There really isn't anything 'typical' .. I believe there's a 'marketplace' section on this site where Players are allowed to post/request backing ideas.
Things to consider ..
1) Pay back if any
2) % of winnings to backer after initial stake is covered
3) taxes and/or 1099 considerations where prizes may deem necessary
4) Will there be multiple entries covered? If not then can Player enter 2nd bullet 'on own'?
5) Are they 'backing' or 'staking' .. and is there any markup? Usually 'backers' expect an eventual return on their funds while 'stakers' are just investing in one time events with a win or lose outcome. If you are good .. then you can even 'charge' markup, where you only give up a lessor percentage of the winnings than the stake itself is to the entry fee.
6) HUGLY unadvisable to do so with friends who don't know anything about poker .. or even those who do.
You can fuss over definitions all you want .. a deal is a deal and the terms are only limited by what each party wants. It's a BUSINESS transaction and both parties need to understand that 80% of the time (or more) the outcome will not be positive.
Hopefully the Player has some sort of documented positive history that may prompt the Backer to feel comfortable making the investment while still knowing it may not go well.
These all may seem complicated .. but they need to be discussed before the event as it's too hard to put the horse back in the bard, so to speak.
You can make it simple .. or you NEED to make it a very solid contract.
7,8,9 and 10) GET IT IN TEXT or WRITTEN form so that everything is clear. GL
i got a phd in stakeology. learned it all by doing. im willing to field a few more questions if posted in the next few days but then ill go back to only occasionally checking out beginners.
1) a full stake, the player puts up zero starting funds. i have a graph somewhere of the breakeven backer share as dependent on player roi. at +33.33% roi, giving the player 25% freeroll on full stake will be breakeven for the backer. 20% freeroll will give the backer a little profit, while 30% freeroll will show a slight loss for the backer.
+50% roi allows the backer to show profit on giving the player up to 33% freeroll.
so why do we see people getting great deals like 50% freeroll on full stake? essentially its because the backer wants to help the player, to see the player succeed. for some its also because they're not good at poker, so they see staking people as more fun than losing themselves. there are many reasons players get big freerolls but i think it mostly boils down to wanting to help a friend. throw em a bone, so to speak.
For long term stakes the math is different. a player with a lower roi can provide long term profit for the backer, even with the backer putting up 100% of the starting funds. cashing out big chunks early essentially ruins the plan of up up and away. google free variance calculator. youll see a glimpse into the madness that awaits you on a long term tourney grind.
2) this is selling action shares. you can sell at discount, even money, or at markup. i like even money because i usually only sell to friends anyway. some people will pre tip when they buy at even money. this is certainly appreciated but never expected.
even money action comes with the authentic feel of a fair deal. ive never liked bargaining nor haggling as it totally removes the feel of a fair deal for me. id much rather sell at even money and receive a tip for good play, as compared with feeling like i squeezed every penny i could from investors with markup.
that said, there is nothing unethical about receiving the markup that the market will bear. you better be damn good tho.