Unique, cash generating business model
ZEAL Network SE, Hamburg, Germany (hereinafter also referred to as ‘ZEAL’ or ‘the Company’), is the parent of an e-commerce group of companies that create online lottery experiences for its customers. Founded in Germany in 1999, ZEAL was initially set up as a lottery broker. In 2005, Tipp24 AG (as it was then called) was floated on the Frankfurt stock exchange.
In 2009, the Group changed its focus from lottery brokerage to lottery betting and moved its registered office to London in 2014.
In May 2019, ZEAL completed the takeover of LOTTO24 AG. It transitioned its former Tipp24 secondary lottery business to a German online lottery brokerage business in October 2019 and has since become the leading German online provider1 of state and other lottery products once again. In the same month, it relocated its registered office back to Germany.
In 2020, ZEAL expanded its product portfolio with the addition of its own charity lottery ‘freiheit+’.
As of June 2023, ZEAL also offers virtual slot machine games (‘games’) on the portals of LOTTO24 AG (LOTTO24, Tipp24).
ZEAL added a further charity lottery ‘Traumhausverlosung’ in late July 2024.
Our former charity lottery ‘Die Deutsche Traumhauslotterie‘ was discontinued in September 2024.
Our Germany segment
The Germany segment comprises the Group’s domestic business activities: the online brokerage of lotteries, the running of charity lotteries and the operation of games. Its cost base includes direct operational costs as well as the Group’s shared costs.
In this segment, we broker lottery products via the Internet (lotto24.de, tipp24.de) and receive brokerage commissions from the lottery operators. We can therefore generate income without having to assume ourselves the book-making risk for the products of the German Association of State Lottery Companies (‘Deutscher Lotto- und Totoblock’ – DLTB). Amongst other things, we offer our customers the possibility to participate in the lottery products ‘LOTTO 6aus49’, ‘Spiel 77’, ‘Super 6’, ‘Eurojackpot’, ‘GlücksSpirale’, ‘Keno’, lottery clubs, instant lotteries and ‘Deutsche Fernsehlotterie’, which are all well positioned on the market. On behalf of, and in the name of, our customers, we enter into gaming agreements with the respective lottery operator.
In addition, we enable our customers to participate in two charity lotteries:
› ‘freiheit+’, which we offer together with BildungsChancen gGmbH and with which we promote educational projects.
› ‘Traumhausverlosung’, launched in late July 2024, which finances the social projects of several charity partners.
These charity lotteries are offered on the portals of LOTTO24 and Tipp24 as well as on the dedicated websites freiheitplus.de and traumhausverlosung.de
(so-called ‘D2C shops’).
Our former charity lottery ‘Deutsche Traumhauslotterie’ was discontinued in September 2024.
As of June 2023, we also offer games on our portals (LOTTO24, Tipp24).
One of the sector-specific success factors of our business model is the loyalty of our customers: once gained, a major share of our active customers provide us
with stable billings over the long term.
Our ‘Other’ segment
The Other segment comprises the remaining elements of our business, including our online lottery operation on behalf of the national organisation for the blind in Spain, ONCE, and our investments in start-ups under ZEAL Ventures.
ZEAL Ventures continues to pursue new lottery-related, start-up investments using a risk-managed portfolio approach. We have made several start-up investments, which we are closely monitoring and supporting where necessary while continuing to pursue additional investment opportunities. Our objective is to learn from these companies, generate profits and/or integrate exciting business ideas into the ZEAL Group.
Our strategy
ZEAL’s strategic targets are:
- Continue to scale our business model in Germany over the coming years and further expand our strong market position.
- Establish new lotteries and games in the medium term.
- Continue to develop our Spanish business via customer growth and an expanded partnership portfolio in the medium term.
- Identify gaming and lottery innovations in order to gain relevant market knowledge and test new product ideas, thus enabling us to tap further target
groups in the medium term, and in future to profit from the sale of investments.
Our vision
Based on the medium to long-term assumption of an online share of 50 to 70% of the total German lottery market (DLTB plus charity lotteries, GKL and other regulated lotteries) of around €10 billion, this would also result in an online lottery market potential of €5 to 7 billion. As our objective is to further expand our own market share to 50%, our long-term billings potential would therefore lie at around the €2.5 to €3.5 billion mark.