Fortune favours the brave
My name is Jonny and I’m the founder of a gambling startup. I’m here to shed light on the unique challenges our industry poses for start-ups, to explain why these startups are essential for innovation and to raise a call to arms to do more to help them flourish.
Innovation is the lifeblood of any industry but it’s also one of the biggest challenges. This is especially true in online gambling, where the risks of deviating from the status quo in such a competitive environment are high.
Old vs new
These days, incumbent bookmakers find themselves in Clayton Christensen’s now famous Innovator’s Dilemma. Granted they have the luxury of a huge customer set, but they also have equally high expectations of yearly sales. Meanwhile, the large customer set is not interested in new innovation and keeps demanding more incremental innovation from the incumbent product.
In contrast, startups find niches away from the incumbent customer set to build new products. They don’t require the yearly sales of the incumbent, nor do they face demands for a perfect product, and therefore have more time to focus and innovate on their smaller venture. It’s in this space that new entrants invent new products and ways of doing things.
The theory goes that by the time the new product becomes interesting to the incumbent’s customers it is too late for the incumbent to react and keep up with the new entrant’s rate of improvement. It’s this opportunity that drives entrepreneurs to invent game-changing technology and ideas that ultimately invigorate and refresh industries. In this way you can think of startups as a small but essential part of the industry ecosystem.
When startups flourish the ecosystem flourishes; when they’re supressed the ecosystem loses vitality.
Whole different ball game
So let’s take a look at what it’s like being not just a startup, but a gambling startup.
First, you’ll need a bank account, if you can find a bank that will give you one. You might want to start talking to venture capital firms, but you’ll quickly discover that 95% of them won’t touch gambling. You’ll no doubt want to follow lean startup principles to go live and fail fast, fail often. Until that is you realise that gambling requires licences, safeguards and compliance and that failing fast or slow comes with serious consequences.
Technology is key to every new business, but then you grasp the sheer complexity of gambling: vast data feeds, real-time odds, KYC, payment gateways, third party integrations and platform providers. How the hell does it all connect together you wonder, and when you eventually figure that out you’ll be asking if you should build it yourself or buy off the shelf.
It’s okay though, you say to yourself, you have some money you can use to bootstrap it, but then you worry if you have enough money. Enough of a runway to pay for monthly feeds subscriptions, the complex integrations, service charges or even just the time to figure it all out – all while keeping food on the table.
Naturally you’ll be keen to network and be part of the wider startup community, only to realise pretty soon that with gambling it’s that little bit harder to fit in. There’s always your own industry, you think, but then again it’s dominated by huge operators with little time or interest in supporting the little guy.
Eventually you have an app and you’re on the home run now, only to discover that because it’s connected to gambling Apple takes three months to review it instead of the advertised three days and the Play store won’t even consider entertaining it before seeing a gambling licence.
Finally, you’ll need traction, so you do what’s easily taken for granted and turn to Twitter, Facebook and Google PPC – only to be shut down for violating their inflexible gambling advertising requirements.
Yet… It's worth every minute
As the saying goes, beyond the mountain are more mountains. So why do we bother? Ultimately we do it to create change where we see stagnation and unexploited opportunities. We choose gambling because sport and gaming are life and let’s face it: unlike other industries the financial pay-off could be monumental.
Even if it doesn’t work out, as a failed entrepreneur you’ll be left with more invaluable business and life experience compressed into a matter of years than a decade working for the man. Off the back of this you can be guaranteed that your next venture will be twice as good and take the half the time.
One thing’s for sure: it’s a tough challenge and as an industry I believe we could be doing more to help.
To see ahead what others cannot see
Recently I met a gambling startup at the very beginning of their journey and was able to tell them more in an hour and a half than I’d learnt in four years, the hard way. It felt good to help. In the past I might have viewed
them as a competitor, but having been through the mill, I could only sincerely wish them the very best of luck.
It was this experience that opened my eyes to the need for, and benefit of, mentoring. It made me realise how much mentoring could have benefitted me – and how much startups in general could still be helped. If you’re reading this and thinking you’ve been through your own kind of mill, be that corporate or entrepreneurial, an hour of your time could make a huge difference to a startup. One of the greatest assets mentors have is their ability to see ahead what others cannot see and to navigate a course to their destination.
Aside from the obvious good karma that comes from helping, we’re starting to realise that mentoring is both what we need and what we can offer, that it puts us in the mix with good ideas and good people, and offers us potential investment and collaboration opportunities.
Join us and make a difference
If finding out more about gambling startups sounds interesting, join our mailing list at gamblingstartup.ventures. Here we hope to start informally connecting like-minded people to do exciting things.
Jonny Robb is the founder of tech innovation studio Bettor Faster, creators of Bet Blocks Messenger app. Being a user experience architect and former developer his passion lies in the creation of disruptive technologies.