The iGaming industry has been one of the biggest growth markets during the past decade, as the popularity of online gaming has soared. More consumers across the world are turning to the digital realm for gaming, including traditional gambling activities. As a result, launching an iGaming business has become an attractive prospect for many entrepreneurs.
The remote gambling industry, however, is highly competitive – as are all saturated marketplaces – but that does not mean running a lucrative iGaming business is not a viable prospect. Successfully launching and running an online real-money gaming platform requires careful planning and execution. In this article, we will explore the key steps involved in launching a business, covering everything from identifying the target market to choosing the right software provider.
Whether you are a seasoned business owner or an entrepreneur looking to build your very own gambling start-up, this article will provide the valuable insights and practical advice you need to launch a successful and profitable business.
The Business Costs of Online Casinos
As with any business, if your goal is to launch an online casino, you will need to create a comprehensive budget detailing all the specific business costs you can expect to face. While the exact costs will vary according to the amount you can allocate towards your new venture, you can expect to assign your budget accordingly:
- Initial set-up 5-7%
- License 10-30%
- Software set-up 30-40%
- Employees 10-20%
- Marketing 20-40%
- Other business expenses 10-20%
Of course, your business will also incur costs after it launches, and therefore it is prudent to allocate a further budget for post-launch expenses. Again, the exact amount will vary according to your specific goals, but the following breakdown will give you a good indication of how much to allocate:
- License fees 5-15%
- Software support 10-15%
- Game provider fees 15-20%
- Marketing 50%
- Employees 10-20%
- Other business expenses 10-20%
Selecting Gambling Content
The next step is to decide the remote gambling sectors in which you want to launch your business. The iGaming industry is vast and encompasses a wide range of casino games — video poker online, electronic slot games, digital roulette, blackjack, bingo, live casino, and sports betting — as well as stand-alone poker games and sports betting opportunities. The most successful platforms offer a diverse entertainment portfolio since they appeal to the largest demographic of players.
Choosing a Software Provider
Unless you are a skilled software engineer or game developer, you will need to outsource the software aspect of the business to a professional iGaming provider. You can typically expect to invest the largest amount of your start-up budget into software costs, so it is important to search the market for quality products that incorporate the gaming solutions you need as well as additional tools and features such as:
- CMS and CRM
- Bonus and promotions management
- Payment interface
- Cashier system
- Anti-fraud system
- Affiliate management tools
- Retention email system
It’s also crucial to think of your chosen software vendor as a partner in your iGaming business; this will ensure that you match with the development company that best suits your needs.
Licensing and Legalities
As an iGaming business owner, you will need to read up on gambling licenses and legalities. While playing online casino games or placing wagers on sports events is an activity that is enjoyed by people all over the globe, not all jurisdictions legally recognise online gambling activities. Therefore, you must plan in advance where you want your business to operate and research the best options for obtaining an online gambling license.
Licensing is not just necessary for operating your business in keeping with the laws of your chosen territory; you will also need a valid license in order to get approval from payment service providers (PSPs) and software development providers.
The most reputable licensing authorities and gambling jurisdictions include:
- Malta Gaming Authority
- UK Gambling Commission
- Isle of Man Gambling Commission
- Curaçao eGaming
- Kahnawake Gaming Commission
As a new iGaming entrepreneur, there are two ways that you can legally launch your gaming platform:
- Manage the entire process yourself, including applying for a license, opening a business bank account, contracting PSPs and software providers, managing taxation etc.
- Purchasing white-label products from an existing gambling provider. In this instance, you will not need to apply for a license, as you will be able to access the provider’s gaming license, fiscal management tools, and software.
Purchasing ready-to-use solutions — while freeing up your time to focus fully on launching and running your business — are often substantially more expensive than managing all the aspects yourself. However, for first-time iGaming entrepreneurs, they can end up being more than worth the initial investment.
Building your Brand
With your gaming license in hand and your gaming portfolio ready to go, it’s time to solidify your marketing strategy and build your brand. You should have already created detailed audience profiles as part of your first business plan so you can build your marketing strategy based on the behaviors, needs, requirements, and whereabouts (digital or offline) of your target customers. This final stage is all about putting your plans into action.
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