i think cake = makeup? they use that term "cake" on part time poker and in context i always assumed it meant makeup

Have any of the investors actually looked into if they have legal recourse against the fund itself, and whoever was running the fund?

I might not be a lawyer, but having taken a few looks at that website, I can tell that it was not on the up and up as either a partnership or as some kind of an investment company.

It really just looks like one guy posted a bunch of stuff to a website and then collected hundreds of thousands of dollars from people while pretending it was an "investment" on their part.

thats how i always looked at it as well.

I'm currently backed live and online and have been for about 18 months. I talked about this with my backer shortly after being picked up and we agreed that if he doesn't want to back me any more for whatever reason he eats the make up and expects nothing from me.

I think that's an important part of the relationship because it means he is committed to me and has a lot to lose if I don't succeed.

That said, if you as a backer don't make it clear to the horse when you initially make the backing agreement that you reserve the right to transfer them and their make up to another backer then you're just asking for them to do you a favor and they probably should refuse.

Yes cake=makeup

And pretty much +1 to everything posted by FE and mattg itt.

I have very little experience in poker staking or being staked, but I have significant knowledge of business and i hold a senior role within a bank.
I can't see any possible justification for your horses owing you anything whatsoever. I am not posting a long post (fatalerror's post was very insightful by the way) because I see it as a very simple answer to OP's question.

I have two further points to make;

1. The players in question should NOT have their make up available for public viewing
2. From what I read, the set up of this entire staking fund and the running of it is absolutely deplorable and it is glaringly obvious that going broke was not a matter of if but when

looked thru the prospectus and I'd question management any time two core players are allowed to/end up going 140K over their allotted portion of the fund money. (nearly 25 percent of the entire starting capital over and beyond their original numbers)

Did all investors agree to allow new horses in and to allow players to go over their original bankroll? If not, I would lawyer up if I were an investor.

I think OP regrets posting at this point.

Was going to say the same thing, also I thought makeup was discounted because the future game condition is not certain and ability of the horse to win is not guaranteed. Is this not correct?

yeah where did he go?

pretty sure he didnt get the right reaction to this thread, and just wont be responding.


i saw he was picking more players up for staking (albeit a lot smaller stakes) a bit ago in a thread in the MP. wonder how he is doing this time around.

I would like to put my point of view as an investor of how things went down. I was living over Summer with most of the players and later once the fund declared the liquidation setting I was part of the committee. Here is an approximate timeline:

June 20 first players action get stopped

around June 23 more players action get stopped

June 26 rocketmist flys home for his dads birtday

June 27- June 29 no communication, rocketmist's dad is in hospital

around July 1 more money was supposed to be organized

around July 5 at least one offer for every player
last players action get stopped

July 12th Official email announcement of fund liquidation setting

July 14 TPF Meeting
Committee takes over

July 15 Current TPF website with MU


It is pretty obvious that rocketmist did a really horrible job in managing this fund. I dont think we need to discuss this any further.

What I would like to have discussed as an investor is how a certain group of horses treated the siutation after the fund went into the liquidation setting. To my knowledge there were offers for all players within a timespan of less than 2 weeks for every player in the fund. All deals were forwarded to players and asked to negotiate details with their potential backer. New deals were found for most horses. Most players took an additional week or two to settle the new deal with their new backer.
There was a certain group that informed the fund that they are planning on buying back their own MU. To my knowledge all of this can be proven with aim converstation logs. After a while these players than argued that they dont have to buy back their MU because it wasnt written down anywhere. And I agree they dont have to buy back their MU. But the fund has the right to sell their MU. Now they are using that they were given the option to buy out as a loophole to get out of the staking deal. It clearly says in the Poker Fund Prospctus:

"The manager reserves the rights to sell any and all cake at market value but must first notify advisors/investors." (Quote Poker Fund Prospectus)

This means they have to take a deal under the same conditions. Players were given the option to buy out as an alternative to continue getting staked. You cant announce you want to buy back your MU, not talk to potential backers and than declare you dont owe anything because you dont have to buy your MU!

Let me restate the most important facts:

- It says in the prospectus MU can be sold
- This group got a first offer within less than 2 weeks
- They announce that they want to buy back their own MU (aim logs can prove this)
- They cut communication and argued that they dont have to buy back their MU because its not stated anywhere

This is just straight up wrong and fully taking advantage of the whole situation! I would really like to hear backers opinions on this.

Swisstard

Are there any investors who are also frequent 2p2ers who would like to chim in?

Swisstard,
In the investment world a prospectus is a document intended for the investors to get a concise description of how a fund will operate with/invest their money. Ignoring the fact that many parts of the prospectus were ignored by the fund managers (who might actually have a legal obligation to the document), the horses themselves may or may not have been aware of the prospectus but that only matters if they explicitly agreed to the terms prior to their staking. It seems you went through pain staking detail about how you would raise funds and take fees but had nothing in writing for your horses?

As far as your communication problems go, i have many great horses with whom i have communication problems in the best of times. To think what they have gone through (I don't see a point on the timeline where you inform the horses that their stake could be coming to an abrupt end during the WSOP) and afterwords being not asked but told what to do (as mattg pointed out your employer employee model was not very normal) i'm not sure i can blame any of them for walking away from a sinking ship. Not that they owed you anything other than their audit histories and a thanks for trying.

Unfortunately this point got a lot of interest, i was clearly talking about a perfect world, i recognize makeup has <100% value, i was simply pointing out that in what i dare call the "real world" we don't sell it for anywhere as low as 20%, and that it simply struck me as a number chosen to maximize the success rate of getting the horses to buy out without seeking advice from others.

Bingo. Personally I'd never allow my makeup to be sold. I've had a sizable makeup figure myself which would easily be in the range of figures incurred in this situation. Plain and simple if you cannot continue to put your horses in the same level of buy ins that were agreed to in the beginning; they owe you nothing. This is why contracts are so important for both sides. For players not to get stuck and taken advantage of in a situation like what went down here and for backers so that you have slightly more pull in the situation; which you obviously didn't correctly exercise in this spot.

What a mess. If I were a horse of yours I wouldn't have even supplied you the dignity of a response with how things appear to have gone down and the complete lack of communication and foresight you showed BOTH sides of the stable. Also the way you favored certain horses and continued to run them is lol. And then you come back to some of the horses which weren't even allowed to continue running at the end of the fund and asked for them to purchase their makeup or else you'd out them to the community? COME ON!

And I'm more than qualified for comment on this; I've been staked in one way or another for the last 4 years (both in cash and mtts at different times).

Was this part of a contract? Or just part of the premise of the organization? Because the way it seems to me this all came up and the horses thought that buying out would be their best bet of getting out then they realized they owed nothing further to the fund and peaced. Which as I alluded to already unless there was a contract signed and agreeing to the quote above then they're completely free to do.

First I want to mention that I did a horrible job setting this fund up, as people have pointed out. I didn't have clear contracts with the players, a lot of things were just said over aim on aim logs and agreed upon and thats it. The fund was drastically underfunded for the number of the horses, anyone can see that now. And to all the people bashing me, I totally expected this to happen, i'll take the blame for overextending the fund. At the end of the fund there should have been at least $200,000/per horse to make it lower risk and the ability for shareholders to sell their shares when things go wrong just compounded the problem.

I also want to clarify that I didn't hand select horses to continue to stake. Horses continued to play with the money they had in their accounts.

There is a couple of things that really need to be discussed. If the horses said they would buy their makeup back so they didn't want to talk to their new potential backers, isn't that in legal terms something close to promissory estoppel, where we told backers that their offers were no good because the player planned on paying us back instead? Also even though it was common knowledge between myself and the horses in the fund that cake was transferable to other backers with the same deal, does that even matter since it legal terms you can transfer independent contracts unless specified otherwise (both parties) as long as they are deemed comparable.

20% figure was what we deemed as a fair price. At every point in this process we wanted input from all the horses, seriously we messaged everyone like 5+ times to attend our meetings. It wasn't a price we "thought we could get away with" or something bogus like that. The whole reason for this thread is to try to get the opinions of everyone to potentially create a more fair outcome for everyone. The lack of communication with the players mostly on their part is clearly seen in how they ignored our emails about this post and still not a single player has posted in this forum.

The main points we need to decide is how much time is the cutoff since it took us around 2 weeks to find everyone new deals from guys that would buy the MU. Also if the horses agreed they would buy the MU at the market rate, where do we go from there? (obviously the original contract is no longer in effect from our side since we stopped providing funding for the players). But does that mean the MU just vanishes? I have seen way to many transfers between backers selling makeup once they stop backing someone, so I have the impression thats not how it works. Would love some more input about these topics, thanks for the input so far also!

I would like to state some more facts and opinions:

Facts:

We found agreements with 70% of the horses (I will refer to this group a 70% group)

The group we are talking about makes about 20% of all horses (I will refer to this group as the 20% group)

For 10% there was no deal found, but this group was at least communicating

The 20% group was investor too and thus new about the prospectus

During the first meeting there were about 70% of all investors and about 30% of all players present. Everybody was invited to that meeting.

During that first meeting the publishing off all MU was decided by players and investors to speed up the liquidation process. It was agreed on to 100% by the parties present.

Opinions:

The fund is not forcing anybody to buy back their MU. The fund has no right to force people to buy back their MU (not sure why this keeps comming up?). The fund has the right in my opinion to sell MU to other backers providing the same deal. It seems really strang to me that this was accepted by 80% of all players and only 20% disagreed. It was the 20% groups choice to annoucne that they want to buy back their MU. Those players chose not to talk to potential backers because they were planning on buying back their MU. And this is where I have a problem. The fund could have easily sold that MU within a reasonable time frame and much higher than 20%, but those players announced they want to buy out.

I would like to comment on the 20% MU value. This value was chose in the 3rd meeting. This number was chosen as an attempt to find a solution before going public with the entire case. I did agree on that number soley because I knew I would spend a lot of time writing and reading forum posts. The value of that 20% gourp's MU is definitely higher, but knowing that I would spend hours reading and writing, I would have personally perfered to take that 20% and use my time otherwise.

I have read several times in this thread, that the fund was threatening players to out them, that the fund was almost blackmailing them. This was definitely not happening. I am sure the fund can provide all aim logs and emails and none of that statement can be confirmend. The fund is using the forum post as a last option to find a solution for both parties.
Apart from that just think about this statment for one second. If that 20% group thought they were acting rightfully, what do they need to be worried about anyway? There is only something to be worried about if you know you are not acting rightfully!

Regarding "(I don't see a point on the timeline where you inform the horses that their stake could be coming to an abrupt end during the WSOP)". Rocket please comment on this. Ty. I dont know that exactly.

Finally, I would like to comment on the 20% groups behavior during this liquidation process. I am assuming those players belive they are acting rightfully. Why would they stop communicating with the fund? I would have really liked to hear their side of their story, hear what they think and use their sources to come up with a fair solution for all parties. We tried to invite them to several of our meetings. I think it is very immature and definitely not a good business attitude. If you really thought you were 100% right, wouldnt it be just easier to name your sources and arguments?

You're lucky you're not in jail for securities fraud. Selling shares in an investment fund to the public is easily the most highly regulated part of public finance. I'm sure you've never passed even the series 7 exam; you're so far out of your league here that it's really not funny.

Beyond that, you're extremely lucky none of your investors have sued you into personal bankruptcy.

If you're part of this "fund", for God's sake stop posting in a public forum and call a personal defense attorney. Get one that's at least familiar with business law, if not a specialist in the federal regulations relating to public investments.

Get a consultation. It'll be free or of some nominal cost.

OP obv. used some of the MF's money for hookers/blow at WSOP

Yea, I didn't even bother commenting on the fact that there is zero auditing going on on where the money came from, and where it went.

And no, I don't mean for OP to post some spreadsheet he typed up on his laptop; I want to see something certified by a CPA.

It wouldn't shock me in the least if there was tens or hundreds of thousands of dollars missing here.

Also, here is the link on the SEC website to report something like this: Enforcement Complaint Form

If I was filling this out, I would put this complaint in as an "Unregistered or Fraudulent Stock Offering" but I could see how someone could possibly pick "Unregistered or Fraudulent Offering of Ponzi/HYIP or Other Investment Program".

common knowledge and an agreement are two different things. there's no chance the community here knows what was actually said at any point, what any horse understood or expected, and there's no chance you are including any/all relevant info that would allow the community to move off "this is a mess, good luck to all parties" line.

cliffs of the thread if we're just sticking to the issue you want to address are:

-stuff was said by people
-busto
-more stuff
-???
-quandary