April 26, 2013
Hi TPE.
I've got the opportunity to get stacked by some close friends for pokerstars.fr (where I currently don't have any money up).
I am pretty confident in my play and hope to get around 300 – 500 tourneys/month for a max. of each 1/100th of my BR going with a ROI of 15 – 60%.
Now, the thing is I have no idea how to properly pay them. Is it fair, if, say, I get 4 people to stake me with 500€, for a total BR of 2000€, return them 50% of my net profit after each month, that is 12,5% for each.
I'd like some agreement that goes for 3 months, after this time we rediscuss if we continue or if they get back their initial investment back. This only works if I am profitable of course. If I am in the red at the end of the month I'll allow them to get back what is left of their money, or, if they want, let me continue to play (if I consider the BR to be still large enough to do so).
When I have a positive ROI I would withdraw my share of the winnings each month for 3 months, to always start with the same BR, unless we all agree that I continue with the increased BR and noone receives any of the profit for the month. Then the procedure continues until the end of the next month.
I want them to have a pretty fair deal, would be nice for everyone involved and I wonder if any of you have some ideas/advice how to do so. Is a 50/50 share fair? Should they get more or me? Etc. Thanks in advance.
TPE Pro
December 30, 2013
sorry im just noticing this now, but the tl;dr synthesis of my article is:
avoid makeup – if you're going to be playing this stake thru to an undetermined end date, and your investors assume you will not quit in makeup, then you will essentially be selling insurance on your own action at 50% mark-up. most edges are not so vast that you can afford to give up 50% long-run and still make enough to live off of, so in general id avoid incurring makeup in the standard sense.
the corollary to this may be: have a well-defined start and end. if this is a date, number of tournaments, the duration of a particular series on .fr, etc. i had an all-encompassing staking deal where i did not define an end, and figuring out my options going forward became particularly murky when i got significantly stuck.
in general, look out for your best interests as a player. it may be enticing to take a deal so that you can play bigger stakes, but often the best route is to play smaller and build up the BR yourself (this is advice that i myself have taken in my own poker ventures).
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