The following lecture was the 21st Tuesday Session, held February 16, 1999, and later appeared in Card Player magazine.
The business of poker
It’s OK to play poker frivolously. Have fun. Giggle. It’s a great game. Not every golfer needs to break par. You can have plenty of fun playing once a year and shooting 130. So, you don’t need to be good at golf to enjoy it. Same goes for poker.
But if you’ve reached the stage that you’d like to play poker seriously and you’re ready to make some money, you probably want to treat poker like a business. This was the 21st in my serious of Tuesday Session classroom lectures at Mike Caro University of Poker, Gaming, and Life Strategy. It was delivered earlier this year and is specially enhanced for Card Player. The title was…
Treating Poker As a Business
- It’s OK if playing poker is fun
– as long as you aren’t playing for fun. Some people don’t want to treat poker as a business. For them, it’s recreation. And that’s just fine with me. There is no reason that people can’t enjoy poker casually without having to carefully crunch and critique it.
As pure recreation and entertainment, poker is one of the most fascinating games ever devised. And perfectly reasonable people – many of them doctors, lawyers, and stock brokers – may be too busy managing the success of their professions to invest the time needed to master poker. These people may want to hear a few tips, but mostly they just want to play the game – not devote their lives to it. Poker is fun for these people; it is not a business.
If you’re ready to take poker seriously and play full or part time with the intention of making money, then you need to think of it is terms of being a business. But it can still be fun.
- What is “enough” when you treat poker as a business?
- Just knowing poker isn’t enough;
you need to play seriously.
- And playing poker seriously isn’t enough;
you need to play poker ample hours to earn a living.
- And playing poker seriously ample hours to earn a living isn’t enough;
you need to play in the right places.
- And playing poker seriously ample hours to earn a living in the right places isn’t enough;
you need to play at the right times.
- And playing poker seriously ample hours to earn a living in the right places at the right times isn’t enough.;
you need to play against the right people.
- And playing poker seriously ample hours to earn a living in the right places at the right times against the right people isn’t enough;
you need to play your best game all the time.
- Playing poker seriously ample hours to earn a living in the right places at the right times against the right people and playing your best game all the time is enough
– IF you keep records!
- Just knowing poker isn’t enough;
- Why keep records?
Records aren’t just for your accountant or for your taxes. Keep them to analyze what works. Which games are better for you? Which limits? Which opponents? Which casinos? Which hours? Use these statistics just as a good baseball manager would to make strategic decisions like when to bunt, when to steal bases, when to use a left-handed pitcher.
Additionally, when you have records, you can’t con yourself about how well you’re doing. You must face reality, and that can motivate you to improve and stay focused.
And never destroy your records. It’s OK to declare a new “campaign” and start fresh, but keep those old records for reference. In fact, starting over with a new campaign isn’t a bad idea. The past is the past, and presumably you’ve learned new things, decided on better strategies, and maybe determined to apply new discipline from this point onward. Fine. Then there’s no reason you can’t declare that brand new campaign, just like a baseball team begins a new season. And you don’t even need to wait for the last season to end, if it will please you psychologically to begin anew right now. You can even give a new campaign a name. Call it “Campaign Stud Storm” or whatever makes you happy. But wait!
I said, wait! Before you begin that new campaign, make sure you do not destroy your old records. I’ve made this mistake when I first started out, and I wish I had all my early records now to contrast them to my current experiences. And, to be truthful, I don’t always keep game-by-game breakdowns by category anymore, because I only play poker five or so times a month (sometimes more, sometimes less) and I don’t have the same passion for percentages that I did years ago when poker was my only profession. But this is my failing, and it shouldn’t be yours. Keep very detailed records. They will help you.
Suppose you want to open a restaurant. You’ve heard the old adage, “The three keys to retail business success are location, location, and location.” Perhaps that’s a little overstated, because there are many other factors to consider and things to do when setting up a successful retail store. But, location is often the most important, because if customers can’t find you and visit you easily, they will usually shop elsewhere. The point is, you want to do business where you have access to the best customers, so you can make the most money.
Poker is the same way. And, in poker, your weakest opponents are your best customers. If you’re a serious player or a professional, when you take a seat in a poker game, you’re setting up shop. You’ve opened for business. Suppose you had to buy a license to sit in that one seat at that one table for years to come. Then you’d have to hope you’d chosen a good casino and that the players who challenged you day after day would be easy to beat (good customers) and that the game would be the limits you want and the form of poker from which you are most able to profit.
Fortunately, it doesn’t work like that. There’s no license required, and you don’t need to build or lease a building freezing you to a single location. One of the great things about poker as a business is that you get to choose your best location every time you play! It’s like opening your restaurant in what you perceive to be the best location, but three other restaurants suddenly open around you, under pricing your meals and taking your business. Wouldn’t you like to just plop down your restaurant somewhere else tomorrow, and keep the profits keep flowing?
Well, that’s almost exactly how it works with poker. If there are better games elsewhere, you move. You do business at a new location. Sometimes changing seats to get a positional advantage on an opponent is valuable by itself. In other words, you might not need to move your poker business clear across town. You might simply decide to use the storefront next door (an adjoining seat at the poker table).
And since location is the key to your poker profit, you better take advantage of this amazing opportunity. You’d be surprised how many knowledgeable players fail to use the concept of location to their advantage.
- What matters most?
Here’s one of the most important concepts about the business of poker. In poker, it isn’t money you should be thinking about. Money takes care of itself if you play correctly. What matters most is time.
If you’re a fairly good player making two minimum bets per hour, whenever you make a mistake costing you two bets, that’s a whole hour you need to make up. Each time you play poorly for a session, you might need to invest days undoing the damage. Think of poker as an exercise in accumulating the most “good” hours possible. Each time you stray from your best game or spend time in the wrong game, those are hours wasted.
- Treat your regular opponents like business clients.
Treat them nice. They are your customers; they supply your profit. Learn their habits. Also, keep track of their results, just as many successful businesses keep track of their customers purchases on a database. They want to know who bought how much, just as you should want to know who supplied you the most profit.
And who are they – the profit suppliers in poker? They’re simply the biggest losers. Maybe – rarely – there’s a particular opponent who is not a big loser that is especially profitable for you. That’s because, maybe you can bluff him or he’s intimidated by you or he furnishes you profit some other way. But usually the biggest losers overall are also you’re best customers, so you should try to identify who they are and play against them whenever possible.
- If you keep a constant, but inadequate, bankroll, you will eventually go broke.
This is an absolute mathematical certainty. And it is the main reason why most skilled, emotionally stable players fail at their “poker business.” Spending pieces of your accumulating bankroll because a long losing streak seems unlikely is a diagram for doom.
Most winning players go broke. Wait! Did you hear what I said? I said, most winning players go broke. Even medium- and big-limit world-class players. The reason is that they may start with $5,000, win $100,000 in four months, spend $80,000, and lose back $25,000. Then what? Then they’re broke despite having won $80,000. These are big winners with big problems. Keep an adequate bankroll. – MC