It"s guranteed money out there. why so many people get greedy is beyond me. you could take a stoned idiot to move numbers and still win, thats how strong it is. as long as you manage your money its noway to lose. sure its nice to have someone moving numbers that knows what he is doing. I still think so many books go underground because of GREED... so many books try to be millionaires too quick, and thats what usually knocks them out.
i posed this question when i first joined the rx and was told by many books have advertising costs, bonuses, etc so it is easy for them to go out of business....what business doesnt have expenses, please tell me......i will never understand how a casino or sportsbook doesnt win......
I would think that it would be extremley dificult to open a new sportsbook and make money in the first few years.
1) for every dollar that is sent to you, assuming you will cover fees, you'll only get $0.96. So if soeone just rolls thier money once, on average all you have done so far is make back the money you lost on deposit fees.
2) in order for a new sportsbook to attract new customers, you are going to have to give away incentives. These incentives or bonuses, cost you money.
3) Typically a large percentage of players that will be willing to risk funds at a new sportsbook are experienced middlers, scalpers, and whores. So while maybe your thoeretical hold on sqaures is about 5%. ON these players its probably cloer to 1 or 2%. In fact, because this is a sportsbook and not a casino, if you don't have a good linesmanager, you could actually have a negative thoeretical hold against some of these players.
4) you are going to lose to these sharp and semi sharp players. The only money you will make is after your squares first roll thoiermoney once to cover depsoit fees, than roll their money enough times to cover the bonuses they recieved, and only after that do you start making all your money.
5) You have a long list of exspenses that need to be paid for. a) software, b) hardware c) payroll d) rent e) admonitstartive exspenses.
Probably the biggest mistake people make is confusing a casino with a sportsbook. At a casino you can set you thoeretical hold on any game you wnat. And you will be sure to make money on all your customers. With a sportsbook, you can't do that. If your players are sharp, you will lose. Becaus ehtye will only bet, when they have the advantage. SO the only way to survive is by being willing to lsoe money for the first few years unitl you can build up a large enough square base to support your business. Most investors in sportsbooks, don't appear to be willing to wait that long. And many also don't have the marketing know how to attract the customer base they are looking for.
1) for every dollar that is sent to you, assuming you will cover fees, you'll only get $0.96. So if soeone just rolls thier money once, on average all you have done so far is make back the money you lost on deposit fees.
2) in order for a new sportsbook to attract new customers, you are going to have to give away incentives. These incentives or bonuses, cost you money.
3) Typically a large percentage of players that will be willing to risk funds at a new sportsbook are experienced middlers, scalpers, and whores. So while maybe your thoeretical hold on sqaures is about 5%. ON these players its probably cloer to 1 or 2%. In fact, because this is a sportsbook and not a casino, if you don't have a good linesmanager, you could actually have a negative thoeretical hold against some of these players.
4) you are going to lose to these sharp and semi sharp players. The only money you will make is after your squares first roll thoiermoney once to cover depsoit fees, than roll their money enough times to cover the bonuses they recieved, and only after that do you start making all your money.
5) You have a long list of exspenses that need to be paid for. a) software, b) hardware c) payroll d) rent e) admonitstartive exspenses.
Probably the biggest mistake people make is confusing a casino with a sportsbook. At a casino you can set you thoeretical hold on any game you wnat. And you will be sure to make money on all your customers. With a sportsbook, you can't do that. If your players are sharp, you will lose. Becaus ehtye will only bet, when they have the advantage. SO the only way to survive is by being willing to lsoe money for the first few years unitl you can build up a large enough square base to support your business. Most investors in sportsbooks, don't appear to be willing to wait that long. And many also don't have the marketing know how to attract the customer base they are looking for.
Set up costs and advertisement campaigns can indeed create cashflow problems to underfinanced operations. Todays cost of acquisition are extremely high ( $ 500 per player ).
Its incorrect to mention Mansion in this thread. They are most definitely NOT underfinanced.
A good example would be Betpanam. 230K start up capital, excessive bonus offers ( which usually pair up with low customer retention ) and the operation automatically finds itself dipping into players money to cover costs. A bad season or a wrong customer base combined to poor risk management does the rest.
Doomed operations are very reluctant in cutting players limits since they fear withdrawals they cannot afford to sustain, hence speeding up the chase to the point of no return.
Main reasons for a book to go under is a combination of lack of bankroll and poor risk management.
Its incorrect to mention Mansion in this thread. They are most definitely NOT underfinanced.
A good example would be Betpanam. 230K start up capital, excessive bonus offers ( which usually pair up with low customer retention ) and the operation automatically finds itself dipping into players money to cover costs. A bad season or a wrong customer base combined to poor risk management does the rest.
Doomed operations are very reluctant in cutting players limits since they fear withdrawals they cannot afford to sustain, hence speeding up the chase to the point of no return.
Main reasons for a book to go under is a combination of lack of bankroll and poor risk management.
Keep in mind that most of the books were street bookies who moved offshore. They were mostly street wise but business sense poor. On the street they operated mini monopolies. But suddenly around 2000 offshore competition became fierce and acquisition costs (marketing) went from $20 a player to today’s $400 a player. The old street bookie was the most exposed participant in the cycle. The idea of giving out a "bonus" was beyond comprehension. And marketing and the heavy cost of transactions solidly tipped the scale against him.
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The aggressive recreational books like BetOnSports, VIP and SportInteraction also stressed the offshore dynamics by reeling in all of the high margin players and leaving the old street bookie with the leftovers...the sharps. The final blow came from spinoff of forward thinking bookies with bankrolls of serious wealth who basically kidnapped the serious player market. This carnivore not only hogged all the players they bet into these books beating them all. This book is of course Pinnacle.
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Still think it's hard to go broke being a book?
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fficeffice" /><o></o>The aggressive recreational books like BetOnSports, VIP and SportInteraction also stressed the offshore dynamics by reeling in all of the high margin players and leaving the old street bookie with the leftovers...the sharps. The final blow came from spinoff of forward thinking bookies with bankrolls of serious wealth who basically kidnapped the serious player market. This carnivore not only hogged all the players they bet into these books beating them all. This book is of course Pinnacle.
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></o>Still think it's hard to go broke being a book?
Rainbow said:
Posts like this allow readers to differentiate between the informed and uninformed posters.
If you were to start a brand new book, with all the associated expenses, giving out the slightly-above-average bonuses that a new book needs to give out to attract new customers, and not having any existing customers going into it ... you have about as much chance at succeeding as you have of going to the moon.
sherman said:
Sherman: Many casinos have lost in Vegas. It's a long list of failed operations. The reason, IMO is they have competition. CT could use a dose of that. You can't even play single deck BJ in CT. Once you are inside the building, that's it, only one other place to go, and that would take the better part of an hour to get out of casino, drive, park, and get to other casino floor. I doubt there are any 100% + pay slots. There really isn't a thing you can beat at Sun... no poker, no sports... bj maybe !
Go to Vegas sometime, you'll love it !
The guys that should never lose are the local bookies, their only problem is collecting... and that prison thing.
Who said anything about post ups. maybe you stop and read before you blabber your mouth. if you have a good name you will get as many as customers you need through agents. and for your information it would be a BRAND NEW BOOK...Halifax said:
I said I dont see how a Sportsbook can go broke. if I opened one up I wouldnt need post ups. all the money in the world cant buy your name. the problem with alot of people they start betting for like 5 years and they act like they been doing it all their life, me myself I have been doing it for 37yrs.
Don't see much discussion here of having a great linesmaker. If you're not a huge operation, matchup isn't going to pay the bills. You have to take sides on games to make money. Lousy linesmaking will put you in the soup quickly. Sometimes even a larger operation (Aces/Gold) will go belly up partly because of the lines they were posting.
SENDITIN said:
Without a doubt a excellent line mover helps out tremendously. but if you are dealing with all squares you could put someone that didnt know the war was going on and explain to him just move the lines just like the donbest screen, and you would still win, I know the excellent line mover would win more, when I say an excellent line mover I mean someone that knows the difference between hot and cold money, and also gets good info and alot of times knows which way the line is going.
Rainbow,
Agree with you...the squares couldn't pick the right side if they had tomorrow's paper. I think finding a perpetual square client list would be like finding the Arc of the Covenant. What happens when the squares start tapping out? Are you saying there's a bottomless pit of squares for future clients?
Agree with you...the squares couldn't pick the right side if they had tomorrow's paper. I think finding a perpetual square client list would be like finding the Arc of the Covenant. What happens when the squares start tapping out? Are you saying there's a bottomless pit of squares for future clients?
