We have written several bookie tutorials on how to open a sportsbook. However, these tutorials were for agents and operators that already know they want to open their own gambling operation. Thus, in this tutorial, we go over the first Steps to Open an Online Sportsbook and what it entails.
Before we begin, you should first figure out if you are ready to become an online bookie. This is because even with today’s sportsbook software, being a bookie is still owning a business. Therefore, it is still a lot of work and the majority of first-time bookies will not last a season. At least, not the full-time one that have bookmaking as their main source of income.
In addition, owning an online sportsbook is not just taking sports bets and collecting money from a player’s loss. Bookies earn a living from the vig or the juice for every bet they take. On average, this is about 4.5% to 5% profit margin from all of the bets they take. Needless to say, most bookies will not be able to make a living from that their first season. In fact, most bookies will be in the red the first season. If they are lucky, they will break even the second season if they retain and get enough new customers.
Now that you know some of the hardship and challenges of being a bookie, here are the First Steps in opening an online sportsbook.
Necessary Steps to Open an Online Sportsbook
Step 1 – Figure out the Kind of Sportsbook do you want
It is important to figure out the type of sportsbook you want to operate. This is because it will also dictate the type of clients you will cater to. In turn, this will also affect the amount of starting capital you will need to open your sportsbook website.
For example, will you have a policy that you will only take recreational players or will you cater to mostly sharp bettors? Some agents are under the impression that recreational sportsbooks require less funds to start. However, that is not always true as recreational bettors tend to ask for a payout as soon as they win their bets. Therefore, you will need a decent amount of starting capital or a way to collect money quickly from the losers.
On the other hand, sharp bettors tend to keep their money in their betting account until the end of the season. In addition, they also tend to bet more and make larger wagers. However, to cater to sharp bettors, you need to have excellent betting odds and be constantly monitoring your betting odds. This is because you need to have a very good balance between player wins and losses so you can make a profit from the vig.
So, what kind of sportsbook do you want to have?
Step 2 – Setting Wagering Limits
Another important item to factor in are the player limits you will give your players. It is important as it will also help dictate the starting capital you will need. This is because the higher the betting limits the more liquid cash you will need for payouts. On the other hand, if your limits are too low, you probably will not get a lot of customers.
Step 3 – Setting Up a Banking Management System
The ability to receive and pay your gamblers is very important and not always easy to do. Yes, you could collect the money personally if you are a corner bookie but that is not always feasible. Person-to-person transactions are also an option but it is expensive and a hassle for most people. Let’s just say that a good iGaming Payment Management System will help acquire and retain players.
It is best to use a banking management System that can easily add and integrate various methods of banking. If you use a Pay Per Head Bookie provider, use one that keeps track of various banking methods like PricePerPlayer.com.