Business Valuation Guide: Do I need a Valuation?
Business Valuation Guide for iGaming Founders
Do I Really Need a Valuation?
Running an iGaming company inevitably raises one strategic question: What is my operation worth today—and to whom? Whether you run a B2C sportsbook, a B2B platform, or an affiliate network, understanding value is the linchpin for capital raises, exit planning, partner buy-outs and even licence compliance. Before you pay for a report—or decide to postpone one—read the primer below. It reflects a decade of advising entrepreneurs on gaming-sector M&A.
1. What exactly is a valuation?
At its core, a valuation converts future economic benefit (cash flow, intellectual property, licences, brand equity and customer cohorts) into a single price. The exercise can be rule-based (comparable EV/EBITDA multiples), income-based (discounted cash flow) or asset-based, but it always starts with why you need the number.
Most appraisers default to Fair Market Value (FMV)—the price at which a willing buyer and seller, neither compelled, transact in an open market. FMV is useful for tax, divorce and shareholder disputes, yet it often understates strategic premiums typical in gaming deals where regulatory footprints, geo-expansion rights or proprietary odds engines create synergies. Those premiums are captured in Strategic (Investment) Value, defined as the price a specific acquirer can justify because of cost or revenue synergies. In 2024, Flutter’s €564 m acquisition of Brazil’s Betnacional at 18.4× EBITDA illustrates how far strategic value can outrun FMV in growth jurisdictions.
2. Do you actually need one right now?
Ask yourself five questions:
Trigger event – Are you raising money, issuing options, negotiating a buy-sell, or facing litigation/tax scrutiny?
Stakeholder sentiment – Will investors, regulators or spouses contest price?
Market timing – Is the sector hot? 2024 logged a record number of gaming deals worldwide; waiting six months could shift multiples.
Data readiness – Do you have segmented KPIs (GGR, NGR, retention, player-lifetime value) clean enough for third-party review?
Budget vs. benefit – Can the insight you gain outweigh the fee and the management time diverted?
If at least two answers point to “yes”, a valuation is rarely wasted effort; if not, an informal range may suffice until a catalyst looms.
3. Deliverable options, costs and use-cases
| Deliverable | Typical Length | Indicative Cost (USD) | Primary Use-Cases | Ideal in iGaming When… |
|---|---|---|---|---|
| Verbal Opinion of Value | 1 h call & summary email | 0 – 3,000 | Early exit planning, sanity checks | You need a ballpark multiple to decide whether to launch a sale this quarter. |
| Limited-Scope Report (a “calculation of value”) | 5-25 pages | 2,900 – 9,700 for SMBs; 10,000 – 50,000 mid-market | Indicative pricing for investor decks, partner buy-outs, vendor due-diligence | You are marketing a €3-8 m affiliate network and want defensible guidance without courtroom rigour. |
| Certified (Self-Contained) Appraisal | 80-250 pages | 5,000 baseline; 30,000+ for complex groups | Tax, divorce, ESOP, contentious shareholder matters | A regulator, court or IRS equivalent will review the report, or you expect challenges to assumptions. |
4. Selecting the right professional
A valuation is only as credible as the person signing it. Options include:
Accredited Appraisers (ASA, CVA, ABV) – deep valuation theory, but limited M&A battlefield insight.
CPAs – strong on compliance; may overlook sector nuance like skin-transfer restrictions or geo-blocked revenue streams.
Business Brokers – pragmatic and often free, yet methods vary wildly.
iGaming M&A Advisers – combine licence knowledge, deal comps and buyer access, but charge success fees if they later run the sale.
For a regulated gaming business eyeing an exit above €5 m, the hybrid model works best: an M&A adviser prepares a limited-scope valuation grounded in live buyer feedback, then brings in a certified appraiser only if litigation or tax authorities demand it.
5. Choosing the right standard of value
FMV anchors courtroom and IRS discussions but omits synergy upside.
Strategic/Investment Value can exceed FMV by 20–60 % when acquirers need licences, market share or tech. Recent EV/EBITDA ranges in gaming span <6× for declining B2C assets to >18× for high-growth sportsbook platforms.
When EBITDA is < $1 m, FMV usually defines ceiling price; buyers are limited and financing is earnings-based. Above $1 m EBITDA, initiate a competitive process—strategic value often trumps FMV, especially in markets with fresh regulation (e.g., Brazil, some U.S. states).
6. Pros and Cons of Commissioning a Valuation Now
Pros
Credible anchor for negotiations; curbs emotional pricing.
Identifies value drivers (player acquisition cost, churn) you can improve pre-sale.
Demonstrates governance to potential investors and regulators.
Cons
Cash outlay and management bandwidth.
Risk of data leakage if prepared outside NDA controls.
Snapshot can become stale in volatile markets; may need refresh within 6–12 months.
Key Takeaways
A valuation is not an academic exercise; it is a strategic tool. For sub-€5 m EBITDA operators, an appraiser-led FMV report often suffices. For larger or high-growth assets, limited-scope valuations calibrated to live market multiples—and later stress-tested in auction—unlock the premium you deserve. Decide based on purpose, audience and budget, and remember: the best valuations evolve alongside your exit timetable, not just your balance sheet.
Selecting the Optimal Valuation Advisor for Your iGaming Business
The iGaming deal-market has never been busier: 2024 set a transaction record and 2025 has opened with headline-grabbing valuations such as Flutter’s majority stake in Brazil’s Betnacional at an ~18.4× EBITDA multiple.
At the same time, mid-market activity is clearing at a steadier 6.4× EBITDA for $10-25 m enterprise-value deals, and smaller iGaming assets still trade inside the historical 3-8× revenue corridor.
Against that backdrop, choosing who should value your company is as important as knowing what it may be worth. Below is a current, sector-specific guide based on a decade of advising iGaming founders and investors.
Advisor Landscape and their Typical Focus
Business brokers still dominate lower-mid-market exits (< €5 m turnover). Their strength is proximity to owner-operators and knowledge of SBA-style debt structures, but most rely on generic software templates that cannot cope with multi-licence gaming models.
M&A boutiques (including iGaming-specialist firms) usually step in from €5-50 m revenue. They benchmark against live deal data, run limited-auction processes and speak the language of strategic buyers—crucial when a sportsbook, affiliate network or B2B platform is the likely acquirer.
Investment banks concentrate on €50 m+ platform plays and cross-border carve-outs; their fairness opinions are court-ready, yet over-engineered (and overpriced) for sub-€10 m EBIT businesses.
CPAs and accounting firms excel at valuations for tax, option plans and litigation; only the Big-Four gaming desks maintain active M&A pipelines.
Accredited appraisers deliver the most defensible reports in shareholder disputes but often underestimate strategic premiums because they lack real-world sale execution experience.
Third-party/automated tools supply rapid desktop outputs; they can help owners sanity-check internal forecasts, but their market data sets rarely segregate regulated v. grey iGaming revenue—an error that can swing multiples by two turns.
Typical Pricing (Global Survey of 44 Providers)
| Advisor category | Fee range (USD) | Survey-average fee | Report depth / best use-case |
|---|---|---|---|
| Business broker | $ 950 – 10,000 | $ 3,800 – 4,500 | 10–15 pp broker opinion; indicative pricing for sub-€5 m deals |
| M&A boutique | $ 1,500 – 15,000 | $ 6,300 – 8,900 | 25–40 pp market-calibrated memo, often bundled with auction mandate |
| Investment bank | $ 12,000 – 17,000 | ≈ $ 14,500 | 60 pp fairness opinion; prerequisite for board sign-off on €50 m+ exits |
| Accredited appraiser | $ 2,000 – 30,000 | $ 7,900 – 13,000 | 70-100 pp USPAP-compliant report for tax or dispute resolution |
| CPA / accounting firm | $ 2,000 – 15,000 | $ 7,500 – 9,200 | 80 pp audit-trail valuation; robust for ESOPs and transfer-pricing |
| Financial advisory firm | $ 10,000 – 40,000 | $ 20,000 – 25,000 | Bespoke model plus sensitivity tables; often paired with fund-raising |
Pros and Cons of Each Advisor Type
Pros
Business broker: Low entry cost; hands-on support with buyer outreach; good for asset sales of single affiliate sites.
M&A boutique: Sector knowledge; active buyer Rolodex; aligns value opinion with auction dynamics.
Investment bank: Deep bench for complex structuring; recognisable brand for public-company boards.
CPA / appraiser: Highest credibility in tax courts; granular financial normalisation.
Automated tool: Immediate output; useful as a second-opinion checkpoint.
Cons
Business broker: Potential fee-driven inflation of value; limited cross-border reach.
M&A boutique: Retainers plus success fees can double costs versus brokers.
Investment bank: High threshold fees; processes can overwhelm founder-led teams.
CPA / appraiser: May miss iGaming regulatory or synergetic premiums.
Automated tool: Ignores grey-market discounting, jurisdictional risk and bonus-cost volatility.
Frequently Asked Questions
Why does iGaming trade at wider multiples than comparable SaaS businesses?
Regulatory moats, embedded payments infrastructure and habitual customer behaviour justify premium revenue multiples—especially in newly regulated geos such as Brazil, where early movers have commanded >18× EBITDA valuations.
Do I need a 100-page report to sell my €8 m GGR affiliate portfolio?
No. Buyers care about cash-conversion, traffic durability and licensing exposure. A 20-page broker or boutique memorandum that benchmarks EBITDA, NGR-per-FTD and player-churn is usually sufficient and far cheaper.
How often should I refresh my valuation?
Every 12-18 months or after any material event—e.g., new market entry, major B2B contract or regulatory tax change—because multiples can compress quickly in risk-off cycles.
Does a valuation guarantee my exit price?
Never. It is an informed snapshot; actual proceeds depend on auction tension, NDA-level disclosures and the strategic logic of the winning bidder.
What is the single biggest driver of value in 2025?
Regulatory certainty. Assets with clean licences in tier-one jurisdictions (e.g., UK, Ontario, New Jersey) command a 25-40 % premium to comparable grey-market revenue streams.
Key Take-aways
Match the advisor to your purpose: legal dispute ≠ exit readiness.
In iGaming, sector expertise and buyer access outweigh thick reports.
Use software outputs only as a sense-check, not as a sale-yardstick.
Refresh valuations regularly; regulatory shocks and bonus-cost swings make 2025 a moving target.
Armed with the right specialist—and a realistic understanding of strategic versus fair-market value—you can navigate today’s vibrant iGaming M&A arena with confidence and capture the premium your business deserves.
