How Do Tipsters Make Money?
A common question people have about tipsters is “how do they make their money?”
The life of a tipster is shrouded in mystery and it is one of these slightly grey areas where there is no “official” way for a tipster to be paid. At the same time, there has been some controversy in recent years regarding partnerships between bookies and tipsters, but as we discuss below this is not always as problematic as it may at first appear.
It may sound like quite a glamorous and exciting lifestyle for a betting expert to earn money from issuing tips, but it is not always quite so straightforward and normally involves significant ups and downs and a lot of hard work to be successful at.
There are various ways a tipster can earn money – whether that’s by being paid by a newspaper (or website) to provide tips, charging a subscription directly to members of their tipping service, through advertising or taking a percentage of any winnings made.
Each of these options has its pros and cons for both punter and tipster and we will take a look at the implications of each one below.
The Evolving Career of the Tipster
Since the earliest days of gambling, where there have been bets being placed on sports, invariably tipsters have followed. It makes sense for people to seek out experts in any field, who may have more in-depth knowledge and expertise that can be utilised to their advantage. When people are placing money on an event, it is logical they may want the advice of a professional rather than relying on their own guesswork or doing a little bit of form study.
This is particularly the case in sports like horse racing, where there are a huge range of factors to consider and the sense that there is “inside information” that not all punters may be privy to.
Back in the early days of racing, a tipster would typically attend the racecourse in person and hand out slips of paper with their tips on in exchange for a small fee. The tipster would often be someone connected to the stables or trainer with a claim to some “inside info.”
This gradually evolved to a more formal service where tipsters would provide their selections in a newspaper column, together with write-ups explaining their reasoning. The newspaper would pay the tipster a salary if they were a regular contributor, or fees for individual articles if the advice was more occasional.
As the popularity of betting grew over the course of the twentieth century, specific newspapers dedicated to betting, like the Racing Post and Sporting Life, sprang up. These had whole panels of tipsters devoted to particular sports or even disciplines within sports.
Within such newspapers, there were also private tipsters who would take out adverts to promote their services to readers. These tipsters would normally provide their tips via a phone-line, for which they would charge a premium rate and earn a fee.
All of this was of course turned on its head by the arrival of the internet in the late 1990s. The whole gambling world was changed dramatically by the internet and tipping was no exception.
As bookmakers moved online, so did the majority of tipsters. It opened up the possibility for many more budding tipsters to offer their services to the public, which had previously been the reserve of a select few.
How tipsters offered their services also changed, with tips being provided via a whole variety of channels including e-mail, text and more recently, apps like Telegram.
Tipster platforms also sprung up, which are websites allowing people to offer their tips, whilst taking care of things like admin and marketing on behalf of the tipster to save them time.
You would expect that in a general sense, any tipster would make some money from betting on their own tips first and foremost. However, some may have suffered bookie restrictions and their strategy might not be viable on the exchanges so that is not always possible – and in some cases not being able to bet themselves may even be the factor that drove them to becoming a tipster in the first place.
Leaving that aside though, the options for how a tipster can make money today are quite varied. The option they go for can have quite a significant impact for them and for the punter however, which we will dive into further below.
The Traditional Method – A Newspaper Tipster
The method through which a tipster was traditionally be paid was by having a job as a newspaper columnist and being paid a regular salary by that newspaper.
The tipster would normally produce a regular column, whether on a weekly or daily basis, providing tips for upcoming races. Those in the UK will probably be familiar with names such as Pricewise (Tom Segal) at the Racing Post or Templegate at the Sun newspaper. The advantage of this approach from the tipster’s perspective is that they get paid a regular income and do not have to worry about the ups and downs that can come with a subscription-based model (more on that below).
The advantage of this approach from the punter’s point of view is that it is free (or cheap, as in the cost of the newspaper). However, the disadvantage is that often the newspapers don’t keep a record of the tipster’s results or seem to place much importance on the tipster’s performance.
Many newspaper tipsters for example actually have losing records. It is more about regularly churning out articles and being a good, knowledgeable writer, rather than producing a long-term profit per se.
The other potential downside of the newspaper tipster is that it can be very hard to obtain the advised prices. With thousands – or even millions – of punters seeing the same tips posted in a popular newspaper (or site) at the same time, it can cause a price crash.
Those who have used Pricewise will probably be familiar with this and it was evident in our review of Hugh Taylor of At the Races, who whilst producing excellent results at advised prices struggled to produce a profit at prices that were actually obtainable.
Today’s Method of Choice: A Subscription-based Model
Since the advent of the internet in the late 1990s, the most common method for tipsters to be paid is via a subscription-based model.
So for example a tipster will charge a monthly or quarterly subscription fee for people to receive their tips. Once signed up, tips are sent out via e-mail, text or Telegram app, or via logging in to a website.
This method works well and is pretty simple and straightforward for both parties. The tipster and punter’s interests are very much aligned – the tipster knows that if they don’t produce the goods, people will stop subscribing.
From the tipster’s point of view, on the downside that means if they go through a losing spell, their income can fall quite dramatically. If the drawdown drags on for a while, that can mean having to live off very little income for an extended period.
The flipside of course is that if they have a really good run, subscriber numbers can soar and the tipster can receive a very tidy income. If for example a tipster charges £30 per month and hits a purple patch with lots of winners, they could see 200 subscribers joining their service, bringing in income of £6,000 per month.
So operating a subscription model can be “feast or famine” for the tipster and if going down that route, a tipster probably has to be prepared for a wild ride in terms of their income level. Some months will be tough and some very lucrative, so learning to look at the average over a year is probably the best way to approach it.
From the punter’s perspective, the subscription model is a favourable one as we say, as you know the tipster will be doing everything they can to produce a profit and keep the subscribers signed up. That doesn’t guarantee they will make a profit of course, but at least you know your and their interests are aligned.
Most of the best tipsters we have reviewed on this site, such as The Bookies Enemy and Hanbury Racing, run on a subscription basis, which we think is the most sensible model overall.
Taking A Cut – Profit Share Model
Another way for tipsters to get paid is a profit share model. This is a lot less common than a subscription model, but means the punter pays a share of profits made to the tipster over a given period.
So for example a tipster might set a 20% profit share model over a month. If the tipster makes £1000 profit for the punter over that month, then the punter would pay £200 from that to the tipster.
A profit-sharing model was used by the (now-defunct) site Betmarkets and we have seen it a few other times over the years, but as we say it is not very common.
One of the drawbacks to this model is that if in the example above, after making £1,000 profit the tipster then made a loss of £1,000 the next month, the punter is out of pocket by £200, whilst the tipster has actually broken even. Losses can be carried over to be counted against future profits, but there is no guarantee the tipster will make back enough profit to cover this.
Additionally it can be complicated to set up and ensure that funds are collected and distributed in the correct way.
A slight variation on this is the “pay as you win” model, whereby a punter does not pay a subscription but pays based on any profits made by the tipster.
For example the tipster might charge £1 per point of profit made. If the tipster makes 50 points profit, you would then pay £50.
This approach can suffer from the same issue as the profit share model if the tipster then goes and loses the previous profits made, but in a way it is not that different to paying a monthly subscription fee with the risk that the tipster makes a loss that month on top of the subscription fee you have paid.
The pay as you go approach is also easier to administer than a profit sharing model, so is slightly preferred of the two.
The other principal way a tipster can make money is through advertising. This is perhaps the most controversial one and has provoked some lurid articles in the press regarding advertising deals struck between bookies and tipsters.
Essentially in these scenarios, the tipster signs up as an affiliate of a bookmaker. They then promote that bookmaker on their tipping website and receive a share of the revenues from any person who signs up to that bookmaker from their site.
What this means in effect is that the tipster receives a share of any losses made by the customer. Often these deals are set at 20-30%. So if the punter were to lose £1,000 and the tipster was on a 30% affiliate deal, they would receive £300 from the bookie.
You can see how quite easily this could lead to a conflict of interest, with the tipster incentivised to provide “bad tips” so the punter loses money and the tipster gets a cut of their losses.
Whilst there do appear to have been some instances of this happening – particularly with social media tipsters – you can also see how quickly this approach would fall down. Punters would stop following a losing tipster very quickly and the tipster would not get any new customers. So it might work in the short term but would not be viable for very long.
More common in this scenario is that the tipster will still try to provide winning tips and make a profit for their followers, thus retaining their punters and bringing new ones to their site, but the weight of statistics will play its part in the long run.
With studies showing over 98% of gamblers lose money overall, it is a sad fact that even if they were receiving some profitable tips, most punters will still go on to lose money from their betting overall. This could be through placing what could be termed “mug bets” such as at online casinos or on accumulators for example.
So the advertising model in many instances is not as controversial as the press have tried to make out, as being a losing tipster is not viable for any length of time at all. In any event, with additional regulations that have been brought in, the bookies have largely stopped working with affiliate tipsters so this model is not very common anymore.
Of course tipsters could just offer general advertising on their site not related to bookmakers, but the revenues from general advertising (pay-per-click) tend to be very low unless a website is attracting millions of visitors. So it would only really be viable for the big betting websites like At the Races and the Racing Post, which as described above already have their salaried in-house tipsters.
In essence then advertising is rarely used as a means for tipsters to make money these days and in fact it’s a while since we have seen any tipsters operating this model.
Conclusion – It’s A Tipster’s Life
The career of a tipster is one of those areas that is shrouded in mystery and attracts a fair amount of controversy.
To be honest though, making money as a tipster is hard and other than those lucky enough to land a job as a salaried newspaper tipster, generally it involves a lot of ups and downs with wildly fluctuating income.
Even those fortunate few who do land a job as a resident tipster at a newspaper are still – like all tipsters – under pressure to produce results.
So it is perhaps not surprising to learn that many tipsters these days do it as a second income rather than their primary job, given the pressures and ups and downs of it.
Those who have managed to do it professionally and successfully for a long period tend to be only the very best – for it is only they who can it make it viable ultimately.
Some of those top tipsters you can check out here in our list of the Best Horse Racing Tipsters.
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