Betable raises $18.5 million in new capital

Betable, a London-based startup providing real-money gambling tools to game developers, raised $18.5 million in a round of funding led by Venture51, Christopher Griffin, Betable’s chief executive officer reported this week.

Previous backers Greylock Partners and Founders Fund also contributed to the round, which brings Betable’s total financing to $23 million.

Betable provides software code that plugs into a game and enables betting, freeing developers to focus on the look and feel of the app without worrying about the hassles that go along with real-money wagering, such as payments, fraud detection, regulatory compliance and complex math modeling.

Figures from research company H2 Gambling Capital probably influenced some investors, predicting that online gambling will be a $43.3 billion market by 2015, up 28 percent from last year, with much of the growth expected to come from major international land casinos.

Moves toward online gambling legalisation in some US states has also encouraged optimism as Delaware, New Jersey and Nevada have all gone online, with more states actively considering the possibilities and California, Pennsylvania and New York possibly joining the roster next year.

Griffin wants to see more innovation and a move away from traditional casino games and sports as a source for betting. He suggests that there are legions of smart phone users out there who are not experienced gamblers, but would like to take a flutter on, for example a virtual hot rod race in a iPhone driving game.

He also points to developer 3OAK’s “Battle Keno” as an ingenious mobile adaptation of the classic “Battleship” game where choosing where to strike an opponent on a grid of 81 squares earns the player money and taking direct fire costs the player money.

The Wall Street Journal reports that venture capitalists are betting on a slew of young startups in the development sector. SGN, a mobile game startup led by MySpace co-founder Chris DeWolfe, has raised more than $25 million from investors, and is developing its own casino games, the Journal notes, whilst Bee Cave Games, a startup created by former Zynga executives Erik Bethke and Jeremy Strauser, raised $1.3 million in July from VCs including Matrix Partners .

The gaming industry-experienced team at Betable – it boasts veterans from Zynga, Electronics Arts, Microsoft, and other game giants – has attracted positive responses from venture capital investors. The team’s know-how and relationships will help Betable as it seeks to expand, says Ryan Swagar, co-founder of Scottsdale, Arizona-based investor Venture51, who comments:

“They’ve assembled this team that can disrupt this regulated industry.”