What does backing mean? How to correctly sell the shares
The backing is a player financial support by the poker community for his participation in the tournaments and cash-games in exchange for a certain percentage of the winning. Usually, the backing applies when the player can win at the limits that are higher than he plays regularly, but he cannot afford himself to play at them because of insufficient bankroll. Also, the players can sell the shares because of outlasted downstreaks or after cashing-out a significant part of the bankroll. The backing for the player is a kind of “safety airbag” that dampens the dispersion and minimizes the probable risks because of loss. For the backer, it is a good opportunity to earn money without playing himself. In today's poker, the shares can be sold of absolutely any discipline whether it is MTT, cash, SNG or even Spin&Go.
The types of backing
The backing can be partial or complete.
- The partial backing means that the backer pays some part of the necessary sum and the rest of the money is paid by the player himself. The profit is divided proportionally according to the agreements. For example, you decided to sell 50% of the shares for the tournament series for a total amount of $3 000. It means that you should pay half of this amount independently, and you propose the backers to buy the rest $1 500. Let assume that according to the package results your net profit has turned out to be $30 000. In this case, half of this amount is for you and the rest one is divided between your interest-holders depending on the gained percentage.
- In the case of complete backing, the player plays completely on others’ money by getting a specified profit percentage.
The backing can also be with a payoff (backout) or coefficient.
Payoff backing – it is the selling method where the backer pays exactly the amount for that package percentage that he reserves without additional payments. For example, the total package cost is $10 000. The player who sells the package sets his payoff in the amount of 10%, the backer buys 30%, he must transfer $3 000. Let assume that the package is played positively and the net profit is $30 000. As his payoff percentage was preliminarily determined in the amount of 10%, the player should pay the interest-holder his 30% from the amount of $27 000 after deducting his 10% of the payoff. In this case, the interest-holder gets $8 100 and his net profit from the package is $5 100. The player can set the payoff maximum up to 50%.
There is also in the MTT players’ backing the payoff percentage that depends on the taken place, the deeper player steps into, the higher is his payoff:
- Net profit payoff
- Final table payoff
- The payoff for the top-3 and higher
The mark-up (coefficient). In this case, the player gives a shares package for the selling with some coefficient. The backer transfers the player not only the buy-in package percentage but the percentage from the buy-in that is multiplied by the coefficient. Most often, the coefficient size is in the range of 1 - 1.4 (more often: 1.05 - 1.25). The coefficient size usually depends on the player’s level and his reputation in the community. For example, the player plays the package in the amount of $10 000 and sells 50% with coefficient 1.1. In this case, the interest-holder by purchasing the package transfers him $5 000 that is multiplied by 1.1 that means $5 500.
Some simple advice for selling shares
- Nobody will buy the shares from an unknown player. You should have a certain reputation in the community. Visit specialized forums and sections. Leave your comments and share your winning success.
- Start writing a blog where you will share your successes, with a mandatory indication of your graphs and links to sites with statistics.
- It is unnecessary to play better than you interest-holders in order to sell the shares. If you have a positive reputation then your package may be purchased even if you have the meagre results. But if you are a massive loser then it will be virtually impossible for you to find the backer.
- Keep communication with the backer. The player should regularly negotiate with the backer the tournaments he is going to play in order to avoid the disputable situations afterward. The situation may occur where the backer will be against the participation, in this case, the player should look for the compromises, but too much stubbornness will have a negative impact on him. After all, you can always play the tournament at your own expense (once again by discussing it beforehand).
- Since the several backers will probably take part in the purchasing of your shares, then you should make a list of the interest-holders and their shares after you have published the offer. Update it according to the new offers.
- If you sell the package with a large number of tournaments/ certain hands number/ SNG tournaments’ number, then it will be the right thing to report regularly to the backers about the intermediate results. For example, you sell a package that consists of 300 tournaments. You should write about the intermediate results after 50-100 played tournaments.
In general, the offers for shares sale are published on the poker sites forums in the sections about the backing.
Let’s consider how to make the backing offer correctly?
- The heading. The heading should include information about the play tournaments, for example: “The shares sell for… (the tournaments, the tournaments series)”.
- Information about yourself. Here should be the greeting, a short description of your poker career, the link to the blog (it is advisable). Your statistics: the link to the sites with the statistics.
- The sale description. This includes the tournament title, poker-room/rooms, the percentage of saleable shares, the mark-up (payoff), 1% share price, the links to the previously sold shares (if any).
- The payments for the shares and winnings. The description of the payments and payout methods. As rule, these methods must be the same. That method you have been transferred money should be applied for the refund in order to avoid any confusion.
Each player is entitled to decide independently the matter of the backing necessity. Somebody prefers to move on the limits independently by sharpening the play skills, and someone is already confident of his play skill for the expensive tournaments, however, the bankroll doesn’t allow him to participate in these tournaments. We hope these several recommendations have helped you to understand the backing concept and its particularities.