Poker Staking: A Comprehensive Guide
In this article, we’ll attempt to demystify the world of poker staking by tackling the fundamental questions typically posed by the uninitiated:
- What is poker staking?
- How does poker staking work?
- Why would people want to be staked for poker or wish to stake others?
- Is poker staking unethical or illegal?
- How can I go about staking players or being staked myself?
Let’s get started by addressing the most basic of those questions: What is poker staking?
Poker staking explained
Staking – also commonly referred to as backing – is a relatively simple concept.
In basic terms, staking is an arrangement between a player and a staker in which the staker provides some or all of the player’s bankroll in exchange for some amount of the player’s winnings.
A brief example will help to illustrate how this arrangement works in practice.
Let’s take a player – we’ll call him Mike – looking to play the Main Event of the World Series of Poker. That tournament carries a $10,000 price tag to participate.
Mike has a friend that we’ll call Brian. Brian proposes to Mike a staking arrangement:
Brian will give Mike $5,000 of the buy in, and in exchange Mike will give Brian 60% of any profit he earns playing the tournament. Brian gets a chance at a big payday without any work, and Mike gets to lower his risk by not putting up the entire buy in out of his own pocket.
If Mike fails to cash in the tournament, Brian gets nothing. If Mike cashes for $20k, Brian would get his $5k investment back plus 60% of the profits (an additional $6k in this case).
Some staking arrangements are simply one-off deals like the one described above. Others are ongoing partnerships that might last months or years. Many of the top online poker tournament players are part of staking syndicates that have been running nearly as long as online poker itself.
While our example cites a specific percentage, there’s no standard amount used for poker staking deals. The percentages vary as the amounts of money and risk vary; percentages as high as 95% and as low as 5% are not unheard of in the world of staking.
With the basics of staking in hand, let’s talk a bit more about the details that make up a standard staking arrangement.
Standard aspects of poker staking arrangements
Every staking deal is unique, but most share many common elements that aspiring backers and players will want to become familiar with.
- Makeup – A way of reducing risk for backers by tying short-term profit-sharing to a long-term contract.
- Markup – A method players use to charge a premium for a share of their action.
- Stakeback – Refers to initial cost of staking investment.
- Buy-A-Piece – A staking structure that involves many individual backers contributing to the backing of one player.
- Contract terms – Any stake should involve a contract to protect both player and backer.
Why staking makes sense for players and backers
Staking makes sense for both players and backers for a simple reason: Variance.
Most poker players – especially tournament players – lack proper bankrolls for the stakes they play. Consider the World Series of Poker, where a player can easily rack up a six-figure buy in bill over the course of the 50 events the WSOP offers each year.
Live tournaments are notoriously high variance, and talented players can easily go several tournaments – if not the whole Series – without a significant cash. Very few poker players have the multi-million dollar bankrolls necessary to withstand the inevitable swings of high-stakes tournament poker.
Online poker tournaments are no kinder to the typical bankroll. A professional player can easily spend tens of thousands of dollars a week buying in to tournaments, and the large field sizes of the major tournaments can easily make for long, bankroll-draining dry spells even for the top players.
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What about cash game players? While variance isn’t as much of a factor in cash games as it is in tournaments, it still plays a significant role, especially for players who have trouble handling the emotional component of (inevitable) downswings.
Even players who have the bankroll and the emotional wherewithal necessary to handle the variance at their buy in level have a potential motivation to take backing: To move up to a higher level.
Let’s go back to Mike for a second. When he’s not at the WSOP, he plays $50 NL online and does pretty well. He notices that some of the players he’s beating handily are also playing $200 NL, but he only has about $1000 in his bankroll.
Even if the games are very soft at the $200 NL level, Mike is still playing with fire if he jumps up with his current bankroll.
So what are Mike’s options?
He could wait for weeks at his current level and build up the bankroll for $200 NL. Or he could call up Brian and arrange a backing deal that would allow him to jump up immediately. Yes, he’d be giving up some of his profits to Brian, but the higher amounts he could make at $200 NL more than make up for the percentage he gives to Brian.
When a player can beat their limits but doesn’t have the bankroll to withstand variance, or when a player could potentially be beating higher limits than their bankroll allows, staking presents a win-win opportunity for both stakers and players.
Players get the funds they need, and stakers get the opportunity to put their money to work for (relatively) passive income potential.
Ok, so it’s a win-win. But is it something people should be doing?
Poker staking is not inherently illegal or unethical
Staking has a long history in the world of poker. Well-known cash game players have openly sold their action for decades, and some of the most famous tournament wins of all times – Stu Ungar’s final WSOP Championship for example – were only possible thanks to backing. Nothing in the rules of major tournaments or in the cash game policies of poker rooms explicitly prohibits staking.
Some people worry that staking is unethical because it promotes collusion. Let’s say that Mike and Brian both play the WSOP, with Brian staking Mike. The two end up on the same table at some point in the tournament. Do they now have an incentive to collude?
Not as much as you might think. First of all, collusion is a very tricky business that naturally puts the chips of both parties at risk. Second, cheating of any nature opens players up to the risk of disqualification.
Finally, both players involved must logically put their own tournament lives first – Mike has no financial interest in how well Brian does, and Brian has more of a financial interest in how he does personally than how Mike does.
While there may be examples of unethical behavior involving staked players, such examples are more a reflection on the player rather than the activity of poker staking. In simple terms: Players who cheat do so because they’re cheaters – not because they are involved in staking.
With those issues covered, let’s move on to our final topic: How does a person go about getting staked or staking players?
Accessing the poker staking marketplace
Most poker staking occurs between individuals with an existing relationship, and rightfully so – staking involves a level of trust that’s difficult to quickly acquire. That’s certainly the rule of thumb for live poker staking, but the emergence of the Internet has driven the creation of new, public marketplaces that offer a much wider audience the chance to participate in staking.
Online staking marketplaces still involve relationships between individuals, but the relationships are far more dependent on the published results of players than interpersonal connections. A typical online staking marketplace allows both players to solicit backers and backers to solicit players.
Players with solid statistics generally attract more funds at a more favorable rate, while players with mediocre or no statistics are often forced to build a reputation in the marketplace by playing small stakes at unfavorable rates.
In addition to the focus on published stats, most staking marketplaces have some sort of reputation component to help backers make smarter staking selections. Reputation is also a function of a player’s participation in the community that generally accompanies an online staking marketplace.
Entering a staking marketplace, then, is an easy enough endeavor. For backers, the focus should be on extensive research regarding the logistics of the community, along with the development of a strong sense of what players in the marketplace will make the safest initial investments.
For players, the road is a bit longer – establishing a reputation takes time, and expressing any frustration with that process to backers or the community at large could easily result in a loss of any reputation earned to that point.
The best advice for players – especially players lacking solid stats – is to drastically lower your expectations at the outset. You will most likely receive little attention from backers at your usual levels of play; backers are cautious and will generally want a few trial runs at low-risk stakes before they trust you with large sums of money.
Poker staking is a crucial part of both the live poker and online poker ecosystems. The flow of money from backers into the poker economy is a critical factor in ensuring the long-term viability of said economy.
Hopefully this article outlining the basics of poker staking has provided you with a better grasp on this vital, yet often misunderstood, aspect of poker.
Why would a winning player get staked?
One of the questions aspiring poker players and poker fans often ask is “why would a winning poker player need to get staked?”
On its surface this is a valid question to ask, since getting staked would seem to signify some type of failure on the part of the player, and should raise questions regarding the value in staking a player. “If you were any good you wouldn’t need to get staked,” is an all too common refrain from people not entrenched in the poker world, when they are approached by someone looking for a stake.
That being said, ask any longtime player about staking and you’ll find that it’s a very common practice, even among some of the biggest names and most accomplished players in the game.
Because of the nature of poker there are multiple reasons a player may need to be staked. A player asking for a stake doesn’t necessarily mean they are struggling, bad players, or desperate for cash. Staking deals do not necessarily reflect a player’s financial situation – although this is sometimes the case.
There are a number of legitimate reasons for winning players to look for stakes, and in this section I’ll take a look at the most common reasons a winning poker player gets staked for tournaments, and sometimes even for cash-games – although the latter is less common and far riskier.
Tournaments are high-variance
Staking is common in both live and online poker, and in both tournaments and cash-games, but when it comes to live tournaments, staking is not just a common practice – it’s practically a necessity! The reality of the poker world is that playing tournament poker at a professional level is not only expensive, but it’s extremely swingy and filled with long stretches of breaking even and small losses, in between your big scores.
Basically playing tournament poker without being staked is like buying a house without a mortgage or a car without an auto loan; sure some people can do it, but they are the exception and not the rule.
Wanting to move-up in limits
One of the top reasons players look for backers is to play in tournaments that are above their current pay-grade.
An example of this would be an online poker pro who does very well playing daily and weekly tournaments with buy-ins between $30 and $215 who wants to play in the World Series of Poker. Even playing just five events at the WSOP can cost a player $25,000 in buy-ins alone, so despite his skill level and good results, this amount is simply way too high for your typical online poker pro to swing.
Another version of this is a player who has been beating $10 online Sit & Go tournaments and wants to move up to the $20 tournaments, but doesn’t have the bankroll to do so. Or a player who has been holding their own in multi-table tournaments with buy-ins ranging from $10 to $50 and now wants to play the major Sunday tournaments that have buy-ins in the $100-$215 range.
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As mentioned, the sheer variance in tournament poker is enough for most tournament pros, no matter how much money they have made in their career or what their current financial situation is, to always sell percentages of themselves or work with a backer(s) all the time.
Playing a full WSOP schedule would require a player to have at least $100,000 just for the buy-ins, and just one bad tournament series would cripple the bankroll of virtually any poker pro. Throw in the cost of travelling, eating out and so on, and you start to get a pretty clear picture of just how expensive it can get.
Because of this, most poker pros always sell pieces of themselves simply to reduce variance.
Another variance problem live tournament poker players run into is hitting the long-run. Since you can only play one, maybe two tournaments in a day, and major tournaments can last anywhere from three to seven days, it takes a really long time for your “luck” to even out.
Unlike an online player who can squeeze-in 100 tournaments in a week, a live tournament player would be lucky to get in that many events over a six-month period. It could take years for a live tournament player to even know if they are beating the game making live tournaments the highest-variance game in poker.
There is a third reason poker players may look for stake money, and this has to do with falling on hard times. A medical emergency, a terrible downswing, or just poor money management can cause a player who was completely self-sufficient to suddenly need a stake.
Just because a player is a financial bind doesn’t mean they are a bad poker player, or even untrustworthy (that being said, you should be a bit more careful when this is the reason a player is looking for backers) and many of these players are often the best values in the staking world. Life happens to everyone, and every now and then everyone needs a little help.
Poker staking terms
New to poker staking and not sure how the lingo works? Here’s a quick guide to all of the major and commonly used terms in online poker and live poker staking.
In the staking world action refers to the percentage of the stake a player is offering to sell to investors. Example: “I will be selling 40% of my action.”
See also, investor. A Backer is a person investing in a player’s stake. Example: “My backer has staked me for 10 WSOP tournaments.”
A bankroll typically refers to the amount of money set aside for playing poker. In the staking world a bankroll is what a player is looking to scrape together, while for backers it generally refers to the amount of money they have set aside to invest in players.
Example: “I’m going to run a couple stakes so I can put together a bankroll.”
Cut refers to the percentage of the profits an investor is due from the player at the end of a stake.
Example: “Your cut of the profits from the BAP will be 20%.”
A Degen is a player who gambles away their money by playing house edge games or betting sports. In the staking world a degen with good results can be a tempting person to back, but can also increase the risk of being scammed or rolled.
“He’s definitely a degen, but he does have a 40% ROI in tournaments, so I staked him.”
An Escrow is a third party who is tasked with holding money for two other parties. “They didn’t know each other so I offered to escrow the stake-money since they both know and trust me.”
For investors, getting a free-roll is when the player makes a big score early on in the stake, at which point the investor’s initial investment is guaranteed.
Example: “He final tabled the first event of the series, so from here on out I’m on a free-roll.”
For a player the term free-roll has an entirely different meaning, since it describes a situation where an investor hasn’t paid for their shares and is unlikely to pay if you don’t cash, but fully expects to be paid if you do cash.
Example: “He hasn’t sent the money for the stake yet, so I’m worried this guy is free-rolling me.”
The Hendon Mob (www.thehendonmob.com) is an online website that is best-known for tracking live tournament results. For players and investors the Hendon Mob is an invaluable resource with the most accurate live tournament tracking in poker.
Example: “You can see my tournament results at the Hendon Mob.”
See also, backer. Investor is term used to describe a person who is backing a player.
Example: “I’d invest in his BAP; he’s a proven winner.”
When a player puts together a stake that involves more than one tournament it is commonly called a “package.”
Example: “I will be selling shares in my upcoming WSOP package.”
Having a piece of a player simply means you have a certain percentage of a player’s action.
Example: “I have a piece of John’s action in the Sunday Million.”
See also, stakehorse. The “player” refers to the person running the stake or a person being staked.
Example: “I’m the backer and Carl is the player.”
A rail thread is posted at an online poker forum to allow backers and fans to follow along with the player’s progress in their stake.
Example:”Once the stake begins I will start a rail thread where I’ll update my progress.”
Reserve is a term used when a potential backer wants to lock-up a certain number of shares in a player’s stake before they officially go on sale.
Example: “Before you get your final package together I want to reserve 10 shares.”
The term rolled in staking parlance refers to being scammed by a player; typically “rolling” is used when a player absconds with the stake money.
Example: “He ran a $12,000 stake that pulled in 20 investors and rolled us all.”
Also known as, rolled-over or rolling over. This is the process of reinvesting in a player’s next stake at the end of the initial stake.
Example: “He cashed three times at the WSOP so I rolled-over my profits into his WPT Stake.”
Scammer refers to any person (backer or player) who has a reputation for underhanded dealings. Scamming can range from non-payment, to running phony stakes, to an investor free-rolling a player.
Example: “I wouldn’t get involved with him, he is a known scammer.”
Shares are equal percentages of a player’s stake.
Example: “I will be selling 100 shares at $10 each for my BAP.”
SharkScope (www.sharkscope.com) is an online poker tracking site that specializes in Sit & Go tournaments. SharkScope is useful to check a player’s track-record, as well as for monitoring their progress in a stake.
Example: “if you want to see my results you can SharkScope my PokerStars screen-name.”
Sheets and Bax
“Sheets and Bax” is the name of an iconic staking duo –Eric “Sheets” Haber and Cliff “JohnnyBax” Josephy– who have revolutionized the way players are staked in tournaments.
A Stable refers to the entire contingent of players a backer stakes, and goes along with the term stakehorse.
Example: “Phil Ivey has a huge stable of players he backs.”
See also, player. Stakehorse is an alternative term for the player being staked.
Example: “He’s been a good stakehorse for me over the years.”
Swapping action is when two players exchange percentages of themselves instead of each person paying the other.
Example: “Joe was playing the Sunday Million and I was playing a WSOP Circuit stop so we swapped 10% of our action.”
Common acronyms used in poker stakes
ITM –In the Money
MTT –Multi-Table Tournament
PTR –The online tracking site PokerTableRatings.com (www.pokertableratings.com). PTR is one of the tools where investors turn to see a player’s online poker statistics.
ROI – Return on Investment
S&G –Sit & Go tournaments
STT – Single Table Tournament
What is a BAP? How does buy a piece staking work?
Staking is nothing new in the world of poker with the practice dating back to the earliest days of the game when it was played along the Mississippi River. But now, in the age of online poker players getting more creative with their staking deals and a new version of staking deals has arisen and become pervasive in the poker world – it is known as a BAP.
Below I’ll detail precisely what a BAP is, how it differs from a standard staking deal, and why BAPs have become so prominent in the world of staking.
What does BAP mean?
BAP is simply an acronym for “Buy A Piece” meaning that instead of backing a player for the full amount of the stake you are only buying a piece of that player – a percentage of their action.
BAPs are helpful to both the player and his or her backers, as they allow smaller investors to get in on staking deals, which allows the player to more easily sell out their stake since they no longer need a single investor with deep-pockets, instead finding multiple small investors.
When players setup a BAP they break down the total amount of the stake (including any markup) into shares, generally 100 shares is the number used to keep things as simple as possible. For instance, if a player is looking for a total of $1,000 in stake-money for their BAP, they will sell 100 shares at $10 each, allowing investors to buy a percentage of that player for as little as $10.
In this case, if an investor purchased three shares they would be entitled to 3% of the player’s profits at the end of the BAP.
BAPs can, and often do, get a bit more complicated than this, and often include stakeback or makeup, especially when the player is charging a premium for each share –known as markup. The most important part of understanding a BAP deal is whether the player who is offering the BAP is also investing in himself or if they are selling all of their shares and playing for a specific percentage:
Selling a percentage
Selling a percentage of yourself means that the player will also be financially invested in their performance –how heavily depends on the percentage of action they are selling. When a player is selling only a percentage of themselves you’ll see the terms of the BAP stated in several different ways:
The player can simply buy some of the shares they are offering upfront. So instead of selling 100 shares the player may offer only 70, 50, or even 25 shares to potential investors, locking-up x amount of shares for themselves.
For instance, if a player buys 50 shares of their own action and sells 50 shares of a $1,000 BAP at $10 each (50% of their action) and finishes the BAP with $5,000, the player would keep $2,500 and the investors would split the remaining $2,500, which works out to $25 per share.
The player can stipulate up front the percentage the BAP shares make up of the entire package. For instance the player could propose the same $1,000 package, but only sell $500 worth of their action, so shares would be $5 each, but would only be worth 50% of the profits.
The math works out the same in both cases, even if the wording is a bit different.
The player may include a markup in the share price. In these cases the player will choose either option #1 or option #2 above but will add a premium to each share, perhaps selling the shares at $11 or $12 each instead of $10.
Occasionally you’ll see a player offer something along the lines of 80, $12 shares for a $1,000 bap, which allows the player to raise all of the money needed and still keep 20% of their action.
Regardless of how it is laid out you should always calculate precisely how much each share is worth in profits compared to the percentage of the buy-in it is covering; if the numbers do not match the player is charging you markup.
Playing for a percentage
When a player is not investing any of their own money and is trying to raise 100% of the money needed they will be playing for a predetermined percentage of the winnings. For example, if a player is not investing in their BAP, and is raising all of the money needed via investors, they will simply include a markup built into the BAP.
So if the player is offering 100, $10 shares for a $1,000 stake, the player will generally offer the investors only 66% of the profits, leaving 34% for the player.
This type of arrangement is basically the same as a typical markup deal, but the player has simply included it in the price of the BAP by altering the payouts. In these cases you’ll have to do some back-of-the-envelope math to figure out the markup, and can then decide if the BAP is worth an investment on your end.
Paying out investors
At the end of a BAP the shares will have either gained or lost value, and this amount is then paid to each individual investor. For instance, if you bought five $10 shares (the total value of the BAP was $1,000) of a player with stakeback guaranteed, and the player ended the BAP with $3,500 you would receive your $50 back, as would all investors, leaving $2,500 in profits.
Since you purchased 5% you would receive $125, for a total of $175 return on your $50 investment. In the case of stakes ending in a loss, makeup may come into play.
What does stakeback mean? How does it work in a poker stake?
For players unfamiliar with the term, stakeback can seem like a complicated concept, and something you simply don’t want to have to deal with. But this would be a major mistake! Once you understand how stakeback works you’ll realize just how important it is for both players and backers to make use of.
Stakeback has become one of the most common terms in the staking world, and is very similar to makeup with only a few small differences. In this column I’ll go over the ins and outs of stakeback and everything you’ll need to know about stakeback as a player and as a backer.
Broken down to its simplest meaning, stakeback is simply the player offering to return their investors initial stake-money before any profits are divvied up at the end of the stake.
When a player finishes a stake and stakeback was part of the agreement the initial stake-money is first refunded from whatever money remains, regardless of whether the player finished the stake in the red or in the black.
When stakeback is involved, the only time investors would get no return whatsoever would be if the player had zero money left.
Stakeback is a type of insurance policy for the backers in a staking deal. By offering stakeback a player who is looking to be staked is doing two things:
- First they are offering the backers a slightly better Return on Investment (ROI) as stakeback is deducted before any profits are split between the player and the backer.
- Second, stakeback allows investors to recoup some of the stake money even if the player ends up in the red.
How stakeback differs from makeup
Unlike stakeback, makeup is an agreement where win or lose the player must repay his or her investors their initial stake. With stakeback if a player was given $5,000 and finished the stake with just $2,000 all of that money would go back to the investors; makeup would require the player to return the $2,000 to the investors AND the player would still owe them a further $3,000 in the future.
If we continue with the insurance analogy: For the investor, makeup is like having premium health insurance coverage, where you don’t have co-pay or monthly premiums. Stakeback is more like having a health insurance policy with low monthly premiums and affordable co-pays.
Entering into a staking agreement as an investor without stakeback or makeup would be akin to not having insurance at all and simply crossing your fingers and hoping you don’t get sick.
How stakeback is calculated
Calculating stakeback is a relatively simple process; below you will find two separate examples of stakeback calculations – one where the player is in the black and one where the player is in the red.
In both cases we’ll assume the following arrangement: Steve stakes Kevin in the WSOP for 10 tournaments with a total buy-in amount of $40,000. The two have agreed to a 50/50 split with 100% stakeback.
Kevin wins $32,000, giving him a total of $72,000 between the stake-money and his profits that needs to be divvied up with Steve. Because there is 100% stakeback, before any profits are chopped-up Kevin will first return Steve’s initial investment of $40,000, leaving the $32,000 of profit to be split between the two.
In this case Steve would receive $56,000 and Kevin would pocket $16,000.
Kevin ends the stake down $16,000, leaving only $24,000 of the initial stake. In this case even though Kevin cashed in some of the tournaments, because of the stakeback all of the remaining money would be returned to Steve.
Calculating stakeback can get very confusing when markup is involved and when a player has multiple backers , but fortunately for all of us there are several sites that offer stakeback calculators.
How does makeup work in poker staking?
Are you interested in staking another player or getting a stake yourself but don’t quite understand all the terminology like “Makeup?”
Don’t worry, it’s not uncommon for poker players to stumble upon a poker forum and feel overwhelmed by the terminology being used – “4-betting light” and “polarized ranges” and “uber-nits” and “clicking-it-back” are enough to make anyone’s head spin and wonder if they stumbled upon a German-language forum –especially the Uber part.
Well, this problem doesn’t necessarily go away overnight, and new terms will keep popping-up that you don’t fully understand, and one of the most misunderstood terms of them all is “Makeup”.
In this article I’ll layout precisely what makeup is, and everything you need to know about makeup and staking.
Makeup is one of the most important terms to know if you plan to get involved in staking deals, either as the backer or as the player. Makeup refers to an agreement between the player and the backer where the player is responsible for compensating the backer should he bust his stake or fall short of matching the initial stake.
At this point I’ll caution you not to confuse “Makeup” and “Stakeback.”
What is makeup? Why offer makeup?
Makeup is basically an insurance policy for the backer.
Without makeup the player is essentially on a freeroll and has no skin in the game –it would be like getting a business loan without putting up any of your own money and offering no collateral whatsoever.
In short: Without makeup the staking deal is basically a one-sided affair benefiting the player far more than the backer.
A mere decade ago it was fairly uncommon for staking deals to include any consideration of makeup, but in the modern game of poker makeup is almost a given in any staking deal.
Not only does it insure the player has something invested in the stake, but it also eliminates some of the potential for scams and other malfeasance that has pervaded the poker world over the years.
How makeup is calculated when the player is in the black
Like stakeback, Makeup is generally taken off the top of any winnings before any of the profits are split.
If Will backs Steve in a 50/50 staking deal with 100% makeup for $5,000 worth of buy-ins at the World Series of Poker, and Steve cashes for $8,000 most people simply assume that both would receive $4,000; well this is most definitely NOT the case.
Steve would first pay Will his makeup (in this case $5,000) and the two would then split the remaining $3,000 of profit. So Will would receive $6,500 and Steve would receive $1,500 based on their staking agreement.
How makeup is calculated when the player is in the red
When a stake ends in the red the player is responsible for repaying the backer the outstanding amount. This can be done in several ways including future staking agreements between the two.
However, if the backer decides to end his staking agreement with the player the makeup is usually forgiven; unless the two parties made an agreement beforehand that the stake would end at some point or when some loss limit was reached.
For example, suppose Steve and Will are running the same stake from above only this time Steve cashes for just $2,500. This $2,500 would go to Will and Steve would still be on the hook for another $2,500.
So, when the next WSOP rolls around and Will stakes Steve another $5,000, Steve wouldn’t receive any percentage of the profits until he cashed for more than $7,500 – the $5,000 stake plus the $2,500 in makeup he still owes Will.
Playing without makeup or reduced makeup
In certain situations (generally during one-off or short-term stakes) the player and the backer may choose to enter a staking agreement without makeup. When this occurs the terms of the staking deal are generally pushed more in favor of the backer since makeup is not involved.
Instead of 50/50 or 60/40 splits, I’ve heard staking deals as skewed as 90/10 in favor of the backer when makeup is not involved, although 70/30 or 75/25 is far more common.
Generally speaking, unless a player is a very proven commodity (both in terms of results and reputation) 100% makeup is the Standard Operating Procedure. If you intend to stake players or receive a stake yourself you should go into the deal expecting makeup to be part of the bargain.
How does staking markup work?
The easiest way to understand markup is to think of it as a premium backers pay to stake a player. Below we’ll go through a more specific explanation with examples and standard markup rates.
Calculating markup for a stake
In poker staking parlance “Markup” refers to the percentage a player adds to his stake above the actual buy-in amount.
If you think of staking deals like investing in a business, a player good enough to be charging a markup is someone who is less risky as an investment, but a slightly higher cost. The better a person’s track-record (and the less the person actually needs to be staked), the more markup they can charge potential backers.
What is markup and how is it calculated?
Markup is one of the simpler poker calculations you will come across. For instance, if a player is offering 100 shares of himself in a $1,000 buy-in tournament at a 1.1 markup, each share will cost $11 instead of $10 – $10 would be the price if he sold without a markup. If the markup was 1.2 each share would cost $12, and so on.
This means if the player sold all 100 shares at a 1.1 markup he would actually collect $1,100 and would win nothing if he cashed in the tournament – which is why it’s important to know how many shares a person is selling to make sure they have a reason to play their absolute best.
Markup for live tournament players
Generally speaking, the better the player the higher the markup will be, but it’s important that you don’t confuse fame with results. By using markup a winning player receives a fair market value based on their skills and their past results.
Calculating markup can be a tricky endeavor, especially for live tournament players where results are fairly hard to track, and it’s important you understand how skewed a live tournament player’s results can be if they have one really big score on their resume, which we’ll talk about a bit more in depth below.
The standard Markup amount for consistent, winning, players is between 1 and 1.25. If someone is charging a higher rate than this they should be able to layout really solid reasons for doing so, and even still it may not be worth it to stake someone at a markup of over 1.3.
Markup for online tournament players
Online players, and their backers, have an easier time calculating markup as they can rely on a player’s ROI to determine the appropriate figure. With so many online poker tracking sites, a player’s results are basically a mouse-click away, and you can see everything from ROI to In the Money percentages.
Most staking deals use a simple formula where the markup for the stake is slightly lower than the player’s ROI.
Here is an example of an online poker player determining a fair markup for their stake:
John is a longtime player, has a lifetime ROI of 17%, and wants to sell pieces of himself for an upcoming online tournament series. The total amount of the package (including the tournament fees) is $4,000.
To determine an appropriate markup John simply needs to come in under his ROI; the lower he sets the markup the more enticing the stake will be to potential backers. In this case a good markup would be 1.1-to-1 (10% being less than his ROI of 17%).
Other important factors when determining markup
Players with a longer track-record can get away with a markup even closer to their ROI than players who are still under the thumb of variance. The bigger the sample size the more accurate the numbers will be.
Consistency is huge when it comes to stakes, and players with more consistent –especially recent– results are generally more desirable to stake. For instance, a player could have a tremendous ROI if they happened to win a couple of tournaments back in 2006 for $4 million, but poker changes pretty fast and these players could very well have a negative ROI in today’s game.
The point is, make sure the markup is consistent with both their life-long results and their more recent results.
Playing higher than you are accustomed to
One of the main reasons for entering into a staking deal is to jump to the next level in terms of the stakes you play. However, when you do this you have to realize that your current ROI isn’t as applicable anymore, and you may have to reduce your markup percentage.
For poker players, life, or just a terrible downswing, can make you a bit desperate, hence needing a stake in the first place. In these cases beggars can’t be choosers, and you may have to reduce the amount of markup you ask for in order to get the stake going as quickly as possible.
How to get staked to play poker
Staking deals do not simply fall from the sky at casinos, and you won’t see solicitations for your services in the chat-box of your favorite online poker room. If you want to get staked you have to put the time and effort into selling yourself as a “stake-worthy” player.
Think of finding a backer(s) like finding a job, where your number one selling point is your resume. In poker your resume is pretty simple – it’s your trackable results along with your ability to sell yourself. If you think you can just slap up a post at an online poker forum in 10 minutes and the stake money will just start rolling in then you are sadly mistaken.
Read on for all of the tools you’ll need to sell yourself as a potential stake and attract the right kind of backers.
To get staked, offer results and data
First off, if you’re not a proven player than don’t kid yourself into thinking people are just going to take a chance on you because you know you are a good person. To even consider offering yourself up as a potential stake you will need to prove to the community that you have a solid track-record and your reason for running the stake-money is legitimate and not some kind of cash-grab.
In addition to this, you usually have to prove yourself as a contributor to the community for months or even years before you start asking to do financial transactions.
If you are a relative unknown entity to your potential investors than testimonials are the best way to solicit potential backers. If known entities show-up and vouch for you, or relay their past dealings with you this will go a long way in proving you are worth the risk to any potential backers.
You’ll also need to be able to show some type of provable results – whether it’s live tournament results or verifying your screen-name at an online poker site and then linking to your results from one of the many online poker tracking sites.
Without results people only have your word, and every poker player thinks they are the best, so real data and results will be needed.
Be professional and watch staking opportunities improve
For all of you Great Gatsby fans the saying “the clothes make the man” most definitely applies to poker staking. In this case the “clothes” is your initial staking proposal.
There are many things you can do to sell yourself. The simplest of these things is to spell-check your post and make sure everything is clear and concise, but you can also look at how the other successful players write-up their stakes, and copy their template.
To put in more simple terms: Even if it is your first rodeo you should at least make it appear as if it’s NOT your first rodeo.
If you can’t be bothered to spell-check an important post, potential backers will see this as your modus operandi and will assume that you are lazy with your notes and other important details while you are playing. If you’re not the best writer, or have trouble expressing yourself, get one of your friends to help you out, or discreetly ask someone from the community to help you write up your stake.
Think carefully about the staking terms you offer
Make sure you are offering your potential backers a good, but not great, deal, and make sure you are thorough and explain as many details of the stake as possible, no matter how small or insignificant you may think them to be.
Whether it is tax implications on big wins, how and when the collection of money and payouts will be handled, or that you are a member of certain poker training sites or have been coached by some well-known player – all of this information could be the difference between a backer thinking you are running a professional, well thought-out, stake, or that you are simply some random yahoo who is felted and looking for a handout.
Advantages and drawbacks of being staked in poker
There are many reasons a player might decide they need to be staked.
For the most part, these reasons are entirely legitimate and offer both the player and the backer an equal chance to profit, but stakes and staking deals can also come with a few drawbacks as well. After all not everything can be a “can’t miss” proposition, and staking deals definitely have some potential disadvantages built-in for the player and the backer.
Let’s now take a look at the advantages and the drawbacks of staking deals from both the player’s and the backer’s perspective.
Staking advantages for the player
Advantage #1 – Staking allows you to play higher stakes than you are bankrolled for
One of the main reasons players look to get staked is to play in games that they simply aren’t bankrolled for. After all, if you were bankrolled for the game you wouldn’t need to find a backer!
This doesn’t mean you are playing in games you are not skilled enough to beat though, which is a different animal entirely. It simply means that you don’t have the necessary bankroll to play in games you can beat.
For semi-pro and pro players, one of the biggest obstacles is getting trapped at a certain level. When you are using your winnings to pay bills and cover your expenses it’s hard to really build a bankroll at the same time. Entering into a staking deal can allow you to jump up to the next level without having to worry about doubling your bankroll to do so.
Advantage #2 – Staking can get you through a rough patch
Needing a stake doesn’t only occur when you blow your bankroll, are stuck at a certain limit, or when you want to play a major tournament like the WSOP Main Event.
Sometimes life happens and your resources get depleted, and a staking deal may be just what you need to get you back on your feet. The key thing to remember is that when you are asking for a stake in these situations (when life has handed you a pile of lemons) it should be a short-term fix and not a long-term crutch to lean on.
Advantage #3 – Staking reduces variance, especially for tournament players
There is no form of poker with more inherent variance than multi-table tournaments. Live poker players can go years between big scores, so having a staking deal can drastically reduce the amount of variance a player has to deal with.
Even some of the best-known and winningest poker players sell pieces of themselves, and the reason is variance. If you do the math it would cost upwards of $1,000,000 per year to play all the major poker tournaments, so it doesn’t take very long for a big score to vanish if you have a couple bad years.
Staking advantages for the backer
Advantage #1 – Staking gives you the chance to back players in events you yourself are not capable of playing
If you’ve ever dreamed of playing in the WSOP Main Event but either don’t have the money, or don’t have the skill to make dropping a $10,000 buy-in a EV move, staking a player is the next best thing. Think of it like drafting a player on your Fantasy Football team, where you get excited when they perform well.
Only as a financial backer you profit financially when they perform well and don’t just get some bragging rights amongst your friends.
Advantage #2 – Staking allows savvy investors to find good value
This may sound sort of callous, but some poker players are really, really good at poker, but they suck at money management. If you can enter into a staking deal with one of these players you may have found yourself a veritable goldmine.
They are skilled enough to beat the games they are playing and bad enough with money that they will always need a backer.
Staking disadvantages for the player
Disadvantage #1 – You are only playing for a percentage of your profits
When you take on a backer you have drastically cut-down on your profits, especially if you are a tournament player who relies on huge scores in between months of treading water.
Imagine if you’ve been paying your own way on the tournament trail and suddenly decide to reduce variance and take on a backer, then you go on to win two major tournaments in the span of a month!
What would have been a $2 million score for you has just been cut in half.
Disadvantage #2 – You could end up in makeup
I’ve already touched on the variance in poker. Because of this you need to be cognizant of the fact that no matter how talented you are, you could run really bad for a while and end up deep in makeup –in laymen’s terms, you “owe.”
Once you’re in makeup it’s really hard to dig yourself out, so the best thing to do is make sure you aren’t a digging a hole that you can’t climb out of.
Staking disadvantages for the backer
Disadvantage #1 – Your money will be tied up
Typically, staking deals occur over a period of time and are often “rolled-over” into the next stake or Buy-A-Piece (BAP) the player offers.
Because of this, you may find that some of your financial resources are tied-up in a player you are backing, and complicating things is the fact that you can’t just “end the stake” on a whim, you have to let it organically end.
If you don’t have a lot of disposable income you need to be very careful with how much of your money you tie up in a stake.
Disadvantage #2 – You could get “rolled”
While most staking deals are conducted on the up-and-up, and go off without a hitch there are plenty of examples of scams, scandals, and shady dealings. Always keep it in the back of your head that there is always the possibility of getting “rolled” by a player you are bankrolling. Sometimes these people set out to scam you from the get-go, and sometimes they find themselves in a desperate situation and don’t see any other way out. Either way it’s your responsibility to make sure you are diligent with checking up on the person you are thinking about staking and always be aware that getting rolled is a possibility when you stake players, even if the person has a really good track-record.
What is a standard poker staking deal?
While I’m not a big fan of using the term “standard” when it comes to describing anything in poker, there are some instances where there is a pretty set-in-stone standard operating procedure in place, and one of those areas is staking agreements. In this column I’ll outline how to setup a standard staking agreement from start to finish, covering everything from creating your proposal to the transfer of money.
When you first approach someone or post at an online poker forum looking for a backer you need to make sure you have all of your ducks in a row. Imagine if you walked into a health club and the person behind the desk offers to show you around but couldn’t answer any questions about the equipment and doesn’t know how much it costs to join… not really a situation that would instill you with a lot of confidence in the facility right?
Well the same is true for players looking for a stake. If you want to sell yourself you need to make sure you have your act together and can provide potential investors with the answers they need.
What you’ll find below is the basic outline for setting-up a standard staking arrangement:
Perhaps the most important figure any staking agreement needs to relay is the percentage split between the backer and the player. In standard staking agreements this number can vary between 50/50 and 66/33 in favor of the backer depending on whether or not stakeback and makeup are included, and based on the player’s previous results.
Any amount above or below these numbers I would not consider a standard agreement.
Is there a markup?
You need to be very up front if you are asking people to invest in your stake or Buy-a-Piece (BAP) at a markup –which has become a standard practice for established players. This markup should be very clear and one of the first things the person sees in your stake along with the percentage split. A standard markup for a proven winning player is in the 1.1-1.2, although as you’ll see in the next header, stakeback or makeup can drive this number up, and players with shorter resumes will usually sell with no markup.
When Markup exceeds 1.2 or so you are starting to move away from a standard staking agreement.
Stakeback and makeup
Stakeback and Makeup have become standard in most staking agreements, so let me briefly describe what each one is and then show how they can affect the percentage split or markup of a stake.
Stakeback is where the player refunds the initial stake before any profits are divvied-up. If you backed a player in the WSOP Main Event and they cashed for $25,000 they would first return your initial stake of $10,000 before dividing up the profits –which would be $15,000.
Makeup is different from stakeback in that makeup carries over. With stakeback if you do not cash in the WSOP Main Event that’s it, end of stake; with makeup you would still be on the hook for $10,000 to your backer, which would carry over into the next staking deal you enter into with him or her.
Now, offering stakeback and makeup allows you to ask for a higher markup or a better percentage of the profits since you are offering some security to the backer’s investment; especially in the case of makeup. For winning players, offering makeup can push the markup as high as 1.5 and/or the percentage split as far as 30/70 in favor of the player –although I would consider these non-standard staking deals and there should be a very, very, good reason why the markup or percentage split is so high.
Basic information to include in your staking proposal
Some of the things you should always be able to supply are:
- Past results, either from a reputable online poker tracking site like thehendonmob.com or sharkscope.com
- Any testimonials from past investors
- Professional references
- Full schedule of events you intend to play
- How you will accepts payment (including the date you need the money by) and how you will payout investors at the end of the stake
The fine print
Besides all of the basic information mentioned above it never hurts to provide some additional details to prospective backers, as this will save time later on and can derail any disagreements before they even come up. Here are a few of the questions you should answer in your staking agreement:
- What will you do if you miss an event?
- How will you handle any tax paperwork?
- How will you update your backers on your progress?
And finally, you should be able to answer any question a backer may fire at you. You may think you’ve covered everything, but believe me, someone will most assuredly ask a question you didn’t even think of; from how you calculated your markup to your state tax laws regarding gambling wins.
A standard staking arrangement: example
So with all of this in mind, here is a look at a pretty standard staking arrangement:
Bill will play five $1,000 buy-in events at the World Series of Poker as well as the $5,000 No Limit Holdem tournament and the $10,000 Main Event. He is selling 50% of his action (Bill and his investors will split the profits 50/50) with Stakeback at 1.2 markup. The total package is $20,000, and Bill is selling $10,000 of that for a total of $12,000. [In addition to all of this Bill gives a couple of examples of potential payouts to investors].
Bill links to his thehendonmob.com page for his live tournament results as well as his PocketFives.com profile which tracks his online poker results.
Bill also provides links to several older stakes he has run, all with excellent feedback from investors.
Bill will require an I-9 tax form for any win over the tax threshold from all investors. Bill will need all payments at least two weeks before the start of the first event and will make payments via PayPal or in person the day after his run in the Main Event comes to an end.
Live poker staking vs online poker staking
There are now two distinct parts of the poker world: Online Poker and Live Poker. These two areas of the game are like night and day in some respects and when it comes to staking the difference between staking someone online and staking someone live are two very different animals. In this column I’ll take a look at the advantages and disadvantages of staking players in both live and online poker.
Advantages of live poker staking
Advantage #1 – Live staking is generally done between people with a relationship
Staking players in live events is usually done between players who already have a relationship of some sort – you don’t simply approach strangers at a casino and ask for money– although there are scenarios where players and backers who do not know one another can have their paths cross and wakeup the next morning in a staking deal, and just like a one-night-stand these can sometimes be full of regret.
One of the main disadvantages of staking someone online is that it’s generally done between people who have never met, and in quite a few cases, the individuals involved may not even know the other person’s real name, just a forum screen-name! Needless to say, there is a lot more trust involved in staking peopled you’ve met online.
Advantage #2 – Live events are generally larger with bigger prize-pools
Unlike online tournaments which run around the clock at buy-ins from $1 to a couple hundred, live events are less frequent and are far more costly to play. Because of this the prize-pools are bigger (which means more money to be won) and the variance is demonstrably higher. Both of these reasons make staking a staple of the live tournament scene.
On the other hand, when you stake someone in online events the chance at a really big score is diminished unless the person is playing tournaments like the Sunday Million or a major online tournament series. Basically, you’re not going to get rich staking people in the “Hot $22” on PokerStars, or staking them in $10 Sit & Go tournaments.
Advantages of online poker staking
Advantage #1 – Online staking deals can be played at virtually any stakes and in any game type
Unlike live staking which is mainly reserved for major tournaments, when it comes to online staking you can stake players in cash games, multi-table tournaments, and sit & go tournaments. When you stake players online you can buy pieces of players for as little as $25 or $30 since online tournaments and cash games aren’t as high-priced as live events, and all of the results are trackable (more on this below).
This also works in reverse for live poker. Because the sheer amount of money a player is gathering in some of these stakes, there is more motivation for shenanigans. Whether it is over-selling, not playing an event they are supposed to, or simply running off with $10,000; all of these things have occurred and you should be very diligent before you invest a substantial amount of money in a live poker player.
Advantage #2 – Staking an online poker player also comes with a bit of insurance policy
Since most of the staking deals between online poker players and their backers are conducted online there is virtually always a written record of the transaction –which makes it harder for people to just abscond with winnings. In some instances, online sites have even stepped-in and stopped a potential scammer’s attempt to withdraw profit or stake money that belongs to another player –often times this proven by a link to the staking thread.
Advantage #3 – Online staking provides you with trackable results
One of the biggest problems you’ll encounter staking live poker players is simple tracking. It’s hard to even find entry-lists for major events, never mind being able to track a player’s results in daily tournaments or preliminary events at tournament series. This is why online poker is far more conducive for staking deals.
Not only can you find full entry lists for every tournament, but there are countless sites that track players’ results in tournaments (MTT’s and S&G’s) as well as cash games.
Poker staking contracts – the basics
Note: Before drafting or signing any contract, we suggest you secure legal & professional advice. This article is just to give you a sense of what general standards in the current staking market are and should not be considered an equivalent to legal or professional advice.
Developing a contract for a staking agreement
When you enter into a staking agreement, either as the player or as the backer, you really need to cross all of your t’s and dot your i’s, and make sure your end of the staking agreement contains contingencies for all possible outcomes.
Now I’ll go over all of the different aspects that must be considered by both the player and the backer in order to insure that their staking agreement runs smoothly and stays controversy-free.
Problems are common in staking deals
Many stakes run into problems not because of dishonesty from one of the parties involved, but simply because the terms of the stake were not clearly defined and the player and the backer were left with making assumptions. A perfect example of this is taxes.
How taxes can complicate poker staking deals
Suppose a Canadian backer stakes a US poker player with a simple handshake agreement of splitting the winnings 50/50. What happens when the US player cashes for $500,000 and tries to withhold the 40% in taxes he will have to pay on the win from the Canadian backer? Canadians don’t have to pay taxes on gambling winnings, so now we have a problem, and the problem stems from not having a clearly defined agreement that would have covered potential tax implications beforehand.
Both people went into the stake with only good intentions, but because they went into the stake without considering taxes the backer feels he is owed $250,000 and the player feels he only owes $150,000! If the player is forced to pay all of the taxes on the win his cut from the $500,000 win would be a mere $50,000.
Staking contracts from the player’s standpoint
Assuming you have already sold yourself to the backer(s), by listing your past results and the terms of the current stake you are offering, there are a number of things you need to consider when you are drawing up the final staking agreement. Writing a staking agreement is not simply a matter of “I will play x and y events and my backer will receive 50% of the winnings plus makeup.”
Here is a look at just some of the factors that should be covered in a staking agreement from the player’s perspective:
- A full list of all backers and their percentages.
- What happens if you miss an event?
- When is the money due by?
- How will you make payments? What is the timeframe for payment and method?
- How will large scores with tax implications be handled?
- Will you be updating daily or only at the end of the stake?
- How will makeup or markup be handled?
Imagine this scenario: You win $50,000 for your backer and head out on a 10-day cruise you booked before the stake. But your backer was expecting money the day the stake ended and is now growing concerned and starts blowing up your phone. This could have been avoided by clearly defining the payout arrangement beforehand.
Staking contracts from the backer’s standpoint
As a backer you need to make sure there aren’t any loopholes or unknown variables in the staking agreement you are agreeing to. Remember, you are sending someone money BEFORE they do any of the work, and if you watch enough of those “Nightmare Home Remodel” shows you know that paying in advance can sometimes lead to really bad outcomes.
A well thought out staking agreement is your first line of defense. Here are some of the things you should insist upon before agreeing to stake a player.
Now, I’m not saying you should hold the player’s passport until they pay, but you should be able to verify that the person is who they say they are and have multiple ways to contact them.
Make sure all of the items listed above in the player’s standpoint are covered
If the player you are staking hasn’t covered all of their bases in their staking agreement than it is up to you to do so.
Make sure you have a signed, legally admissible agreement
Not that you’ll need to (or want to) go to court over most staking agreements (although Jamie Gold’s backer did), but this will go a long way in shaming the person and winning in the court of public opinion.
Guide to online poker staking sites
When it comes to staking players or looking for a stake there is a lot you need to know, but even if you know the who, the when, the how, the what, and the why of staking, there is still one piece of the puzzle missing; the where.
If you don’t know where to go looking for stakes, or to find prospective players to back, all of your knowledge and wherewithal about the world of staking is for naught. In this column I’ll go over the basics of the major online poker staking sites, and how you can use these sites to enter intoprofitable staking agreements.
Why use a poker staking site?
Think of it this way, if you have a massive collection of baseball cards you are looking to sell would you be better off posting it on Craig’s List or a niche website dedicated to the buying and selling of baseball cards?
Poker staking sites are similar to using the niche site in that you are bringing your potential poker stake to the target audience. Poker staking is done by only a segment of the already small segment of pro and semi-pro poker players, which is why it’s better to focus on the target audience than trying to solicit stakes from the masses.
By using a poker staking site and focusing on your target audience you accomplish the following things:
- You’ll quickly see if you’re offering a fair price by how fast you sell shares. If your stake sells out in hours you probably undersold yourself, and if it sits there with nothing but crickets for days than you know the community thinks your price is a bit steep or there is some other flaw with the stake you are offering.
- You’ll find people that are in the staking business for the long-haul, which will help eliminate the need for back-and-forth conversations trying to explain how staking works and why there is a markup, or what stakeback is and how it is calculated. These people can also give you constructive criticism and help you along the way. You’ll also eliminate a lot of the trolls and begrudgers that are prevalent at public, mainstream, online poker forums.
- There is a safety element to these sites since these are wizened investors and players who have seen people try to shoot every angle already. Most staking sites use a point system to identify the best and the worst players and backers on the site. Most scammers avoid these sites in favor of smaller communities that are not as well-versed in staking deals and arrangements.
- MOST staking sites require pretty stringent posting requirements, which is yet another way to discourage potential scammers looking for a quick-hit.
- You can see who the big backers are staking and what the players who are selling out fast are doing in their stakes. Or use this information to see which players you should be looking to stake yourself –essentially piggy-backing on the site’s top backers.
The major online poker staking sites
Pretty much every major online poker forum has some form of staking and marketplace area where users can try to sell stakes. The 2 2 forum has a massive staking forum, as do other poker forums like PocketFives.com.
That being said, these are not necessarily staking sites, and these forums offer these services to accommodate their user base, not because they really want to or have anything vested in it. So, while you get a lot of positive staking deals coming from these sites, you also get more casual staking deals and more uninformed players and backers; which can sometimes be a problem.
On the other hand, “real” online poker staking sites focus almost exclusively on running stakes and connecting players with backers –any other forums on the site are usually a byproduct of the staking forum and not the other way around.
Below you’ll find a quick overview of the most popular online poker staking sites:
ChipMeUp.com is the closest thing the poker world has to a straight staking site. The site runs stakes for live and online events, and a quick look at the stakes shows names like Victor Ramdin, Casey Kastle, and other “name” poker players. The site is also extremely easy to navigate and filter, with stakes sortable by player name, running, and upcoming, and even by wins/losses.
While not a staking site per se, 2 2 does run a high-traffic staking forum and unlike most other poker forums where moderators watch over the entire site, at 2 2 the staking forum has its own moderators and administrators, which keeps everything running smoothly. The only thing 2 2 is missing is the rating system used by most online staking sites.
Instant bankroll sites with training programs
In recent years another type of poker staking has swept across the poker world – instant bankroll sites that offer poker coaching.
Basically what these sites do is act as affiliates, driving player traffic to online poker rooms with the hope that their training will make you a winning player and therefore a high-volume player who will generate a lot of rake –which is good for the poker room as well as the affiliate that gets a percentage of the rake generated by players they brought to the site.
There are also sites that offer small amounts of free cash to new players for signing up at an online poker site, but do not attach any strings, such as NoDepositPoker.co.uk.
It’s important to note that these are not what most people consider staking sites, they are aimed at new players who have no track-record whatsoever, with the goal of turning just a small percentage of them into winners, with the site profiting from their rake for years. The leading site offering this type of program is PokerStrategy.com.