Published: January 30, 2021

New York State Gaming Commission approves Jackpocket for concierge service lottery

SCHENECTADY — Want to buy a Lottery scratch-off ticket but prefer to stay home because of the virus? Now there’s an app for that.

The pandemic has kept many buyers from their usual stores, so the state Gaming Commission on Tuesday approved a plan allowing a Manhattan-based app developer to buy scratch-off tickets for customers and have them mailed or delivered to their homes.

The company, Jackpocket, offered its first fully licensed version of the service several weeks ago allowing people to purchase other games such as Mega Millions.

While not disclosing sales, company founder and CEO Pete Sullivan said the business has, since going live, grown five-fold, which he attributes in part to the recent large jackpots in games like Mega Millions and Powerball and in part to the pandemic.

When the Lottery’s Powerball game reset on Saturday, they handled 7 percent of statewide sales for that game.

“Think of us as like Uber Eats or Instacart for the Lottery,”  Sullivan said.

The company uses a deposit system allowing players to put money into a Jackpocket account that they play with. Jackpocket makes its money through a 9 percent fee on the deposits.

The non-scratch-off tickets that are purchased are held by Jackpocket. They buy the ticket, and then scan it and send a photo to the buyer, holding on to it until the winners are announced. If someone has a winner up to $600, they send the ticket by certified mail. For larger amounts people can come in and retrieve the tickets in person.

The scratch-off version, which hasn’t started yet, will involve a subscription system in which players can buy bundles of tickets, such as 50 at a time.

Jackpocket is so far the only such company to be licensed in New York.

Retail backlash

Convenience store operators opposed Tuesday’s decision, citing what they say are dangers with verifying a player’s age. They also note that retailers like convenience stores only get a 6 percent commission rather than Jackpocket's 9 percent on deposits.

“We just don’t understand the Gaming Commission’s fixation with elasticizing its statutory authority in order to bestow unprecedented privileges upon this new license class while treating with ambivalence the lottery retailers whose decades of commitment and hard work have grown New York Lottery into a $10 billion-a-year enterprise benefiting education,” James Calvin, president of the  New York Association of Convenience Stores wrote in a letter to the Gaming Commission.

Sullivan said he believes his business, though, might help drive traffic to convenience stores since scratch-off game winners have to go back to the retailer to collect their winnings. “We’re driving people back to store,” he said.

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