Cash Games and Rake
Recently there has been a lot of discussion about cash games in people's homes, and the rake that is taken. Seems every time I send out an invitation to 50 people, at least 10 reply back "Is there a rake?" It's an easy question to answer, since nearly every time the answer is "Yes".
So what are rakes, and why are they taken?
Well, to begin with the invitation nearly always says "Food and Drink provided". That doesn't mean there's bread and water there, it means there's a meal and any drink you may want. If you arrive and there are 11 types of soda, but you like Tab, the host will run to the store and buy you some Tab. If you drink Hennessy, I can assure you there's either already a bottle waiting for you, or there will be before you can get your cup of ice and mixer prepared.
Hennessy is $72 a bottle. And that's just one drink for one person. Wait, you drink Johnny Walker Black? That's $43 a bottle. So for two of the players, the host has already spent $80 on food, and $115 on liquor. They've passed $200 in expenses, and not one card has been dealt. And that's why there's a rake.
But wait, there's more! What other expenses are there:
Poker Table: $300 (each)
Cards: $14 per deck
Chips: $300 minimum and for that price they are just generic
Chairs: Another $200
Electricity: A house full of people is harder to keep cool
Pay Per Views: Players want those fights
Carpet: Replaced at least annually if you've got a good game going, because people spill lots of things
Water: Lots of toilets get flushed
Repairs: Things get broken a lot (toilets, hand rails, chairs, etc)
All of those are provided to you and those expenses come out of a rake.
The biggest part of discussing a rake is nobody ever asks The Golden Gates, The Belagio, or Ameristar if they pull a rake. Of course they do. And they pull a bigger one than any home cash game. Minimum of $5 per pot, plus an additional rake for the bad beat and any other promotion that is running. Oh, you play on line? Every poker site pulls a rake from every tournament buy in and cash game hand. People that host poker games have to explain why there's a rake, but nobody ever asks the casino what they get for the same rake. I promise you don't get free food at a casino just for playing. That comes out of your comps. Where do the comps come from? Ahhh...the rake. Where does the free drinks in a casino come from? Ahhh....the rake.
OK, then let's go play free bar poker. Free chips if you buy drinks or food? That's a rake. No bar is going to provide free bar poker if the players aren't buying food and drink.
In the end, hosting is expensive. On the flip side, the players don't have to drive 90 minutes to the casino, or back home down the mountains. They don't have to risk their lives on those mountains in the winter. They don't have to face the highway patrol.
Nobody is getting rich hosting games. If a host stops taking a rake, they will will have to stop providing the games. It simply isn't economically feasible to do it.
Now, let's look at the flip side, because rake has gotten out of hand. Local hosts no longer are trying to cover expenses. They're living off of the rake. And below I'm going to tell you how much.
On average, hosts pull $1 per $10 in the pot up to $50....so a max of $5 raked per pot. Seems like not much, right? Well....let's do the math. A good dealer can deal 30 hands an hour. Since not all hands reach the maximum of $5, let's call it $4 per hand, times 30 hands, or $120 an hour in rake. For simplification purposes, let's round that down to $100. An hour. The cash game starts at 7PM, and runs until 3 AM. Eight hours. $800 in rake. Oh, did your game run til 7 AM? Make that $1200 in rake.
Are we done? Oh now, now we have to tip the dealers. A good dealer makes about half the rake per hour, so $50. Did the game run til 7AM? Another $600 in tips. Total of $1800 was taken off of the table and locked away by the host. How many people played? 10 players, $300 buy in each...$3000 in play. How much can you win if by 7AM you win IT ALL? $1200. The other $1800 is taken off the table in rake and tips. I'm not kidding. Six of the buy ins can't be won. They go straight to the host and dealers. You spent 12 hours competing to win 40% of the total money available. The rest cannot be won by any player. That's why it's nearly impossible to overcome the rake in a $1/$2 poker game. Six of the buy ins go towards overhead. You might overcome the rake short term, but you can't possibly long term.
Now, here's another problem with the rake. When I win a giant $200 pot, I tip the dealer sometimes $20. Well, I do in a casino. I wouldn't ever in a home game. Because guess what? That tip doesn't go to the dealer. It goes into the total $1800 rake/tip pile of money. And the dealers split 30% of that. So when you tip someone $20, they only get to keep $6 of it. The host keeps the other $14. NEVER tip a dealer more than $1. You're not tipping them. You're increasing the profit margin of the host. If you have a big $1000 profit night, wait until the next day, find the dealer, and give him $50. It's the only way to tip the dealer.
One more problem in the rake/tip scenario. When the host is playing, watch closely to see if they are over-tipping. I've seen hosts win a $20 pot and "tip" the dealer $15. Oh so generous!!! Not. What they actually did was take $15 off the table, put it in a savings account, and you can no longer play for it. The dealer gets to keep 30%, remember? So the dealer gets $4.50. The house "tip" is actually locking up $10.50, taking it off the table, they no longer risk it, and you no longer can win it. It's cheating. It's damn near stealing. And I call out any host that does it.
So here I've presented both sides of the rake. It's a problem that needs to be addressed. But as long as the players keep playing and not arguing the rake, nothing will be done. Just know that I can personally name the following games each week. Monday night $1/$3. Tuesday night $1/2, $1/3 and $2/5 omaha. Wednesday night $1/2, $1/3 and $2/5 omaha. Thursday night. $1/2, 1/2, $1/3. Friday night $1/3, $1/2, $2/5. Saturday night $1/2, $1/3, $1/3. Whew, let's take Sunday off. And nearly every player I know in Colorado Springs supports most all of those games at one time or another. So the available money is limited, but spread over 16 games a week, pulling on average $1300 EACH in rake/tips. TWENTY ONE THOUSAND DOLLARS A WEEK IN RAKE/TIPS TO FOUR HOSTS. You read that correctly. $1,081,600....that's MILLION folks, a year in rake/tips being pulled out of our pockets and into a handful of people's bank accounts.
1. It's not sustainable.
2. It's coming out of the pockets of people that can't afford it.
3. It's allowing a handful of people to live job free lives while the players are busting their ass to earn that money.
All that and I haven't even mentioned booking. Booking is where someone plays with money they don't have on the promise that they will pay the money to the host at a future date. In old casino terminology, it's called getting a marker. High rollers in casinos still can do it. But the problem lately is people are ALL playing 'on the books'. I've played in games recently where of the $5000 on the table in chips....only $300 or so was actually paid with real cash. The rest was on promissory notes to the host. And I'm telling you for a fact, people play different when they have no actual money in play. When I was hosting I stopped booking people. If you can't afford to play....don't.
So what are rakes, and why are they taken?
Well, to begin with the invitation nearly always says "Food and Drink provided". That doesn't mean there's bread and water there, it means there's a meal and any drink you may want. If you arrive and there are 11 types of soda, but you like Tab, the host will run to the store and buy you some Tab. If you drink Hennessy, I can assure you there's either already a bottle waiting for you, or there will be before you can get your cup of ice and mixer prepared.
Hennessy is $72 a bottle. And that's just one drink for one person. Wait, you drink Johnny Walker Black? That's $43 a bottle. So for two of the players, the host has already spent $80 on food, and $115 on liquor. They've passed $200 in expenses, and not one card has been dealt. And that's why there's a rake.
But wait, there's more! What other expenses are there:
Poker Table: $300 (each)
Cards: $14 per deck
Chips: $300 minimum and for that price they are just generic
Chairs: Another $200
Electricity: A house full of people is harder to keep cool
Pay Per Views: Players want those fights
Carpet: Replaced at least annually if you've got a good game going, because people spill lots of things
Water: Lots of toilets get flushed
Repairs: Things get broken a lot (toilets, hand rails, chairs, etc)
All of those are provided to you and those expenses come out of a rake.
The biggest part of discussing a rake is nobody ever asks The Golden Gates, The Belagio, or Ameristar if they pull a rake. Of course they do. And they pull a bigger one than any home cash game. Minimum of $5 per pot, plus an additional rake for the bad beat and any other promotion that is running. Oh, you play on line? Every poker site pulls a rake from every tournament buy in and cash game hand. People that host poker games have to explain why there's a rake, but nobody ever asks the casino what they get for the same rake. I promise you don't get free food at a casino just for playing. That comes out of your comps. Where do the comps come from? Ahhh...the rake. Where does the free drinks in a casino come from? Ahhh....the rake.
OK, then let's go play free bar poker. Free chips if you buy drinks or food? That's a rake. No bar is going to provide free bar poker if the players aren't buying food and drink.
In the end, hosting is expensive. On the flip side, the players don't have to drive 90 minutes to the casino, or back home down the mountains. They don't have to risk their lives on those mountains in the winter. They don't have to face the highway patrol.
Nobody is getting rich hosting games. If a host stops taking a rake, they will will have to stop providing the games. It simply isn't economically feasible to do it.
Now, let's look at the flip side, because rake has gotten out of hand. Local hosts no longer are trying to cover expenses. They're living off of the rake. And below I'm going to tell you how much.
On average, hosts pull $1 per $10 in the pot up to $50....so a max of $5 raked per pot. Seems like not much, right? Well....let's do the math. A good dealer can deal 30 hands an hour. Since not all hands reach the maximum of $5, let's call it $4 per hand, times 30 hands, or $120 an hour in rake. For simplification purposes, let's round that down to $100. An hour. The cash game starts at 7PM, and runs until 3 AM. Eight hours. $800 in rake. Oh, did your game run til 7 AM? Make that $1200 in rake.
Are we done? Oh now, now we have to tip the dealers. A good dealer makes about half the rake per hour, so $50. Did the game run til 7AM? Another $600 in tips. Total of $1800 was taken off of the table and locked away by the host. How many people played? 10 players, $300 buy in each...$3000 in play. How much can you win if by 7AM you win IT ALL? $1200. The other $1800 is taken off the table in rake and tips. I'm not kidding. Six of the buy ins can't be won. They go straight to the host and dealers. You spent 12 hours competing to win 40% of the total money available. The rest cannot be won by any player. That's why it's nearly impossible to overcome the rake in a $1/$2 poker game. Six of the buy ins go towards overhead. You might overcome the rake short term, but you can't possibly long term.
Now, here's another problem with the rake. When I win a giant $200 pot, I tip the dealer sometimes $20. Well, I do in a casino. I wouldn't ever in a home game. Because guess what? That tip doesn't go to the dealer. It goes into the total $1800 rake/tip pile of money. And the dealers split 30% of that. So when you tip someone $20, they only get to keep $6 of it. The host keeps the other $14. NEVER tip a dealer more than $1. You're not tipping them. You're increasing the profit margin of the host. If you have a big $1000 profit night, wait until the next day, find the dealer, and give him $50. It's the only way to tip the dealer.
One more problem in the rake/tip scenario. When the host is playing, watch closely to see if they are over-tipping. I've seen hosts win a $20 pot and "tip" the dealer $15. Oh so generous!!! Not. What they actually did was take $15 off the table, put it in a savings account, and you can no longer play for it. The dealer gets to keep 30%, remember? So the dealer gets $4.50. The house "tip" is actually locking up $10.50, taking it off the table, they no longer risk it, and you no longer can win it. It's cheating. It's damn near stealing. And I call out any host that does it.
So here I've presented both sides of the rake. It's a problem that needs to be addressed. But as long as the players keep playing and not arguing the rake, nothing will be done. Just know that I can personally name the following games each week. Monday night $1/$3. Tuesday night $1/2, $1/3 and $2/5 omaha. Wednesday night $1/2, $1/3 and $2/5 omaha. Thursday night. $1/2, 1/2, $1/3. Friday night $1/3, $1/2, $2/5. Saturday night $1/2, $1/3, $1/3. Whew, let's take Sunday off. And nearly every player I know in Colorado Springs supports most all of those games at one time or another. So the available money is limited, but spread over 16 games a week, pulling on average $1300 EACH in rake/tips. TWENTY ONE THOUSAND DOLLARS A WEEK IN RAKE/TIPS TO FOUR HOSTS. You read that correctly. $1,081,600....that's MILLION folks, a year in rake/tips being pulled out of our pockets and into a handful of people's bank accounts.
1. It's not sustainable.
2. It's coming out of the pockets of people that can't afford it.
3. It's allowing a handful of people to live job free lives while the players are busting their ass to earn that money.
All that and I haven't even mentioned booking. Booking is where someone plays with money they don't have on the promise that they will pay the money to the host at a future date. In old casino terminology, it's called getting a marker. High rollers in casinos still can do it. But the problem lately is people are ALL playing 'on the books'. I've played in games recently where of the $5000 on the table in chips....only $300 or so was actually paid with real cash. The rest was on promissory notes to the host. And I'm telling you for a fact, people play different when they have no actual money in play. When I was hosting I stopped booking people. If you can't afford to play....don't.
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