It’s a decision that can define your company’s trajectory, and I’ve seen it play out countless times.
Here’s how it goes
A young iGaming start-up is gaining traction. It’s backed by a smart team with a clear vision, and investors are circling.
Usually, start-ups are simply relieved to secure funding, whatever the source. But where that funding comes from is one of the biggest factors in whether or not a business will succeed.
The toughest part is that there’s no right or wrong answer here.
On paper, the trade-off is usually between the deeper pockets of VCs against the active involvement of angels.
At their best, angels are often ex-operators, ex-founders, or industry veterans who have learnt the hard way what makes iGaming such a high-risk, high-reward arena.
They tend to move fast, make decisions based on instinct, and genuinely enjoy rolling their sleeves up in the early chaos.
For an iGaming start-up, this can mean immediate credibility in a sector where trust is currency. An angel who has the ear of the right marketing director, or knows how to navigate a licence application, can shave months off your go-to-market plan.
The trade-off is that angels rarely lead large rounds. Even the most active are unlikely to match the firepower of a mid-sized VC fund.
If your ambitions involve scaling into multiple regulated markets at once, that extra capital can be the difference between first-mover advantage and getting crushed by a well-funded competitor. Uber, Spotify, Airbnb and others burned through billions in VC cash to grab market share before turning a profit.
The best VCs are also more about the money, but it really depends on a case-by-case basis.
I’ve been lucky enough to work with some that bring not only deep pockets but also operational muscle. They can quickly plug you into networks (often including their other investments) that can facilitate new market launches, hiring sprees and more.
But there’s a reason some iGaming founders hesitate. Many VC firms don’t touch gambling at all because of regulatory complexity or internal LP restrictions.
Those that do often come from fintech, consumer or gaming more broadly, and may underestimate how different real-money gaming can be.
You don’t want to spend your first board meeting explaining why GGR isn’t the best measure of success, or why your payment processor shut off your merchant account without warning.
Bridging the trust gap
The obvious solution to all of this is a mix of both. Perhaps a VC leading your round, then a bunch of angels joining. The best of both worlds.
I’ve seen this work, but it isn’t always an easy trick to pull off.
Firstly there’s an opportunity cost. I consistently see founders underestimate quite how gruelling fundraising can be.
There’s the obvious time sink, right when you want to be focused on your product. But there’s also a mental toll. Most potential investors will pass, and it’s tough to keep bouncing back from those rejections when you are pouring your heart and soul into a project.
So which way should you lean? In my view, the answer depends on your immediate constraints and your founder profile.
If you’re pre-revenue or working in a niche, an angel or syndicate of angels who get your market may be worth more than a VC cheque twice the size. The right angel group can help you land your first 1,000 customers and connect you to suppliers who won’t flinch at your vertical.
On the other hand, if you’ve already proven product-market fit and you’re staring at a time-sensitive land grab in a newly regulated jurisdiction, VC capital can give you the firepower to execute at speed and scale.
One thing I tell every founder, regardless of whether they are talking to VCs or angels, is not to evaluate investors only on the money.
It is vital you align on things like risk appetite, and factors like decision-making speed are incredibly important.
I’ve seen angels wire funds within minutes of a single meeting; I’ve seen VCs take four months to issue a term sheet while the market window slammed shut. But then I’ve also seen angels ghost founders at the first sign of trouble, and VCs step up with bridge financing when it mattered most.
Wherever you turn for funding, pick the partner who will still be in your corner when the storm hits.