To Stake, To Be Staked, or stay away from it?

Do you guys have any problem being staked or staking friends in either a cash-game or tournament?

How much and/or little does the actual cash you are staking or being staked have to be in relation to the cash flow / net worth of yourself or the staker.

I only ask because some friends and I are about to take on a 100% backer for tournaments.

P.S. - The backer is a good friend of ours with basic poker knowledge and evaluation skills... but not seasoned enough to play in some of the bigger games / tournies.

[threeonefour]

the stake shouldn't be on a touranment by tournament basis. if so then the staker could come out way in the red even if the stakee is a great player.

the deal should be something like, play x amount of tournaments (where x is a significant amount) and after that amount of tournaments the staker takes on 100% liability for any net loss and in the case of a net profit the profits are split along some lines.

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Do you guys have any problem being staked or staking friends in either a cash-game or tournament?

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On being staked: No, I would never ask to be staked in poker or anything else relating to putting money at risk. If I cannot afford to be in it with my own cheese, then I don't deserve to be in it and don't want any part of it.

On staking: Staking has to be viewed from a business viewpoint, not being pals with someone. My first question and one that I never get past is "Under what circumstances can staking be profitable for the stakehorse?" IMHO, the circumstances are rare.

The first thing is the split. Let's say for purposes of discussion that you agree to split 60/40 with him getting the bigger chunk. As the stakehorse, he is also absorbing 100% of the loss. Let's even take it a step further and say that you are also logically expecting at least a 10% return on investment.

Under these circumstances they would have to be virtually assured of a sizeable win almost every time, and never having to absorb a big negative swing.

Another way of looking at it is that as the stakehorse, they absorb 100% of any -1 or -2 StdDev swing, but they only see 60% of of any +1 or +2 StdDev swing.

IMHO, this means they not only have to be virtually assured of a win, they also have to have deep pockets and be prepared to stick with you the horse if things run bad. Of course, this all assumes that the game is on the square, and no one is doing a hustle, a dump, a cheat, or something else to that effect. An alternative to the stakehorse to making up their end is by making some side action book and taking 100% of the reward.

In your case, you are the horse and your backer is presumably your friend. If he truly is your friend, then I would be a good friend and make these sorts of things very clear to him. If he is not your friend and you are just using him for whatever you can get out of him, then I don't know what to say except "what comes around, goes around."

He is an excellent friend who understands the risk/ reward.

The deal we came to is 50/50% with any wins immediately covering all buy-ins he has fronted (past and present).