Founders of 888.com
The Owners and Founders of 888 Holdings
Update: January 4, 2010. Please see bottom of page for updates.
Two pairs of Israeli brothers, Avi and Aaron Shaked and Shay and Ron Ben Yitzhak founded Virtual Holdings Limited in 1997, which later became 888 Holdings ( see here for the history of 888). Today, the Shaked brothers own around 50% of the parent company, while the Ben Yitzhak family owns around 13%. The four founders are fiercely private about their connections to the company and will not disclose any information over and above what is necessary. Out of the four, Avi Shaked is the most prominent, due to this involvement in the world of politics.
Avi Shaked was born in Netanya, Israel. As a student, he earned a Bachelor’s Degree in Chemical Engineering from the prestigious Ben Gurion University in Beersheba and went on to develop a business career in the early 1980s. He worked as a representative at MCI, Inc. until he founded Virtual Holdings Limited – thereafter known as 888 Holdings – with his brother, Aaron and the Ben Yitzhak brothers.
When 888 Holdings was floated on the London Stock Exchange, each of the brothers earned a staggering $90 million each, and were left with joint holdings of over $250 million in the company.
Shaked is an astute follower of politics and used his business connections and talents to try and push for peace between Palestinians and Israelis. He was one of the main contributors to the creation of the Geneva Convention in 2003 that would serve as the basis for further peace talks between the two sides.
In 2005, Avi Shaked made the move into politics by running for public office in Israel. Running under the banner, “Proud Socialist Millionaire”, Shaked guaranteed far reaching reforms and changes in social welfare. Unfortunately, after he ran in the 2006 Israeli elections, he was not elected.
Shaked’s involvement in the political sphere did not stop there, however. He continues to believe in viable peace between the Israelis and the Palestinians and recalled in an interview with Reuters that he offered the Palestinian Prime Minister $1 billion if he would sit down with his Israeli counterpart and reach a peace agreement.
“The killing must be stopped,” Shaked said in the interview. “My initiative is to both leaders: please sit down, start negotiations and try to reach an agreement. The Palestinian Prime Minister, leader of the terrorist organization Hamas, eventually turned down the offer.
In 2007, Avi Shaked announced plans to expand into the food industry and, together with his son Eyal, invested in a chain of coffee shops named Chitta Café, with the intent of opening up 130 cafes in China over the next two years.
In a recent issue of TheMarker, a financial publication, the Shaked brothers were listed among the 500 wealthiest Israelis, with their combined assets estimated to be worth up to $150 million.
Aaron Shaked was also born in Netanya and studied to be a dentist after leaving school. Aaron has always been credited for being the first to think of the idea of creating a casino online, which first came to him when he was attending a dentist’s conference in Monte Carlo – which took place in a casino. Aaron brought the idea to his brother Avi and after many discussions, the two decided to set up a virtual casino site on the internet. The problem was that neither was a gambler and their knowledge of the basic rules of classic games such as blackjack and poker was next to nil. Not ready to give up on their idea, the brothers made their way to a casino in Taba, Egypt and, with check books in hand, tried to understand the rules of the different casino games.
Together the two approached Sha and Ron Ben Yitzhak who were acquaintances of theirs, to consider the option of a joint investment. The four of them took out a loan after mortgaging their homes and founded Virtual Holdings Limited, after purchasing a gambling license from Antigua for $100,000. Casino on Net was launched soon afterwards.
A critical error by the search engine Lycos changed the fortune of the Shaked brothers forever. The advertisement for Casino on Net appeared all over the world as a result of a computer glitch and the amount of traffic that made its way to the new site was too heavy for the fledgling system to support. Shaked recalls in an interview that half a million people visited the site, causing it to crash. As a result, the brothers realized the importance of internet advertising and immediately afterwards, started buying up any advertising space available online.
The success of Casino on Net and subsequent sites founded by the brothers, including Pacific Poker, was unmatched and continues to this day to serve as an example of the perfect combination between having an astute eye for business and simply being in the right place at the right time.
Besides investing in the gambling world, Aaron Shaked made a name for himself as a property tycoon. Even prior to the launch of 888 Holdings, the brothers owned a small hotel in Netanya. In 2005, a hand grenade was thrown into the home of the Shaked family in the prestigious neighborhood of Ramat Poleg in Netanya. This was not the first time the family had been targeted, and the police investigated whether the crimes were connected to Avi Shaked running for parliament with the Labor Party, or whether it was connected to Aaron’s property deals.
Aaron Shaked is well known for his philanthropic activities, having built homes and schools for the poor in Israel. His modesty stands out, even in interviews. When asked by Financial Times reporter, Matthew Graham, about the millions he was about to receive with the flotation of 888 Holdings on the London Stock Exchange, Aaron said: “I already have a lot of money. I’m not going to eat in a better restaurant or buy a new car. I’ve already done all those things.”
Shaked continues to deal in the medical world and recently founded a company that develops cardiac solution patents. He also invested $5 million in a clinic that deals with people suffering from cataracts.
Shay Ben Yitzhak
Shay Ben Yitzhak is a program engineer who developed the first technological platform for 888 Holdings. He holds a BSc in computer science from the Technion – Israel Institute of Technology. Shay was a software engineer for Tower Semi Conductor Ltd. and CIBAM Technologies Limited before teaming up with the Shaked brothers to create Random Logic, based in Tel Aviv, which develops all the technology needed for the casinos operated by 888 Holdings. When asked to write the program for the embryo 888.com, Ben Yitzhak came up against the same problem that the Shaked brothers had – he had never been inside a casino before. Shay said in an interview that he wrote the programs for the casino site using a handbook on gambling!
Shay served as the Chief Technical Officer and Chief Operating Officer of the Company and has been in charge of the research and development center since 1998. For the most part, Shay was the only one of the four brothers who was involved in the day to day running of the business. From 2006, Shay Ben Yitzhak has been a non executive director of 888 Holdings after he stepped down, and he was replaced by the current Chief Operating Officer, Gigi Levy. At the time of his stepping down from the executive post, the company chairman, Richard Kilsby said: “The company will continue to benefit from Shay Bet Yitzhak’s guidance and counsel.”
In an interview after his retirement from the day to day running of 888 Holding, Shay said that he was going to devote his time to his family (married + 2 kids), to studies and to quality rest time – something that he had not experienced in a long time.
In 2007, the Ben Yitzhak brothers announced that they were selling a significant part of their shares in the business. From a position of holding 57.5 million shares (17% of the company), 13.6 million shares were sold. Many of the shares were sold to a large European fund and the brothers made approximately $31 million as a result of the sale. As a result, the family now owns about 13% of the company, valued at around $102 million. The Ben Yitzhak brothers are said to be worth around $250 million in joint assets.
Ron Ben Yitzhak
Out of the four founders of 888 Holdings, Ron Ben Yitzhak is the least known. Two years older than his brother, Shay, Ron left Israel many years ago to live with his family in the United States. Ron has been credited for luring his brother from his intensive studies at the Technion to team up with Shaked brothers in the mid nineties… and the rest, as they say, is history!