Bookmaker Operations: What are the Steps to Follow?
Starting your own online bookmaker can be a lucrative pursuit, but it comes with a range of challenges before you can get things up and running. From licensing to risk management, starting up as a bookmaker is certainly not the easiest thing to do. With the growing popularity of online betting, and third-party solutions for those that want to start their own betting sites, there are ways you can streamline some of this work to setup your own sports betting service.
What licence do you need for online bookmaking?
If you’re looking to offer sports betting services in the UK, you must hold a licence from the UK Gambling Commission. The Gambling Commission is the sole regulator of gambling activities in the UK by law, and you are liable to prosecution for offering services without the appropriate licence in place.
The licensing application process is handled throughout the Gambling Commission directly, taking up to 16 weeks to approve your application. A range of documents are required to be submitted as part of the application process, including rules, policies and procedures, accounts, and more. Full details can be found at the Gambling Commission website.
There is also a licensing fee to be paid, which you’ll need to pay annually to hold your remote betting licence. Once you’ve overcome this hurdle, there may be elements of back and forth with the regulator to establish that you meet the criteria for holding the licence.
Start the licensing process way ahead of establishing your gambling business, and expect some delays and bureaucracy in the process. Once you’ve overcome this hurdle, you’re able to look at software and other more exciting elements of starting your own bookmaker operation.
What software is available for online betting sites?
To start an online bookmaker, you’ll need software in place, which will accept the bets of your players, quote odds on sports and handle all of the day-to-day functions of your operation. Software developers like Playtech provide sports betting software on licence, which is another cost involved in the process. However, their software provides all of the main functionality you’ll need to start and run your bookmaking operation successfully.
There are a number of leading software providers for sports betting sites, so you should be ready to do your homework and to learn more about what functions each platform offers and the relative costs. The software is an important part of the customer experience, as well as the engine of your online betting business - don’t cut corners here. The best software you can afford will position you well to take advantage of opportunities with your new online bookmaking operation.
How to find customers as a new online bookmaker?
Once you’ve up and running with your licence and software, you’ll need marketing systems in place to help you find new customers. Customers are the lifeblood of any business, and an online bookmaker is no exception. You need a healthy stream of new punters coming in and depositing funds to begin to see some turnover, and to see your business start to move.
Advertising and promotion is heavily regulated for online betting companies, so you need to be familiar with the unique limitations here. Marketing must all be legal and within the terms of your licence, as well as within UK law. Marketing via affiliates is one effective tool new bookmakers can use to drive customers to their sites. Working with an affiliate platform or an affiliate manager can be a good way to reach out to affiliates directly - individuals and companies who already have gambling traffic that can be sent to your new sports betting offer.
Reaching out to sports betting websites for sponsorship and advertising opportunities could be another way to raise awareness of your new sports betting brand. This type of marketing seldom comes cheap - but with the right amount of awareness at launch, your new sports betting site stands a better chance of hitting the ground running.
How much money do you need to start an online bookmaker?
At the cheapest end of the spectrum, you’re probably looking at somewhere between £50,000 and £100,000 in cost to start a small online bookmaker. When you factor in the cost of licensing, software, website development, marketing, insurances and the fact you’ll need a float to manage your betting liabilities, it’s not a small undertaking that can be done on a shoestring.
The amount you’ll need also depends on your current financial situation. If you need money to live on while you’re setting up your online bookmakers, you should factor that amount into your total capital pot, too. Ideally, you should be investing from saved funds while you still have a source of income, or enough to live on that you can focus exclusively on your new sports betting operation.
However, once you’ve jumped through those hurdles and spent what you need to spend to get going, you will have a sports betting platform that can take bets and generate revenue for the foreseeable. With the right experience and marketing savvy, it’s possible to transform this into a highly successful venture. While you shouldn’t expect an easy right, particularly in the competitive online landscape, there are opportunities there for entrepreneurs with the right approach and the right brand to seize some market share.
Starting an online bookmaker operation can be a fruitful endeavour - but it’s not for the faint hearted. Ideally, you should already have extensive business experience, and certainly a strong understanding of the gambling industry and its unique quirks before planning to invest your money in a sports betting operation.
By following the steps above and getting the fundamentals in place, you should be ready to launch your new betting service within a matter of 6-8 months from initiation. And with unlimited upside potential for successful gambling businesses, there are large rewards there for those who can make a success of it.
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