Working at Jackpocket: The First Mobile Lottery App in the U.S.

Keith Cline, VentureFizz  

Peter, thanks so much for joining us.

Peter Sullivan, Jackpocket

Hey, thanks for having me. Super excited to talk.

Keith Cline, VentureFizz  

Yeah, I'm excited to talk about Jackpocket because it's one of these applications that just makes sense. I mean, the lottery, it should be something that is convenient. It should be something that is mobile. So it's an amazing idea. But I'm assuming that amazing idea wasn't an easy thing to build. So it's a regulated industry. So well talk about Jackpocket, what you guys do get and of course, talk about, you know, kind of the founding of the company.

Peter Sullivan, Jackpocket

Yeah, totally. So it's funny bringing up the idea that, you know, why hasn't this been done before? And that, you know, seems so obvious. And basically, when I tell someone what we do, they come back and say, one of two things, either why isn't this happening? Why is it taking so long, or the other one is, I thought of this five years ago, 10 years ago, and I never did it. So it's always kind of comical to start off the conversation. But with whatJackpocket is it's the first mobile application that allows players to play official state lottery games, like the ones that they already know and love. So Mega Millions, Powerball, cash for life, as well as the official state daily games that are available once you're inside the jurisdiction. So our app uses geotechnology, to verify that you're within a particular jurisdiction. And then we also obviously, verify your age and identity to make sure that you're over the age of 18, to be able to play the lottery. And then basically, they have the ability to order that ticket directly from their phone wherever they are. But the convenience kind of doesn't stop there. Everyone thinks about it as Oh, you know, you can play anywhere. But players don't have to worry about, you know, holding on to their tickets, checking their tickets, or even redeeming their tickets. And by adding, you know, a layer of user experience we adding really compelling new features, like the ability to play in a pool socially with your friends and colleagues, as well as set up an auto play, so you never miss a drawing again.

Keith Cline, VentureFizz  

So how did you, you decide that this was the idea you wanted to tackle?

Peter Sullivan, Jackpocket

Yeah, it's something that's been ingrained in me. So my background is I was born in Brooklyn. My mom and dad were from Brooklyn originally. And my dad is an MTA employee blue collar guy, worked for the train system, like his grandfather, and even his grandfather, my great grandfather. And so he was an everyday lottery player. So my dad played the New York lottery every single day, and then moved us out to New Jersey to make a better life for us. At that time, New York was going through a big change. And so as he became a New Jersey resident, he not only became a New York player, but a new jersey daily player. And so it was always a big inconvenience in our lives. And we would joke with my dad, because he always needed to play the numbers before going to our sports games, practices. And being the head coach for all the teams it was super embarrassing when we would show up late, but my dad had to travel from the Bronx back to New Jersey, pick us up and get his numbers in. And so about seven years ago, we were on our way to a family party, we're already late. And my dad pulled into a bodega and came out with a two liter bottle of Coca Cola. And I said, I know you went in there to get your lottery tickets, long be hold he took them out of his pocket. And literally about a week before that we had kind of forced an iPhone five onto him. He didn't want a smartphone. But I saw just within the first week, he was playing all these like little casino games, where he could win no money, right? It was just literally playing slots to have fun. And I was like, wait, why can't he you know, get his lottery tickets through the phone. And what we saw was that the Department of Justice has came out with a ruling saying that state lotteries could pursue online sales. And what I saw was, you know, there's been one or two states that had attempted to do it themselves. But you know, they didn't have the technology, they didn't have the in depth marketing to go digital. And so we said, okay, there's a way for us to fill this hole and to create a multi jurisdictional brand. So just like Uber, when you land in San Francisco, the app knows you know where you are, and you're not downloading the California or San Francisco Uber app. Even though it's a highly regulated market, it's geo aware. And then the back end is understanding all the regulations in that area and conforming to them. So our vision was, can we create that for the lottery industry?

Keith Cline, VentureFizz   

And then how did you actually convince, you know, the regulatory affairs that control the lottery system to actually say that this, you know, we could pull this off, we're a startup, but we can pull this off.

Peter Sullivan, Jackpocket

So even before that, I think when I finally decided, hey, this looks like an opportunity, I started understanding how big the lottery was. And Americans spend more money on lottery tickets in all sporting event tickets, concert tickets, movie tickets, video games and books combined. 

Keith Cline, VentureFizz  

Wow, I never knew that. 

Peter Sullivan, Jackpocket

Me neither. So I knew it from my dad buying tickets. And him talking to his grandma, my grandmother and his brothers and sisters about the lottery, but little did I know how big it was. And so we knew that going into it going into a heavily regulated industry was going to be difficult but if we found you know, opportunities and were able to knock over walls, this was just going to be huge. So what we needed to prove to the lotteries were basically the same thing that you prove to investors that there's product market fit. And there's no better story than being able to show real data. So we needed to figure out a way to launch the service, and ensure that we were fully compliant, and, you know, obeying all the laws. And so we got creative. And so basically, what jack pocket is, is a service provider between a consumer and an official state retailer. And we've learned and created ways that we actually process real paper tickets. Now what we do is we actually own those retailers in each of the jurisdictions that we operate. But we first actually partnered with retailers on the corner, and then eventually actually went and bought a retailer that was available in New York. And so from that, we were actually able to show a year's worth of sales, and demonstrate to the States, hey, listen, this is safe, this is convenient, we're getting a different demographic that's playing. And we can implement this at zero cost to the state. And so what most people don't understand is, yes, the lottery exists to sell tickets. But most of the money goes to the beneficiary, which is usually steady state education, elderly care, job creation. And so all these programs rely on this revenue. That said, you know, the lottery’s have a really tight budget on what they can do in terms of marketing. So what we're able to offer is the ability at zero cost to go out there and actually do all the marketing, user acquisition, and we get paid out just like any other retailer.

Keith Cline, VentureFizz   

So that's fascinating because like I, you know, I don't know if most consumers know that where the funds from the lottery system go to they I mean, they go to the supporting foundational pieces of what makes our world operate.

Peter Sullivan, Jackpocket

Look at this. I mean, if you look at especially in a post COVID world, most of these services are under real trouble right now and need more capital. They're underfunded. And it's really hard for politicians right now to raise additional capital by raising taxes, nobody wants that no one wants to run on that platform. So if you think about it, New York sold $10 billion worth of lottery tickets last year, which created $3 billion for education. But most people don't understand this, they're now expecting that, right? So the lotteries are under a lot of pressure to maintain relevancy, especially in a world where now online gambling is coming into play, online sports wagering, new forms of games and entertainment. So um, you know, there's a lot of, you know, you want to catch as many eyeballs as you can, and people only have a certain amount of attention, and, you know, expenditure that they can use. So we're trying to make lottery relevant again. And I think we're at the tip of the iceberg of what we can do by offering like social features, and really elegant UI/UX. And for me, when I started the company, it was really about getting user design right. And one of our key kind of motivations at the company is design is not a luxury, you have to have it built into a product. And so what we're really doing is focusing on those players that may have never played the lottery before, but also making it so that it's easy enough for a guy like my dad, who's basically computer illiterate to be able to pick up the app and be able to purchase his favorite games, without having to think too much.

Keith Cline, VentureFizz   

So what's the current stage of the company? Like, where are you at in terms of funding or employees or whatever else you can share?

Peter Sullivan, Jackpocket 

Yeah, so we've raised over $35 million dollars in funding. We're about to announce some recent funding that we've done that we haven't announced yet. And we're talking to some real late stage big investors, where we have a lot of momentum. The company just did a 70%, quarter over quarter growth. And we're looking to beat that. And we've launched five new states since December, making us live now in eight jurisdictions, we hope to launch the ninth one in about one week. And we have three more kind of in the pipeline. So we're rapidly growing, you know, it took a while to get here to go through all the regulation hurdles, compliance hurdles, to get buy in from the lottery and to build those relationships. And so we're actually an official member of the trade association for the state and provincial lotteries. And I know most of the lottery directors around the country, and that only happens for building relationships and actually traveling and going to all the conferences. But you know, as much as I talk about lottery, at the end of the day, we are a technology company, right? We're a mobile focused, b2c company that's looking to continuously innovate with the newest technologies out there. And so when we talk internally, we don't talk that much about it being a lottery company, we really think about ourselves as a entertainment company, that is mobile focus and trying to bring the best experiences to users.

Keith Cline, VentureFizz    

Now what what are your plans in terms of hiring?

Peter Sullivan, Jackpocket

So right now we have a few positions open. We're hiring a director of analytics. I'm also starting a process for COO. So that's a big hire, obviously. As I continue to grow the company, what I'm realizing is, you know, my best value to the company is being on the road and telling the story, whether that's to investors, to lotteries, to regulators, and obviously internally to the team. And so we're looking for someone to help kind of build operational excellence as we kind of double the size of our team. And with the next funding round, we're going to basically be doing that our headquarters is going to be doubling in size. We're looking now to actually start, you know, offering some more remote work after COVID. So we're, you know, we're looking at positions across the country. And basically almost every division of the company will be growing, but specifically marketing and a lot of product. So we're looking for back end developers, front end developers, designers, animators, marketers, people that do UA. And so I think what you're going to see is in over the next few months, there's going to be a whole bunch of new job offerings. But right now, we're kind of focused on those two positions. But we're always looking for great talent. So I always tell people to send over their resume, because we'll never miss an opportunity with someone that we think's great. We'd like to build positions around great people.

Keith Cline, VentureFizz  

So what's it like working at Jackpocket? what's the what's the culture, like in terms of the day to day?

Peter Sullivan, Jackpocket

Yeah, so I think one of our biggest assets is that we don't have an ego. So you know, ideas are being able to be passed along, we make sure that everyone's kind of transparent with what they're working on, in a sense of, we have Friday wins every Friday, where people basically like a show and tell of what you've been working on. And that's everyone from a developer to a marketer, to maybe our public affairs or, you know, VP of Finance, demonstrating kind of aspects of our business. So there's a lot of learning that goes on. We'd like to keep, you know, it light hearted, but people understand that we sometimes have deadlines to hit. And I think people are self motivated. And that's what we try to really empower people to be self motivated. We have a lot of trust in our employees. And I think the one thing that really speaks to our culture is over the course of the last seven years, other than people that relocated, we've only had one person ever leave the company to go to another company, and that's pretty outstanding. So I like to think that, you know, our company is built around inclusion and being respectful. We have a very diverse, kind of eclectic mix of people, which brings together you know, different ideas from different types of industry and different backgrounds.

Keith Cline, VentureFizz  

So why is now the ideal time to join Jackpocket?

Peter Sullivan, Jackpocket

you know, what we're really kind of pivoting and focusing on now his performance, where before it was about, can we make this happen. And what used to keep me up at night was, you know, rules, regulations, compliance, fundraising. Right now, we have clear channels to really great funding. And it's about building the business and waking up every morning and looking at the numbers. And we've had our best months from March to April to May to now June. We've hit and beat every single month in terms of sales goals and revenue. It's really fun, we have a slack alert that lets you know, every time there's a new record breaking night, and it's almost happening every day, every other day. So it's a really exciting time to be with the company just in the fact that you're actually getting to see the transparency of the business growing. And one thing I like to really bring on to those Friday wins is showing transparency in the numbers. We have dashboards that are real time that everyone can look at in the company. So we're never trying to hide anything. Um, and you know, I think we're also at this point, we're like the core products built out, we know we have the best way to order a lottery ticket, we're now thinking about is how does that lottery experience become more personalized to a consumer? How does, how do we start entering into media and entertainment? How do we start working with big partners like sports teams, and casinos, and sweepstakes companies? And what are how will the lottery look in 10 years? Um, you know, right now, it's been pretty kind of narrowly innovated due to the fact that, you know, when they come out with a new game, it's like, okay, we're gonna add another ball, right? I always say the analogy is like shaving. If you look at shaving innovation, it's like they used to have two blades, and they added three, and then they added four. But what we're really looking at is, you know, for the longest time, play had to be cash base, anonymous, no decision or interaction to it. And very kind of based around a paper physical ticket. So you know, why can't you play interesting games, versus a state or amongst friends. And so what we're going to start developing our new game formats that live in basically a digital age, that still helps those great beneficiaries like education and elderly care.

Keith Cline, VentureFizz  

Well, if you are interested in exploring opportunities at Jackpocket, you can check out all their job listings on their bizzpage on VentureFizz, go to venturefizz.com/jackpocket. And this is a compelling opportunity join a company that is on that rapid trajectory, with a foundation already created in a regulated industry, which is really hard to compete in forms like that. So definitely check out their job listings. Peter, thanks so much for taking the time to walk us through all that's going on in Jackpocket.

Peter Sullivan, Jackpocket 

Thank you so much for having me.