Graboyes betting on video game slot machines

Graboyes betting on video game slot machines

April 26, 2016 3:01 AM
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The idea came to Blaine Graboyes in late 2013. In retrospect, it seems so obvious.

Why didn’t I think of it?

Graboyes was involved at the time with producing increasingly popular “esports” events, some of them at casinos, for competitive video-game players.

He remembers mentioning to casino managers that it had to be nice to bring these Gen X (typically described as anyone born in the early 1960s to early 1980s) and Millennial (early 1980s to early 2000s) gamers to town.

“To my surprise, they weren’t really excited about it,” Graboyes said. “I asked them, ‘Why wouldn’t you want 5,000 gamers in your casino for the weekend?’

“Their answer was pretty straightforward: ‘They (Gen X and Millennials) don’t play slot machines and that’s where we make all of our money.’

“It came to me that, wow, if there was a way to bring video games to the casino – specifically, in the same configuration as slot machines – that would be a really huge opportunity.”

Less than three years later, Graboyes and his New York-based pioneering company, GameCo, Inc., are on the verge of possibly (probably) changing the future of gaming.

While slot-machine manufacturers and most in the casino business apparently were ignoring the warning signs of the younger generation’s betting habits, Graboyes created what’s believed to be the world’s first video-game gambling machine (VGM).

“There was a misguided perception that just everybody was going to age into (conventional) slots,” Graboyes said. “But it’s obvious that that’s not going to happen.”

The VGM is the potential (likely) solution to the problem, a way to start consistently attracting these younger people to the casino floors.

Imagine this: You walk into a casino, sit down at a machine and make a bet on yourself while playing one of your favorite video games.

“Our product looks just like a slot machine or an arcade cabinet,” Graboyes said. “We work with a slot-based expert. All of the hardware in there is basically a slot machine. “The two key differences are the controller that we’ve designed in partnership with Suzo-Happ (an international engineering and manufacturing company) and the video games.

“We go out and we’re licensing popular video games and adapting them to work on our platform and fit into the regulatory requirements.”

Here’s how Graboyes describes the game-playing experience, which could range from 30 to 90 seconds.

“Our first game is what’s called a first-person action game,” he said. “I have enemies that are attacking me. I have 45 seconds to take out as many enemies as possible. If I take out seven enemies, I break even. If I take out more than seven, I get a return on my money up to five times to 20 times my bet.

“It’s very fast paced, interactive. Story and character and narrative are very important to gamers. We work very hard to incorporate all of that.”

Like many, Graboyes believes there are few things Gen X and Millennials like to do more in their free time than play video games.

“We all grew up doing it, whether it was Nintendo or Xbox or PC games or the arcade or all of them,” he said. “A majority of gamers play either daily or weekly. It’s exactly the sort of activity casinos are looking for – something that people want to do all the time.”

Still, Graboyes was told by casino executives just two years ago that while this might be the future of gaming, “it’s 20 years away.”

He went back a year ago and the same people told him that it was still “10 years away.”

And now?

“We’re in discussions to launch in Atlantic City,” Graboyes said. “We’re pushing really hard to be on the casino floor this summer.”

Graboyes has also presented his game design and concept to Nevada’s Gaming Control Board and expects to file a licensing application in the next couple of months.

“It’s a very expensive process to become a regulated gaming company,” he said. “We’re a small start-up. The deposit alone is $250,000. We’re working with all of our investment and finance partners.”

Graboyes projects his machines could be in Las Vegas casinos in a year.

“I think once we have a machine approved in New Jersey, everything’s going to fall into place very quickly,” he said. “Everybody recognizes that video-game gambling and skill gaming are going to be a part of their business no matter what.”

Graboyes’ investors include Seth Schorr, chairman of the Downtown Grand in Las Vegas, and two other casino owners.

Schorr recently confirmed when discussing the timetable for Atlantic City, “Nevada will be next.”

Other states Graboyes has been in negotiations with include California, Arizona, Florida and Oklahoma.

Graboyes realizes he has to stay patient, but it’s not easy.

“The big thing for us is pushing as fast as we can in setting the pace,” he said, “but also accepting the pace that comes with being in a regulated gaming environment.”

Whenever he meets with casinos, Graboyes automatically asks whether they’re aware of anyone else with the same intentions.

“The feedback I get from everybody is we’re the only one, and we’re a year or two ahead of anything they’ve seen in the market,” Graboyes said.

Some slot manufacturers have started to inquire about his controller device, which is also patented, but he thinks they’re probably still in the beginning stages like he was in 2013.

It’s only natural Graboyes would try to launch out East because he grew up in a Philadelphia suburb and spent summer vacations playing video games on the boardwalk in Atlantic City.

Graboyes, 43, credits part of his success to the small liberal arts college he attended, Bennington College in Vermont, where he received a degree in mathematics, sculpture and the philosophy of science.

“That wasn’t a triple major,” he said. “My major actually was ‘mathematics, sculpture and the philosophy of science.’

“I think that multi-discipline approach I gained at Bennington is highly relevant to what we’re doing now.”

Graboyes helped create his product’s math model, led the game design, did the fund-raising and also wrote the business and finance plans.

“To move seamlessly between the creative, technical and business side of the industry is really critical,” he said.

Before this venture, Graboyes had produced projects for companies such as Mattel, Sony Pictures and Disney, and had founded another startup that was the first DVD company in New York City.

But it wasn’t until he worked with War Gaming, a video-game developer and publisher, and got involved in the esports competitions that he came up with his best idea yet.

GameCo, Inc., is like a team on the brink of winning a championship but still needing another victory to clinch it

Graboyes is trying not to get too caught up in the anticipation.

“It’s both invigorating and a little terrifying,” he said. “People say things that in my opinion are a little bombastic about how many units we’re going to sell, how this is just the future of video games and gambling.

“I just try to stay very focused – and humble – on what we’re doing.”

Nevertheless, it appears it’s only a matter of time before he makes the well-established and wealthy slot-machine manufacturers look a little foolish for not pursuing this sooner themselves.

Dave Dye is a former sportswriter for the Detroit News and FoxSportsDetroit.com. He has covered six Stanley Cup Finals, five Final Fours, three NBA Finals, three Rose Bowls and one World Series. Email: DaveDye@GamingToday.com.