How to Start Your Own Sportsbook Business

The sportsbook industry is a core of the gambling ecosystem. Traditionally, betting is more popular than online casinos, especially in countries with solid sports cultures. For example, the UK is obsessive about football, the U.S. is crazy about NFL and NBA, and India spends all its free time playing cricket.  

During major sports events like the World Cup, Super Bowl, Olympics, sportsbook usage can spike dramatically, often outperforming online casinos. According to Entain, global betting volumes during the Paris 2024 Games were double those of the Tokyo 2020 Olympics.

So, sports betting has a huge user base, which is predicted 182.5 million by 2029, according to Statista. Meanwhile, the online sports betting market was valued at $95.5 billion in 2024. It’s expected to grow to $275 billion by 2034, reflecting a compound annual growth rate (CAGR) of 10.5%.

Yes, we know, sportsbooks are a hot commodity for those who want to enter the online gambling industry. But how to start your own sportsbook business? Let’s find out.

What is a Sportsbook?

A sportsbook is a place where people can bet their money on sports. They can do it online or in the physical office of a bookmaker. They can bet on football, basketball, tennis, horse racing, and even esports. 

From this point, the primary function of a sportsbook is to accept wagers on sports, allowing bettors to predict the outcomes of these events. 

Unlike online casinos, people’s skills and knowledge matter in sports betting, not luck. So a person who is good at football knows all the pros and cons of different teams and players and uses it to predict a possible outcome. 

So how does it work?

A sportsbook operates as a bookmaker or "bookie," setting odds for different outcomes and taking bets from customers. When there is a match between Team A and Team B, and people want to place a bet, a sportsbook gives them choices — these choices are betting markets.

Odds tell them how much they can win if their bet is correct. If a team is very likely to win, the odds are low, which means less reward. But if a team is unlikely to win, the odds are high, so it's a bigger reward than. 

The sports bookie protects itself from losing too much money, and how it does so is called risk control. If too many people bet a lot on one outcome, and that outcome wins, the sportsbook could lose a lot. To keep itself from being bankrupt, the system limits how much people can bet, adjusts odds, or even blocks certain bets to balance the risk. 

The sportsbook charges a commission, people also call it the vig or juice. That’s how sportsbooks make money, regardless of the event’s outcome. 

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Key Steps to Launching a Sportsbook Business

There are two main ways to start a sportsbook business:

Custom development is the first and most complicated way. You build the software from scratch with a tech team. With a lot of effort, you have full control over the features, design, and functionality of this sportsbook. But it takes more time and money to develop and test than to try the second way. 

A turnkey solution is a way to save money and time, using a ready-made sportsbook with already built-in features, betting markets, odds, and admin tools. You have less control and can’t customize the platform, but it’s much faster and cheaper than creating the sportsbook from scratch, which is perfectly reasonable for startups and companies without experience in the industry. 

One way or another, starting your own sportsbook business involves several critical steps.

Step 1. Conduct Market Research and Define Your Business Plan

It’s good to start by researching the sports betting market, industry trends, and your target audience to understand demand and competition. Next, define which sports and bet types you will offer.

Step 2. Find a Reliable Data Provider for Real-time Odds and Stats

Any sportsbook runs on data, especially when it comes to live games. So you need a data provider to supply:

• Real-time odds (who is likely to win, etc.)
• Game stats (scores, goals, injuries, fouls, etc.)
• Live feeds for in-play betting.

If the data is slow or wrong, users may lose trust and money, miss bets, or face legal issues in the end.

Step 3. Build or Choose a User-Friendly Website

There are thousands of sportsbooks in the gambling industry. Your sports betting platform should be comprehensive. What does it mean?

Your website or app should be:

• Easy to use: it should take no more than 1-2 clicks to find anything. 
• Fast and mobile-friendly: Most users bet from their smartphones. 

Interactive: there should be things like bet slips, filters, and search functions.

This list of necessary things can be endless. But these points are the base that might keep players from going to competitors. 

Step 4. Obtain a License 

Like online casinos, sportsbooks should obtain a license to legally operate.

If you plan to focus on a specific market, like the U.S.A. and the U.K., get a license in these jurisdictions. Good news: over 38 U.S. states legalized sports betting. 

But if you want to start an international business, get a license in Malta, Curaçao, Isle of Man (if you have enough time and budget), or in Anjouan, Tobique, and Kahnawake in Canada if you prefer a cheaper and faster way.

The licensing process includes background checks, taxes, strict compliance, and more. It might be challenging if you do that on your own. Why spend your precious time on bureaucracy? 

We, at MGL, can assist you in paperwork and handle an application process to help you focus on business directly. 

Step 5. Set up Payment Integrations

First, open a high-risk merchant account to process customer payments securely. Next, partner with reputable payment providers that support fast, multi-currency transactions. We can assist you even here. In the end, your sportsbook should meet all the security standards and accept a few payment gateways:

• Credit/debit cards
• Bank transfers
• E-wallets (Skrill, Neteller, PayPal)
• Cryptocurrencies 

When all the necessities are in place, you can go to the marketing and promotion part. Don’t forget to monitor betting activity closely to balance risk and adjust odds accordingly.

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Who Should Consider Starting a Sportsbook?

Starting a sportsbook can be a profitable venture for those with the right resources, knowledge, and risk tolerance. Here’s who should consider starting a sportsbook:

iGaming Businesses

If you already run an online casino, adding a sportsbook is a smart move. You already have a player base, a gaming license, and payment systems in place. By offering sports betting too, you give your users more ways to play and keep them coming back more often—especially during major sports events like the World Cup or Super Bowl.

Those familiar with sports, betting strategies, and industry trends can navigate the complexities of running a sportsbook more effectively. 

Entrepreneurs with Sufficient Capital

Starting a licensed sportsbook requires a significant investment, ranging from $500,000 to $2 million, to compete in the legal sports betting market. Even smaller operations need a cash reserve to cover operational costs, licensing fees, and bet payouts. 

Startups

Don’t be scared of six-figure numbers. For new business owners, a sportsbook can be an exciting entry point into the digital entertainment world. Turnkey solutions also make it easier to launch quickly without needing to build everything from scratch. It’s not only faster but also much cheaper. 

Those Prepared to Navigate Legal and Regulatory Requirements

The sports betting business is heavily regulated, and compliance with local laws is essential. Entrepreneurs must obtain the necessary licenses, understand data protection, manage risks, and prevent fraud and money laundering. 

Why Enter the Sports Betting Market Now?

The sports betting industry is experiencing unprecedented growth. It’s projected to reach an impressive $153.71 billion by 2029 at a CAGR of 5.4% in the U.S. alone. 

A market this large can’t go unnoticed, so the more expansion, increased legalization, rising consumer demand, and technological innovations, making it a lucrative time to enter. 

The industry is adopting cutting-edge technologies, like artificial intelligence (AI), virtual reality (VR), blockchain, and live streaming. The main advantage of these innovations is they enhance user experience, engagement, and personalization.

It’s also time to enter the sports betting market also because many regions have seen its fast growth and liberalize laws around sports betting, creating an accessible environment for new operators. This ongoing trend opens opportunities for entrepreneurs willing to navigate compliance.

The cherry on the top is high revenue potential. The industry’s revenue is projected to grow significantly, with estimates of $124.39 billion in global revenue by 2025 and further expansion afterward. 

How to Monetise a Sportsbook

Here are the key methods and approaches to monetize a sportsbook effectively:

Commission-Based Betting (Vig or Juice)

This is the most common revenue model. In essence, a sportsbook takes a small commission from each bet placed on the platform. People call it "vig," "juice," or "hold." The commission is charged regardless of the bet outcome, so a sportsbook profits over time. 

Margin on Odds

Sportsbooks set betting odds with a built-in margin that guarantees profit. This margin ensures the house earns money regardless of which side wins. It is subtly incorporated into the odds offered to bettors, making it a fundamental profit mechanism.

Live Betting

When a sportsbook offers live betting options during ongoing matches, it increases user engagement and betting volume. Sportsbooks can charge higher commissions or margins on these bets due to the dynamic nature and higher risk. At the same time, live betting keeps users active longer, increasing lifetime value per customer.

In-App Advertising and Sponsored Content

Some sportsbooks display targeted ads related to sports merchandise, events, or other betting platforms that generate additional income. They can be different formats, such as banner ads, video ads, and sponsored content like exclusive interviews or betting tutorials.

Fees on Deposits and Withdrawals

You might see that many sportsbooks charge transaction fees on deposits and withdrawals. They do that because it creates a steady revenue stream. These fees can be flat or percentage-based, encouraging frequent financial activity within the app.

Differences Between Sportsbooks and Online Casinos

As already mentioned, a sportsbook and an online casino are different by nature. A sportsbook has a focus on betting on the outcomes of sports events like football, basketball, and even eSports. So bettors wager on predictions like who will win, scores, or other event-specific outcomes.

By contrast, online casinos offer slots, poker games, roulette, and baccarat to play. Most of those games are games of chance or skill-based card games played against the house or other players. 

They differ by competition and odds. Playing sportsbooks, people are competing against the bookmaker, which sets odds for every possible outcome. The odds give bettors some control over their potential winnings, because their skills and knowledge of a specific sport can influence betting decisions. 

In online casinos, players often compete against the house with games designed with a built-in house edge. That’s how the casino gets its long-term profit. 

Poker can be an exception because it involves competing against other players, but many are pure chance-based with fixed odds favoring the house.

How about profit margins and business models? They differ as well. 

A sportsbook operates on thinner margins (typically 4-5%) and relies on high volume betting to maintain profitability. Bettors can occasionally beat the book, which adds risk for the operator. 

Online casinos generally have higher profit margins (often 7-15% house edge on slots) and more consistent returns due to the built-in advantage in games. Online casinos tend to generate significantly higher revenues than sportsbooks. 

If you are searching for cross-selling opportunities, you need to use different approaches for sportsbooks and online casinos. 

Sports bettors are more methodical, while casino players are more impulsive. Cross-sell strategies must align with these styles—use quick-win games for bettors and structured offers for casino users.

Trends in Sports Betting

Here are some of the key trends:

• Artificial Intelligence (AI) and Machine Learning (ML): Like everything in the digital world, AI is being used to enhance prediction capabilities, analyze real-time data, and provide personalized betting experiences. ML models help in setting more accurate odds and predicting outcomes based on vast datasets. 
• Blockchain and Virtual Reality (VR): Blockchain technology is improving security and transparency, while VR is enhancing user engagement by offering immersive experiences. 
• 5G Networks and Mobile Betting: The adoption of 5G networks is accelerating mobile betting, so bettors can enjoy faster, more reliable connections and real-time updates.
• Live Streaming and Real-Time Analytics: More platforms are integrating live streaming with real-time analytics. This helps bettors to make informed betting decisions and engage more actively with sports events. 
• Social Media Integration: Sports betting is becoming more social. Bookmakers integrate their platforms with social media. As a result, fan interaction is growing and community building is growing around sports events.
• Virtual Sports Betting: Virtual sports are gaining popularity, offering betting options on simulated events, which can be played at any time. 
• Legalization and Regulation: Many regions are legalizing sports betting, but regulatory challenges remain, requiring operators to adapt to varying legal frameworks. 
• In-Play Betting: Real-time betting during events is becoming more popular, offering dynamic wagering options. 
• Daily Fantasy Sports (DFS): DFS continues to grow, allowing users to participate in short-term contests based on real sports statistics.

Risks in the Sportsbook Industry

Yes, sports betting involves a lot of opportunities for businesses, but the industry isn’t free of risks. 

Technological Failures

Like anything digital, sportsbooks can face system crashes, server downtime, and software glitches. All these problems can disrupt betting operations, causing a loss of revenue and customer trust. Platforms can avoid these problems if they continually monitor their systems. 

Human Error

Mistakes by employees or customers can lead to financial losses or operational inefficiencies. Training and clear procedures help reduce these errors.

Fraud and Cheating

Besides human error like mistakes by employees or customers, there are also sophisticated fraud schemes such as multi-account betting, arbitrage, and late betting that exploit loopholes to guarantee wins. All of these causes significant losses to sportsbooks.

Regulatory Compliance

The sports betting industry is heavily regulated, with laws varying by jurisdiction and frequently changing. Sportsbooks should always monitor changes to comply with them. Otherwise, any non-compliance can result in hefty fines, license revocations, or business shutdowns. 

Wrapping Up

Sportsbooks are capturing emerging markets with a strong sports culture. This is a promising segment of iGaming, because it offers both immediate and long-term potential for operators.

There are some future opportunities:

• Rapid adoption in emerging markets like Africa, Asia, and LATAM.
• Bet-and-watch experiences will drive engagement.
• New verticals like esports and blockchain-based betting are next-gen growth areas.

All of these areas are big enough to build a business in. But most of the time, success depends on smart tech choices, regulatory readiness, and innovation. Operators who invest in quality platforms, real-time data, and seamless payments will be best positioned to lead in this dynamic space.

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