If you’re looking to start a sports betting business, whether you want to accept online bets or accept wagers from the public, then there are a few things you need to understand.
Here’s an overview of what you need to know to get started successfully.
The History Of Sports Betting
While many sports have been featured on TV and the internet long before it became popular to place sports bets, horse racing and boxing were the only sports available for betting interest. However, as the 21st century rolled in, more and more people were discovering the excitement of placing wagers on sporting events, especially football. Professional sports betting really took off when the Nevada Gaming Act was passed in 1931, which legalized sports betting in the state. Prior to that point, many states had imposed penalties for engaging in sports wagering activities.
Since then, other sports have risen in popularity and importance as sports betting has expanded. In 2015, for example, the total prize pool for the Super Bowl was 100 million dollars, the largest in history. And the NBA Finals between the Golden State Warriors and the Cleveland Cavaliers drew a huge audience as well, with over 2 billion views on YouTube alone.
Although there have been some legal challenges to the Nevada Gaming Act, it continues to be the legal basis for sports betting in the United States. And to this day, it remains the only state-by-state legal framework for sports betting in the country. In 2018, the federal government also enacted the Professional and Amateur Sports Protection Act (PASPA), which effectively nullified many of the federal laws that had limited sports betting prior to its reauthorization in 1992. PASPA allowed states to establish their own regulatory frameworks for sports betting, with some restrictions. The state of New Jersey, for example, only allows bets on collegiate sporting events.
Which Sport To Bet On?
The first step in the process of setting up a sports betting business is to decide which sport to bet on. If you’re new to the business, it’s highly recommended that you begin with betting on horse racing. It’s one of the most popular sports in the U.S., so you’re sure to find an audience eager to place wagers on the outcomes of horse races. The odds are always in your favor, and there’s a lot of flexibility when it comes to placing wagers. You can place a single bet or set up shop at a racetrack and bet on a variety of sporting events.
Hockey and basketball also draw large audiences, particularly amongst younger people. It would be a great way to expand your customer base if you establish a presence on social media channels like Twitter and Instagram, where you can engage with fans and share exciting game updates.
How Does Betting Work?
Once you’ve decided which sport you’ll bet on, you need to learn the basics of how betting on sports works. There are several different ways to place a bet on a sporting event, depending on how much you’ve got to wager and whether you want to bet online or at a physical bookmaker’s. Let’s take a quick look at how each method works.
Over/Under The Spread
If you’ve ever watched ESPN, you probably know what over/under betting is. On sportsbooks, you can bet whether the total number of points scored by both teams in a particular game will be higher or lower than a set amount. For example, if you choose an over/under of 57 points, then you’re betting that the game will end in a total of more than 57 points scored. On-the-ballers, runners, passers, or kickers are often involved in these types of bets because they impact the total number of points scored. These are also referred to as “money line” bets because the payout and return are based on whether or not your chosen team wins.
Under/over betting is another common wagering scheme, in which you predict whether the total number of points scored by both teams will be lower or higher than a designated amount. For example, if you choose an under/over of 37 points, then you’re predicting that the team will score less than 37 points and will lose the game. Under/over betting has become popular because it offers people the opportunity to bet without having to predict the winner of the game. The point spread is the amount of points that the winning team is expected to score. So, if you bet on an under team, then the point spread is usually in their favor. On the other hand, if you bet on an over team, then the point spread is usually in your favor as well because the over team usually scores more points than the number that was predicted.
Point Spread
If you’re familiar with sports betting, you may know what a point spread is. It’s the amount of points that you have to wager in order to win a bet. For example, if you bet $10 on a football team with a point spread of 3 points, then you’re wagering $10 that your team will score more than 3 points. Point spreads can vary from +3 to –3, so you have to make sure you’ve got enough money to cover the spread, whether you win or lose the bet.
Over/Under The Total
Over/under betting on the total is yet another common type of bet. This type of bet is usually placed on a single player’s performance in a specific game. On-the-ballers, runners, passers, or kickers often find themselves in situations where they have to run with the football and score more points than the opponent. So, if you choose an over/under of 57 points for a single player’s performance in a football game, then you’re predicting that that player will score more than 57 points and win the game. Just like in the previous two wagering schemes, over/under betting on the total is usually placed on a single player’s performance in a specific game. Although many people still wager on the outcome of games, the point spread and over/under betting on the total have risen in popularity because a lot of people find it more convenient to wager on a single player or a team’s performance in one game rather than having to keep track of the scores of multiple games.
Types Of Wagering
While there are several different ways to wager on sports, not all of them are available to all businesses. For example, you may want to avoid placing wagers on golf tournaments and bowls because these types of events are covered by the USPGA and the NCAA, respectively, and you may be restricted from doing so by law. If this is the case, then you may want to consider alternatives such as on-the-ballers and over/under betting, where your odds are usually in your favor because the under teams and over teams usually lose.
What Is The House Edge?
When you place a wager on sports, whether it’s at a physical sportsbook or online through a bookmaker, you’re essentially splitting the profits with the house. This is why it’s often referred to as “the house edge.” The house edge is the amount of money that the sportsbook expects to make off the overall activity, including your wagering and the betting of other people. The sportsbook is expected to make their money back from the betting activity plus a small amount for handling charges. When you bet on sports, regardless of the method you use, it’s important that you keep in mind that you’re essentially gambling with the house’s money, and you have to expect to lose some of it. If you want to keep the house edge low, then you should avoid betting on events where the house edge is in excess of 3%.
Establishing a sports betting business is a profitable venture if you do it legally. However, if you want to go the extra mile and ensure that you’re creating value for your customers, then you may want to consider creating an affiliate marketing program where you payouts are based on success and you don’t have to worry about legalities.