The Maltese Falcon
Alexandre Dreyfus, a Frenchman living in Malta, accepted a bet that he couldn't set up an online poker room. Chilipoker.com was born and the exile collected on his bet.
"I am a born entrepreneur," stated Dreyfus. Indeed, the life story of this young man, who hails from Lyon and celebrates his 30th birthday at the end of the year, attests to his extraordinary get-up-and-go. A pioneer of francophone Internet, he created one of the first French web agencies in 1995 when he was just 18 years old, and sold it shortly afterward to Havas. In 1997, his second business, Webcity, was one of the most prominent start-ups of the new economy. The idea was to develop a vast network of local websites offering editorial content specific to each of France's 50 largest cities. After successfully attracting investment, the business, which employed 90 people, achieved some success before it went bankrupt in 2002, and was subsequently taken over by another structure. Reflecting back, Dreyfus commented, "I made a bad decision at a critical moment. But, it was an exceptional adventure, and I was able to prove that the project was healthy and ahead of its time."
After a brief period spent working for Caramail/Lycos, Alexandre became interested in gaming, "somewhat by accident" motivated by his interest in "finding out what was going on abroad." He bought Winamax with two collaborators, a brand that had existed since 1999 but had never been used. The England-based Winamax.com site opened in 2004, and dealt exclusively with sports betting. In 2005, the decision was made to add poker to the services offered. The poker branch of Winamax opened in 2006 with the much-noted support of the French singer Patrick Bruel, who would silence himself shortly afterward under pressure from French authorities. A few months later in the summer of 2006, Alexandre withdrew from the project, citing "strategic differences" between him and his colleagues.
Malta or Bust
But the young entrepreneur was quick on the rebound. "I love the e-gaming industry. It's a sector where you find the kind of development you were seeing with the Web in 1999 and 2000, in terms of the fast action and the rhythm of market evolution," said Dreyfus. By October 2006, he had created ChiliPoker.com, with the clear intention of targeting the international market, including his native land, "although avoiding too much exposure in France." Not long afterward, he set up his offices in Malta, a European country that has proven to be one of the most welcoming to gaming businesses.
To create an online poker room solo is not an easy task, as Alexandre explained. "There are three obstacles to overcome. The first is financial. You need to have between €500,000 and €1 million to launch a poker room. I figured it wouldn't be a problem to come up with that money. Next, there are legal issues. This is a source of stress, especially since my profession is not recognized in my native country. Being a confirmed citizen of the European Union, I chose Malta. But that aspect of things is very complicated. You have to fight to obtain licenses, show your credentials, undergo audits, and negotiate with networks and payment companies. It takes a long time and involves a lot of paperwork. The third and final potential obstacle is the competition. But, I'd had experience with Webcity, and in that case I was in direct competition with the entirety of France's regional daily press. Power struggles don't scare me."
A Poker Room on the Up and Up
"Besides initial difficulties, you have to invest a lot in security and in technical aspects. And then you have to get users and keep them loyal, which is not easy in France, since we can't advertise there," explained Dreyfus, while highlighting, "Paradoxically, the big actors endowed with huge marketing and communication budgets don't necessarily have an advantage." For this young entrepreneur, a healthy knowledge of the Web and of Internet practices can "make all the difference," and even make up for the total inability to advertise.
Word of mouth is at work, as is the great demand created by "poker mania," both of which have helped Chilipoker to develop rapidly. About 20,000 players are already signed up, with a monthly growth of 10 percent. "In terms of the income generated by the rake collected on virtual tables, we are at double my initial objectives after one year," Dreyfus confided, adding that the business, whose staff was limited to one person in the beginning, now employs 12 people, soon to be 15.
And Dreyfus certainly doesn't intend to stop here. "Up to the present, we haven't done any promotion. We just wanted to put the product in place. But now we're going to be more aggressive," he warned. And so they are. In September, the little poker room made its grand entrance. Two professional players have teamed up with Chilipoker and will wear the poker room's colors during major tournaments all year, all over the world. One is the very glamorous Liz Lieu and the second is Fabrice Soulier, one of the best French players, who is now based in Las Vegas.
For Alexandre, this is part of his plan to kick the company into high gear by showing that Chilipoker can play in the big leagues. "Player sponsorship from people like Liz or Fabrice, both of whom are being courted intensely by other poker sites, is expensive - several hundred thousand dollars a year - but it's a wonderful opportunity for me. They put out a very positive image and represent the Chilipoker brand on the international scene," explained Dreyfus, adding that many months of negotiation were necessary to convince the two players.
Setting His Sights on Asia
There's no shortage of ideas for a follow-up. With 20 percent of his company's sales generated in France, and the rest coming from other European countries (Germany, the United Kingdom, and Scandinavia, mainly), Chilipoker is already an
international company. But Alexandre wants to go farther. "The next step is Asia," he declared, with the intention of using Lieu as the company's "ambassador" to the Far East. But he hasn't given up on France. "If one day the French government decides to offer legal licenses to online poker operators, I'll try to get one, if only to demonstrate that we are not a criminal collective, but actually a legitimate business."
In tandem with these ambitions, the start-up could also begin to diversify. "The company's flagship will always be poker, but we'll venture into other sectors of the market," explained Alexandre, who has already scooped up domain names ChiliCasino.com and ChiliBet.com. Dreyfus remained ambitious yet realistic: "This market is big enough to leave room for the little guys. I know I'll never be a market leader. But I want to show that an alternative operator can succeed alongside big players, a bit like Bouygues Télécom did at the beginning, or like virtual operators do today in the cellphone market.
"In any case, it's all fascinating," he smiled, adding, "I am very confident in the coming years," and concluded by saying, "The market is growing steadily, and I'm convinced that poker is going to become one of the most popular leisure activities."
Find out more at www.chilipoker.com. 
