Insider: Lessons in Convention Finance at Origins 2016

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This past weekend I traveled on a shop trip to the Origins Game Fair. This yearly excursion has become a getaway that I look forward to. Origins 2016 was a blast and many finance concepts were evident to me while I was out in Columbus for the convention. The first aspect of the convention I want to discuss is EV.

Don’t google EV because you will get all sorts of weird definitions for that acronym. Google thinks that EV stands for Electro-Voice or Electric Vehicles, but we in the Magic finance community know better. When we talk EV we mean expected value, an important term for anyone who walks on both the competitive and financial sides of Magic.

Convention Tournaments

For those of you who haven’t been to a convention where Magic is a central part of the weekend, one important thing to note is that they hold a variety of interesting events for attendees. They have tournaments like Sealed Draft where you open three packs of a set, then draft normally and finish up by building your deck with all the cards you have. Additionally, most tournaments like this have awesome prizes like uncut sheets of cards. Many tournament organizers are moving towards the prize wall structure but there are usually some cool prizes no matter what the setup.

One strength and weakness of conventions is that they must cement their schedule of events far in advance. For Origins, Pastimes scheduled a 10k for the Saturday of the convention months and months ago. Because you need an Origins badge to compete in the event, some players feel that the entry fees would supersede the value of playing. Although this seems like a sound line of thought, from my experience this is failed logic.

First of all, Origins is my favorite convention and there are so many awesome things to do. Board game companies have all their games set up to demo, there are many cosplays to look at, and there are so many interesting tournaments to have fun with. It may seem like a lot of money to pay the entry fee for the convention and then pay the entry fee for the tournament, but that’s until you dissect the EV of the event.

The main event at Origins, as I said, was a tournament with a ten thousand dollar payout. This happened at a time when players would most likely not want to participate due to initial costs. Finally, the prize payout trickled down to the Top 32 of the event.

Maybe you can see where this is going. The attendance for this event ended up being shy of a typical 10k by hundreds of players. Honestly from the way things were shaping up, I thought all the participants were going to cash. Right before signups closed though, a bunch of dealers sent players and the extra judges ended up registering as well. With the extra players we ended up with a whopping 46 competitors.

Have you ever played in an event with that large of a prize pool and so few players? This is the type of thing that happens at conventions. The expected value of a Top 32 prize payout is unsurprisingly epic when there are barely more than 32 people signed up for the event. Conventions like this are a blast and sometimes you cash an event at 3-3.

Convention Finance

In addition to the occasional awesome EV tournament, conventions have some other great finance things going for them. Many of the dealers at a big con like Origins will be the big-name companies that you know of, but there will also be some small fish as well. Even if you know the companies present, they may operate differently at a convention than they do elsewhere.

Most of the time I think companies trend towards buying cards at 40-60% of their value, which they usually set somewhere around the now standard TCG Mid. Once they have the cards, they then sell them based on that price the buy price was derived from. We know this because it’s the normal flow of finance these days.

One great thing about conventions though is that they can break this mold. I’ve seen on multiple occasions a completely different mindset from businesses at conventions. The space you rent for your booth costs a ton of money. Sure it’s great to pay to buy cards at 40-60% of their value, but often you want more profit to offset that cost.

The trend I’ve noted is what I’d like to call the Fire Sale. This method goes against the current tendency in Magic businesses because the thought process is very short-term. The basic concept of this technique is to sell cards so cheaply that players will feel like the only choice they have is to buy the awesome deals. When you walk by a case filled with cards and you notice some that are below TCG Low, they stick out. Usually this is cause for immediate purchase and that’s what they’re going for.

When you focus on selling as many cards as quickly as possible, you can sell a lot of cards. Once you set your goal to take as few cards home with you as you can, then it’s easy to achieve that goal. For us in the finance community, that situation becomes how much money are we willing to spend? When I saw this opportunity there were many cards I couldn’t pass up on.

The way I noticed this trend and started dissecting it was based on an incredibly low-priced Polluted Delta Expedition. High-end cards like this don’t sell below TCG Low often or ever and that’s a solid enough reason to buy into a card. As it happens though, Polluted Delta is one of the last fetch land Expeditions I need for my Commander deck so it was an even better find for me. Now if I could only locate a decently priced Verdant Catacombs Expedition.

When you’re at a convention, pay even more attention the prices in each booth. They can tell you a great deal about how that dealer is operating. Who knows, maybe you will be able to get foil Baleful Strix, foil Shardless Agent, Grand Prix Promo Umezawa's Jitte, and foil Mishra's Factory all below TCG Low. Finding good deals can happen at any event too so I always like to check all the dealers out and see if I can snag any good investments.

Selling Eternal Masters

Finally, the last thing I noted was a distinct lack of Eternal Masters. Many of the dealers had some packs of the set but there were no events fired at the convention because they didn’t have any product. Additionally, the dealers didn’t have many singles. This led to some competition between vendors for the singles I did have.

I would classify this under checking with each dealer for the best price, but in this case it was slightly better. When dealers fight for the cards you are selling, it turns into an onsite eBay auction. When there’s competition, you get the best price for your cards.

If you notice a shortage on any type of card, that is likely your best time to sell. No matter the product, if you’re the one that has it available, you are going to find the best price. Opportunities like this come up from time to time; all it takes is an open mind and an observant financier to take advantage of the situation.

Thanks for reading all about convention finance. If you have any questions or comments, let me know below. Hopefully next week we will have a bunch of Eldrich Moon spoilers to go over!

Until next time,
Unleash the Force!

Mike Lanigan
MtgJedi on Twitter

2 thoughts on “Insider: Lessons in Convention Finance at Origins 2016

  1. It’s interesting that Magic is happening at Origins again. I remember the great days in 2004 with Vintage events. Those evaporated for many years, with Origins dropping Magic completely. I’m glad to see that it’s picking up again. From what you said, though, I doubt they’ll run a $10k again…

    1. The past couple years star city has been there and that obviously drew a huge crowd. Wizards isn’t there but magic has had a presence for a while. We’ll see what happens next year I guess.

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