Selling Action In Poker Tournaments: Daniel’s Unfortunate Event

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I love writing about things that are positive in the poker world. Too often, the discourse around things in the poker is negative. We’re talking about sexism, scandals, debts owed, cheaters, sites that aren’t handling the money they’re trusted with, or casinos doing shady things to cover their guarantees.

This time, I get to write about someone who offered a cool promotion and then had to scramble to make up for some mistakes in execution. I’m referring, of course, to Daniel Negreanu, who did something I’ve never seen before and was unfortunate to have it backfire on him a bit.

In case you missed it, let me bring you up to speed. Daniel offered to sell pieces of himself in the upcoming World Series of Poker, which kicks off Wednesday. Opening up the opportunity for lots of poker fans to get themselves a piece of the action at the WSOP, Daniel sold, at no mark-up, 10 percent of his tournament action for $1,500 and lower tournaments, 25 percent of his action for buy-ins between $1,501 and $10,000, and 50 percent of his action for buy-ins $10,001 and higher. Again, at no mark-up!

Daniel, who recently parted ways with PokerStars after 12 years, sold those pieces through his website so there were small credit card fees, but he charged no premium to buy action. As the second-winningest tournament player of all time and one of the most recognizable faces in the industry, he could easily have charged gigantic mark-up and gotten just as much interest.

Speaking of interest, this is where the story takes a little turn. After it was announced that all packages sold out in about 30 minutes, I was a little bit confused, and disappointed to be honest. I let time get past me and didn’t think to buy a piece until it was about 12:15. I was out with my son and figured there was no chance I was getting any, presuming they were sold out in the first five minutes or so. As it turns out, I was actually right. Daniel’s site seemed to make some mistake with its database, and his packages oversold.

He had originally offered around $275,000 in action and actually took in about $1.8 million according to statistics he posted on Twitter. This left him holding the bag on refunds to thousands of people. After offering such a cool deal, he seemed to be devastated about having to turn people away that wanted action.

I’m so incredibly sorry to those of you who bought a piece but won’t have any action.

I think the only solution is to honor those that got in first and fully refund the rest of you.

Will also figure out a way to make it up to those that got screwed.

— Daniel Negreanu (@RealKidPoker) May 25, 2019

All refunds on my WSOP packages have been processed.

Those that got in will get a confirmation email today.

For those that were refunded, we will keep you posted on your exclusive opportunities in a closed Facebook group.

— Daniel Negreanu (@RealKidPoker) May 27, 2019

I believe in poker players selling action to tournaments. There’s almost no chance that poker tournaments would be as lucrative or well-populated as they are these days without access to a marketplace for staking and buying action. Daniel’s offer shows that there are plenty of people who want in on the action, especially for big name poker players.

However, this could easily be taken advantage of. The problem with current marketplaces is that there is no regulation, and people with Daniel’s profile (nobody actually has Daniel’s profile, so perhaps a tier or two below him), could very easily charge obscene mark-up for pieces sold. Phil Hellmuth sold at 1.8 mark-up for a $10,000 super turbo, and it sold out quickly. Those buyers need some protection, and the current sites that offer staking to the public aren’t bothering with that regulation or oversight.

I applaud Daniel for offering this deal at the price he did, and for the incredible way he’s making up for the mistakes that were made on his end. I’m not sure that there is a useful way, right now, to force the most high-profile players in the world to be held to accountable for price gouging the tournament-piece-buying-marketplace. I also see why the big poker crowdfunding sites want people like Hellmuth to sell pieces using their platform, because they bring in customers who might spend on other people as well. The less well-known sellers who are offering pieces have built-in price caps, because people don’t know them and they won’t generate as much interest.

Mike McDonald, the high-stakes crusher known as Timex, has offered to act as the other side of these sites by offering pieces of tournament players at rates that he thinks are fairer, to him at least. In a true, free market, and with the many people in the current market on forums and crowdfunding sites, this would be a natural extension. Someone could buy offered shares and sell them at a higher rate if they think the person was selling for too little, or they could offer action on someone at a lower rate and pay out the difference when that person cashes.

As is, it’s a seller’s dream to get their packages bought up on these sites. There is only upside. If you don’t sell all you want at the price you’re offering, just reduce the price and try again. Daniel didn’t take advantage of a very profitable situation for himself and got some good promotion for himself in the meantime. I would love to see what a healthy market for tournament piece buying would actually look like, but it’s unlikely we’ll get to a point where we see it anytime soon.

Gavin Griffin was the first poker player to capture a World Series of Poker, European Poker Tour and World Poker Tour title and has amassed nearly $5 million in lifetime tournament winnings. You can follow him on Twitter @NHGG