Here\’s a question from a reader that I thought might be useful to answer for everyone, including me! Chuck in Fort Worth writes:
Hi Dan,
Jake and I will be in Vegas the week of June 13. A buddy of his will be staking him in event #26. Do you have access to any kind of staking agreement we could prepare prior to the event? Thanks.
Chuck
Hey Chuck! I\’m not Dan, but I am Dan-ielle so … close enough! 🙂
There are no set-in-stone guidelines for backing players but the most common practice is a 50/50 split of winnings, after the backer has been paid back on his investment. (i.e. the buy-in.) The second most common is for the backer to get his investment back and 60 percent of the remaining winnings, with the player keeping what\’s leftover after that.
Backing deals can get more complex depending on if the player is responsible for paying back all or some of the money if he doesn\’t cash. Usually deals that require no make up from a player would have a higher percentage going to the backer, usually 70/30 or even 80/20.
Here\’s a video I found — Mike Frazin – Backing Poker Players and the Rules — explaining \”make up\” a little more.
http://www.youtube.com/watch?v=IqPoRwnz9Hw
Ethics play a large part in making these deals, so Jake and his backer should know each other well or both already have a trustworthy reputation before agreeing. It would be a good idea to use a lawyer to draw up a contract but if they just want to keep it simple, just make sure that each party understands the terms and writes them out, clear as day, for both parties to sign or have notarized. You may also want to be sure you both are clear about the breakdown for tips and taxes.
Hope that helps and tell Jake I said, \”Good luck!\”
