How Poker Backing and Staking Are Usually Structured
Online poker staking is a great way for players who, for one reason or another don't have a sufficient bankroll to play in the games which they want to and believe themselves good enough to beat. The staking agreement usually involves one player paying the full entry fee to games for another player to play, with any winnings divided between the two. When it works well it can be a rewarding and profitable experience for both the stakee and the backer.
Technically backing and staking are two different activity, but don't worry too much about it, they are both universally understood in any context in the poker world. Backing is associated with long term deals for cash games or tournaments, whereas staking is where players sell a stake or piece of their action for a one off event or a series of tournaments.
Staking or backing is common for both tournament and cash game players, but probably more popular in tournaments. A typical one off stake for a tournament would see any winnings split evenly between the backer and the stakee, after the initial buy-in has been returned. In some cases, if the stakee goes very deep in the tournament and makes the final table, the winnings are split 60:40 in the stakee's favour.
In ongoing staking arrangements, the stakee will often receive a full bankroll with which to play cash games and/or tournaments online. These more formal staking deals tend to be long term and are often tied in with a coaching package by the staking player or organisation. The coaching is obviously mutually beneficial as if the staked player becomes a better player through the combined staking and coaching deal, the backer ends up making more money from the profit sharing deal in the long run.
How does Staking Work?
There will normally be strict rules for the staked player to adhere to, such as the amount of hands or tournaments to be played per month, the provision of all hand histories to the backer every day, the implantation of stop-losses after losing a certain number of buy-ins, and so on. A typical cash game staking deal might work like this: The backer may stake a player whom they think is promising and could maintain a good win-rate in say the $0.10/$0.25 No Limit Holdem games online, and an agreement is reached for them to play 4 tables and put in a minimum amount of hands per month, say 30,000. For Sit n Go staking deals, the agreement will usually be to play a fixed number per month, again with a pre-agreed average number of tables that shouldn't be exceeded. For MTT deals, the backer and staker will usually decide in advance which tournaments are to be played every day.
To cover variance and multi-tabling, the backer in this case might transfer something like $300 to the staked players account initially, and would top it up to this amount daily if necessary. At the end of each month, any profit in the account will be split between the two in a pre-determined ratio. Staking deals are often inter-twined with rakeback deals and the staked player's net win for the month is the combined total of their winnings from play and their rakeback.
Typically the player will send his hand history files over to the staker at regular intervals which are usually determined by the level of trust that exists between the two and the stake will load the hands into a tracking package such as Poker Tracker or Holdem Manager so he can verify that amount that has been won or lost and also review hands so as to determine if the staked player is playing well and worthy of continued staking.
Player Selection Process and Conditions
For players or organisations offering staking, prudent selection of their 'horses' or staked players is critical to their success. It's imperative that the staker ascertains why, if the stakee claims they're good enough to play the games for which they want to be staked, that they don't have a sufficient bankroll to play in the games themselves.
There are a wide range of legitimate reasons for this, such as someone who has taken a break from the game or has had to use up their poker bankroll for life events such as paying for medical treatment or laying a deposit for a house. Another valid reason would be if the player wants to reduce their own variance and risk when moving up to a new level. Very often players feel more comfortable playing under a stake for a variety of reasons and will often find that they adopt a more professional approach when they have to report to a backer. Separating this type of legitimate staking candidate from a poor player or one who has bad bankroll management and tilt control problems is key to being successful in staking.
In the situation where the backer and staker aren't known to each other before a staking deal is made, the player seeking out the stake will normally be required to provide their online poker screen names and other pertinent information to potential stakers so their credentials as a player can be verified through online poker results tracking sites, and profiles in poker forums.
As a stakee, your backer will expect you to have a strong work ethic and to be professional at all times as the agreement in essence is a business deal and your conduct should reflect this. You'll often be given advice from your backer like when you should take a break from the game, and how to deal with running bad. You should accept this advice and never adopt a confrontational attitude that could lead to mistrust developing.
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