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Profile: The Evolving Gamma Entertainment

Profile: The Evolving Gamma Entertainment
Stewart Tongue

In an industry that has continued to evolve at an amazing pace since its inception, very few brands have been able to adapt quickly enough to stay ahead of the curve from start to finish.

One of the few companies that has continued to thrive at each stage of the trajectory of adult online is Montreal-based Gamma Entertainment.

What I like the most about our industry is that it tends to reinvent itself in five-year cycles. -Karl Bernard, Gamma Entertainment

XBIZ sat down with its president, Karl Bernard, to find out what has allowed the company to continue succeeding as it changes with the times and earns money for itself, its affiliates and everyone else in its ecosystem.

XBIZ: Gamma started in the 1990s. What was it like back then starting up your company?

Bernard: Our debut was back in 1996. Back then it was me who started it all, but quickly I had two friends coming to help me. We opened our first offices in 2000. We had a 3,000-square-foot space all equipped but with no employees to fill it up. The landlord thought it was a joke, and he was not even sure if he wanted to lease it to us. We were a bunch of guys in our early 20s trying to put together a company while coding day and night.

XBIZ: Many companies had similar starts. Why do you think Gamma succeeded?

Bernard: Even though we were young and evolving in a fun and sometimes wild industry, it has always been important for me to project an image of professionalism and treat this as a real business. We were always very good at growing and seizing opportunities through partnerships.

I would say our employees were profoundly important to our success. We were able to surround ourselves with a group of passionate people who are each invested in our collective success. Besides that, I would say that we were able to keep a good balance between jumping in on new opportunities, while at the same time being disciplined enough to focus on our core business at the same time.

XBIZ: Gamma successfully bought and expanded brands while others have seen their acquisitions wither on the vine. What’s the secret to continuing success after the transition?

Bernard: It comes down to selecting, negotiating and executing. Obviously, we are careful to select brands that are complementary to what we do, but we also have to be disciplined in paying the right price, while remaining respectful of what the other party built over time. Very often, people have an emotional investment in the company they are selling for the simple reason that it is their baby. Selling something so precious that you’ve invested so much time in building is not easy.

The reality is that in our industry, companies cannot sell for the same multiple as you see on the news when publicly traded companies acquire others. If you take those as a reference you’ll never be able to recoup your investment, that’s for sure. Ultimately, execution matters the most, and again this relies on our people. When we do an acquisition, there are many people involved — from accounting to legal to product management, engineering and sales. Everybody has to do their part in making it a success, and we steer the company to make that teamwork a key point of our focus.

XBIZ: You’ve mentioned Gamma’s people and teamwork. Tell us about them?

Bernard: We are now at about 165 employees. It is quite different indeed than when we were 20! Back then, it was all about jumping on opportunities, making bets and working crazy hours. Today, we have to think more about efficient structures, delegation, coaching, strategic planning, corporate governance, risk management and financial ratios. It is a completely different game, but that change has made me grow quite a bit as a manager.

XBIZ: Gamma always seems to make time for the team to have fun together. How important is that to the health of the business?

Bernard: I strongly believe that the culture is one of the key aspects of the success of a company. As president, I delegate pretty much all functions to other people, except what we call our “Talent and Culture” team, which I keep for myself. It oversees everything from the values of the companies to the office spaces, salaries, communications, hiring process, employee development, training and coaching, as well as all our special events.

We also have a group called “FUNraisers,” which consists of a group of employees who volunteer to organize events, contests, awards ceremonies and other activities to put the fun into our workplace. I do believe that building a great culture is one of the keys for having a successful company and having fun is definitely part of our culture at Gamma.

Our events range from the usual holiday parties to more special gatherings like our “Agile Olympics,” where our developers compete for prizes and honors; team potlucks, where employees cook meals from their native heritage (we have over 28 different nationalities present in our company); foosball tournaments; and Nerf-gun fights in the office. [There is] lots of things to keep us entertained and imaginative!

XBIZ: What advice would you give someone brand new to the industry?

Bernard: You cannot be a jack-of-all-trades. Find out what is the thing you are the best at and focus on it. For the rest, try to make partnerships and strategic alliances with other people and companies that can complement your skill set effectively.

Our history is all about seizing opportunities to work with other people. Some of our biggest successes came from people who approached us to work with them. Therefore, if you have a good idea and you are ready to put some of your own skin in the game, we will always be there to listen.

XBIZ: What do you look forward to at this stage of Gamma’s development?

Bernard: I look forward to seeing how the business field evolves over the coming years. What I like the most about our industry is that it tends to reinvent itself in five-year cycles. I think we are entering a new cycle soon and I intend to have Gamma Entertainment playing a major role in it.

With a proven 20-year track record and 165 of the brightest minds in the adult online sector of the market working together flawlessly, there is good reason to be optimistic about the future at Gamma and great reason to be one of the many companies that work with Gamma on a daily basis.

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