity depending on your perspective. Clearly with the explosion of interest in this market, capital flows, and flat footedness of the incumbents it’s certainly a dynamic area that will leave an impact on the industry in the coming years.

Sean Ryan - Biography

Sean’s post-university career was in Finance, but the goal was always to move into technology and digital media, so after business school, Sean joined the Business Development team at SegaSoft Networks, helping the team launch the pioneering HEAT online game network. He then spent 7 years in digital music at Listen.com, eventually becoming CEO and selling the company to Real Networks. Later he left to start MEEZ, an early avatar and virtual world provide, and that company spun out Open Wager, a social casino provider, providing his first entrée into the casino gaming ecosystem, which eventually sold Luckyland Slots to VGW. He then joined Facebook (now META) for 11 years, ending as the VP of Platform Partnerships. Looking to return to start up operations, Sean left to become CEO of AQUA.xyz, an early web3 commerce marketplace. When that category failed to appear, Sean shuttered it and co-founded ZOOT (getzoot.us), a sweepstakes and stablecoin-focused iCasino operator and game developer, where he is currently CEO, having raised $8M+ in 2 rounds of financing. In addition to ZOOT, Sean actively invests in a wide range of tech start-ups and is often seeing walking his dog in Greenwich Village or in Barcelona, Spain.