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    6 Replies Latest reply on Jun 10, 2009 9:06 AM by online_poker

    Winning streak in online poker

    winningstreak Wayfarer
      Poker is the great American game and it's become the perfect social game for the Internet, maybe even the original social network. Only one state, Washington, has a law prohibiting it's citizens from playing on-line poker, however this may be the most difficult business to start-up because of the complexities with offshore banking and foreign business development. Never the less, on February 18th, 2008 we launched Reefer Poker and within 48 hours registered 1,800 players and over 500 affiliates. It was with seed capital from friends and family that we've been able to set records in our industry (for a start-up) and grow at over 1,200 new players per month. To date, we're 14,000 players strong, in the black but still seeking investment capital.

      The revenue model from on-line poker is tremendous, also the risk isn't like a casino because people are playing each other, not the house. Our commitment is to fair play and a fair deal, we strive to be the best dealer on-line. It's surprising how many misconceptions surround our industry and this makes it all the more difficult for raising capital. So many of today's potential investors come from a brick and mortar background, where they can see the property, or completely relate to the asset they're investing in, whereas with on-line businesses everything is based on a process and or system, and when some of these (ie. banking) are located in foreign countries, it causes the investor to become apprehensive. To counter this sentiment our corporation has to become so much more transparent and totally accountable for every dollar, plus strict compliance to tax laws needs to be adhered to, and more money spent on advisors than most any other type of company.

      At the end of the day the on-line poker business is about providing a good honest service that customers enjoy on a repeat basis. What has provided reefer poker with it's winning streak is a powerful marketing strategy combined with a truly viral brand name. Timing is helping, since ESPN portray poker as a sport, really there's not a time of the day when you can't find poker on television somewhere, now the tournament cash-prizes are so much larger than professional golf, tennis, or any other sport, that it's driving players to the on-line game in the droves but what will make the biggest change to the industry, in the not too distant future, will be the regulation and taxation of on-line poker in the United States, then start-ups like reefer poker won't stand a chance because companies with massive market reach (MTV, ESPN, Yahoo, etc...) will close the window of opportunity for the little start-up.

      For now the winning streak continues, with lot's of blood, sweat, and tears the little start-up called reefer poker has become a brand name in the poker game.
        • Re: Winning streak in online poker
          NoBullFunding Scout
          I looked at your website, it looks very professional. The theme of it all cracks me up. I think it will appeal to the audience you are looking for.

          As far as raising money, your business type and location will automatically disqualify from pretty much all banks and conventional lenders. I'm not sure if you have banks/lenders in your locality, but perhaps you can talk to them since gambling is presumable not illegal there. This is one of the few times when I'd say an investor might be the better option, if you can find one. Although you mention in your post that the location and online thing are barriers for investors too.

          Let's back up, how much are you looking for? That can steer where you might go from here...
            • Re: Winning streak in online poker
              winningstreak Wayfarer
              Thanks for the kudos re: reeferpoker.com we're very fortunate to have an extraordinary web design/development team. We're finding that theme also attracts top poker who think they'll have an advantage over our affininty group. We refer to this as the "sharks and minnows" factor, in other words a poker room can't have all sharks but needs to have enough weaker players to attract better players. Our mix works.

              As for structure, yes the jurisdictions where the company is domiciled disqualify us from conventional lenders. An independent investor really is our only option.

              At this time we're seeking $500k and we have a detailed strategy to use the investment capital almost entirely on marketing. Our objective is to use that money to build the company's net revenue to $100k/month, at which time we'd then then raise more money, at a more favorable valuation (favorable to the existing shareholders).

              So far we've been able to get to where we are with out giving up much equity, we're very tightly held. Lot's of sweat though.
                • Re: Winning streak in online poker
                  NoBullFunding Scout

                  How have you funded the business to date? Just personal savings?

                  $500K for marketing might be a tough sell for an investor, just because marketing needs to be a long term process, so if you blow through the entire $500k and don't see immediate results, then what? With marketing, one push rarely yields immediate dividends (I learned that the hard way).

                  If the business is profitble right now, I say keep doing what you're doing and create a marketing budget. You can do what franchises do and sink a fixed % of revenues into marketing and promotions. If you sink 2% of monthly revenues into marketing, your budget will grow as your revenues grow. That way you get to keep 100% of your business and will grow at a measured pace.
                    • Re: Winning streak in online poker
                      winningstreak Wayfarer
                      Friends and family invested to help us seed capitalize the start-up of Reefer Poker and each founding partner invested both cash and lot's of sweat. Also, we secured a second round that keeps us going at a good pace for another six months, at which time we expect to be profitable.

                      We are currently still accepting up to
                      $500,000 of
                      additional investment capital.

                       

                      If
                      you study the industry then you have seen what Party Poker and
                      others
                      have done; Full Tilt Poker is reportedly paying out $40 million a month to
                      investors,
                      and even Cake Poker, new on the scene, is already paying out 30 cents a
                      share
                      quarterly dividends.

                       

                      Please let me know if you'd like detailed information sent to you.

                       

                      Thanks,

                       

                      A

                       

                • Re: Winning streak in online poker
                  LUCKIEST Guide
                  Winning streak in online poker, Welcome

                  YES, Poker is the great American game and Lefty Rosenthal, "Kingpin in Las Vegas" died.

                  Who?? Lefty, a professional gambler who introduced sports betting to casinos in Las Vegas
                  • Re: Winning streak in online poker
                    online_poker Newbie
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