Poker Rakeback

One of the greatest qualities of poker, and one of the key things that separates it from games like roulette, is that you play against other people, not the house. It’s this benefit that makes it possible for any person, with dedication and effort, to become a long-term winner.

But poker rooms don’t offer their services for free. If you play ring games online, you’ll pay a small percentage of each pot you win to the operator. If you play tournaments, you’ll pay a fee for each event you enter. These charges are collectively known as the rake.

Much of that rake ends up as the poker room’s profit. As a player, these costs quickly add up, and can eat into your bottom line. For example, let’s say you’re a casual $0.50/$1 no-limit Hold’em player, and you play for about two hours a day after work. You could be paying over $350 a month in rake – and the more you play, the more rake you pay. Thankfully, some of this rake is returned to players through bonuses, special offers, VIP clubs and rakeback.

In this article, I’ll talk about how to make the most of the offers that are available and save you some money!

What Is Rakeback?

When people talk about rakeback, they typically mean cash that is paid to the player on a regular basis, based on how much rake they have paid. The poker site calculates your gross rake, which is an estimate of how much rake you’ve paid in total. They then deduct certain costs (for example, any point store purchases you have made, deposit bonuses you’ve earned, or fees incurred when you deposited or cashed out) to come up with your net rake. Then, a percentage of this rake is refunded to you as cash.

Rakeback derives from online poker’s thriving affiliate business. Poker sites pay affiliates to refer new players to them, and one of the most common methods of payment is revenue share. Under a revenue share agreement, the site pays an affiliate a percentage of your net rake in return for referring you. For example, a site might pay an affiliate 35% of your net rake each month. If you have a rakeback deal with the affiliate (which is the most common way to get rakeback), the affiliate then returns a slightly smaller percentage to you, for example 27%.

Rakeback is marketing genius. It’s great for the player, because it’s a way of getting extra money without having to change your style of play in any way. It’s great for the affiliate, because they earn money every time you play. And it’s great for the poker site because it encourages the player to play more hours, more tables, and generate more revenue.

What’s more, rakeback is a very efficient (and comparatively cheap) form of marketing, because it’s only given to players who are motivated enough to seek it out. The downside, of course, is that if you’ve already signed up through an affiliate and don’t have rakeback, you probably won’t be able to get it, because the poker site has already paid the affiliate for referring you and doesn’t want to pay again.

If you try to create a new account to get around the site’s restrictions, you’ll probably be breaking the poker room’s Terms of Service and could get into serious trouble.

Rake Structures

There are some serious misconceptions about rakeback floating around the online poker world. The biggest one is that it’s better to play at a site that offers rakeback than one that doesn’t. The first thing to realise is that there are major differences between the rake structures at different sites.

In tournaments, this is pretty obvious. It’s clearly cheaper to play at Site A if Site A rakes only 10% of the tournament buy-in, while Site B rakes 20%. In cash games the differences are usually subtler, as the maximum rake is usually capped at $3 (something of an industry standard). There are, however, often major differences in how much the pot is raked below that level. For example:

• Site A rakes a maximum of $2 when the game is five-handed, but Site B rakes $3. This effectively makes Site A 33% cheaper when only five players are dealt in – and if you play six-max games, this is a regular occurrence.
• Site A rakes more money in British pound games than it does in US dollars, by capping the rake in each game at three currency units ($3 or £3). Site B adjusts the rake depending on the actual value of each currency, making it much cheaper if you play in British pounds.
• Site A takes $0.05 for every $1 in the pot, but Site B takes $0.01 for every $0.20. At first glance it looks like both sites are taking five percent, but if the pot is $0.99, Site A will rake nothing, while Site B will rake $0.04. On average, Site A will rake much less, and these differences add up in low stakes games.
• Site A uses the ‘live poker method’ of raking the pot when it reaches a certain threshold. For example, Site A rakes $1 when the pot reaches $20, and another $1 when it reaches $40. Site B rakes $0.05 for every $1 in the pot. If the pot is $19, Site A rakes nothing but Site B rakes $0.95. If the pot is $35, Site A rakes $1 but Site B rakes $1.75.

These differences are common in limit poker games and also add up. Clearly, it pays to shop around! It’s always better to pay less rake up front and have the money in your account straight away, than to pay a higher rake and then get some of it back later. Any reputable site will publish their rake schedule on their website and will answer questions about it if you contact their support department.

VIP Clubs

The second thing to realise is that in order to compare two sites fairly, you have to consider not only the differences in rake and rakeback, but also the value you might gain from VIP clubs, bonuses and other promotions. Almost any promotion can be analysed in terms of its effective rakeback – in other words, how much value is returned to you for each dollar that you pay in rake.

If you’re playing with rakeback, any money earned in promotions is often deducted before your rakeback is paid. For example, Site A might offer you a bonus of $100, but then deduct any bonus you earn from your gross rake. However, it may still be better to accept the bonus if its value in effective rakeback terms is higher than your usual rakeback deal. Also, not all promotions are deducted from rakeback, so it’s important to add the value of these onto your overall effective rakeback figure.

At sites that don’t offer rakeback but have VIP systems instead, you have to analyse the value of the rewards available in effective rakeback terms. Usually, the value will increase significantly at the higher levels of the club, as an incentive to play regularly and work your way up.

It may seem difficult to calculate your effective rakeback, and it is! Thankfully, much of this work has been done for you already, and a quick search of a big poker forum like Two Plus Two reveals a wealth of information about what is available.

What To Play

People often discuss what game to play to maximise their rakeback. Usually this is a mistake, because in order to earn more rakeback, you have to pay more rake in the first place! However, let’s say you have a bonus that you need to clear as quickly as possible. What types of ring game should you play?

The simple answer is: whatever game rakes the most! You’re looking for
games with big pots and lots of showdowns. No-limit Hold’em is the worst
choice because so many hands end before the flop and aren’t raked.
Split-pot games are a good candidate – lots of hands see heavy action
and result in a split pot. Fixed limit games are also good because the
hands tend to go to showdown more often. I’ll save you the effort of
researching this one – it turns out the best game is fixed limit Omaha

Hi/Lo, followed closely by Stud
Hi/Lo. And you never know, you might
become a mixed games expert along the way!