The iGaming sector is extremely profitable. By 2027, the online gambling market is projected to have a total market volume of more than 130 billion dollars and approximately 234 million users. For these reasons alone, it is understandable why online casinos are one of the hottest internet investments at the moment.
However, competition is extremely fierce. In a market dominated by huge players, is there any room for start-ups and other entrepreneurs to claw themselves onto significant relevance? The answer is yes—as long as they understand the difficulties of launching a new and successful online casino.
But how can new platforms attract users and, more importantly, significant investors? Let’s find out.
Understand the iGaming Market
As of today, the online gambling market has a revenue of around 95 billion dollars. In just four short years, this number is projected to grow by 45 billion, penetrating almost 3% of the entirety of internet users.
iGaming businesses that want to set themselves apart need to understand the direction this market is headed towards. In order to become key players, platforms need to offer both broad and niche services. While regular casinos remain relatively profitable by targeting the general population, online casinos for VIP players, for example, target a smaller subset of punters but offer bigger profits as these players tend to bet more.
Understanding the iGaming market is necessary for any online platform wanting to become—or remain—relevant in this competitive field.
Develop a Solid Business Plan
But understanding the market is only one of the aspects of running a successful iGaming business. Entrepreneurs in the field need to have a solid business plan consisting of, at the very least, these key aspects:
- Market research
- Revenue models and streams
- Client acquisition and retention
- Financial projections
- Competitor research
Only by focusing on these key areas can iGaming businesses survive this extremely competitive field.
Showcase a Strong Track Record
Investors don’t like surprises. In other words, they prefer CEOs with proven experience. While this is true for most fields, it is even more so for the iGaming market. Starting an iGaming business can be done for cheap, and these ventures are available to almost everyone. For those reasons, it is important to investors that they choose businesses led by capable people with proven track records.
If you want to attract investors to your iGaming business, then you either need a groundbreaking idea, the data to back up your investment requirements, or the proven experience in the niche.
Demonstrate Technological Expertise
The iGaming sector is in constant evolution. At the moment, virtual reality and crypto are some of the hottest topics, because they are not only profitable but also extremely innovative.
A stagnant iGaming business is doomed to failure. By proving that your business has what it takes to compete with the leading technological giants in the iGaming market, your business becomes much more attractive to possible investors.
Highlight Regulatory Compliance and Responsible Gaming
Investors want casinos that people can trust. Unsurprisingly, the growth of the sector has led to the appearance of predatory websites, scams, and other frauds. For that reason, showcasing your regulatory compliance and how your platform safeguards players is of utmost importance.
If players cannot trust your platform, then investors won’t do it either.
Present a Scalable Business Model
Besides wanting innovative and profitable platforms, investors also like scalable operations. While a stagnant revenue stream might be worthwhile to smaller investors, big investors seek market consolidation and constant growth.
This is why you need to prove to investors how your business can grow and become even more profitable. The sector itself is predicted to grow by considerable amounts—there is no reason why your business shouldn’t follow the market’s upward trajectory.
You can present scalability plans by focusing on key aspects such as:
- New client acquisition plans – such as big marketing pushes to acquire new clients.
- Expansion strategies – do you plan to breach into new markets? If so, make that a key aspect of your presentation.
- New product offerings – will your online casino also feature a sports betting platform in the feature? Your investors should know about it.
These plans highlight the fact that you know what you are doing and increase investor trust in your project.
Provide a Clear Investment Proposition
Investment firms want profitable investments, but they are aware of the risks their business entails. CEOs in the iGaming sector who want to attract investors need to present clear investment propositions. If you recognize certain risks or dangers to your business, your investors should know about them too.
Don’t forget that you and your investors have the same goals. Let them know of the dangers your platform might face, and in turn, they will offer you their expertise on how to navigate them.
You should also provide investors with clear exit strategies, as well as their projected return on investment. Remember—you might need their help, but they also need you to make them money.
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