When a player wins a six-figure tournament prize, the number announced on stage is often not the number that reaches their bank account. Poker staking is usually the reason. Staking is an arrangement where an investor pays some or all of a player's tournament buy-in and receives the same share of whatever that player wins. It can cover one event or an entire season, and at the top of the game it's the norm.
What Is Poker Staking?
Poker staking (frequently searched as poker stacking, though staking is the correct term) is the sale of a share in a player's results. An investor puts up a percentage of the buy-in and collects that same percentage of any prize money. If nothing is won, the investor loses their stake and the player owes nothing back.
The purpose is variance control. High buy-in poker tournaments produce long stretches with no cashes at all, and few players want their entire bankroll exposed to that swing. Selling a piece of the action spreads the outcome across several people.
Staking comes with its own vocabulary, and terms like action, markup, makeup and horses sit alongside the rest of the poker terms a new player picks up at the table.
What's the Difference Between Selling Action and Being Backed?
Selling action is a one-off transaction on a single event or series. A player entering a $10,000 Main Event who doesn't want the full amount at risk might sell 50% for $5,000. Win or lose, the deal ends when the tournament ends.
Backing is an ongoing relationship. The backer funds every buy-in and the player keeps a minority share of the winnings, commonly around 20%. The player has no money at risk, and no money of their own in play.
Long-term backing deals almost always include makeup. Makeup is the running total of buy-ins the backer has paid that haven't yet been recovered from winnings. Until that balance clears, the player sees none of their share. A player who's $30,000 in makeup and then cashes for $25,000 still collects nothing personally, because the whole cash goes against the debt.
What Is Markup in Poker Staking?
Markup is a premium a player charges on top of the face value of their action, priced against their perceived edge in the event. It's expressed as a ratio. At 1.2 markup, 50% of a $10,000 buy-in costs an investor $6,000 instead of $5,000.
The rule of thumb from experienced buyers is that very little action justifies a premium at all. "Very few players are worth more than 1.2," says John "KasinoKrime" Beauprez, a WSOP bracelet winner and proprietor of PLO QuickPro. "The ones that are, typically don't sell. If you are the buyer, negotiate markup down in exchange for a larger piece."
His example is a straightforward trade. Someone offers action at 1.2, and the buyer counters with 1.1 in exchange for taking the whole package. The seller gets convenience and a single point of contact, and the buyer gets a better price. Those margins compound across a lot of pieces.
Beauprez also draws a line on when charging markup makes sense at all. "If you are considering playing a tourney you otherwise wouldn't play without selling, I wouldn't charge markup," he says. "On the flipside, if you are playing a tourney you don't need to sell for, I would sell at markup if someone wants a piece." Every player believes they hold an edge. The question a buyer asks is whether the results, the reputation and the field justify paying for it.
How Do Backers Choose Which Players to Stake?
Investors back players in games they can't play themselves, whether that's a series they can't travel to or a format outside their own skill set. Choosing correctly is the whole job.
"I am more likely to stake players who I have played with," Beauprez says. "I'm an experienced player and can recognise the players who have true talent much easier if I have the opportunity to sit at the table and observe them in real time." Short-term results are close to meaningless over a tournament sample. Direct observation of how someone plays carries far more information, and it also tells the buyer whether any markup being asked for is real.
What Is Action Swapping?
Swapping is an exchange of equal percentages between two players in the same event, with no money changing hands up front. Each player holds a small piece of the other's result.
German pro Dominik Nitsche has described the appeal simply: players offer a small piece of their tournament in exchange for the same piece of a friend's. It softens a buy-in that sits slightly above what someone wants to risk, and it gives every player involved a reason to keep watching after they bust.
Swaps are usually informal and often agreed on the spot. Players deep in a tournament sometimes swap based on chip stacks, with an even swap between two similar stacks and a larger share going to the player who's holding more chips. Groups travelling to a series together commonly swap a fixed small percentage, around 5%, across every event they all play.
What Can Go Wrong in a Staking Deal?
Most staking deals lose money, because most tournament entries lose money. That's the expected outcome and it isn't the problem. The problems come from the people.
"People will inevitably lie about winnings or be difficult to collect from in some instances," Beauprez says. "In long-term poker staking deals, it's good to get things in writing for obvious reasons. For individual piece buying, a gentleman's agreement is the norm."
Poker history supplies the cautionary tales. Ivan Demidov finished runner-up in the 2008 WSOP Main Event for $5.8 million while backed, and said years later that his backer never paid him his share. Overselling is the other classic failure. Constant Rijkenberg sold more than 100% of himself before the 2009 EPT San Remo, then won it for close to $2 million, and the arithmetic exposed him immediately. A player who sells 110% of a $1,000 buy-in pockets $100 up front, and then owes investors $11,000 on a $10,000 cash. The scam only survives as long as the player keeps losing.
Staking also explains why announced prizes and actual take-home rarely match. Daniel Negreanu, a fixture on any list of the best poker players of all time, sold 13% of himself before finishing runner-up in the 2014 Big One for One Drop. Greg Raymer paid out more than $2 million of his $5 million win at the 2004 WSOP Main Event.
How Are Staking Winnings Taxed?
Tax treatment depends on where the player lives, where the backer lives and where the tournament is played, so the only universal rule is to settle the question before the money moves, not after.
The United States is the case most players meet, because so many major series are held there. Zak Zimbile of poker tax specialists Kondler & Associates sets out the basics: a player paying an investor more than $600 in net winnings should issue a 1099, which needs the investor's name, address and social security number, documented on IRS Form W-9. That transfers the tax liability to the person who actually received the money. Non-US investors can't be issued a 1099 and require Form 1042-S instead. Buyers should also check whether a non-US player will have 30% withheld from any US winnings under their country's treaty position, because that decides whether payouts are calculated on the gross or the net figure.
Zimbile's wider advice applies everywhere. "Track everything. You do not necessarily need a written contract, but those always help. It can be something as simple as 'Player A gave Player B $XXX for a XX.X% share in WSOP Event #15.'" Have both parties sign it, keep a traceable payment record, and the argument about who owned what never happens.
Where Do Players Buy and Sell Action?
Action changes hands in three places. Private deals between players who already know each other account for most of it, and they run on reputation. Dedicated staking marketplaces handle listings, contracts and payouts for a fee, which removes the collection risk at the cost of a cut. Poker forums such as 2+2 carry long-running staking sections, where a seller's post history and feedback are the only due diligence available.
Whichever route is used, the checks are the same. Look at the player's real record over a meaningful sample, agree the percentage and the markup in writing before the event starts, and confirm how and when payouts happen.
Key Takeaways
- Staking is the sale of a share in a player's results, and it exists to spread variance.
- Selling action covers one event or series; backing is an ongoing deal where the backer funds every buy-in.
- Makeup is unrecovered buy-in debt, and the player collects nothing personally until it clears.
- Markup is a premium on the face value of action, and very little of it is justified above 1.2.
- Swapping trades equal percentages between players with no money up front.
- Overselling more than 100% of yourself is fraud, and winning is what exposes it.
- Get it in writing and keep a payment trail, whichever side of the deal you're on.
