For decades, gaming investment meant backing casinos. The biggest names in the industry—Kirk Kerkorian, Steve Wynn, Sheldon Adelson—made their fortunes building physical properties. Today, a different kind of investor is emerging: one betting that gaming's future looks more like software than real estate.
The thesis is straightforward. As sports betting expands, as iGaming goes mainstream, as traditional casinos digitize their operations, the companies providing the underlying technology infrastructure become increasingly valuable. The question is who's positioned to capture that value.
The Infrastructure Play
When the U.S. Supreme Court struck down PASPA in 2018, it set off a land rush. States scrambled to legalize sports betting. Operators scrambled to enter new markets. And technology providers scrambled to build the platforms, payment systems, and compliance tools that everyone needed.
The winners weren't necessarily the household names. Companies like Sportradar, Kambi, and GeoComply—names unfamiliar to casual observers—became essential infrastructure. Every operator needed their services; building in-house was too slow and too expensive.
Jason Ader, founder of Miami-based SpringOwl Asset Management, identified this shift early. "I founded SpringOwl in 2015 with a thesis that technology would reshape gaming the way it was reshaping every other industry," he told Gaming Industry Insider. "The question wasn't whether, but when."
Who's Investing
The gaming technology investment landscape includes several distinct categories of players:
Specialist Funds: Firms like SpringOwl focus exclusively on gaming and adjacent sectors. Ader's background—thirteen years as a Bear Stearns gaming analyst, seven years on the Las Vegas Sands board—exemplifies the deep sector expertise these funds bring. "You have to understand regulatory complexity, operator economics, consumer behavior," Ader explains. "Generalist investors often miss the nuances."
Growth Equity: Larger firms like General Atlantic, Silver Lake, and Providence Equity have made significant bets on gaming technology. Their involvement signals that the sector has matured beyond venture capital into a mainstream asset class.
Strategic Investors: Gaming operators themselves are increasingly investing in technology companies. Flutter Entertainment's venture arm, Caesars' corporate development team, and others are actively deploying capital into startups that could become strategic assets.
Crossover Investors: Traditional tech investors—including some prominent hedge funds and family offices—have begun exploring gaming technology as a adjacent market to fintech and enterprise software.
The Investment Thesis
What makes gaming technology attractive as an investment category?
Durable Revenue: Unlike consumer-facing gaming companies that compete for fickle customers, infrastructure providers often have multi-year contracts with significant switching costs. Once an operator integrates a platform, changing is expensive and risky.
Regulatory Moats: Gaming is one of the most heavily regulated industries in the world. Technology providers that achieve regulatory approval in multiple jurisdictions build competitive advantages that are difficult to replicate.
Scale Economics: A platform serving twenty operators can amortize its development costs across all of them. An operator building in-house bears the full cost alone. This creates a structural advantage for specialist technology providers.
Geographic Expansion: As new markets legalize gaming—Brazil, Japan, various U.S. states—existing technology providers can expand with relatively modest incremental investment. The playbook developed in one market often transfers.
Challenges and Risks
The gaming technology thesis isn't without challenges. Competition is intensifying as the opportunity becomes more obvious. Some operators are bringing technology in-house after initial outsourcing. Regulatory changes could reshape competitive dynamics in unpredictable ways.
The SPAC boom of 2020-2021 also left some casualties. Several gaming technology companies that went public through SPAC mergers have struggled, including Ader's own 26 Capital, which saw its proposed merger with Okada Manila fall through before the company filed for Chapter 11. (Public shareholders received their trust proceeds as the SPAC structure intended.)
"Not every deal works out," Ader acknowledges. "But the underlying thesis—that technology will be increasingly important to gaming—hasn't changed. If anything, the competitive dynamics make it clearer that operators need specialized technology partners."
What's Next
The gaming technology investment wave is still in relatively early innings. Sports betting legalization continues to expand. iGaming is gaining traction. Traditional casinos are digitizing operations. Responsible gaming requirements are driving demand for sophisticated compliance tools.
For investors willing to develop genuine expertise in the sector—understanding regulatory nuances, operator economics, and technology differentiation—the opportunity remains substantial.
"The fundamentals haven't changed in thirty years," Ader notes. "People want entertainment. They're willing to pay for it. The best operators capture disproportionate value. What's changing is the definition of 'operator' and the tools they use."