Should staked players give backers a cut of bonuses?

Are backers entitled to money won from rakeback, promotions, added value prizes and sponsorship? Barry Carter discusses this ethical poker quandary.

I came across a great debate last week on a poker forum about backer/horse relationships. Specifically if the horse wins a ‘bonus’ on top of the standard prize pool, should the backer get a cut of that? If, say, they won a seat to another event, should the backer get the same percentage in that new event as they did for the tournament they won it in? 

So for example, historically anyone who won a WPT event would, as part of the prize pool, win a seat in the WPT Championship event which was worth $25,000 (Now $15,000). I have also seen many tournaments where anyone would makes the final table would win a package to that tour’s following event. The WSOP also would sometimes award the bubble boy or girl a ticket to the Main Event the following year. 

In some instances (Like the WPT) that package was part of the prize pool, meaning the backer’s dollars paid towards it. In other instances (Like, I believe, the WSOP bubble example) it was an added value incentive provided by the events sponsor, essentially taken out of the marketing budget.

So if the horse went on to play this event and cash, should the backer get the same percentage of whatever they won?

The backer's money made the bonus happen

When the bonus is taken from the prize pool itself, I see this as a 100% clear case where the backer should be entitled to the same percentage of any future winnings. Otherwise it would actually mean they were paying a hefty premium for backing them in the first place. 

The instance where it was an added value package provided by the event sponsor, there is more room for debate. However, I still believe the backer should get their cut of any future winnings. The horse did not do anything extra to earn that bonus and as far as I am concerned, when you are backed in a tournament it is an equal footing business partnership till the end. Without the backer's money, the horse would never have earned that bonus. 

Another hypothetical example is what if you are staking someone to play Jackpot SNGs on iPoker or they go on a good run to win money on Battle of the Planets playing SNGs on PokerStars? It is usually standard in these longer term arrangements for the backer to take a cut of the rakeback of a player (Their money paid for the rake after all), but these bonuses are entirely independent of the normal expected profit. I’m still inclined to think any bonuses should be paid equally to the backer, again because it was simply not possible without their money. 

Is a backer entitled to the value of a trophy?

There are some harder to split up bonuses on offer in tournaments. I’ve played events where everyone at the final table wins an iPod before, and Dusk Till Dawn in the UK even had one where you could win a Mini Cooper. In the case of small things like an iPod, I don’t think it’s worth even debating, but something like a car should certainly get sold and the value of it split fairly.

How about this hypothetical? What about the trophy itself for winning? A WSOP bracelet, for example, is actually worth thousands of dollars, but the expectation is that the winner keeps it, not the backer. It is a form of added value, so by the terms I have already set out, one would expect it should be divided equally between backer and horse.

This is where it gets tough, because it seems incredibly sour grapes to insist a tournament winner get rid of their trophy or pay to keep it. This is one of those situations where technically it might be right to share the value of it, in reality it would be just a poor business practice between backer and horse not to give it to the tournament winner (With a stipulation that if ever sold on eBay to split the money), because it would create bad blood. Especially as the trophy, like a used car, is worth significantly less the second you take it away from its first owner.  

Legitimate business expenses?

This leads me to another awkward situation. If an event package is the bonus and it includes hotel and travel expenses, how does that get split up? In some instances you might get your flight and hotel paid for by the sponsor, in others you might get say $3,000 to pay for them yourself. Some very generous packages will include money just to eat well and party.

I am not sure where I stand on this. I think in my heart, I believe that as long as the money is used to get the player there and keep them well rested, it should be written off as a business expense. The player has to get to the event after all if you want any hopes of a big score, and it seems unfair they should take a hit for travel expenses when they technically have not cost the backer anything.

However, where do the necessities end and the partying begin? I remember a few years ago a player had a big score in the EPT and tried to take the money he spent on massages at the table out of the final amount he paid back to his backers, claiming it was a legitimate business expense. Something like this is very dubious, but what about food? You have to eat right? So what budget are we giving the horse to stay fed during the event? Can he get lobster or are we budgeting for a happy meal? I think instances like this are so hazy and (perhaps more importantly) hard to prove that the backer should probably just write it all off as a business expense - it was a bonus after all. 

Another tricky situation is if the bonus came from a leader points system. If it was a tournament leader board, player of the series or other equivalent promotion that rewards consistency over a series of events. In these instances, I think it comes down to how many events were played on the stake. If the same person backed you to play every single event that contributed towards a leader board promotion, then once again, that money made it possible and they should be entitled to a cut of the profits. However, if it was only the one event you were backed for and the rest of the points where earned on your own dime, then I think the backer doesn’t really have a claim.

A cut of the November Nine?

My final hypothetical is the one I find most interesting of all. What if the bonus is not from the tournament organisers itself, but a third party? I’m talking about sponsorship here. What if your horse makes a televised final table and is offered $5,000 to wear a patch? Or better yet, what if they make the November Nine and get a lucrative sponsorship deal as a result? Should the backer get a cut of that $5k patch? Should they get a percentage of any future events the player cashes in that was paid for by their new sponsor?

This one is hard. My gut says no, but I can’t truly articulate why I think that it is a definitive no. Based on my own previous arguments, I’ve lobbied for the side of ‘the backer's money made it happen, so they deserve a piece’ but on the other hand it seems like a big ball and chain around the neck of the horse, who could seemingly be indebted to the backer for a long time. I’d love to get your views on that particular debate in the comments box. 

Over the years I have seen hundreds of debates like this between backer and horse, where the two sides will fall out over what each party is entitled to. In 99.99% of all backer/horse disputes, prevention would have been the best remedy, and having clearly laid out the terms of the stake for every scenario would have eliminated any debate (Some of the best backers I know now insist on a contract for this reason, which I like). When it comes to bonuses like these, I think all parties have to research the event and discuss every possibility before they arise. 

Where do you stand on this debate? If a staked player gets sponsorship as a result of making a final table, should the backer get a cut of the sponsorship? Where do we draw the line with what a backer is entitled to? Let me know in the comments box.