Several factors can help make a local casino stand out, and Emerald Island Casino in Henderson, NV hits the nail on the head. URComped CEO, Craig Shacklett, interviews the owner of Emerald Island Casino and the BRAND NEW Rainbow Club Casino in Henderson, NV, Tim Brooks, to learn more about his success as a Casino owner, his recent casino acquisition, and what makes his casinos special. Listen to podcast version.
Topics discussed include:
- Tim Brooks upbringing in the casino industry
- The acquisition of Rainbow Club Casino
- What opening a new casino is like
- Stand out casino promotions (Game-Side Delights)
- Local Casino vs. Big Operators
- What makes Emerald Island Casino and Rainbow Club Casino special
(0:00-0:24) Craig Shacklett: Hi everybody, Craig from URComped here with another special Comped Travel interview. I’m super excited about this one. I’m with Tim Brooks owner of The Emerald Island Casino in Henderson Nevada. And now, breaking news, owner of The Rainbow Club Casino as well. Tim, welcome.
(0:24-0:27) Tim Brooks: Thank you. It’s great to meet you Craig.
(0:27-0:40) CS: I know that you guys are a staple. A lot of locals in Henderson, Nevada love your casino. I saw you won numerous awards. But for folks that maybe aren’t familiar with it, I want you tell us about Emerald Island Casino.
(0:40-1:16) TB: I’d be happy to. The Emerald Island Casino was founded by my twin brother Mike and I back in 2003. We opened our door of May of 2003.
Correct, we do cater primarily almost a hundred percent to local trade here. We are Nevada’s only all penny casino which means all of our slot machines, all four hundred fifty four of them, can be played at a one cent denomination. We find that players really like the lower denominations in this market. And we have an award-winning restaurant that’s receiving numerous awards for good food. And we have a full bar. And we just treat our guests like royalty.
(1:16-1:31) CS: I want to come back to the penny slot. Because I’ve heard a lot of things that you guys do that are just so unique and what makes you special. So I definitely want to come back to the penny slots. But first, tell us how you and your brother got into the casino business?
(1:31-2:35) TB: was in the casino business in Reno, Nevada in the mid 90’s. And company that I was working for purchased a casino here in the Henderson market. And I ended up traveling back and forth between Reno and Henderson and decided that I was going to stay in Henderson full-time. So I moved from Reno and ran a casino down here. We have four other properties in Reno. But I did make the pilgrimage quite often from Reno to Las Vegas about 500 miles.
Made that drive probably at least a hundred times. The loneliest as highway to America. It gives you a lot of time to think when you’re on the road. Anyway to make a long story short, my brother Mike and I had talked about having our own business for years. And then we opened the casino of companies that opened a casino here in 1999. And I worked with that company until 2003. My brother Mike and I partnered up. And we found an empty building that was a closed casino which is now the Emerald Island Casino. And we ended up purchasing the building. And eighteen months later we are open.
(2:35-2:45) CS: When you are working for a bigger corporation that owned a few different casinos, were you in a General Operations position, were you Marketing, what were you doing?
(2:45-3:32) TB: Yes. I was actually the CEO of the company. So I would have my hands in a lot of the pots. And that’s where I really applied my trade and learned a lot about the casino business and really honed in on what the locals want. And it really came to the forefront when I moved to Henderson from Reno. The market here is much larger. There’s more opportunity to… More people always bring more money to the game. We found a niche. And one thing that we have always learned is that service never goes out of style. So we wanted to make it fun for our guests. Because if any business that you go through, whether it’s casino or whatever it is you enter, if it’s not fun why would you want to go there. So we really made a really concerted effort not only to make it fun for our guests but to make it fun for our team.
(3:32-4:08) CS: Now we interviewed Matt Sodl from Innovation Capital about a month ago. And I asked him the question about how often do people that are outside of the business come in to the business acquire a casino. And he says, “Pretty rare because the licensing requirements. The gaming commission wants to see that you have a team in place. That it’s going to be successful.” So I was looking forward to hearing your answer about how you got into the casino business. So it sounds like as CEO of this other company you could already check all the boxes where the gaming commission knew that you knew how to run operation.
(4:08-4:46) TB: You’re correct. They’re familiar with me because I had a previous license as an operator, not as an owner. So I still had to go through the regulatory process to become a licensed, full-blown licensee. And my brother Mike had never been licensed before so that took a little longer because they weren’t familiar with him. So they went through the regulatory background checks and asked for a plethora of information from both of us. And it’s quite an extensive background check as well. It should be. And I kept nothing but good things to say about the Nevada Gaming Control Board and the commission.
They are wonderful partners. And they really keep the integrity of our business at the highest level possible.
(4:46-5:00) CS: You had run a casino business for a while. Multi property, I’m sure there’s tons of complexity with that. But was there any surprises as you’re opening a casino, starting a business from scratch? You could talk to us about that.
(5:00-5:02) TB: How long do we have?
(5:02-5:04) CS: As long as you want.
(5:04-6:46) TB: As you probably know Craig and all your viewers and listeners know that any time you get into something and you think you have it wired or think you have it down pat, there’s always things that turn up. So even now with the current licensing at our new casino, things have changed somewhat in the
way you provide information in the digital age that we live in. Yeah. Every day that you wake up, there’s something… I don’t want to say a roadblock because there’s no such thing as a roadblock in our book. But there’s always something new that comes up that you need to address. But it’s usually a minor thing that you didn’t foresee. Every day is a great day like I said earlier. So we just hit it head-on and we’d make most of what we have. And we’re just going to keep going forward and we look forward to the day that next month when we’re able to open our door across the street with the Rainbow Casino is just about a hundred
and fifty feet from our door here at Emerald Island Casino. So in that respect it made it very attractive to us because we were able to stay in the same area.
And we shared a lot of customers with the Rainbow Club Casino before we purchased it from the Peppermill Corporation which is based in Reno. And they were wonderful to work with. They made acquiring it as easy as possible. Nothing is easy in life but I can’t say enough good things about them as well.
So we’ve been inside now. We’re doing some soft upgrades on the inside. We’re changing the slot mixbit. We’re going to have a different restaurant concept. And then next we’ll start on the exterior. So we’ve got about thirty to thirty days to get that done. So we’re ready to go.
(6:46-6:56)- CS: Congratulations again on that. And I love the Peppermill in Reno. It’s kind of a trip with all the purple everywhere. Was Rainbow? Was it similar?
(6:56-7:27) TB: When you come if you ever have the opportunity to come down to see us in Henderson, Nevada at the Rainbow Club or the Emerald Island you’ll see the Rainbow Club is like a mini-Peppermill Casino. And a lot of their engineers would come down and do upgrades for them. They bring a lot of their staff down from Reno. And it’s really cool inside. There’s not a whole lot that we need to do. When any new ownership takes over the business they want to put their spin on it. But the Peppermill did such a good job which we’re very fortunate. Just like I said, “Just some soft upgrades.”
(7:27-8:02) CS: So you mentioned earlier about all your slots are penny slots. And just in this acquisition you’re going to do some changes to the slot mix. So we’re in Dallas. And in Oklahoma I’ve heard that the Windstar, which is the largest slot count casino in the world, all their machines are leased from what I understand. And then we’ve talked to the Venetian. We work the Venetian where I believe, my facts may be wrong, but I remember hearing that they own all their slot machines or the vast majority of them. So how do you as an owner think about your slot floor lease versus owning machines?
(8:02-9:06) TB: Well, we have four hundred fifty four slots on our floor. For example. Emerald Island Casino where approximately 75% of the those games are owned by us. The other 25% are on a participation or lease-to-own. So basically what that means is you want to get a new machine. And you don’t want to put out all the capital before you know that it’s going to work or be popular. You work a deal with the slot companies; get them on your floor. Usually it’s a 90-day trial period. And then if you decide to buy the games they do a calculation where you can apply some of the revenue that you could gain on those machines toward the purchase Or if you decide you’re not ready to purchase the machines just yet. You can usually work Revenue share with the slot company. Usually it’s an 80-20 split. That’s a common in this industry where the casino will keep 20% of the revenue and the gaming manufacturing company… Excuse me.
Casino will keep 80% and then manufacturer will keep 20% of the revenue.
(9:06-9:17) CS: So you may use that opportunity to keep… That maybe the freshest titles. You come in. You test them out. And if some in fact to be homeruns
then you’ll invest in it.
(9:17-10:14) TB: Right. In over the years since we opened the Emerald Island Casino, the cost of a new slot machine has more than doubled. So you can imagine that’s a big capital expenditure. And for us to pay out that kind of capital all at once is usually not a good thing. So we liked it. We like to reinvest in the business in other ways. But your slot floor is where most of your revenue is generated from. So you want to make sure you have a current slot mix and games that excite players. So there’s, I don’t want to say it’s scientific, but there’s a lot of analysis that goes into the slot machines. It’s more than just buying the machine, put it on the floor and then praying a lot. We do a lot of that too. But there’s a lot of things that come with that. So we do a lot of backout studies.
And we look at what they call “Coin In” which is the amount of play that the game gets. So there’s a lot of factors that go into your final decision to actually purchase a game.
(10:14-10:43) CS: Fascinating. So I heard about you from a friend of mine because I was looking for ideas like, “You know any like just kind of fun, creative entrepreneurs. Like just cool that are doing their own things. Something unique.” And you were the first person he thought of. And I’ll tell you after who it was.
He mentioned you’ve got ice cream carts that go up and down the aisle, hot dog. Tell us about some of the promotions that you have.
(10:43-12:28) TB: I’d be happy to. We started giving away food on the floor to our players because our restaurant became so busy. And in certain peak times
we have a two or three hour wait. And as much as people wanted to stay in play they didn’t really want to wait that long to eat. So we thought, “Well, how are we going to entice them to stay a little longer?” Because people become Hangry, if you will, when they’re hungry. And so we got the idea about 10 or 15 years ago we’ll serve them little treats while they’re waiting for their table at their machine. And it we call them “Game-side Delights.” And it just morphed into this bigger thing than we ever thought it would be. So every day at certain times of the day we’ll pass out donuts or chili dogs or pizza or tacos, cream puffs,
pretzels, anything like that just to keep food in our player’s stomachs. And that alleviates some of their stress from not having to wait so long for a table.
We did expand the restaurant back in 2015. We’ve doubled the size of the restaurant. So that definitely helped with wait times. However, we are too far in to take the game side delights away. So it’s something that we’ve become known for. You’re right. We do serve ice cream cones and ice cream bars especially on a hot day. Players are very appreciative. Little things in life. And that’s what I said earlier in the interview. If you make it fun for the players, they’ll want to come back. What I like to say is that if you come to the Emerald Island and soon the Rainbow. You’ve all been to Disneyland or Disney World. As soon as you walk through those gates, you don’t think about anything but having a good time. You could have the worst day in your life. As soon as you walk through the doors,
all that goes away for a short period of time. And that’s how we want guests to feel here. We want them just to relax and chill for a while.
(12:28-12:41) CS: So smart. It’s such a great idea. And it makes everybody… It’s kind of common to have cocktail service going around. Food service. It’s genius.
(12:41-12:44) TB: Well, you know how you feel when you get hungry.
(12:44-13:11) CS: Absolutely, I sure do. So we talked a little bit earlier… You made a big purchase recently. Big investment. Buying a nearby competitor.
We talked a little bit about slot machines, deciding what to invest in versus not… Aside from those two what was the last tough investment decision?
You and maybe Jeff were weighing. And you decided to pull the trigger and you’re happy you did it.
(13:11-13:45) TB: Well, I can say it wasn’t a tough decision. But about five years ago, we decided to start a retirement fund for our team. So that was a big deal
for us. We wanted to take care of our team more than anything because they’re our number asset. And many of them have worked here with us for upwards of 10, 15 years. They become like family if you will. And so it’s very important to me and my brother that they’re well taken care of. And that was not a tough decision but that was the best decision we ever made.
(13:45-13:52) CS: That’s great. I love hearing about that. And I’m sure your turn-over at your casino, I imagine, is quite a bit lower than the industry standard.
(13:52-14:28) TB: I think it is. I’d like to think so. Yeah. I agree with you there. I’m very pleased. I love our team. And I think they have a lot of respect for me.
But like I said without your team they’re your number one asset. And you got to take care of the people that take care of you. That’s for sure. Whether it’s in business or day-to-day life. When the postman brings your mail to your door, the newspaper guy drops off the paper in your driveway in the morning, it’s a service. And you really appreciate that. You want to thank them and you want to reward them for their service.
(14:28-14:47) CS: I think anybody listening will recognize a lot of things that you’re doing that big chain operators aren’t doing. But I had this question written down. So I want to ask it anyway. What is something that you think or actually works that big operators aren’t doing? And why don’t you think they’re doing it?
(14:47-15:53) TB: Well, I think that in the confines of our sized casino, for instance, there’s a lot more personal touch. And it’s hard to get that kind of service
in a big corporation. So we use our size to our advantage. So if we make a decision that we want to address… For example. Buy a slot machine or put a new item on the menu. We don’t have to run it up the corporate flagpole and wait for approval to come down two months later. I don’t know how long that would
be but we can make a decision today as I’m talking to you that we want to put a new sandwich on the menu for lunch today and we would have it. So food trends change. People give us ideas. Or you hear about the latest slot machine that may be doing well in a test market somewhere and you want to get it.
Well, we can make that decision today, send over the contract, we’ll sign it and we’ll go from there. And we’ll try to get things before everybody else. We do away with that layer of corporate time lapse if you will.
(15:53-16:03) CS: And you, as a very engaged owner being there like I said, you can make things happen that maybe at scale of multiple properties.
(16:03-16:33) TB: Yes. Right. Right. Exactly. We are competitors and everybody in this industry knows each other. I don’t really view them as competitors. I’ve used them as friends and colleagues. But they’re big corporations. Billion with the B corporations. Some of the people in our valley are big corporations. So we just have to be very smart, be that the standard of the radar, do our thing. And we know our market. We know that we’re on 100% locally driven. And we really focus on providing service to our guests.
(16:33-17:00) CS: So you come in from the Reno area. I’m sure you knew. You remember the Carano family when they just own a couple properties and all of a sudden El Dorado is the biggest casino company in the world. Now the Brooks just bought… You just doubled in size. Do you and your brother do you think about… What are your expansion plans? You have any grand ambitions? Or what do you guys see for the future?
(17:00-17:35) TB: Well, I’ll start by saying that when I worked in Reno I knew the Carano family and they are fine family. I would have lunch once a couple times a week at one of the restaurants they had at the El Dorado Casino. And they would be in there themselves many times and… They’re very personal. Good family. And I’m very proud of what they’ve done. And they deserve everything they’ve got to this day. And I was tickled to death when I read that they were going to acquire Caesars because I don’t think there’s a more deserving family in the industry. And with that said, what was the question about the… You were going to ask me about what are our plans?
(17:35-17:45) CS: Yeah. What are you doing? Do you have any ambitions? You’ve grown in a very local market. It sounds like within a couple hundred feet. But do you have ambitions to continue to expand?
(17:45-19:14) TB: No. We’re just gonna get… I’m gonna get through the day today. You can ask you that question tomorrow I may have a different answer. But no plans to expand now and not to say that we won’t in the future. But the opportunity that was afforded to us by the Peppermill Corporation. They came to us and offered it to us. We developed a nice relationship with them over the past 18 years being across the street. And I don’t know if that kind of relationship is in our… there’s other casinos close to us. We know them but at the present time we’ve got our hands full, we’re happy with what we have. And I think one of the things that some companies do is they try to grow too fast and there’s a hiccup. And all of a sudden either you’re back to square one. So we’re not going to get over our skis. We like to sleep at night. We want to take care of the team we have in place. We have inherited some great team members that we’ve agreed to hire at The Rainbow Club Casino. So we’re just going to feel our way through the waters next year or so and see how it goes. And if the opportunity presents itself we’ll take a look at it. But right now when I can tell you when I go home tonight, I’m only going to have one meal and I’m only going to drive one car when I get home tonight. So how much do you need? Really? I’m happy. The older I get the more I realize that what’s really important for me personally. And I think for the people that I work with is quality of life. So I don’t want to be stressed out all the time worrying about this, worrying about that is. Want to stay within our wheelhouse and not getting over our skis.
(19:14-19:32) CS: That’s a refreshing outlook on life. I appreciate you saying that. There is one casino though I used to live and work. I met my wife in Lake Tahoe. Both working at Harrah’s. We used to love going to the Lakeside Inn which was small local casino that closed down. I would love for you to buy that.
(19:32-19:40) TB: Yeah. So I would love to live in Lake Tahoe. I’ve been at Lakeside Casino many times. I think they just closed in March. They were a casualty of COVID.
(19:40-19:41) CS: Yep.
(19:41-20:08) TB: I don’t know what’s going to happen. There are several casinos in our area. Not several but a few that have not re-opened yet. And we’re just hoping that they can find their footing and get open because we like not only being competing with them, but we like to see the industry survive and thrive. As far as a Lakeside Inn, somebody will buy it and somebody will make… Why don’t you buy it Craig.
(20:08-20:14) CS: Where do I start? How much time you got? Operational experience…
(20:14– 20:18) TB: I didn’t know you lived in Lake Tahoe. That’s a beautiful area. That’s for sure.
(20:18-20:37) CS: Yeah. We loved it. And someday we’d love to get back. I am curious how much… Actually if you want to spit ball… Like a property like that…
Because there’s so many things that go into a purchase as I said. Real estate and there’s all this stuff. What do you think a property like that would go for?
(20:37-21:02) TB: Well, most properties that are valued on EBITDA … So there’s no EBITDA now. I think it would probably… And there’s value in the non-restrictive license. So I’m not familiar with, I know in Lake Tahoe, the real estate has to be through the roof in value. So I wouldn’t even venture to guess of what it could be. But there’s some somebody out there that I’m sure is looking at it now and we’ll make a go of it.
(21:02-21:06) CS: So I’ve just got two more questions for you. I know you’re a very busy man.
(21:06-21:15) TB: Let me answer your question more than I have in my bank account. That’s for sure. I will totally go for a lot more.
(21:15-21:23) CS: Well, Caesars went for a lot more than what’s in El Dorado’s bank account. So there’s financial leverage out there.
(21:23-21:29) TB: Like I said before I want to sleep at night if I can.
(21:29-21:38) CS: Alright. So anything that you know now that you wish it realized sooner when you bought the casino.
(21:38-22:39) TB: That’s a great question. And I probably, if I knew then what I knew now, I probably wouldn’t have had the courage to open up my own business. And I’ll be honest with you because we went through some tough times in the beginning. And this is the first business that I’ve ever owned.
And so you learn along the way. But one thing that we made a decision, once you make a decision you don’t look back. We just stayed the course and we were new to the industry in southern Nevada. And we had to build our clientele one customer at a time. So it’s been a labor of love for me and my brother for 18 years. And so I’m not going to lie to you the first few years were rocky because we had no customer base and we had to prove ourselves to the community. And we both know Strip where we’re located is the most competitive gaming market in the world. So we just put our nose to the grindstone. And somebody told us once you aren’t going to make it and that’s all we needed to hear.
(22:39-23:00) CS: I told you I had two. I’ve got one more quick question though. Doing business with family is tough or it can be tough. But I’d imagine that you and your brother must have different personalities for it to work so well. So you could talk about your brother and what are you guys… What are your complementary skill sets?
(23:00-23:44) TB: Yeah. Mike’s great. So Mike is a financial mind. He has his degree in finance. And I’m more of a people person so we complement each other very well. We make a great team. He’s my twin brother. I’ve known him for 59 years. So used to share a bedroom when we were kids. So there’s not much about each other that we don’t know. And we know, I tell you one thing being twin brothers, especially we know all the right buttons to push. There’s been some challenging times from a business relationship and also from a family relationship. But over the year, as you mature and you appreciate each other more, I don’t think there’s any person that I love more than my twin brother. And so it’s worked out real well for us. But I’m not going to say it’s been easy.
(23:44-23:50) CS: Well, I apologize to Mike. I think for some reason I said Jeff earlier when referring to your brother. Sorry about that.
(23:50-23:54) TB: That’s okay. He’s been called worse. Probably by me.
(23:54-24:00) CS: Alright. Last question. What is your favorite part about owning and running a casino?
(24:00-24:59) TB: Creating jobs and employing people. I really love that. I love being a leader. I love the fact that I’m able to guide our team. and they come to me with questions and I’m able to provide them answers. And the same token I go to them and they give me answers too. So I love working with people. And I love our team. And so that’s the most rewarding point about me. From a business owner, I would say the best part of my life as a business owner is the day that we were fortunate enough to, at sometime, write a bonus check for our entire team. That’s what makes me happy to reward them for their service. But money isn’t really what drives our team. I think what really drives our team is the environment we’ve created here, the working atmosphere. And usually like my dad used to say, “If you create a nice environment, the money will follow.” And I think that’s what’s happened here with our team. And to answer your question
that’s the most rewarding part of being in business.
(24:59-25:10) CS: Well, Tim this has been an absolute pleasure. Thank you so much for talking. Your energy and enthusiasm comes across. And I think anybody that’s watching is going to want to come visit you.
(25:10-25:11) TB: I hope so.
(25:11-25:20) CS: So Emerald Island… We’ll put the links and everything in the show notes. But where’s the best place people can go to get a feel for Emerald Island and come check you out.
(25:20-25:38) TB: Real easy. Emerald Island Casino all one word, emeraldislandcasino.com that’s our website. And you can call me personally on my
office number, (702) 567-9160 extension 238. I’m like the furniture. I’m always here.
(25:38-25:45) CS: Well, Tim thank you so much again. I really appreciate your time. This has been a real pleasure for me.
(25:45-25:51) TB: The pleasure has been all mine. Have a great day. Thank you.