Backer Question

David · #1 02-15-2005, 06:31 PM

I have a very good friend of mine who has approached me with a backing proposal. This is for a 1 trip deal with possibly more in the future. Here are the specifics;

He will pay all travel expenses.
He will pay all hotel expenses.
He will pay all food, etc expenses.
He will pay all tournament and satellite entry fees.
He will bankroll (very sufficiently) any ring games I care to play.
He will pay everything (he told me "don't bring a dollar").

This arrangement will be at a major yearly tournament. I have told him I will play up to 4 tournaments in 7 days with most of my free time spent in PL/NL ring games. I do usually play a few satellites also. This is my usual routine when I go to tournaments. If I wake up one day and don't feel like playing, I don't, no matter how much I planned on playing a particular tournament. I know not to play when I don't feel like playing. I have told him my routine and he has been to several tournaments with me.So this is very clear.

Now, for the split......he wants 45% of all winnings and he absorbs all losses. He proposed this and I will not make any type counter proposal. I will either take the offer he has made or turn it down. Is this a fair deal for us both ? I do want the deal to be fair to the both of us.

Voltron87 · #2 02-15-2005, 06:38 PM

It is definitely fair to you any way you look at it. Whether it is unfair to him depends on how much of a winning player you are.

fearme · #3 02-15-2005, 06:43 PM

have u won him money b4?? i dunno what u thinking about, take that deal every time, u got nothing to lose

David · #4 02-15-2005, 06:50 PM

Yes, he backed me in a PL game in Tunica last month that was a tad bit (yea right, way) bigger than I could play comfortably myself on my bankroll. We did well. We also play in alot of games together and my results have been good and he knows this.

Awesemo · #5 02-15-2005, 09:28 PM

I think it's not fair for him, he's only taking 45% of winnings. I think that even well respected players who are backed take less than a third of their winnings for tournaments.

sthief09 · #6 02-15-2005, 09:37 PM

yeah, keeping 55% of your winnings without having to pay for anything, while playing much higher than you normally would (ie profiting more and getting experience in bigger games) sounds like a pretty good deal to me

sthief09 · #7 02-15-2005, 09:40 PM

[ QUOTE ]
I think it's not fair for him, he's only taking 45% of winnings. I think that even well respected players who are backed take less than a third of their winnings for tournaments.

[/ QUOTE ]

technically, if the backer has money, and the player is a winning player, the player is responsible (won't play above his roll), won't end the deal for a while, and is trustworthy, it can't possibly be bad for the backer. if the player plays enough, he's guaranteed to turn a profit.

the only costs for a backer are the risk involved and the opportunity cost from whatever else he'd be doign with the money. if he assesses it as 0, he could take as low as 1% of this guy's action and technically it would be profitable.

ISF · #8 02-15-2005, 10:26 PM

If it was only for cash games then it would probibly be fair as there should be little risk of him not making money if he is a winning player, and would almost certainly yeild a higher ROI then any other avaliable investment, but For tournaments most likely one would want much more then 45%
So I would think the fairness is somewhat a function of the mix of tournaments and cash games that are played.

reddred · #9 02-16-2005, 02:25 AM

If I recall correctly, Fossilman was backed for his WSOP run, and paid out 40% to his backers (2 mil)....bottom line is this: backer knows you, has played with you, seen you win, and (most importantly) PROPOSED the deal to YOU. He must think it's fair for him, which is more important than if you think it's fair for him.....no brainer

AAeyes · #10 02-16-2005, 02:37 AM

The deal has no downside for you unless you are as good as your buddy seems to think you are and have the bankroll to take on all the action yourself. If the deal is just for one trip and you're playing mostly tournaments he's likely to see no return on his investment even if he is making a "good bet." Assuming you're likely to show a decent return on his investment the deal should be over several major tournaments so that you have a chance to overcome some short term bad luck. Obviously short term bad luck can be a lot longer in tournament terms than in live action.

That being said if it were me I'd take the deal...

Best Wishes

AAeyes