By Simon Collins, Director, Cashcade Ltd.
With the recent economic chaos created by questionable practices in discredited investment banks, it may be time to focus on building businesses through sound principles in promising new markets, such as online gambling, where the UK has a natural advantage.
That may sound strange because the perceptions of online gambling companies like my own, Cashcade Ltd, can be quite negative, often as a result of alarmist press coverage or grandstanding politicians.
However, the reality is that our industry is one based on highly sophisticated technology, twenty-first century business practices, and, crucially, a progressive legislative environment. What’s more it’s growing fast, is profitable and has a great entrepreneurial spirit. How many other UK business sectors can you say that about?
For innovative British-based technologists and engineers that means there’s a profitable, forward-looking marketplace for their ideas – and willing operators looking for the next applications and services to build into their online offerings.
The UK and European technology community is often overshadowed by America’s Silicon Valley with its established start-up environment and the benefit…
…of a vast consumer marketplace right on its doorstep. However, George Bush’s (remember him?) Unlawful Internet Gambling Enforcement Act (UIEGA) made online gambling illegal in the USA. That means the burgeoning industry is off limits to our friends in San Jose, but a great option for the technologists of Cambridge (the original one) or the entrepreneurs of ‘Silicon Roundabout’.
What’s more gambling has, historically, tended to hold up well during times of recession. And common to other sectors, online gambling has an advantage when times are tight. We are not affected by the overheads of real estate and property cycles. The focus can be purely on the customer experience which is increasingly one enjoyed in the comfort of people’s own homes.
As an industry, online gambling will never be The Daily Mail’s favourite. (That said, the paper’s views may have changed since launching its own Bingo site). However, Cashcade and other responsible operators like us have thousands of happy customers, solid revenue streams, debt-free balance sheets and, we believe, a bright future.
So as an entrepreneur how do you approach the online gambling market? As with any other sector you should try and understand the customer. In the Bingo market, the customer is generally young and female. This is contrast to the Poker sector, where the customer profile is more likely to be older, male and affluent. As you’d imagine, they are very different audiences looking for different things.
It’s also important to understand the trends that are driving the marketplace, many of which will be familiar. Personally, I am interested in technological innovation in the mobile and social spaces that make our customers’ experiences more enjoyable and therefore likely to build loyalty to our brands Foxy Bingo and GetMinted.
The online gambling market may not be for everyone. However, if you are a UK technology entrepreneur looking for ambitious, entrepreneurial clients with profitable, well-established online customer bases, the answer may be closer to home than you think.
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