Why the house always wins in gambling
By Waithaka Gatumia
Btting companies are not charitable organisations throwing free money away. Their primary function is to generate profits for the shareholders.
When they run a competition the aim is to make as much money as possible and they do so by attracting many gamblers with promises of possible rewards such as a huge jackpot.
But always remember even though the Jackpot may seem large to you, it is only a fraction of the revenue the companies generate in the same period.
Imagine that the betting company has one million customers trying to get the jackpot. To get the jackpot you have to make a bet of at least Sh100. That means that the company will at minimum get Sh100 million from everyone trying to win.
If they give a jackpot of Sh10 million, the amount may be large in proportion to the person who only bet Sh100 but to the company, it is only 10 per cent of what they bring in.
Even in a simple bet on a soccer match, the game is designed to make money for the betting company. There are three possible outcomes to a match, win, lose or draw; and an individual can only choose one when placing a bet.
An individual, therefore, has one out of three chances to win. The betting company is already in a better position because they have two out of three chances to win.
A bet once in a while with friends using money from your budget for entertainment could be fun and sometimes earn you something small.
The problem is that according to the current data released by GeoPoll, a provider of research services, including text message and online surveys, 77 per cent of males aged 25 to 34 have gambled and over half of those who have ever gambled continue to do so at least once a week.
Overall 10 per cent of all gamblers place bets more than once a day. This frequency and the number of people gambling is a cause for concern.
Betting companies have spent a lot of money sponsoring sports and other good causes as well as paying huge amounts in tax to the government for development. The question is; at what cost?
Some people can handle their gambling just the way some people can handle their drinking. However, from the numbers it is obvious many are struggling. For those who think that gambling is some kind of investment that can get you out of poverty, think again. The house always wins.
The hope that you could go from Sh100 to Sh100 million overnight is so enticing for the impatient. However, the time spent looking for cash to bet every day, watching the matches and analysing the possible outcomes could be spent thinking up and executing a business idea.
This direction is more sustainable, however, it involves placing a bet on yourself and your potential.
Do you have faith that you can make it? I believe that with the same daily diligence put into betting you can build a great business or score that job you have always wanted. The question is: Do you believe in yourself?
The writer is the CEO at Centonomy
