Top Mistakes to Avoid When Starting Your Sportsbook

With the global sports betting market projected to reach $182.12 billion by 2030, launching a new sportsbook presents a lucrative opportunity. However, a sportsbook launch also comes with challenges that are often underestimated. 

 

Many new operators fail due to mistakes in licensing, technology, risk management, and customer experience. This guide showcases the top mistakes to avoid when starting your sportsbook to ensure long-term success. 

 

Ignoring the Foundations of Licensing and Regulation

 

One of the main mistakes operators make is ignorance of the licensing and regulation requirements. Operating a sportsbook without proper licensing is a fast track to legal trouble and financial penalties. 

 

For instance, in 2022, the UK Gambling Commission fined four operators for compliance failures, with the fines totalling £20 million. Not to be one of those operators, it is essential to consider a few key steps: 

 

• Obtain licenses from reputable regulators (e.g., UK Gambling Commission, Malta Gaming Authority, or Curacao eGaming).

• Ensure compliance with anti-money laundering (AML) and responsible gambling laws. 

• Stay updated on regional restrictions (e.g., the U.S. requires state-by-state licensing).  

 

Choosing the Wrong Sportsbook Platform

 

The platform is the backbone of the sportsbook business. A poor choice will lead to downtime, security breaches, and scalability issues. This mistake mostly occurs when operators navigate toward cheaper options with outdated features. 

 

The key things to avoid when choosing a platform are: 

• Poor performance during peak events. Platforms that lag or crash during high-traffic moments like the Super Bowl or the Champions League can ruin the user experience. Check reviews on platforms like G2 to spot recurring issues with the platform providers you consider collaborating with.

• Lack of essential integrations. Don’t overlook API integrations for odds feeds, payment gateways, and KYC solutions; missing these can seriously limit your platform’s capabilities.

• Security vulnerabilities. Stay away from platforms with a history of data breaches, fraud incidents, or weak security protocols.

 

Opt for a reliable white-label or turnkey solution to ensure a robust, scalable platform. Always test thoroughly before launch to avoid issues post-deployment. Key metrics to consider include uptime, with a target of 99.9 %+ SLA, to ensure consistent service, especially during high-demand periods. 

 

Also, make sure to choose a platform that offers a seamless mobile experience, that enhances user satisfaction and retention. These metrics directly impact the platform's performance and user engagement.

 

Not Having a Clear Trading and Risk Strategy

 

Without a solid trading and risk management strategy, your sportsbook can suffer heavy losses. A clear risk management strategy includes setting rules and regulations for: 

 

• Bankroll Management. Setting limits on the amount of money allocated for betting activities to prevent significant losses. 

• Odds and Margin Management. Adjusting odds to balance the book and protect profit margins while remaining competitive.

• Market Analysis. Continuously analyzing betting patterns and market movements to make informed decisions.

• Regulatory Compliance. Ensuring risk management practices align with local and international laws to avoid fines and license suspensions.

 

It is crucial to choose trustworthy odds providers and set up well risk management systems to flag suspicious bets, dynamically adjust odds, and move ahead safely. 

 

For instance, Altenar, a global sportsbook provider, partnered with FeedConstruct to enhance its platform with real-time, accurate sports data, pre-match and live odds. Having a quality and accurate feed helps to minimize risks and improve reliability of the odds.  

 

Initiating Operations Without A Marketing and Acquisition Strategy

 

Launching a sportsbook without a marketing plan is like opening a casino in the middle of nowhere. You might have the required infrastructure, but no one knows you exist. 

 

Several operators expect traffic from affiliates or organic growth, but do not have a clear action plan on achieving visibility and improving brand awareness. Lack of planning and KPIs is a mistake in a saturated and competitive market like sports betting. 

 

Meanwhile, established sportsbook companies understand the importance of marketing and have more successful ventures. They invest heavily in brand positioning, localized content, influencer partnerships, and retention strategies to ensure their platform thrives. According to a report by Scaleo, top-tier sportsbook operators typically allocate between $50 million and $200 million annually to marketing alone. While the average CPA (cost per acquisition) ranged from $250 to $750, depending on the competition and region. 

 

Make sure to avoid this mistake by: 

• Develop a multichannel acquisition strategy before launch. Determine which channels will bring in your highest-quality traffic; this could include affiliates, paid media (Google Ads, programmatic), SEO, content marketing, sponsorships, or partnerships with sports teams. Don’t rely solely on one.

• Localize Your Messaging. If you’re entering multiple regions, adapt your creatives, language, and offers to local preferences. 

• Track, Test, and Optimize in Real Time

• Use performance analytics tools to monitor how each campaign and channel is performing. A/B tests creatives, landing pages, and offers. Make sure to continuously optimize campaigns based on user acquisition costs, conversion rates, and lifetime value. 

• Build a brand. Build a brand that stands out by creating and sticking to a consistent visual identity, memorable messaging, and strong positioning. 

 

Avoid being just another sportsbook, be the Sportsbook that is memorized. 

 

Underestimating the Role of Player Support

 

Another mistake sportsbook operators make that impacts the performance of the business is underestimating the role of player support. Poor customer support leads to higher churn rates and more conflicts, and sometimes can be the cause of legal issues. 

 

Customers today are quick to abandon brands that don’t meet their expectations, especially when it comes to customer support. According to a Zendesk report, consumers give companies an average of just 2.2 chances before switching to a competitor. In fact, the same report states that 73% of customers would switch to a competitor after a few bad experiences. 

 

Poor customer service is the leading cause of this churn, making it critical for sportsbook operators to prioritize responsive, helpful, and consistent support from day one.

 

Overlooking Mobile Betting Experience

 

Overlooking mobile betting is a critical mistake, as mobile devices have become the dominant channel for sports betting. Users expect a fast, seamless, and intuitive experience; thus, operators who fail to deliver fail to profit. 

 

In fact, according to Grand View Research, the global sports betting market size was estimated at USD 100.9 billion in 2024 and is expected to grow at a CAGR of 11% from 2025 to 2030. This growth is primarily connected with the increased access to the internet and mobile phones, allowing users to place more bets. At the same time, NeuFutur Magazine claims that over 75% of bets globally during 2024 are placed using mobile devices. 

 

These figures and data highlight the critical importance of optimizing the mobile betting experience. A few actionable steps include: 

• Adapt a mobile-first design approach and ensure that the user interface of the sportsbook is tailored for mobile devices, allowing for intuitive navigation. 

• Optimize performance by minimizing load times and ensuring compatibility across various mobile devices and operating systems. 

• Enhance in-play betting features. Provide real-time updates, live-streaming options, and quick bet placement functionalities to cater to users interested in live betting.

• Simplify payment processes by integrating popular mobile payment solutions and ensure that deposit and withdrawal processes are straightforward and secure.

 

Offering Limited Payment Options or Poor KYC Processes

 

According to PayNearMe and Betting Hero’s 2023 Research, one of the top reasons for discontinuing play on an app among players is encountering depositing or withdrawing issues. In fact, 27% of players mentioned it as the number one reason. Another 32% answered that they are most likely to abandon an app if it takes too long to fund an account. 

 

Common issues arising from limited payment options include user frustration, abandoned transactions, and loss of trust. To mitigate these issues, sportsbooks should integrate a range of secure and convenient payment options, such as Visa, PayPal, Crypto, and others, catering to diverse user preferences. 

 

However, offering multiple payment methods isn’t enough. The underlying systems supporting them must also be secure and compliant. Inadequate Know Your Customer (KYC) procedures, for instance, can expose your platform to fraud, money laundering, and costly regulatory violations. These regulations are designed to verify customer identities and safeguard the integrity of financial transactions. Without robust KYC protocols, sportsbooks expose themselves to fraud, money laundering, and regulatory penalties. 

 

For instance, another gambling company was fined £19.2 million for failing to protect consumers and having weak anti-money laundering controls. The company systematically failed to comply. 

 

To avoid similar pitfalls, sportsbooks must approach payments and KYC not as daunting technical tasks but as integral parts of strategic operations. 

 

Going Live Without Proper Testing

 

Rushing the sportsbook launch without proper testing can lead to its failure, as this high-risk move can damage both user trust and brand reputation. From inaccurate odds to payment gateways that fail to work, everything can have huge consequences in terms of financial loss and regulatory violations. 

 

Thus, before going live, it is crucial to conduct in-depth end-to-end testing. This includes testing mobile responsiveness, simulating user flows, testing the responsiveness of the platform, and overall conducting compliance audits. 

 

As a sportsbook operator, make sure to have a checklist of things to test: 

• Functional testing: testing the core features, registration, login, depositing, betting, and withdrawing. 

• Payment gateway testing: testing integrated payment methods for deposits and withdrawals. 

• Load & stress testing: simulate high traffic scenarios to ensure the platform responds well. 

• Security testing: conduct vulnerability assessments to ensure secure operations. 

• Device & browser compatibility testing: make sure the sportsbooks work across a range of devices and browsers. 

• Compliance testing: ensure that the platform meets all regulatory requirements, including KYC, age verification, anti-money laundering protocol, and local licensing laws. 

 

Conclusion: Avoiding Mistakes is Just as Important as Innovation

 

To ensure the success of your sportsbook, it is critical to avoid mistakes such as improper testing, overlooking mobile betting experiences, and failing to comply with requirements. 

 

FeedConstruct helps sportsbook operators stay ahead by delivering high-quality sports data, pre-match and live odds, and video streaming solutions. With us, operators gain access to advanced products such as Odds Feed and Live Scouting Data.

 

The Odds Feed solution is powered by our Live Scouting Data, ensuring unmatched speed and accuracy. With a dedicated team of over 2,000 scouts collecting data across 18 sports, we deliver the fastest data transmission times in the world at just 0.5 seconds latency. This real-time data forms the foundation of our Odds Feed, which provides access to over 140,000 pre-match events and 90,000+ live matches monthly across more than 2,000 odds markets.

 

Moreover, to ensure the accuracy and reliability of our odds, a team of 700+ experienced traders continuously calculates odds based on the data gathered via the Live Scouting solution.

 

Together, these capabilities empower sportsbooks to deliver engaging, real-time betting experiences that meet the demands of modern bettors and boost long-term player retention.