Hi guys,

i do have some questions regarding a buyout of a backing deal.

Ill show some easy numbers .
i need a check up for the situation where i would like to sell a part of the MU.

situation:
We are talking about a 50/50 deal over profit and rb.
The horse is required to play x amount of buyins and will receive a salary for doing so.monthly.The salary is not being put in MU obv.

the horse cannnot stop playing before the backer is in profit including salary.

currently the horse is down 100k.
i am selling 10 % of his Make up at 80 c/ dollar.( which will sum up 8k ).
we have an agreement that the buyer can not sell his piece to another party without our concent obv and i as the backer have the first right to buy it back

I do have the following questions:

A)When i would like to buy the 10% i sold back form the buyer should i pay 8k or 10k.( I.e. i sold with a 20 % discount aka 80c/dollar)We agreed upon 8k at all times no matter if the horse is winning or losing .


B)over the first 100k the horse wins, the buyer will obv receive 10 % aka 10k profit.till the point where the horse is down in the deal things are clear.
once the horse wins >100k do you agree that the buyer would receive 10 % over MY profits.
example: the horse is now 100k in profit ( 200k from starting point buyer )
should the last 100k profit be split as followed "Y":

50k for the horse
45k for the backer
5k for the buyer

Or do you think it should it be "X" :
50k for the horse
40k for the backer
10k for the buyer

C) should the buyer pay 10 % of the salary starting from now.
D) should the buyer stake 10 % from coming losses.( I.e horses loses 10k tomorrow, should buyer stake 1k and backer 9k ).Since he has 10 % of the deal . IE otherwise its a freeroll.

It think be B)C)D) are pretty clear .
IMHO b should be option Y
and c and d are answered with "Yes"

A is more difficult to answer, but it should be 8k imho.Since otherwise one would be changing the rate of the sell.

Thanks your time

I was kind of confused by your post...but since I used to back a lot Ill do my best to answer, what I think your asking....

You sold 10% of makeup so the guy is paying 8k to win 10k hoping for a 2k profit

Once that makeup is clear, I do not see why this said investor is of any concern to your deal with your horse, since you sold "makeup" and there is no longer any makeup.

When buying back that 10% it is the investors, so it is at his discretion, at a price he feels fit to sell back to you.

Dunno if that helps at all lol.

thanks for your time

Wait so he bought 10k mu with 8k, invests 0 $ from now on into the horse (say hypothetically horse goes in MU another 100k) and you freeroll him to a 10% share of whatever (if ever) profits the horse will earn above 100kMU+ salary ?

Sorry for offtopic, but in practice this means the salary is put in MU, right? Or did I misunderstand something?


If he bought 100% of the MU, he should provide him a bankroll, right? So he has to match 10% of the bankroll the horse has and match 10% every reload.The salary thing is kinda meh since it's not in MU, but basically I think he should pay 10% of that too.

So, if the horse has 10k bankroll and 100k MU and he buys 10%, he should pay you for the MU (10k*0.8 = 8K) and 10% of the bankroll (1k). Then if the horse wins 100k, you'll have 110k to share, and he'll get 11k back an 10% of the future profits. If horse wins 100k more, he'll get 50k, OGbacker 40k and the new backer 10k.

Buing back the 10% is more complicated. Let's say the horse cleared MU and is at zero. Then you guys should estimate the value of 10%, which isn't really easy, so gl with that. Really hard to tell anything since there's no info how to estimate the value of 10%.

Actually, made a mistake there. Can't edit anymore. The share of the future winnings is 5% since you sold the part of your action.

If horse wins 100k more, he'll get 50k, OGbacker 45k and the new backer 5k.