CEO Special: Catena Media’s CEO Michael Daly – autonomous leadership
As online continues to expand in the US, we speak to Michael Daly, CEO of one of the biggest affiliates in the sector, Catena Media. Daly tells us about life in the Navy, his time at Shuffle Master and Bally, lessons learned at GAN and much more.
Gaming America gets an honest response when we ask if a young Michael Daly ever thought he would end up a gaming CEO. “Probably not.” Born on a farm in New Hampshire, Daly lived most of his youth in the inner-city Boston area of Massachusetts. As a boy, the now Catena Media CEO’s first passion was “space and the like.” More specifically, volcanology and plate tectonics were of great interest – even providing a basis for Daly’s college education. A far cry from the gaming boardroom, Daly initially considered studying nuclear engineering, although he was persuaded by his freshman advisor that “nobody is going to build a fusion reactor” in his lifetime. Indeed, Daly was advised a better bet might be mechanical engineering, in which he now holds a degree.
Daly ended up at the world-famous MIT (the Massachusetts Institute of Technology) on a naval scholarship, where he jokes that he gained his first exposure to gaming: the card-counting club at MIT, made famous by movies such as 21. Daly “didn’t get too involved” for fear of losing said naval scholarship! It was a wise choice, as eight years followed as a naval officer. There would not yet be any Q2 reports for Daly, nor any revenue-sharing agreements or CPAs. In the US Navy, Daly started on a ship and then toured with special warfare units and SEAL teams. “It was good for me. I became an officer thanks to the program in college. The time in service turned me from a punk-ass kid into an adult who understood a little bit about leadership.”
Part of Daly’s duties were “running around the world and jumping out of planes.” His passion for, and fond recollection of, these experiences comes across quite plainly in conversation. Eventually, however, he recognized that his mortality “might be a real thing.” He continues, “I had gotten some injuries and put my letter in to get out. I went to Utah for the 2002 Winter Olympics to do some work. Then they wanted me to go back to MIT. They were willing to do a deal where I went to Utah and didn’t give them any more time, but did an MBA paid for by them. Once the Second Gulf War was declared over, I thankfully did not get recalled for the long, protracted policing action that followed.”
Life after the navy
While in Utah, Daly has an ex-girlfriend’s father to thank for pointing him towards gaming. He was recommended the industry as a post-military career choice and introduced to a certain Mark Yoseloff, CEO of Shuffle Master – the dominant force in shuffling machines and games patents. Shuffle Master had a small business refurbishing, and then selling, IGT machines – but it was a “disaster.” During his meeting with Yoseloff, Daly was offered the job of cleaning up that division, to either later be sold or shut down. Shuffle Master wanted someone with “a little backbone” because it “wouldn’t be an easy job.”
“I was brought into what I thought would be a short stint in the industry, to clean up and shut down a slot division,” he explains. “It was a mess; they thought they were getting out of electronic games and just going back to the shuffling machines. But meanwhile, they bought some patent rights from Sega around the concept of electronic tables. I sat in one meeting on those with the Head of Marketing. After what I saw, I went to the CEO and said ‘look, you’re going down the exact same path you did with the slot machine business.’ All the technology is the same and you don’t know what you’re doing.”
And so that became Daly’s next job: rolling out the concept of electronic blackjack tables in the US industry, before doing the same thing in Europe, and ensuring this process was carried out to the requisite standard. US and Europe was quickly followed by Australia, after the acquisition of Star Games, and here came a little bit of gaming history for Daly and co. This was essentially the introduction of the electronic gaming machine industry. And that Star Games brand? After combining with Shuffle Master, it later became Light & Wonder’s electronic tables division.
Bally and Gavin Isaacs
Daly’s next concrete move was to join Bally Technologies – but not without a certain degree of legal rigmarole in between. While business was “going very well” in Eastern Europe and the Spanish arcade markets, Shuffle “liked to sue a lot of companies related to trademarks and patents.” Indeed, that is how the company “basically kept the shuffle industry monopolistic.” One such case involved Casinos Austria, where a dispute had surfaced over the operator’s new shuffling machine – argued to contain patent infringements. The resolution of that dispute was Shuffle Master’s purchase of Casinos Austria’s Research and Development business; and, more directly, the appointment of Daly as the company’s Managing Director of Europe.
Daly subsequently began to learn German – and even got married to allow for a Austrian spouse Visa. But two weeks before the exec was due to fly out, auditors alerted Shuffle that the supplier would have to pay “an inordinate amount of money” to hire a non-Austrian in a role that could technically be filled by an Austrian native. That job therefore “came off the table,” meaning Daly would regularly spend one alternating week in the US and one in Europe – not to mention frequent visits to Australia due to Star Games. Spent, Daly decided to ‘Shuffle’ his cards – and accepted a job offer from Bally.
There, Daly would oversee the first wide-screen gaming slot machines, coming to the realization he now had one firm objective: to become CEO of a small to mid-sized gaming company. Remembering his conversation with that ex-girlfriend’s father all those years earlier, Daly was advised there was a dearth of mid-level management talent within gaming. So opportunities out there definitely existed – and Daly’s desire to do more was recognized by Bally’s new COO: industry veteran Gavin Isaacs. “He knew I wanted to do more, so he helped me start to move around the organization,” he recounts. “I moved to field operations and we were implementing agile manufacturing. So that helped me understand how those sorts of processes work in a business and really drove that in the company; we took slot machine manufacturing time down from 16 weeks to two weeks.
“It was just revolutionary to me to see how this was being applied. From there I went into business development, at that point looking at online gaming. We made some acquisitions and stopped some acquisitions that had been in the prior administration. I asked at that point if I could run that division rather than stay in biz dev and was given that opportunity, so I started to do remote gaming servers in Europe and running teams in UK and Gibraltar. I was really fascinated by the online gaming side of things.”
Command and Conquer
You could say Daly’s next move saw him move backwards to go forwards. Indeed, Isaacs proceeded to leave Bally and become Shuffle Master CEO, bringing Daly with him after his non-solicitation period. Daly’s new job was to run Shuffle’s startup online division and, in his own words, it was “more appealing” to work for Isaacs than his current boss. He would now report directly to the CEO (Isaacs) as well as Board Member and Head of Strategy, Louis Castle. For Daly – an avid video gamer (more of which later) – working for Castle was an inspiration, as he was the Founder of Westwood Studios, the creator of strategy-based phenomenon Command and Conquer.
“Louis was the guy who could see Point Z when no one could figure out point B,” Daly recalls. “My job worked well because I could help him figure out how to get through points B, C and D, which was not his speciality. So it was a very good pairing and I learned a lot from him. He was one of the most talented people; I went to MIT with a lot of talented people but Louis was on a different level. On one hand he would be a programmer and coder, but on the other he understood finance and had a sketchbook with Renaissance art. I learned how to dream a little bigger, which was never quite my forte.”Daly’s gaming career to date had served up a near-three-year stint at Shuffle Master, over six years at Bally and then nearly two further years at Shuffle. Perhaps perfectly encapsulating the ever-consolidating nature of our industry, Bally then decided to buy
Shuffle. Understandably, after so long at both companies, Daly decided it was time for something else. An under-two-year stint at Automated Cash Systems followed – a payments/ATM machine start-up where Daly eventually agreed to disagree on the direction of the business. Then came a quick return to gaming, with Daly receiving a call from Game Account Network (GAN). Previously, its only US partner was Foxwoods Resort Casino (whose current CEO Jason Guyot also features in this edition) and Daly’s job was to change that.
A learning curve
The aim at GAN was very straightforward. Yet, in reality, Daly’s journey with the business was far from it. From June 2015, Daly worked with a “good team” to prove a theory that social casino could precede real-money casino gaming. Daly’s time at GAN, though, would not exceed two and a half years. Daly tells Gaming America the story, “Myself and some others had a deal in place where, if the company reached profitability, it would change the amount we were making – because I was making less at GAN than I previously had been. We reached that goal in December 2017. So the company declared that, besides the Owner’s actual expenses that he took out of the business, we were EBITDA positive. This was the triggering point.
“So we all went on holiday… And when I came back, I was let go for cost reasons. There were some lessons there. It was unexpected but in some ways expected. Did it teach me to make more secure personal contracts? Sure. But, you know, the US industry has never been quite the same as Europe. Most of us are still at-will employees to a certain level. Even as an EVP at a company in North America, which I was at that time – it’s still at the CEO’s discretion. It was the first time I’d ever been let go. And the only time I’ve ever been let go.”
As often proves the case in these kind of stories, however, Daly would not be featuring here today as the CEO of Catena Media were it not for this twist of fate. Following his GAN exit, Daly looked to utilize his industry connections, something he confesses he was previously “never very good at.” But, this time, he succeeded – crediting gaming consultant Melissa Blau for putting him in touch with Catena Media. “I’d been in circles with her for years based on the things we were trying to do in the US with Bally and Shuffle,” Daly looks back. “She introduced me to the then-COO of Catena Media, for their North American start-up. They owned two small acquisitions that were on earnouts, and they needed to transition that to an actual business. At that point, the stock was skyrocketing and they were just rolling up acquisitions.” A new chapter was beginning.
The here and now: Catena Media
It was April 2018 when Daly was appointed Catena Media’s General Manager US. Back then, the North American branch of the business was effectively “ignored by the main company.” Annual revenue of roughly €6m ($6.4m) meant the division was “probably just 8% of the business.” And yet 2018 saw a changing of the guard. Daly’s arrival coincided with the overturning of PASPA (May 2018), meaning increasing traction for sports betting, especially in core markets such as New Jersey. Up until 2021, Daly and Catena Media’s priority was expansion, and capitalization on this lucrative new growth opportunity. By the time he had established himself as VP, North America (he started that precise role in April 2020) revenue was closer to €60m – and a “much higher percentage of the company.”
From here, looking at how Catena Media could grow became a sticking point. As Daly explains, “the company had become very challenged. We had way too much debt, so we weren’t doing some of the M&A in North America we’d have liked. We proposed more, and in LatAm too, but couldn’t carry them out. We’ve worked hard to reduce the debt, but we still had a number of ugly acquisitions.” Catena Media CEO Per Hellberg subsequently left the affiliate and the Board started an open search. Daly, given the CEO goal he had outlined earlier in his career, did not shy away.
“I wasn’t the obvious choice because I was an American for a European company and I didn’t live in Europe. But I went through the interview process and was given an opportunity. I respect greatly our Chairman and the Board for giving me that opportunity. I didn’t have the pedigree of having been CEO of a similar-sized company. And it’s very hard, I would say, for many people to break into that layer of management. So I was very fortunate to be given the chance.”
Life as a CEO
Since March 2021, as Catena Media CEO, Daly has continued to focus on the Americas (he has previously told us there may come a day when Catena Media is fully America-facing) and has continued to work on “cleaning up the organization.” “That’s been hard yards,” he comments, “because a lot of what we have to do comes with a price, as we bought a number of brands for X value and they’re not those values today.” However, assisting Daly in his mission are teams he has found it “fascinating” to work with. “Some of them have gone from being my peers to me being their boss, and they’ve been very good at how we’ve all handled that.” Daly’s next quote perhaps gives the truest indication yet of his ethos: “It’s better to have a leadership team, I think, than a leader. You get a lot more accomplished and you get a lot better decision making, because it’s not just one person’s view.”
Daly draws on his experience in the military when it comes to letting people go (“regardless of how ugly it is, everybody goes home at the end of the day; they will get another position because these are people of talent”). It also helps with running small teams and the “ability to be autonomous – as well as making people autonomous.” He reflects, “The last thing you want in a small-unit operation like in the military is for everybody to be waiting for you to tell them what to do. So that taught me a lot about what leadership is really about: pointing people in the right direction and saying, ‘I’m sure you’ll figure it out better than I will,’ because otherwise it’s just limiting it.”
Daly is keen to break what is “very much a wall” between accounting departments and the rest of an organization. Sometimes, he says, financial executives will talk in what seems like one language – but not the same language as everyone else. A “better” CEO, for Daly, is a jack of all trades rather than a particular accounting specialist who might, for instance, “sit in an ivory tower on the second floor and be very much removed.” The topic reminds Daly of a story from earlier in his career: at a previous company, executives would occasionally serve employees lunch. One employee greeted “Mr Daly” before turning to the company’s CEO and saying “hi, I don’t know you.” “That, to me, was a massive disconnect,” Daly states. “I believe in leadership by walking around. It comes from the military as well, though it’s harder to do in a remote organization! It is great to be smart, but if you are disconnected from what is going on in your organization by language or ability to communicate, you’ve got a big problem.”
Outside the boardroom
As with our other five interviewees in this year’s CEO Special, Gaming America was keen to know what keeps Daly motivated beyond his day-to-day duties. He, firstly, participates in a number of charities that work with disadvantaged children. “I was very lucky I had a strong family foundation,” the exec says. “If I lived in Massachusetts still, I’d be in a family event every weekend. So those opportunities are important to me.” Daly is also a huge animal lover (his cat Betty White jumps in and out of focus during our Zoom call), while he also used to own two Great Danes before giving them up due to his busy travel schedule. There is still a small dog in the house, though, courtesy of Daly’s fiancé Mattina.
Working out is important to the CEO – and perhaps a vital way of coping with the demands of the job – while his Navy background has made him a “big swimmer and diver.” Based in Las Vegas, Daly is a keen hiker and mountain biker, with Nevada providing a “beautiful environment” for outdoor camping, lake-based water sports, off-roading and more. “I go out when I can; I try to find a long weekend and get a couple hours where, funnily enough, your cell service doesn’t seem to work and you’re really off the grid for a bit.”
Daly used to be a “voracious reader” but now does most of his reading on plane journeys – as well as another big hobby: playing video games. He has already expressed his love for Command and Conquer and the studio that produced it, while he “loves” Catena Media’s esports business, he prefers playing AI to people. Why? “Because I’m not nearly as good as the 12-year-old who is going to be on the other side of the game” he quips. “I like strategy a lot, which probably helps with business too.” Completing a well-rounded list is his love of cooking with Mattina, and his love of travel. Daly has been to 99 countries (most recently Iceland, where he could show off his love for volcanoes) but has never been to Ireland – the prime candidate for country #100, as that is where his family immigrated from.
Following your path
As we approach the end of our discussion, Daly tips his hat to the future. Perhaps paradoxically, he believes “part of the job of a leader is to obsolesce ourselves.” He explains, “The ultimate for me would be for somebody on my senior team to become ready to replace me. Then my job is to get out of their way because they’ll probably do it better than I can.” At the same, a practical Daly acknowledges that Catena Media is a publicly traded company. His job is to meet the expectations of investors who can decide his fate externally. “It’s all business and I respect that. You can’t take that personally or emotionally.” But the CEO believes that, “in anything you do, you should have a path and a plan.” And Daly’s personal plan is far from finished.
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