Secondary bonusing niche paying out for Reno startup

The last time Kent Young built a company that developed game content for slot machine makers, he took the slow-and-steady approach of an entrepreneur who is pulling himself up by his bootstraps.

This time around, he’s barreling down the track like a top-fuel dragster at the Winternationals.

Young’s newest company, Spin Games Inc., took a big step last week with its announcement of a strategic partnership with Reno-based Leap Forward Gaming Inc.

Leap Forward, founded a couple of years ago by longtime International Game Technology executive Ali Saffari, is making a name for itself with wireless networks that allow casino operators to link the machines on their gaming floors with centralized servers.

With the new deal, Spin Games’ products — especially secondary bonusing games — can be linked into the Leap Forward’s SaffariNet system.

In secondary-bonusing games, players are rewarded with the opportunity to move up from the primary game they are playing to a secondary game that gives them more chances to win.

Young calls secondary-bonusing projects “a huge growth opportunity” for Spin Games Inc.

He explains: Casino operators, still pressed for capital as a result of the recession, need to update their slot floors without sinking big dollars into new machines. Secondary-bonusing systems added to existing slots provide new action less expensively than all-new slots.

Adding to the buzz, some of the secondary-bonusing products developed by Spin Games Inc. make their payouts in cash — returning greenbacks to a position on the casino floor that they lost with the advent of ticket-in, ticket-out technology.

“We very much believe that cash continues to create a tangible reward for players,” Young says.

At the same time that Spin Games is developing secondary-bonusing products in its spare offices in Sparks, it’s also creating slot games that will be licensed to manufacturers of gaming equipment.

It’s collecting licensing revenue on games from four global manufacturers, important cash to help jump-start the company that was founded only early this year.

Spin doesn’t plan to get into the manufacturing business itself. Instead, it’s focused entirely on development of intellectual property — patented processes, copyrighted graphics and sounds — that can be licensed. The company has five patents pending.

“I’m very conscious of taking on too much, too early,” says Young.
But within the two niches where it’s doing business, Spin Games is putting the capital of Young’s backers to work quickly.

“We’re very aggressive. I believe in moving quickly and taking advantage of opportunities,” Young says. “To be successful, you’ve got to be fast.”

In just over five months, Spin Games has nailed down relationships with major slots manufacturers and companies such as Leap Forward Gaming.

It created a design team based in Bangkok, Thailand, to complement the company’s headquarters staff in Reno. Between the Asian and Nevada teams, about 10 people work with Spin Games either as employees or contractors.

The Reno operation, Young says, allows the company to tap into a deep talent pool of game developers, mathematicians and graphic artists in northern Nevada. The Bangkok office allows Spin Games to stay close to the Asian markets that are driving much of the worldwide growth in gaming.

Spin Games is growing more aggressively than True Blue Gaming LLC, a startup launched by Young and sold to Aruze Gaming in 2008. Young was general manager of Aruze Gaming from the time of the sale until the end of 2010.

On the other hand, Young notes the gaming industry today is far more competitive than it was even five years ago — more competitors battling over a marketplace that’s suffered the ill effects of the recession.

A 20-year veteran of the gaming industry Young got his start in sales with Aristocrat Leisure Ltd. in the New South Wales region of his native Australia.

He got into the business just as video gaming was becoming a big deal, and his career got a major boost as he led the introduction of penny slots into American markets.

Before he left to create his first startup, Young was Aristocrat’s global general manager of marketing.

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