[Wongboy]

Fair for you will depend on how good he is. You need a return equal to what you could get on an investment with similar risk. If he is a winning player and he agrees to only play games where he is properly bankrolled (which reduces risk), then you wil need a fairly small return. Look at your other options for investing this money, and if you can get a better return for the same amount of risk, then the deal is not fair. Once you have reached that point, the deal is fair. For example, if a similar investment would return 1% a day (365% per year), and your friend plays 10 hours a day with an EV of $40 per hour, then a fair return on your $5K would be $5 per hour, or 12.5% of winnings (EV).

For your friend, a fair arrangement is one where he will make the same amount as he would make by doing a job that he enjoys as much as he enjoys playing poker. This will have to be increased by a risk factor since he could do the work and get no pay (if he loses). If he could average $20 an hour selling cars (assume no draw), and he likes selling cars as much as he likes playing poker, then a fair deal for him would be one where he averages $20 for every hour played. If he is playing with an EV of $40 an hour, then a fair split for him would be 50% of winnings.

Ideally, the fair return for each of you will still leave some unclaimed money. Divide that equally, or however you wish.