Gaming has won big in 2021, with the American Gaming Association (AGA) declaring it “a new record as the most profitable year ever” for US commercial gaming with $53 billion in revenue.
The industry is changing rapidly, with states setting their own timelines and rules, leading the AGA to ask Attorney General Merrick Garland to crack down on unauthorized sportsbooks. Now is the perfect time for a form of online betting that takes the big bettors and offshore operators out of the equation to allow ordinary people to have a little fun.
That’s the idea behind Lucra, a peer-to-peer (P2P) betting platform that founder and CEO Dylan Robbins sees as a more personal way to tap into the demand and immense potential.
Telling PYMNTS there’s “huge demand for traditional, passionate sportsbooks in the United States,” Robbins said existing sites ostracize “the 100 million sports fans who love LeBron James, or follow the New Yorkers. Knicks, or they’re a Tiger Woods fan, but they’re not really betting today.
Many who don’t bet but would like tend to be confused about legality and safety and it doesn’t seem “accessible”. Also, most don’t understand the jargon.
“What is parlay, teaser juice, vig, odds, you know? It’s a complicated thing,” he said.
Mainly, even the uninitiated player knows that they don’t trust the house odds.
“A lot of them say, ‘I don’t want to bet against a black box’ or ‘I don’t want to bet where I don’t have the same information as the other operator. I don’t want to bet in a group of 5,000 people, I want to bet against you, or my sibling,” Robbins said. “That social interaction is the connection.”
Gamified 1-on-1 sports betting against friends and family for small amounts is safe enough to pass the litmus test in 37 states, according to a legal opinion Lucra wrote, which was enough to attract $10 million in funding Series A announced in March.
Focusing on social betting gives people who already play sports a new way to bet, Robbins said.
“People who talk about it, discuss it, now they bet on it,” he added. “That’s huge for fan engagement. If you have $10 on the game, studies show adrenaline, brainwaves, just the way you feel about it changes.
See also: States pursue online gambling in a bid to restore pandemic-hit tax coffers
Focus on compliance
Much of the legal wrangling around online betting comes down to games of chance versus skill-based games. States regulate the two types differently, which is to Lucra’s advantage.
Calling the Las Vegas odds little more than a coin toss by people you don’t know based on intricacies you may not grasp, Robbins told PYMNTS that Lucra is a platform generated by the user. By using the site, users create their own contests, create their own set of terms and share it with each other.
“We’re taking a lot of luck,” Robbins said. “Lucra is really focused on the area of skills, where 37 states, according to our legal opinion that we wrote by our team, allow us to operate.”
When the remaining 13 states join “it’s hard to plan,” he said, but Lucra is going in a different direction from Caesars Entertainment, DraftKings and FanDuel — and may have an edge. Part of this comes from groundwork done in compliance and an anti-money laundering (AML) and know-your-customer (KYC) technology stack that puts users and regulators more at ease.
“We will not be the guinea pig. We are a conservative company in this regard. We built our business legal first,” Robbins said, calling it wise to follow the paths blazed by the bigger operators.
Without naming platform partners, Robbins said Lucra “works with the same people in the space that a lot of the big players do. We work with the highest quality people, both KYC and AML, compliance, etc. I think it helped us build a very secure and transparent platform.
This also applies to banking and payments, where Lucra leverages its banking partnership with an in-house team “working day in and day out on our product, analyzing our data pattern recognition, monitoring transactions, verifying reports and ensuring that all of our users operate within our guidelines,” Robbins said. “The fight against money laundering is huge, especially peer-to-peer.”
Read more: Global Payments Gaming Solutions on Adopting an Omnichannel Approach to Streamline Payments and AML/KYC Requirements
Beyond sports betting
While not alone in the P2P social gaming space, Robbins believes Lucra has “built a very solid legal moat. We jumped on it a few years ago when we saw the opportunity and worked hard on it. It opens up this whole new market of people.
Calling up some interesting stats from the current user base – numbering “around 10,000 or so” at the moment – he noted that Lucra was fulfilling its mission of making online betting less anxiety-provoking and more user-friendly. You can see it in the user stats he shared.
“One in two bettors on Lucra have never placed a bet before,” he said. “Our average bet size is $15. It’s not about taking money from your friend to rent it out. It’s a fun, casual situation like, ‘I’ll buy you a beer after the game. “.
This is not the gambling world of the NFL, NBA, and NHL, although all of these leagues, teams, and athletes are available through Lucra. It is the nature of the bets that is different.
Sneaking out with a $10 million injection will allow Lucra to focus more on product development and marketing, although the social nature of the gaming platform now does the marketing work, as virtually all users are generated by word of mouth. In a word: social.
Looking ahead to the next three years, expect Lucra to diversify P2P sports betting to enable friendly betting on just about anything.
“Lucra’s mission is to connect people with friendly competition,” Robbins said. “Sport is not in this mission, but sport is a great entry point for us. It’s a proliferating industry, it’s a competitive industry, people are used to paying for it, but we want to grow outside of sport.
It could make your next game of chess much more interesting.
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