Launching your own online casino
The increasing digitalization of the world, the advancement of smartphones and various applications available along with secure and credible online payment systems are promoting a rapid growth of the online gambling market all over the world. According to Statista report, the volume of a global online gambling market is expected to from approximately 46 billion U.S. dollars in 2017 to 94 billion U.S. dollars in 2024.
It is not surprising why many entrepreneurs get excited by the idea of starting their own online casino: if done right, the online gambling industry promises significant returns over a rather short period. However, many people do not have the experience in this area and do not know what kind of budget one has to come up with at an initial stage as well as in order to keep the business running. There is quite a lot to think through and to arrange if you choose to go on with the idea.
Herewith, we shall try to put things into perspective and give you some guidance on the important points to consider and types of expenses to be prepared for.
Launching an online casino is not a trifling matter – it is an undertaking that should be carefully planned. There are several important points that need to be addressed to get your online casino up and running:
- Registering a company;
- Obtaining an online operator’s license;
- Registering an operator’s domain
- Choosing quality i-gaming software;
- Marketing your online casino
Registering a company
In whatever location you choose to operate from, you would need to register a company and have a business address. The corporate registration fees can vary significantly depending on which country you want to register your business in.
Just by way of an example, if you plan to register your business in Malta, which is a reputable gaming jurisdiction and its gambling license is recognized in many other countries of the world, the total minimum registration cost may come to approximately 3,165 EUR, which will include:
- standard registration fee of EUR 375;
- minimum share capital of EUR 1,165 for opening a private limited liability company;
- virtual office cost of approximately EUR 125 per month;
- company formation fee of EUR 1350.
You, certainly, do not have to set up your company in Malta, – it can be registered somewhere in the EU, for example.
Obtaining an online casino license
After you have registered your company, you need to get a license for operating your online casino. The most popular locations for registering an online casino business and obtaining a license are Gibraltar, Isle of Man, Malta, Curacao, Antigua, and Costa Rica.
The cost of license may vary depending on the country, however, just by way of an example, an online license from Maltawill cost you an application fee of€2,300, an annual license fee of a minimum €25,000 and its variable component, which is calculated and applied on a sliding scale as a percentage of the total gaming revenue.
There are simpler options for getting an i-gaming license, for example, such as Antigua and Costa Rica. For example, in Costa Rica, the cost of license is $15,000 and there is no i-gaming revenue tax. Nevertheless, since there are no regulatory bodies or provisions governing online gambling in Costa Rica, there is a fair share or risk involved, as many operators run the businesses just how they see it fit.
Choosing a domain name
The online gambling industry is very competitive, and the domain name you choose for your online casino should stand out. There is no wonder why gambling related domains are sold for high price. Popular gambling domains that include such key words such as casino, poker, bingo and others cost a lot of money primarily because such domain names attract a large number of Internet gamblers.
For example, Palek International Ltd. has bought the domain name Jackpot.com for half million dollars back in April 2012. It
Casino.com is the biggest reported gambling related domain sale is the sale of Casino.com and the sale of Slots.com. Casino.com was sold in November 2003 for $5,500,000to an owner Mansion Limited of Gibraltar, a leading online gaming company with more than ten years’ experience in the gambling field.
Not every company can afford to spend millions on a site’s domain name. If this is the case, you may try to choose a word or a group of multiple words in one that describe what a business does or what type of content a user will find on the website. According to industry specialists, the best options of domain zones are considered to be .com or .net.
It is possible to find online casino names on special domain name hosting services’ sites that create domain names. Another option is to get a ready-to-use White Label casino solution. White Label casino package typically includes a domain name along with a completely developed online casino platform.
Setting up a merchant account
You want your players to be happy playing on your site, and their payments to go as fast and smooth as possible. For many players, the payment system will be a key factor when they are choosing an online casino. Many players who do not have credit cards also favor casinos that provide pay by mobile options.
However, setting up an online casino merchant account is definitely associated with high risk. The major risks are the potentially fraudulent transactions; an increased risk of chargebacks; players’ failure to cover debts. As a high-risk business, you will be required to keep a reserve on your merchant account.
Because of the above-mentioned reasons along with the legal regulations and laws governing online gaming operations of particular jurisdictions, finding a provider of an online casino merchant account can be a challenging task.
However, it is very important that you choose the right and reliable payment system provider. You would need to find a reputable payment provider taking into consideration the markets that you are targeting. For instance, you may need to consider points such as having the payment gateway compatible with all the major e-merchants popular on the market, the ability of fraud detection, fraud prevention, and others.
It is in your best interest to find a provider who understands how to get your casino merchant account approved without delays, hidden fees, and the lowest transaction rates for the high-risk industry. Typically, casino merchant account providers will charge your business some transaction fees, a gateway fees, a Visa/MasterCard processing fee. Before you choose a provider, you will need to examine their offers carefully and pay attention to details. For instance, some of the top reputable merchant account providers are Instabill, IPayTotal, Regularpay, and others.
Sorting out an online merchant account provider for your casino on your own can be time-consuming and expensive. Today, many online casino solutions providers already have a merchant account setup service included in the White Label platform package, which makes the whole account setting process much easier and faster.
Choosing the right software
You have to have a good selection of games to make your online casino venture worthwhile and competitive. Without a good selection of games, your business will not last long.
A reliable, secure and diverse gaming platform is a pivot of the gaming business. It is a piece of software that is literally crucial for your business success: all other elements are built upon it.
Long cash out times, poor quality of the gaming site, and insufficient diversity of gaming options are the primary reasons for online casino projects failure. The competition level in the gaming industry is so high that limited selection of games, long transaction processing and cash out periods will deter players from your business.
That is why in order to have a successful online casino business, it is very important for an owner to invest some effort and money into a platform with the right mix of slot games, live dealer games and betting games that has a capacity to load and integrate games smoothly, can processes payments fast and safely and facilitate high level of online customer support.
Online gaming businesses can order a fully customized gaming software or obtain a licensed gaming platform White Label from a wide variety of gaming software suppliers. An owner of an online casino has to decide what type of a software package to choose.
A unique, fully customized software from such gaming software industry giants as Net Entertainment, Playtech, and Microgaming may cost from € 11,000 – 12,000 per month plus a company royalty payment on net profits that may range from 15% and up to 45%.
Not everyone is able to afford such high expenditures, and certainly, there are cheaper options available on the market. Multiple and diverse white label software platforms options are available from a variety of white-label online casino providers, which will furnish an online casino owner with an already licensed portfolio of games with a pre-set design and logo, while the owner’ s gaming business will retain its domain name.
White Label casino supplier typically may charge €10,000 to €20,000 as a setup fee plus a monthly royalty fee, which generally amounts to 10 –20% of the casino’s gross revenue.
The key to the successful online casino is marketing. From the get-go, you need to start generating sufficient traffic, and if you do not generate enough, then the destiny of your business will be at risk.
The hardest part is that it is almost impossible to create a website independently. You will have to master many professions, learn technical subtleties and creative trends. It is more logical to entrust the project to an external contractor.
Marketing and customer service is the key
After your online casino gets rolling, and you start generating income, your main priority must be set on attracting customers and keeping them.
Bringing in new players is costly, but there is no way around it: you will have to advertise your casino in order to attract traffic to your gaming site, and also you will have to put together necessary bonus packages for your players to make your offerings more appealing to them and win them over.
You just have to realize that at least 50% of your annual budget will have to be spent on advertising, especially in the beginning. Here is where casino affiliates’ come at play: you will attract new players with their help. Pricewise the sky is the limit here. Many gaming affiliates’ sites may require a CPA (cost per acquisition) or a percentage of revenue share, which can range depending on the affiliates’ sites popularity and traffic generation capacity from 25 and up to 60% of the online casino’s net gaming revenue.
In addition to startup costs and advertising, there are also other expenses related with running an online gaming business: maintaining a reserve capital to cover winnings payouts, annual license renewal, software maintenance, accounting costs, paying corporate and or gaming taxes, when applicable, and other miscellaneous expenses.
Summarizing all the said above, starting an online gaming business requires thorough preparation and a substantial budget of at least $100,000 US and more.
While proprietary platforms can take months to launch and many headaches to deal with, using a White Label online gaming platform from a well-established supplier of games can be cost-effective and efficient timewise. White Label suppliers provide operators with a complete scope of services, usually offering them a full turnkey solution, including games, setting up a merchant account, licensing, customer support, and even some marketing tools. This allows operators to focus on other key areas, such as branding and marketing.
The fastest and smoothest launch guaranteed with Inbet’s White Label
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In a matter of – just in 5 hours and no launch fee, you will get your hands on a robust and highly-secured piece of software that also maintains the following features:
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