Five Reasons Why I Like Selling Action During the WSOP
Ed. note: In this second of a two-part series discussing both buying and selling action at the World Series of Poker, today Carlos Welch shares a list of reasons why he likes to sell action (to multiple investors, not just one backer) at the WSOP.
It is a well known fact that many tournament poker players do not play completely on their own dime, especially those who play tournaments full-time. There is so much variance in tournaments that we often seek funds from investors in order to spread out the risks and rewards.
Many players who sell action choose to seek an individual backer, but that is an approach I have always avoided. Instead, I prefer to sell action to multiple investors for the following reasons.
1. I Don't Give Up Control to a Backer
I've always liked playing on my own dime as opposed to being backed because I am a control freak. I got into poker in order to have control over when and where I work. This is not possible when you have a backer with volume requirements and buy-in restrictions.
Selling action to multiple investors is different. I retain control over how often I play and which games I play. If I decide to not play a tournament, I can just issue refunds to my investors. If I decide to take three months off, I can do that as well since I don't have a backer who is expecting me to punch the clock.
2. I Handle Losing More Easily
News Flash: Losing sucks. There's no way around this, but I've found that it sucks twice as much when I lose someone else's money.
I was once backed by a friend for live cash games and I proceeded to lose the entire roll. I still feel a sense of guilt over that. I've lost many times that much of my own money with zero regrets, but I can't get over causing one friend to take that big of a hit.
This doesn't happen when you sell action to multiple investors. I generally get between 10 and 20 investors each of whom get a small percentage of my action. When I lose, the hit that each individual person takes is small enough that I don't feel that sense of guilt.
3. I Never Get Into Makeup
The makeup horror stories I've heard from other players kept me from getting a backer for a long time.
Makeup is the amount of your backer's bankroll that you have lost which must be regained before you can take out any winnings. The feeling you get from shipping a tournament to get yourself out of makeup just doesn't seem as good as the feeling you get from shipping a tournament to get yourself back to even during a month of losing your own money. These two scenarios are practically the same thing, but they feel completely different.
When you sell action, there is no makeup, so wins still feel like wins.
4. I Can Charge Markup
Markup is the premium you charge investors to buy a piece of your action. Say I want to play five $400 events (a total of $2,000). I can sell pieces as small as 2 percent to investors for $40 each. However, this price undervalues the work I have put in to become a profitable player or the physical time and effort I will be investing in the tournament.
To account for this, I will markup this share price by (say) a factor of 1.2x. So instead of paying $40, investors would pay $48 for a 2 percent share of my action. That extra $8 is mine to keep and my investor gets 2 percent of the winnings from the tournaments. It's not much, but it does somewhat make up for the fact that I am having to actively sit and play the tournament while making passive income for the investor.
5. I Can Give My Friends a Meaningful But Stress-Free Sweat
I think I have some of the best friends in the poker world. Most of them would be happy to root for me or sweat me at a final table for nothing, but the experience is even sweeter for them if they have a piece of my action.
For me, having 10 guys each with 5 percent of my action railing me is a lot less stressful than having one guy with 50 percent of my action. In the first case, I imagine my investors would be on the sidelines having drinks and enjoying themselves. In the second case, a backer may be on pins and needles depending on me to get a big score to save his summer.
Hopefully, I have made clear why I prefer selling action over getting a backing deal. Maybe my experience will give you something to consider as you prepare and begin playing at the WSOP this summer. That said, there are plenty of good reasons to play backed that may apply to some players even if they don't apply to me.
At the end of the day, players should look at all options and decide for themselves which is the best fit for their own situation.
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