blonde poker forum

Horses – are your backer’s glorified loan sharks

I understand that a lot of players who want to have a crack at going pro don’t necessarily have the finances to bank roll themselves and end up joining a stable.

Are stables a good thing – maybe – maybe not

In my opinion if you join a stable – you are taking on a proper job – for this reason as a horse you should be paid for the work you undertake.

It should be irrelevant whether you win or lose over say a year period – to me your backer should be able to provide you with the following –

A monthly salary to cover you day to day living
Education and know how into how to improve your game

And more importantly not put you in make up – if you lose 10k over several months or even $100 your backer should take the losses – if they cant take the losses they shouldn’t be running a stable.

*** I pay a monthly fee to the trainer of my horses – I don’t say at the end of the month – hey we haven’t won jack shit – so you now owe me ***

Sounds great. I'd like to apply to be a horse please.

They are a loan shark if they have unlimited amounts of cash to throw at a proven winning horse who will not rob them/leave them/play pissed/play when tilted.  The reality is this very rarely happens therefore they are taking substantial risk and deserve their 'loan shark' rewards to go along with the risk.

All of my horses get a really good deal in my opinion. They couldn't play the games I put them in without putting themselves at excess financial risk and for that I take a fee on the winnings. No one in the business world provides capital for free. No one in the business world gives away expertise for free. Its like venture capitalism and do you have a problem with that? You spend far too much time discussing an industry you don't really understand. I wouldn't criticize you for the business model of your stable, even though I think a decent amount of people that own horses lose money, and therefore using this as a business model doesn't make much sense to me. Having said that, you seem like an intelligent bloke, so I've assumed you have made a reasonable decision. Contesting an industry standard without having an informational edge is a mistake. You do not have an informational edge here.  

:D :D :D

so much bs man.

No one in the business world gives their expertise for free

The biggest bollock statement i have ever heard.

I have and do back numerous businesses - i put my own money in and pass on knowledge that i have gained over the years - sometimes the business goes well others go bust and i lose my funds. Such is business

Venture caps work on the basis 1 will be a winner 2/3 will do okay the rest will fail - just ask warren

Also i think you will find that their are thousands of ceo and retired business people who are more than happy to give advice and help for nothing - i know quite a few.

Pleno  - seen  your last lot of post - you obviuosly like to niggle -  if your trying to be negative at least be constructive -

Very similar to staking poker players to play mtt's then.

Yes arrboy

Only big difference is that once we have lost are investment we write it off

Its the old adage only invest what you can afford to lose

Horses get dropped in makeup too. They have the option to leave poker too. Its the same.

So do a lot of horses get written off by stakers with their 'debt/make up' fully written off by the staker and they walk away totally debt free having had the chance to win big by not risking a copper coin (a total freeroll for the horse).  Like Adam said previously if you don't really get the industry you are talking about sometimes it is best to not ask too many questions on why things happen.

So do a lot of horses get written off by stakers with their 'debt/make up' fully written off by the staker and they walk away totally debt free having had the chance to win big by not risking a copper coin (a total freeroll for the horse).  Like Adam said previously if you don't really get the industry you are talking about sometimes it is best to not ask too many questions on why things happen.
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Interesting answer - though i only frequent the live poker scene occasionally - i do know of several players that get to play in decent tournaments through backers who just like the blokes and dont care about the money if the blokes lose or win there happy either way.

Final sentence sounds like something out of an old mafia movie.

If the business makes money, do you get paid anything?

think of it in this way.

When you stake someone for poker, on a long term backing deal, then you say to them for this **indefinate** period of time here is the deal; I will provide finance and you will provide your time and effect, and we will split the profits of our venture 50%-50%

If someone loses for 3 months and is £15k in make-up, then it is just like a business that loses some money over a period, the next £15k that the business makes goes into the balance sheet to pay off debts etc.

You're going 50/50 on long term results not individual results or short term periods of results (if its a long term backing deal we're talking about, which im pretty sure you are)

Yes if the business is a success i reap the rewards if it fails i lose my investment.

I make a judgement call if i want to keep investing - sometimes i have cut my losses and walked away handing over my shareholding and 2 years down the road the business has become successful.

However - i dont go back and say hey the 50k i put in now your doing well i want it back - i made my judgement call and just move on to the next thing

Be good to hear some thoughts from the horses

I think you have been hearing from horses since the thread started.  Everyone in the thread so far has been a horse at some stage i would imagine.  Probably all have been stakers as well.

Ive been a horse and a backer for several years and Mike, you are so far off the mark. If you have a rich punter friend who is happy to throw thousands at you/someone and write it off regularly then obviously go for it, but that isnt how it works or should work in the real world.

That isn't remotely how it works, and I explained it about as clearly as you can do here


you're backing for the long term, so if over the course of two years the horse makes £200k, then it's £100k for the backer, £100k for the horse, over that period of time there would have been stretches of results where i) the horse loses a lot, and doesn't take the hit financially for any of those losses, and ii) periods of time where the horse has won a lot and the backer has just sat back and collected.

Iv been backed, backed, started businesses with investors and invested in businesses and the similarities are there but it's a MUCH MUCH more volatile industry is poker backing, way less stable, way less policed + regulated/more casual and really really fucking risky.

Your decision to completely ignore my point (quoted) which answers your points r.e backing entirely makes me think you're just trolling here so I'm pretty annoyed at myself for wasting my time replying to you, but i'll leave with this thought, which as you seem to have been involved as an investor before you'll be all too aware off...

THE GUYS WITH THE MONEY, CALL THE SHOTS = LIFE

If you're gambling and giving someone a spin in a comp, absolutely fine here's a bag try and win it and we go 50/50 if you make anything back. It's fun, its good spirited and a nice gamble, it's not a business though, and thats what long term backing is, or at least what it should be.

So, you are right, its often a bad deal for a HORSE to get a BACKER when he has his own money to play and the backer gives nothing but financial support. In fact theres a lot of cases where playing lower off your own money is a lot better.

Take for example you have $3000 and want to play $200nl, you play and your win rate is 2bb/100. You give 50% of your winnings to the backer. Its obviously way better to play $100nl with a 3bb win rate and keep 100% of the winnings. Often when you double the stakes your win rate significantly decreases.

It is however good for players to get backers who provide additional support outside of financial freedom.

Sorry to self publicise here but lets say you earned $20k a year playing tournaments and joined my stable.

You would get the following

8 hours group coaching/week from 5 of the best players in the world at your game type and guys who are playing the stakes directly above yourself and doing really well
2 hours private coaching/month

Lets give these coachings a modest $100/hour, that means every week you are getting $1000 worth of coaching content, every year that equates to $52,000.

The experience you can use off these coaching will not only

a) increase your initial expectation of $20k a year a lot
b) increase your expectations for future years when you potentially keep 100% of your action

but it also puts you in a community of poker players that are speaking about poker every day, there are sites out there like mttmarket where you pay almost $500 for the privilege of this. So lets say the ev of being in my stable would be

52k+6k+X+Y+z-x2

x= 2015 profit expectation
y= 2016 profit expectation
z= 2017+ profit expectation
x2= 50% of 2015 profits you give away.

I think if you look at it this way it is almost impossible to suggest that we are fucking the horses over. Things we haven't even touched on is mental support where we speak to the guys whenever they need advice or help, we are there straight away to help them overcome whatever problems. Friends! The ability to reinvest your money and make your money work etc etc etc etc

It is IMPERATIVE that a horse find the best stable and deal for themselves rather than just joining the person that is first to offer them a deal.

Haven't even gone into horses walking away from staking deals, cheating, stealing (without consequences!!) and loads of other stuff. There is many, many, many horses who have walked away from 100k+ make up deals, I could probably name around 50 guys (some of them twice with the same and different backers) staking is far, far away from a printing business.

Also any clever staking company will only allow their horses to play games with 15%+ roi playing stakes they are beating thus having regular income and lower variance meaning they are basically giving them a wage every month anyway.

that's not really how the time value of money works but w/e. Wtf is this, getting staked is obviously the best decision for some people who wish to play the game in a serious manner (professional or non-professional).

Although the tone of this thread got abit angry quite quickly I think it's one of the best that has been started recently, a proper debate on a subject that is actually really interesting and has managed to get all the big hitters to contribute an opinion. It's what blonde needs more of. (Unfortunately I know nothing on the subject so cannot contribute but have enjoyed reading).

Couldn't agree more.

Personally, I've never really liked the idea of people playing with other people's money but it's completely ingrained in poker and has been since the game was first played I expect.

Lots of successful people in many sports, games and jobs have had outside financial support to get there. In an ideal world, they get there on natural talent alone, but that's just not how it works in reality.

I'm a horse in a very well run stable

its easily been the most + ev decision i've made.

i am a part-time player and work full time, yet i have been able to move from micro to mid-stakes and have been supported every step of the way. hours of group and individual coaching, tech support, software, and being in a group of like minded enthusiasts. it all adds up.

there are a number of highstakes professionals in the group also, and their development is largely due to being in the stable, many ex stable mates are now elite nosebleed crushers.

one thing that people forget about being backed is the development of you as a player and the increased likely-hood that you will get established at the most profitable stake for you.

if you play off your own money - aside from not getting the coaching, support etc - before you move up you have to increase your bankroll to be properly rolled. if you have to withdraw to pay bills, hit a downswing etc etc then that can take considerable time.

everytime i have moved up, or switched formats, my backers have simply sent me the roll to do so. so getting established at a stake, progressing to being a more profitable player, improving skill set, muse of software etc can be exponentially faster as part of a well run stable than it can be when trying on your own

just to say also, i am a poker geek and love learning the game.

so access to likeminded people and a learning enviroment is just plain fun for me.

it really has increased my love for the game overall

Guys the biggest troll on blonde, if aaron had wrote this, I think some people would have spontaneously combusted .

I wrote an email to Hertz asking why they charge for cars when my mate lent me his Ferrari to take that bird on that date. I wrote an email to Run It Once telling them their business model wouldn't work, as people could watch poker videos on youtube, for free!

When investing in a business providing time, expertise and money in exchange for a shareholding in a company you have a resale value or a future return. You are comparing this to investing time, expertise and money in a horse who can walk away from the arrangement if they are out of make up or if they buy out of make up. This business model of yours whereby you expect a share of future profits or a fee to be bought out of your shareholding seems very unfair.

I might write something later :)  I originally agreed with a few of the others that this was either so off base to be not worth engaging or just trolling.  I remember a few more posts from OP on the subject in the past that are equally off base, so I don't think taking time to lay out a solid (and balanced) argument will make any difference to him, but if there is a genuinely healthy debate unfolding, I'll definitely chip in.  I've probably been in that area longer than (everyone?) and continually see horrendous business decisions made my stakers and horses alike.

Oh and Lil Dave -- the golden rule is.... the men with the gold make the rules.

It is an interesting subject - I obviously hear stuff about staking but tend to only hear about great successes or horrible make-up stories

It's pretty easy to understand one-off style staking however frequent it might be.

For yer average horse in a stable with make-up. What percentage earn a decent income,  say £20k-25k p.a consistently over 2 -3 years. For most youngish guys £20k p.a with no tax would be a reasonable income I guess ?

haha you are, as usual mr G, correct.

What Simon doesn't know about staking, and more importantly making money from staking, it likely not worth knowing (or basically what Mikey currently knows :D )

Also, huge props to pleno and gang who do seem to be crushing it, not an easy business to make pay, at alllll.

What business doesn't carry over losses?

Iv been staked for the last 8 years, via various people and the relationship is the most important thing. If you are really struggling a good backer will help you out, its a human industry after all and based heavily on trust. When that trust is established there is way less likelihood of any horses reneging on a deal, not playing optimally and im sure we have all heard of worse. Reputation is ultimately key in this industry, for backers and horses.

Poor derivatives traders when they move from job to job.  Same score for horses I suppose.  Get in make up and if you can get someone else to back you then losses wiped out. 

No idea how horses can complain - they're being given free options by stables.

Not sure if my comment will be worth anything (but I'm going to post it anyway)

I've been staked quite a bit, either by selling action or by being part of a stable, and I'm very glad staking is around. As I understand it, in my current deal, my backer can fire me whenever he likes, at which point any make up is written off. I can also quit whenever I want, but if I want to go and do something else then I have to pay back any make up that I am in. This seems very reasonable to me, as I get to play stakes I otherwise wouldn't be able to, and have access to a network which offers coaching and general support whenever it's needed. I don't see this as being backed by some sort of glorified loan shark, I see it is an investment on both sides. My backer is risking his money on me, but at the same time I'm risking whether or not I'm a winning player and betting that I am. By taking on the staking agreement I feel like I accept that if I'm not a long term winner, I have to pay for that. I mean, it's not as if I'll get dropped if I lose for a month or two, if I was to lose for an extended period I would be offered help and would only be dropped as a last resort. To me, this arrangement is mutually beneficial and offers people opportunities that they wouldn't otherwise have.

Prop trading is actually a really good comparison. I didn't think of that. Aren't most salaried with bonus? Maybe that's the best solution for staked players. Salary plus bonus.

Ok, a few comments :)

First of all, for those new in, some previous discussion on it, quite interesting to look back and see what has happened in 3 years or so.

http://blondepoker.com/forum/index.php?topic=58457.0 (http://blondepoker.com/forum/index.php?topic=58457.0)
http://blondepoker.com/forum/index.php?topic=57621.0 (http://blondepoker.com/forum/index.php?topic=57621.0)

Next up, from time to time I get a PM asking me about staking.  In just about every instance, the enquirer has considered themselves to be a staker.  But all they are/were really doing was buying an occasional piece of a package, putting a friend in the SM, etc.  I think most of the serious contributors on this thread would not consider that staking.. that is puntering.

"A bank is an organisation that will lend money to anyone that can prove they don't need it"

Similarly, a backer should be willing to lend money to players to play at a buyin/level where they really shouldn't need it.  This is either going to be a short term rescue package until the horse is solvent again, or as a longer term arrangement, providing that both parties are getting an acceptable bang for their buck from it.  In both cases, both sides have options.  The backer can choose to invest that $ somewhere else and the player can choose to play lower for themself/play staked for someone else/stop playing/whatever.  If you can find terms that make sense to both sides, you may find an equilibrium which allows a mutually beneficial deal to continue for months/years.

Not going to make this war and peace, but some cliffs:

The player
Even as a backer (or particularly as a backer, perhaps) I have the utmost respect for players that decide to play lower for themself asap, grind out a replacement BR and do their own thing.  If I can help them achieve this plan, and both sides know exactly what that plan is, then it more or less IS a loan.  It doesn't come with the same sureities of loans underwritten against property, there is almost certainly no recourse to be had from a court of law and so it is perfectly reasonable to be providing $$ at a higher risk for a higher return then Tesco Bank might be prepared to charge you.  Only we all know Tesco won't approve your loan request to go on a mad spinup, and many players would fail any kind of credit check, even if they did claim they were using it for "home improvements."

For players to want to stay beyond the short term, they should need, and receive, more.  Access to coaching, to like-minded players, to sensible IRL advice, whatever it is that they want.  Yet many players do not seek this, skip free coaching sessions, make continually poor choices away from the tables and effectively perpetuate a situation where they need staking indefinitely.

The backer
There are no real barriers to entry, so if everyone is doing it wrong.. pull out some $$ and offer some stakes.  2+2 and various skype channels are chokka with guys that did exactly that.... and now have a selection of horses available at a generous discount.
Most backers are players, or ex players, themselves.  One major problem is that they mostly have no business accumen, having little exposure to anything other than poker.  Take a look at the cast of High Stakes Poker, just about all of them are doing their niags in lifetime business dealings.
Some backers tried to compete on price, offering golden handshake deals, expiring MU deals, wages, private health care no doubt.  I don't hear much about any of these nowadays, I can only assume there were some rude awakenings.
To be successful, it really does need to be a full time effort, some guys just won a bunch and decided to start staking mates ~ some from Blonde too, and I think a mixture of underestimating how much work was involved as well as overestimating the amount of effort that everyone else would need to put in led them to either knock a serious hole in the budget or otherwise just decide it wasn't worth it.  A USP is never a bad idea.  WHile standard staking deals are fairly ubiquitous, it doesn't hurt to have P5/sharkscope crystal star-type guys for those exact game types as a method to attract and retain good calibre horses.  The lifetime value of the improvements a backer can help give a player are considerable.

The industry

Everyone else writes about how it is for the backer or the player, but not much gets written about the effect on the industry at large.  I readily admit I haven't given it much thought either :)

What happens when the horse starts off on a heater and then starts losing?  Does the stable claw back cash from the horse?

This is the bit that does make it sound like a loan shark though from an outsiders point of view.  Let's say you are skint and get £20k in the hole in make up from your staker and have just had enough of poker (girlfriend asking you to stop playing because it is ruining your relationship etc or affecting your job) but your staker is going to stake you forever and forever to get his money back.  You have no way of paying the £20k back as you don't have any cash.  What happens then?  If you have to keep playing until you have won it back.  If this agreement is strictly enforced you might as well have got a loan yourself (if you could obviously) as you are still on the hook for the money but you only get to keep 50% of the rewards if you had won.  I think this is where the loan shark idea comes from by the original poster.

seperate issues

- where would the poker industry be without staking?

- could or should it be regulated, and how?

I don't know, because I haven't asked, but I imagine if I wanted to stop playing poker completely then I would be able to do this and the backer would forfeit the make up. Although I imagine if it got to that stage, I would be dropped before it came to that, be it for lack of volume or consistently poor results. I mean, to get to a point where you're in so much make up that there's no way you'll ever be able to pay it back normally and get to the stage where you never, ever want to play again, there have been some failings on the backers part. They won't have managed you correctly, i.e. they will have allowed you to keep on playing to a point where you're basically on permanent tilt and have very little chance of being mentally able to grind it back.

Obviously the remarks made weren't specifically about yourself.  Just want to make that clear!  I was talking generally about the whole subject.  I suppose my point is the verbal agreement is worthless then if you can just walk away from it in such a manner even if your staker is willing to keep putting the money up front to get a return on his investment.  The deeper you are in make up the more incentive there is in some ways for the staker to keep punting you because everything you win is his.

Yh sorry I think I worded that poorly, I know what you meant :)

This is where experience comes in.  There are a lot of players that will deliberately start losing, or just playing terrible volume, whilst always at the top of their permitted buyins, hoping they magi-bink out of it, and otherwise laying siege on the backer's bankroll.

Flip side of the coin, there are backers that will blindly try and hold a horse to a schedule that clearly doesn't make sense and clearly isn't going to work out for either side, short of getting very very lucky, which is never the best business plan.  That's where experience suggests that not taking turns to quote the contract to each other might be a good start and agreeing another solution.  When I've been asked to arbitrate in some of these situations, the backer hasn't really helped themselves by not applying any sanity tests to the situation pre agreement.  "so... the applicant is married with 4 kids, lives in Wembley and is playing the $3.50 45 mans for sole source of income?  And you didn't anticipate any problems? OK."

Well, having asked, apparently if I wanted to leave and not play then I can do that without having to pay back make up. I would like to think there's a fair amount of trust in my particular arrangement, and so I wouldn't ever do that and I think there'd be some sort of intervention before I got into the sort of situation arbboy described, but the fact that the option is there has to make it less loan sharky, right?

That said I think I'm really lucky to be in my situation.

Yes a smart backer will have anticipated this from a while out and tried to steer the horse into making better choices.  Yet for balance, a lot of horses do seem to have a lemming-esque propensity to send themselves (and their backers) skint by insisting on playing the wrong games.  I'd like £1 for every time I have heard "but you don't understand variance" followed 3 months later by "ok shit, perhaps you understood variance better than me, I'm now broke, can I have a loan"


Deep in MU, ----> 100% of the returns are for the backer, a great mathematical situation for the backer, yet also the reason that many backers get sent spinning.

It would be next to impossible to regulate.

In relation to point one, it would be easy to argue that it's detrimental to the poker ecosystem.

The more and more players getting "staked" is just taking more and more money out of the poker ecosystem at a quicker rate versus if staking did not exist.

Players, if there is decent coaching involved, will also be getting better at a quicker rate. Also the proliferation of staking. to some extent or another, will have sped up the evolution of online poker.

You constantly hear players talking about games getting harder, certainly over the next couple of years this trend will continue, and "staking" will be one of the reasons behind that.

 





 

2 different types of staking

1) Someone has done well got money, is really good at poker, they stake a friend(s), theres some coaching involved in the deal.

2) Large scale staking operations, they advertise on poker websites for "horses" (what a ridiculous term along with "stables". Most folk they take on they will not know/ have previous experience with.

Going back to my post above with the type of "staking" from point 1, this seems quite natural normal, and acceptable.

However with point 2, this is a real drain on the poker industry. Setting up on a commercial scale to just bleed as much money from the poker system as possible, it's just greed, how can we milk as much money from the poker industry as possible.

Overall re staking, the only benefit I can see for it as TeddyBloat mentioned above is development and improvement of ones game. I can not see how this can be healthy on a long term basis. For sure there is risk for a "backer", probably significantly less so when it's point one above there is a good relationship, you are friends prior to any staking agreement.

Overall, it must be pretty terrible for someone getting staked giving away so much of their profit every year, this is especially true for cash games.

I have no idea why anyone would ever be staked long term for cash games. If they are a winning player they are just burning money.

One thing sites could do to inhibit large scale staking operations is disable player to player transfers.

Without staking a lot of games simply wouldn't run either though.  That is the flip side.

mikeymike seems to have left the conversation now that it's gotten sensible.

maybe he's given an ice cream van man £1000 to try sell as much ice cream as he can in a day, if he makes some money on the day, great, if not then thats the risk you take but as we all know he can definitely afford it.

He might have just been asking, in a round about devils advocate way, "am I being shafted or am I shafting myself?".

Well, it's one or the other

I don't think it is a simple argument that staking is flat out bad for the poker economy. A lot of people who couldn't otherwise play at the level they do, do so because they are staked. Especially when it comes to mtt's the fields are going to be full of people who are backed in some way, whether this is a long term thing or a short term thing.


There are people on this forum who run stables, are you saying that Pleno and Picken back people for no other reason than because they are greedy? I don't think this is fair at all. They offer things in return, such as coaching and degree of financial security. Furthermore, most larger stables require their players to already be winners before they join, so already we're talking about a very small % of the overall community. They are giving people opportunities they wouldn't otherwise have and risking their own time and money in order to make it work, if this is your argument then basically everyone that owns is business only does so because of greed, and while I'm sure some do, this is an unreasonable blanket statement imo.

How can you not see that it is beneficial long term? I get to play stakes that are higher than I would otherwise be able to. Even if, in the short term, this means taking a small cut in profit that I see, in the long term I get access to coaching that I wouldn't otherwise be able to, a support network where I can discuss hands and learn from better players than myself, and I get to test myself by playing higher and against better players than I otherwise would. Yes, I have to give something back, but it seems like I get a lot for my money. If I'm a losing player, I don't even have to give it all back. So no, I don't think it's bad having to give profit away, because in return I get lower variance, more opportunities, and if I'm a winner practically guaranteed longevity in a game where a lot of people go broke.

As an example, I'd fucking love to be staked by Pleno for cash games. Even if it was at a similar level to what I already play, I get coaching from one of the best players in the world, and I get to be involved in chats and sessions with other players who are way, way better than me. I would get pushed and motivated to learn and grind, and in the long term I would benefit massively from this. Yes, it might mean I lose out on a little money in the short term, but in the long term for me this would be hugely +ev. If I do well, I might also get the chance to play a fair bit higher than I currently do, and when you put all of this together, from the horse's point of view I don't think there is a reasonable downside.

I am happy, in the nicest, non trolling way to say the only reason they do it is greed - pretty pointless enterprise otherwise. Greed can have broad definitions but think it's fair to assume the main reason is to make money..ergo, can call it something else euphemistically but it's OK to call it greed..ask Gecko.

The rest of your points can be let through though :-)

This isn't necessarily true, as I said before there are very few successful staking operations. If it was just print print print there would be dozens of companies. Fact is many have lost hundreds of thousands or even millions in some cases thus actually helping the poker economy.

When I started in poker. If player a put player b in a tournament.

It was 50:50 no make up.

I remember :)  I guess that's a combination of 1) people not thinking about it too much and 2) actually might still have been reasonable split back then when telephone number roi's were possible.

Enjoying the insight to staking etc in this thread. As a rec player for about 10 years I've always had a maximum buy in level. This has increased over the years from a £100 tourney buy in, to £300 of my own money. If say I want to play a £440 GPS and haven't won a seat, then I will sell the extra £110 to mates as a bit of fun for them, and keeping me within my own buy in rules. I am a bit different to most in the poker world in that I don't gamble, and never have, in any shape or form outside of poker.

I have a few questions.

 Firstly having set up and run a few small businesses over the last 30+ years, some from small funds, others from bank loans. All, whether successful or not were based on my own ability and knowledge of the field I am working in. So why do poker players not do the same thing? If you think you are good enough and have the ability then why not back yourself with borrowed finances (assuming you are able to). In a new business starting up, growth comes from success and reinvestment.

Is it just that poker players want to play too high above their own bankroll will allow and are too impatient to build up a suitable roll themselves?

From Pleno1 post:

Also any clever staking company will only allow their horses to play games with 15%+ roi playing stakes they are beating thus having regular income and lower variance meaning they are basically giving them a wage every month anyway.

Are there actually staking companies? Given poker is gambling therefore not subject to income tax or for the gambler to claim expenses, how can companies exist?

Why? I'm sure it would only take a couple of lines added to the Gambling Act. Unlikely, sure, but I'm struggling to see why it would be next to impossible.

Thread

No i haven't disappeared - neither am i trolling

Backers and horses - what i am saying is that if a horse spends his whole day every day playing poker - you as a backer are employing that person - so they should get a living wage -

ask any builder - plumber - electrician - why they take on an apprentice who will for quite a while only be any good for humping things - they pay them a decent wage  show them all they know and then when the apprentice has qualified they may stay for a short while before they decide to go on there own - the builder - plumber cant say hey i have shelled out ex - in most cases he just remembers that was him/her years ago

If a backer stakes at say 50/50 it actually pays the backer to keep his horses in make up for the following reason -

Lets say as a backer you have backed a horse and are in the hole for 15k - suddenly the horse binks a 40k win - you take 20k your 50 percent which is profit - the horse takes 5k and the 15k  goes to pay the make up and it all starts over-again - the horse isnt really getting a good deal - for the hours he has put in its pretty poor pay

perhaps it would be better for backers if they paid their horses enough to live on but only gave them say 10 percent of there winnings - and no make up - very few people work well under pressure and if you know that your in the hole for 15k you will always be chasing and up making bad decisions

I would be interested to know how many horses (full time) in a stable are making 50k profit +++ a year

Its interesting that some of the worlds most successful poker players have backed horses and then realised for what ever reason its not worth it

If you want to back people that's fine - but most poker players are gamblers and when people whinge because they have invested ex and lose it - just remember that's why its called gambling

Interestingly when my horses run its for fun - i never back them - shame as i have had 2 3rds and a 1st this month

Good hunting

In high variance games this exists. Spin n go stables pay their horses based on their ev not on their actual results because the variance is so high.

In Mtts you should simply make a lot of profit if you're playing the correct games with the correct approach. People lose because of game selection, whether that's a guy playing the big109 with 15$ Abi or the storm with a 0.50 abit. It goes all the way Upto live tournaments.

Your maths is wrong, $15k goes to reduce make up to 0. Then $25k is split so the horse gets $12.5k

That stable is insanely overestimating their likelihood of getting paid when the horse binks a jackpot.


Not a great example as your apprentice is a) not well paid and b) unfit to even make a good cuppa on day 1.  They are taking the worst of it in the name of getting an education.

A horse gets their 50% right out the gate, in return for already having gotten their education and proven track record, prior.


maths fail


maths pass

6 months of posting because of this fail. fml. Only took me 17 mins to call it this time.

edit: shouldn't have posted that sorry

its a seller's market this is.

People who approach people for backing because they need it, if the alternative is a low paid job then really they have no alternative but to accept it and get going. Perhaps they could get a well paid job and they have some attractive alternatives, or perhaps more than one option to back them, so they can shop around or just quit, whatever is best for them.

People like Pleno and SG offer more than money, as a way to both a) justify their fee (the 50%) above the financial outlay, b) improve the players and thus increase their profits and c) to attract the best calibre of player to join the stable.

The example of the apprentice is, as SG said, way off the mark, nothing comparable in the slightest (bar one thing), typically speaking 16 yr olds with no marketable skills at all take apprenticeships get paid hardly anything in exchange for a chance to learn, the employer (the backer in this instance) takes little risk, he gets labor, albeit hugely underskilled labor at a fraction of the price, and in return he passes on knowledge. By the end of the term the apprentice (horse) will have learnt lots for zero money, but will have invested lots of time for which he has been statutorily underpaid for. It's a fair exchange and one which benefits both (thats the one similarity) providing it works out.

In the instance of poker backing the backer takes on lots of risk, lots and lots of risk.

If backers were loan sharks that level of risk would demand an equally high interest rate, plus lots of fees and dodgy 'insurance' products.

Fascinating thread which I have much enjoyed, whatever the agenda may or may not have been.

Very few successful staking operations? Probably, yes.

Human nature being what it is, those not in the current loop tend to recall the bad examples. My impression, for example, was that, say, Flushy & Moorman did not exactly do too well at it, but it all seemed a bit informal & ad-hoc from where I viewed it.

I do recall, & know, of a few more formal Staking organisations though, the first in my recollection was Bad Beat. I've no idea how that turned out, or if it still exists (Marky?), but the impression I got was that it was well run & presumably successful.

More recently, Bankroll Supply seem fairly organized, from the little I can see.

Sharky ran one, too, might still do?

Do those sites make a decent return on their capital? I've no idea. Anyone?

The schemes run by the likes of Pleno don't fall in either category. Pleno's stable seems a long way from "corporate", far more intimate, but is, by all accounts, astoundingly successful.

On which note......     

blonde received an approach recently from a Staking Operation, who wanted to use the blonde Staking Boards to promote their product.

For better or worse, there were a number of issues that made it a no no, & we declined the offer.

I'm not too up on Staking Operations, & had never heard of them, but their website seems very professional & well put together.

They are called "Standard Backing", you may have seen them register as a new Member on blonde last week.

In impeccable timing, I can't get their website to open at the moment, but their handle is StandardBacking.com
 
They have a 2+2 thread, too, which seems to have been very well received - unsurprisingly, everyone wants their poker paid for it seems - & it has page after page of applications, here...

http://forumserver.twoplustwo.com/225/staking-archives/standard-backing-mtt-mttsng-players-1545334/

I'm curious, so if anyone has any knowledge of them, I'd be interested.

Should add I am not recommending them, or whatever the opposite is, I'm just interested.

After Stake Back Right  ?

Things like "after stakeback" hadn't been thought about.  £500 comp, 50:50 no MU  meant you were given £250 for your time playing it.  There were quite a few people readily itching to put "known faces" into events like that, either without having worked out the maths, factored in the chances of getting shafted, or possibly having done all of that, but still convinced it was a good spot.

And with a readily available reload for the next event, you can see why some players back then had an exceptionally cavalier attitude towards money.

recently this year, I did some work with a guy on this forum on a project that involved some staking, this a very clever guy and we didn't some decent exploring into the mathematics of backing...

I learnt some really interesting things, mostly notably that 50:50 with MU deal is actually very favorable to the horse IF you chop the profits everytime you get into profit. We worked out a deal based on the horse not always cashing out and allowing some of his profits to risidually build up to contribute to the bankroll, and gong 50:50 on the EV at every point.

The way it came out was that at first the horse would receive ~25% of the profits and as the profit built up he would end up with 70%, all the while the EV being 50:50, the backer getting 50% of the EV in exchange for 100% of the money and the horse getting 50% of the EV in exchange for the time, effort etc.

This lead us onto an interesting discussion, which went on for a fair while and one of which we never really reached an agreement on as to what % split of the EV should be...

We were universally in agreement that the minimum the horse should receive is 50%, and thats where we stuck, be interesting to hear the thoughts on this actually... What is a fair EV split?

@Mikey, this pretty much comes to your point of paying the horse more for his time than the man with the money. In a 50:50 MU deal the horse is actually relieving more than 50% of the EV, actually quite a bit more depending on his ROI. Just gotta bear in mind the difference between EV and $.

There aren't very many.  Quite a few pop up and do not survive even the briefest time test.  The original major league players were Sheets+Bax.  I don't think the numbers have ever been disclosed, but they must have had first run at all the very early cake.  They are rumoured to have suffered some "correction to the mean" later on, possibly as a result of dis-economies of scale and I assume geography/UIGEA did the rest.  My first exposure to it over here was Lawrie (Laurie?) Buttars ~ "Godolphin" as he was known.  No knowledge on how that went, but he definitely bankrolled some domestic household names in the poker circuit.  Next experience of it was Flushy and the Shrewdies, who were just getting going on here at the same time I started.  A lot of the threads were fun, I imagine the final outcome wasn't.  Likewise with Moorman, no idea what actually happened there. Perhaps he overestimated how much work was involved, perhaps he wrongly assumed that everyone else would kill it to a similar level that he had and hadn't reckoned on getting a few rofflers on board - idk.  Someone said something about several million, could be, I have no idea.  But if it was on that scale, then putting someone sharp on a salary and a % at the rudder would have been worthwhile considering doing.  Regardless, it was either losing money, or too much of a time drain and I don't think he actively stakes now, on any kind of scale at least.

Forward wind to the maybe dozen* outfits operating today, either in backer channels, 2+2 or other known staking outlets.  Most are embryonic startups building on the sand, based on observation of how quickly these startups disappear and how much drivel they spout while briefly around.

But there are a small handful of seemingly smart market participants, most targetting a very deliberate sector, that seem to be doing ok, at least well enough to continue to operate, and with intelligent contribution to discussion.

*  Ther must be a lot lot more than that, but a lot of these will be splinter groups in geographic regions that no-one would ever have any reason to come across.

^^^^

Do you know of these "Standard Backing" people?

No idea. NKOTB I assume, I'll look into it.

The group i am with have been around for about five years.

There are 3 'front of house' goto guys who deal with day to day problems, cash outs reloads and moving up stakes, one is a tech support.

There are also 4-5  coaches and aslo some admin guys that we players dont deal with.

Pretty big operation. Very well run and they have been very supportive of me even with off-table problems. Its very much a learning enviroment and they invest in us as players.

Dont know about the more corporate / generic operations but without investing and being selective with their players i can see how they can go badly wrong.

I finished with BB in 2013, and they had stopped almost all their UK staking, apart from a few private deals IIRC.

Chris had long since gone back to Monaco to focus on Manro Haydan, but I believe John still has a few irons in that fire, and the company is still going, although not in the same manner it was back when I was there.

'BRS being fairly organised', is like saying Alex Ferguson was a fairly good manager :D

Yeah if staking really was super printing, stress free then Moorman, flushy and more so bad beat/ bankroll supply etc would just naturally get bigger and bigger.

Almost every single staking operation from 3-4 years ago either ceased operations or is bankrupt meaning a lot of money was plowed into the economy.

People simply just don't stop a cash cow. Every cow eventually dies, just got to try and look after yours and feed it and teach it well.

think BRS are actually doing really good.