An interview with SCCG Management’s founder and owner, Stephen Crystal

How does one go from politics, to being an attorney, to becoming a land use attorney–which opens doors into the gaming world–to becoming a casino owner and developer of leading-edge gaming technology? These are just a few of the questions that URComped CEO Craig Shacklett had for SCCG Management founder and owner, Stephen Crystal. Listen to podcast version.

For the URComped CEO, it’s always an interesting conversation connecting the dots on how someone gets to where they are in the gaming industry. Crystal explains that his journey started “as a very young person coming out of college at Dartmouth in New Hampshire” (1:27). It was at this time that Crystal had an active career in politics, running presidential and senatorial campaigns all across the United States.

After serving in the legislature in New Hampshire as a student in Dartmouth, he decided to go to law school, graduating in 1992. Upon graduating, he was approached by a gentleman who was running for Mayor of Kansas City, Missouri and asked him to run his campaign. The kicker was an offer of becoming a land use attorney if the gentleman lost the race, which he did. Crystal explains, “I became a land use attorney at the very same time that Missouri was approving Riverboat Gaming. And in order… If you were a Station Casino or a Boyd Gaming or some other big casino company and you needed to get financing to build a half-billion-dollar Riverboat, you needed an opinion from a land-se attorney that said that it was legal under the statute because it had never been done before. So we were the experts who would provide that zoning opinion. And then we would assist those companies and put together their operations initially in Missouri and then throughout the Midwest” (2:13).  

You would think that this connection and a bit of luck would have been the entrance into the gaming world for Crystal, but as he shares, there’s actually a bit of a moral lesson involved in how it actually happened (3:19). Crystal says a couple of gentlemen walked into the “very high-end” law office where he worked, wearing “swamp boots” because they were walking the Missouri River. He continues, “my name partner, who’s no longer living but was an excellent person, didn’t know these people. So he sent me to meet with them. And they were so impressed that the name partner would meet with them that they invited me back to their hotel room the next day where they were dressed in three-piece suits. (They wore three-piece suits back then.) And they said that their plane was getting fueled and they were flying me to Las Vegas to be their attorney in negotiating a half-billion-dollar casino deal. And would I please call my name partner and tell him that I would be handling the case from here on out while they listened in. And that was how I started in the gaming industry. I was in the right place at the right time. And I did not judge a book by its cover. So I would say, those are two lessons. Be flexible and take advantage of opportunity. And do not judge a book by its cover. That’s what I would say was my entry into the gaming industry.”

From there, Shacklett was curious about Crystal’s gaming into other states (4:29). Crystal explains that he “worked pretty much everywhere throughout the Midwest and even in Native American country” (4:53). He explains that he worked with the Tribes who were building some of the earliest Tribal casinos, and became an “expert in everything from the legalities, to the regulations, to the operations, to the land use issues, to the HR issues, to the gaming equipment issues” (5:06). The reasoning, he says, is because the industry was experiencing the big growth it had outside of Nevada and New Jersey, which up till then were the only jurisdictions that had casinos.

This growth and expertise led to the creation of “a lot of things that didn’t exist,” as Crystal puts it (5:57). Crystal cites the example of riverboats–the law says that the boats had to be on the river, but it wasn’t safe to do so. He continues, (6:10) “we came up with the notion of creating a boat in the moat; which is that, it’s basically–take river water and channel it miles in-land, create a bath where these big facilities would sit on pontoons. These hundreds of millions of dollar facilities, when it was intended to be a riverboat that cruised up and down the river. So… this is how the industry evolved in the early days. Some of the early Native American casinos were in cornfields. They were in butler buildings. Or in tents. And now, there’s, some of them are multi-billion-dollar facilities. So it’s… The early days were like the Wild West is what we like to say.”

Craig wondered just how wild those early days were, in terms of demand. Crystal explained that it was a lot like the Field of Dreams–if you built it, they would come. It didn’t matter if your venue was a tent in the middle of a cornfield in Iowa, as long as there were slots to be pulled. Of course, Crystal says, that is no longer the case (7:11). Nowadays, the marketplace is much more competitive and consumers are looking for more enticing comps and amenities to attract them into the various venues. It’s all about supply and demand, and there is a lot more supply than ever before. As Crystal puts it, “you have to provide a whole package to get people in the door” (8:00)

It was while sitting by the pool in 120-degree heat one day in Scottsdale, Arizona, enjoying some adult beverages when Stephen Crystal’s life changed again (8:41). He says his friend and entrepreneur, Dave Barrick, said, “what if instead of us facilitating deals or working on behalf of others, what if we did it for ourselves? What if we became the gaming company?” The result is Barrick Gaming (9:31).  

Crystal explains that it took time to get their joint venture off the ground. He said he made many trips back and forth from his home on the East Coast to Nevada, but they finally got their big break just after 9/11, when they bought 6 hotels and casinos on Fremont Street–along with four thousand employees and two hundred and fifty thousand square feet of gaming and twenty-five hundred hotel rooms and thirty acres of downtown real estate. This purchase secured their place as the largest landowners, fee simple landowners, in downtown Las Vegas overnight.  

Crystal ended up selling his casino business in 2006 and used some of those profits as the foundation for his investment fund in gaming technology (12:55). That has expanded into eSports and iGaming. Crystal says he is now moving away from “brick and mortar” into the online world of gaming, “be sports betting or eSports.”

For Stephen Crystal, success is all about staying ahead of the game. It’s about being flexible. He says, “you need to take that meeting, (13:55) you need to take the phone call. Because that’s how you learn. And so everything we’ve done is based upon people reaching out to us over the years. To say, ‘Hey take a look at this electronic card shuffler. Take a look at this electronic table game. Take a look at this new side bet. Take a look at this new CRM. I’ve got a new way to do Bingo or Keno. I’ve got a new lottery-style game.’ And we’ve always said, ‘Yes, let’s listen to it.’ And then over time, people, bigger companies were coming to us and they were saying, ‘Look, we’ve been doing this for thirty or fifty years somewhere in the world. And we want to come to America. Is there room for us in America?’ And what I say to them is, ‘The great thing about America is there’s room for everyone in America.’ Let’s not lose sight of that. We’ve had a lot of debate, important debate, in the country. But America still is the place that is open to everyone else to come in with their best technology. And it’s no different in the gaming industry. So we’ve been receptive to it. We’ve traveled the world. We visited all the casinos of the world. We visited online operations. And now when sports betting is taking over in every state, we’re at the forefront of that with some of the best providers, some of the best operators in the country, and in the world.”

You might have noticed the “Betfred” hat on Crystal’s head. That is just one of the many companies he handles development for. He mentions that Betfred landed a key sponsorship deal during the Wilder-Fury fight when a main sponsorship deal fell through–yet another time that Lady Luck shined on Stephen Crystal and Crystal wasn’t afraid to roll the dice. Crystal says that a far bigger investment is his new 5-year sponsorship deal with the Denver Broncos (16:06).  

With all of the success that Stephen Crystal has experienced, it might seem that he has truly lived a charmed business life. But he is quick to point out that is not the case. He says if you are looking for advice from him, it’s pretty simple: (19:01) “first, pursue the things you’re passionate about because you’ll put your best effort into things you care about. Don’t be afraid to fail because you’re going to fail more than you succeed, but you learn more from failing than you learn from succeeding. So, my advice is you live once, make the most of it. If you’re open to other people, they will be open to you. That’s kind of in the Ten Commandments, ‘Do onto others that what you want done onto yourself.’ These are very simple rules to live by, whether it’s in life or in business. If you follow those rules, you will be successful as a person, even if you’re not always successful in the particular business. So that would be my advice.”

Full transcript below

(00:00-00:44) Craig Shacklet: Hi everybody. Craig from URComped and Comped Travel here. I have a very special guest. If you are in the casino industry, you have probably heard of him. If you are just a player you may have not. But we’re going to… We’re gonna walk through Stephen Crystal’s background today. It is fascinating. We’re going to learn a lot about the development of casino industry in the US and just a lot of cool things that go on behind the scenes. So I’m very excited to talk to you today. Stephen Crystal, founder and owner of SCCG Management. There’s a lot that goes into that. So we’re going to get into that. Stephen, thank you so much for being here.

(00:44-1:00) Stephen Crystal: Yeah, Craig. Great to be here. You do an amazing work with players and educating them about offers and the industry. So I’m happy to be part of your program and to get to know you a little bit too.

(1:00-1:24) CS: Well, thank you. So let’s dive into your background because it’s fascinating. So you entered gaming as a Missouri-based Land Use Attorney. And from what I read in your bio that was really how you got into gaming. You were maybe an attorney and then casino start opening up in Missouri and you were… you jump to the opportunities, is that right? Why don’t you walk us through that?

(1:24-2:57) SC: Well, there was one step before that. But before becoming a lawyer, I had an active career in politics. I ran campaigns across the United States at the Senatorial and Presidential level as a very young person coming out of college at Dartmouth in New Hampshire. And after serving in the legislature in New Hampshire as a student, while a student at Dartmouth, I then decided to go to Law School. And upon graduating Law School in 1992, a gentleman who was running for Mayor of Kansas City, Missouri said, “Why don’t you come run my campaign. And if I don’t win, you can become a Land Use Attorney.” So, I went to Kansas City. He didn’t win. And so I became a Land Use Attorney at the very same time that Missouri was approving Riverboat Gaming. And in order… If you were a Station Casino or a Boyd Gaming or some other big casino company and you needed to get financing to build a half a billion dollar Riverboat, you needed an opinion from a Land Use Attorney that said that it was legal under the statute because it had never been done before. So we were the experts who would provide that zoning opinion. And then we would assist those companies and putting together their operations initially in Missouri and then throughout the Midwest.

(2:57-3:13) CS: Wow. So I assume… I mean how fortuitous. So you went out there. You’re helping the mayor. He didn’t win. But he was well connected. And then when these casinos came out, was he the one that kind of connected you as a…

(3:13-4:28) SC: No. The story behind that is a little bit interesting and there’s a lesson in the story. There was a couple of gentlemen who walked into the law office. It was a very high-end law office. And these gentlemen were wearing swamp boots because they were walking the Missouri River. And my name partner who’s no longer living but was an excellent person. He didn’t know these people. So he sent me to meet with them. And they were so offended that the name partner would meet with them that they invited me back to their hotel room the next day where they were dressed in three-piece suits. They wore three-piece suits back then. And they said that their plane was getting fueled and they were flying me to Las Vegas to be their attorney in negotiating a half a billion dollar casino deal. And would I please call my name partner and tell him that I would be handling the case from here on out while they listened in. And that was how I started in the gaming industry. I was in the right place at the right time. And I did not judge a book by it’s cover. So what I would say, those are two lessons. Be flexible and take advantage of opportunity. And do not judge a book by it’s cover. That’s what I would say was my entry into the gaming industry.

(4:28-4:46) CS: So that first deal it went well. And there were more casinos that came out to Missouri, is that right? So over the… From 1992 to 2000, which we’ll get to in a second, it sounds like you did numerous deals. And it wasn’t you expand it beyond the Missouri. You went to other jurisdictions as well.

(4:46-5:35) SC: Yes. I worked in Iowa. I worked in Mississippi. I worked in Louisiana. I worked pretty much everywhere throughout the Midwest and even in Native American country. So we worked with tribes who were looking to build some of the early tribal casinos. And so I became an expert in everything from the legalities, to the regulations, to the operations, to the land use issues, to the HR issues, to the gaming equipment issues. So I became an expert because the industry was experiencing the big growth it had outside of Nevada and New Jersey which up till then were the only jurisdictions that had casinos. Now we have casinos in the forty four states.

(5:35-5:46) CS: Now, were you having to pass the bar in every state. Or where it’s like… What was… Were you personally having to do going all these jurisdictions? Or was just you became the foremost expert and you didn’t…

(5:46-6:50) SC: I said that I was among a handful, couple of handfuls of experts in the United States. I was in my late 20’s and early 30’s so I was very young. And we basically… We created a lot of things that didn’t exist. Like the law said that the boats had to be on the river, but it wasn’t safe to be on the river. So we came up with the notion of creating a boat in the moat which is that… It’s basically take river water and channel it miles in-land. Create a bath where these big facilities would sit on pontoons. These hundreds of millions of dollar facility when it was intended to be a riverboat that cruised up and down the river. So we… This is how the industry evolved in the early days. Some of the early native American casinos were in corn fields. They were in butler buildings. Or in tents. And now there’s some of them are multi-billion dollar facility. So it’s… The early days were like the wild west is what we like to say.

(6:50-7:11) CS: And when these would… I imagine when these first riverboats or first Indian casinos were opening up, there really wasn’t a way to forecast how well would a tent in Iowa do. I mean were you guys always like blown away by how successful it was? Where there any disappointments? And like, “Ah, we thought it would do a lot better.” Like… Were… Yeah…

(7:11-8:02) SC: In the early days, the demand exceeded the supply. So if you built it, they would come. That was the early days. Now, like most mature industries, it’s much more competitive. Which is why people like yourself and companies like yours exist. It’s a competitive environment. There’s more direct competition in terms of overlapping jurisdictions. So people need to come with their best offer. Their best offers to the customers. Their best amenities. But in the early days, it was a function of just getting it open and people would line up to go into the tent and pull a slot machine. This was the early days. Now, you have to prepare. You have to provide a whole package to get people in the door.

(8:02-8:35) CS: So 1992 to 2000, you started with that first, the amazing story you just told us, started with that first deal, got in became the foremost expert in land use and helping set up different casinos in different jurisdictions. In 2000, your partner with D.W. Barrick to form Barrick Gaming Corporation. Right. What was the… What was it in your personal life or desires that led you from being a service provider to becoming an equity owner?

(8:35-10:50) SC: Yeah. That’s a very good question. We were… I’ll tell you the exact moment it happened. We were sitting in a pool, in Scottsdale, Arizona. It is a hundred twenty degree day. And I think we were drinking beers. So there was some alcohol. And I remember Dave Barrick who was 25 years my senior. And he came up through the horse-breeding industry and the oil and gas industry. And he was an old-school entrepreneur. And he said, “Stephen, you’ve got the smarts. You’ve got the connections on Wall Street. I’ve got the experience.” He said, “What if instead of us facilitating deals or working on behalf of others. What if we did it for ourselves? What if we became the gaming company?” And with that began Barrick gaming. We put a few bucks into the pot. And we started on a process every week of going on the road looking for casinos to acquire mostly in Nevada. And we spent two years. Every week for two years, I would leave my family and fly to Nevada. At that time I was living back East. I had moved from Kansas City to Washington DC and opened up a law practice across from the White House. But we would fly to Nevada and we would look for an opportunity. And that resulted, finally right after 9/11, us buying six hotel casinos on Freemont Street in downtown Las Vegas. And that occurred, ultimately, it took us two years between 2002 and 2004 to acquire not only those six casinos and four thousand employees and two hundred fifty thousand square feet of gaming and twenty five hundred hotel rooms but also thirty acres of downtown real estate. So we became the largest landowners, fee simple land owners in downtown Las Vegas overnight. So that was our kind of crowning achievement. Taking everything we had learned and putting it into our own operating company, which we did.

(10:50-10:59) CS: Wow. And so six properties. Were those all owned by a single owner? Or were these kind of six separate negotiations?

(10:59-12:19) SC: It was owned by a gentleman named Jackie Gaughan who passed away recently. Jackie was a bookmaker from Omaha, Nebraska. And he left Omaha with a million dollars in a suitcase. And he bought his first casino in Las Vegas, which was part of the portfolio. His first casino was the Las Vegas club which was recently sold to Derek Stevens who I think you interviewed as well. We bought that casino for twenty five million. And now he’s finishing up a billion dollar Sports Book Theme Casino on that location. That started with Jackie Gaughan. And then it passed through Barrick Gaming. And now it’s with Derek Stevens. But yeah. We negotiated actually with Jackie’s son, Michael Gaughan, who’s a very famous operator of the South Point Casino. Previous to that, own the coast properties. And we negotiated and signed a deal. It took 18 months for us to get licensed. And we raised a couple of hundred million on Wall Street. And we put some of our money in. And we put a management team together. And we took ownership in April of 2004. And then we sold out in 2006. That was our ride in downtown Vegas.

(12:19-12:25) CS: And it seems like looking back 2006 was a pretty great time to sell.

(12:25-13:24) SC: Look. We had a partner who was one of the wealthiest men in the world. And he was a big… He was into real estate ownership more than he was casino operation. He still owns some of the real estate. He owns The Plaza Casino to this day. So it was a great investment for him. It was a very good investment for us. We did very well when we exited in 2006. And that was the foundation for my investment fund in gaming technology. And that’s when I transitioned from ownership to investing in gaming technology. And now sports betting and e-sports and i-gaming so all the… I started investing ten, fifteen years ago. And now the future is here. We’re moving from Brick and Mortar to on-line gaming whether it be sports betting or e-sports. We can talk about the different forms. But that process began for me when we sold the casinos. I started making those investments.

(13:24-13:44) CS: Yeah. that’s a perfect transition because… Yeah. I started following you on LinkedIn. I’m not sure how your name came across my radar, but you just seem like the most interesting man in the world type of guy that’s just involved in so many different things. So I started following you. And hey, you’re involved in so many different aspects of gaming. So just tell us what you’re excited about right now.

(13:44-15:17) SC: Look what I have found is the key to staying ahead of the game. The key to maybe having some vision as to the future is you need to be open. You need to be flexible. You need to take that meeting. You need to take the phone call. Because that’s how you learn. And so everything we’ve done is based upon people reaching out to us over the years. To say, ”Hey take a look at this electronic card shuffler. Take a look at this electronic table game. Take a look at this new side bet. Take a look at this new CRM. I’ve got a new way to do Bingo or Keno. I’ve got a new lottery-style game.” And we’ve always said, “Yes, let’s listen to it.” And then over time people, bigger companies were coming to us and they were saying, “Look, we’ve been doing this for thirty or fifty years somewhere in the world. And we want to come to America. Is there room for us in America?” And what I say to them is, “The great thing about America is there’s room for everyone in America.” Let’s not lose sight of that. We’ve had a lot of debate, important debate, in the country. But America still is the place that is open to everyone else to come in with their best technology. And it’s no different in the gaming industry. So we’ve been receptive to it. We’ve traveled the world. We visited all the casinos of the world. We visited on-line operations. And now when sports betting is taking over in every state. We’re at the forefront of that with some of the best providers, some of the best operators in the country, and in the world.

(15:17-15:45) CS: So speaking of sports betting, if anybody is listening on podcast. You’re not going to see it but you’ve got your Betfred sports hat on. It was like I saw you mentioning it talking about on your LinkedIn. But then all of a sudden I saw it, watching the biggest heavyweight fight in years, Wilder versus Fury. And Betfred was featured sponsor. So how did that sponsorship deal come out? Were you involved in that at all? Or what… Yeah. It looks like very high priced.

(15:45-17:57) SC: Well, I’ll tell you about that. But I’ll also say we announced last week our sponsorship with the Denver Broncos. That’s by far a bigger investment. So we competed with forty other companies in Colorado. And we were one of two companies that landed a five-year sponsorship with the Denver Broncos of the NFL. So that’s part of what I do for Betfred. I handle their development. So their market access. So I go state to state, tribe to tribe. And I make sure we have an operation in every state. I also handled the discussion with the professional sports teams because that’s a good way to co-brand. And that’s a way to make people know about the fact that we operate. And in most cases an on-line sports book. One of the advantages for Betfred is that they’re into taking risk. So they give good pricing for the bettor. They give the bettor a chance to win. And this is the big thing that distinguishes Betfred. And that’s why we seek out like the Wilder-Fury fight that happened at the last minute. What happened is the main sponsorship fell through. So with less than a week, they called up Betfred in the UK. Because they knew a lot of people from the UK would be watching. And they said, “How would you like to be the title sponsor?” It’s going to be at a discount. I won’t tell you exactly how much but it’s not cheap. And we… Within twenty four hours we plop down the money. And then I was asked to sit ringside wearing the Betfred colors because we were very new to the United States at that time. But I have so many people as I travel around the USA telling me that they saw our name associated with that fight. It was one of the last events I went to before the shutdown. Was that fight at MGM. That was in February.

(17:57-18:28) CS: So yeah. So we… As I said, we did the Denver Broncos. We did that fight. You’re going to see our name. I won’t say we will be everywhere that you see Draft Kings or Fan Duel. But pretty much everywhere will be. Will be one of the top operators in America. That’s exciting. And you talking… You gave us a lesson earlier about don’t judge a book by it’s cover. When there’s guys in swamp boots came in. And you talked to them. And turned into.. actually kind of launched in some ways your gaming career. Now for these companies that are starting up that… I mean listening to your story, you never shied away from knocking on doors or having conversations. Like what advice would you give to somebody that maybe has that side bet idea? Or some idea how do they get their foot in the door?

(18:28-19:44) SC: Look my basic premise is and I wrote about it today on LinkedIn. I talked about when I used to own a supper club. A 24/7, 365 gaming saloon, live music, wine, tapas. That was my dream. Now, it didn’t end up being financially successful because we had a downturn in Vegas in 2009. But it was my dream to do. And I pursued my dream because I didn’t want to live with the regret. So what I would say is first pursue the things you’re passionate about because you’ll put your best effort into things you care about. Don’t be afraid to fail because you’re going to fail more than you succeed. But you learn more from failing then you learn from succeeding. So my advice is you live once make the most of it. If you’re open to other people they will be open to you. That’s kind of in the Ten Commandments, “Do onto others that what you want done onto yourself.” These are very simple rules to live by, whether it’s in life or in business. If you follow those rules, you will be successful as a person, even if you’re not always successful in the particular business. So that would be my advice.

(19:44-19:53) CS: Very excellent wisdom. Thank you Stephen. Now, is there anything I didn’t ask you yet that I should have asked? Anything you like to talk about.

(19:53-21:10) SC: No. I think… Look I think we’re entering a very dynamic time. Because of COVID-19, casinos realized they have to have a digital footprint. So what… Where we used to focus almost entirely on the Brick and Mortar experience. We need to start thinking about providing the entertainment experience on-line. That means every business, including yours, including mine, needs to think about how do we function with the new normal? I think you could say that life will go back to what we knew. But the truth is nothing ever goes back to something we knew. It always moves forward. And I think, in that is opportunity. So we it seems a little dark now because there’s a lot of uncertainty in all aspects of our living. But actually that’s when the best things happen. Whether it’s culturally. Whether it’s in business. So the best days are ahead as much as we’ve done in gaming for thirty years at SCCG management. The way I look at it, is we have another maybe thirty years left. I mean that’s optimistic. But a lot has been done in thirty years. And I think a lot more can still be done. So I would say, “Stay tuned.”

(21:10-21:18) CS: Well Stephen Crystal. Thank you so much for your time. This was a lot of fun. Very inspiring. And let’s do it again sometime.

(21:18-21:23) That’s a deal. Thank you.