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What makes an idea worth chasing? For most tech founders, it’s whether a product can scale and generate considerable revenue. For the better part of the early 21st century, online casinos were undeniably lucrative start-ups with low upfront investment.
Times have changed, and especially in markets like the UK, where regulations abound, there are plenty of things to consider before diving into the world of online gambling.
Let’s look deeper into the pros and cons that will lead us to an informed opinion on its viability.
Potential Pros of an Online Casino Startup in the UK
The biggest advantage of launching an online gambling platform in the United Kingdom is that you serve a large and engaged market. Dozens of operators like Broadway Gaming and Skill On Net have created an active gambling audience by launching hundreds of online casinos and sister sites. What that means for you is that your potential customer base is already right at your doorstep.
More so, technological advancements in the games and live dealer features make it relatively easy to develop a product that jumps off the page, attracting players seeking cutting-edge experiences or simply ‘something new’.
Most importantly, when planned and executed correctly, you can turn your online casino business into a profitable venture, given that the UK is the world’s largest regulated remote gambling market.
However, profitability is the main reason numerous operators have been exiting the British markets in the last five years, so it’s important to remember the challenges.
Challenges of Launching an Online Casino
As mentioned before, the UK is the world’s biggest regulated gambling market, and it’s also the most strictly regulated economy.
Since 2019, the UK’s Gambling Commission has cracked down on unlawful operators or those stretching the rules by adding numerous strict regulations to its license requirements. These include a ban on accepting credit cards for player deposits, heavy limitations to bonus offers (such as free spins), and stringent KYC requirements for every player who signs up with your online casino.
If you’re ready to handle the Commission’s requirements, your next challenge is to beat your competition, which is incredibly high in the United Kingdom. The market is saturated with established players, and attracting new customers is costly. For example, running a Google Ads campaign in this niche might mean paying up to £120 PER CLICK with no guarantee this click will convert into an active player.
Once you grow your customer base, you will face the next financial hurdles: taxation, fraud, and chargeback charges.
The Key is Experience and Financial Stability
As you can tell from the previous sections, there is a lot to consider when starting an online casino in the United Kingdom, and whether you will be successful mainly depends on the experience of your leadership team and the company’s financial stability.
Essential questions to ask before launching your start-up are:
- What makes your casino different and appealing to UK players?
- Can you handle the upfront costs of compliance, licensing, and marketing?
- Does your team have the experience to navigate the regulated market?
- Are you comfortable working in a high-pressure market with significant financial and personal risk?
If your answer is ‘No’ to any of these questions, there are better start-up options than launching an online casino in the United Kingdom. Only founders with a well-defined strategy, ample resources, and a deep understanding of the regulatory landscape should enter the online gambling world since it’s no longer a get-rich-quick scheme.
