In recent years, there has been a huge increase in the number of start-ups that are disrupting numerous industries. The success of these companies have varied, but incumbents will have to contend with the effects they have had, or will have, on various markets.
Start-ups can offer a number of beneficial services, whether they be automating services, opening up new possible markets, providing easier methods to carry out transactions, or anything else. This can make them very desirable options and they often have the flexibility or opportunity to evolve and provide specialised services; however, there are some difficulties that they have to overcome.
Established businesses have the advantage of large resources that newer firms may not have. In addition, existing firms will have experience and existing systems in dealing with areas such as regulation and compliance. This is a barrier that start-ups need to cross.
Besides this, existing companies have brand loyalties and consumer trust in many cases, which new options will need to overcome in order to disrupt a market. This can take significant work before customers will make the effort to switch to change to a relatively new and possibly unproven option.
Still, start-ups continue to make in-roads into every market, even ones historically resistant to change. Some companies are attempting to avoid the competition by employing digital transformation, providing the same benefits that the start-ups offer themselves before they are affected. This can work, although without an effective regime of constant digital transformation focus, companies may be coming to the new technology behind the curve.
Rather than existing businesses and start-ups spending their time and resources in competing, many are instead looking to collaborate in order to see benefits to both. There have been many examples recently of incumbents partnering with start-ups to provide the benefits of new technology to their customers. Alternatively, companies may set up incubators and accelerators to progress projects with merit.
Even amongst those not currently working with start-ups, there have been numerous reports that companies globally recognise the disruptive potential of new technology and express an interest in working with start-ups to better realise those benefits. This can match the market expertise and resources of existing firms to the innovation of start-ups, mutually benefitting both to advance quickly and more efficiently. There are many benefits that companies in the gambling industry stand to gain by taking this approach, from renovating outdated systems to reaching a wider audience, if they can find start-ups to work with.
In the interests of collaboration, many companies are also joining forces to create consortiums to investigate and develop the large number of possibilities offered by areas such as blockchain, artificial intelligence, virtual reality, IoT and others. In this, traditional competitors work together and share the advantages of further developments. Whilst most of these consortiums so far are found in the FinTech area, other industries are starting to get on board with the idea and the gambling industry may join the trend.