This is the second of a three part series (broken up for length) on the 10 most valuable entrepreneur lessons I learned from playing poker on a semi-professional level. If you haven’t read the first part yet, read it here.
4: Ability to Disregard the Value of Money
By far one of my most interesting observations of the effects of my poker playing was my conditioned ability to disregard the value of money. I would sit at a table, often betting, and sometimes bluffing with, thousands of dollars. I was young and didn’t have much of it… this was a big deal. I didn’t think about how many months rent was being pushed toward or pulled away from me. Thinking about that is bound to affect one’s play in a negative manner. A nervous, fearful player is a losing player. This sort of mindset took time. But it’s not simply blind ignorance that allows a player to disregard the value of money. I knew my own metrics. I was well aware that I would win some and lose some. I knew that in the long-run, I would win more than I lost because I remained focused and disciplined. I trusted my own play and talent, knowing I was better than the average player.
Startup Application: In the beginning, its good to worry about money and its value. Keeping close tabs and being nervous about your burn-rate is probably a good idea. But eventually, you’ll find yourself with more money than you’ve ever had access to. The bets will become much larger and much more meaningful from a monetary standpoint. This, in the startup world, is known as raising venture capital. Your burn rate will increase to levels you would have previously deemed insane. How you adapt and handle this change will be vital to your survival. Panic and you will go down in flames. Trust your metrics and you’ll be fine.
It’s also important to note that this perception of money only applied at the table. The ability to build a bankroll and manage it wisely away from the table is imperative to the longevity of a player, just as it is imperative that a startup CEO doesn’t start spending lavishly on things that don’t contribute to the bottom line.
5: Money Management
Most professional poker players have gone completely broke, often more than once. However, they have a public reputation for being great players and are usually able to find backers to get back on their feet. In contrast, the aspiring professional (first time entrepreneur) will have a much longer road to a second chance. Risking more of your bankroll is a foolish, irresponsible thing to do and is often the demise of many otherwise talented players.
Startup Application: As the CEO of a startup, you must spend your funds wisely. I’m not saying you should be stingy. But being thrifty, creative, and smart with where and how you’re spending your funds is critical. It’s easy to start running good and feel like you’re on top of the world. It’s here where you usually start to get cocky and make poor monetary decisions.
6: Owning the Outcome
I’ve always been a quick learner, poker was no exception. Part of this comes from learning from your own mistakes. I did my fair share of it. One of the most important inhibitors of poor players becoming average, and average players becoming great, is their inability to take ownership of their mistakes. Poker is an interesting game… you can do the right thing and still lose. However, most of the time losses and poor outcomes can be traced back to poor decisions. Most players refuse to accept this, often blaming ‘luck’, another player that ‘shouldn’t have been in the hand’, or best of all ‘the dealer’. There’s no shortage of excuses for why people lose hands. Sadly, this attitude has the undesirable effect of never improving one’s game. The constant blame on external, uncontrollable factors will prohibit these players from ever being open minded to the fact that they messed up. In turn, they will never learn from their mistakes and never become better.
Startup Application: As the CEO of a startup, you have the final say on all decisions. Your board, your employees, even your friends may provide input, but ultimately the decision lies with you. If you can’t accept this and, in turn, accept that when your decisions result in undesirable outcomes, you’re to blame… then you shouldn’t be the CEO. Get out of the game and try something else. Maybe you were meant to be a dealer, pit-boss, or some other role.
7: Building Something from Nothing
I started playing poker with just $50. I never directly committed more out-of-pocket than this. I patiently built my bankroll, played with discipline, and worked my way up to bigger and bigger games. I also managed to teach myself how to play the game. I read blogs, books, and observed other tables and games either online or on television. I built my own skills, abilities, and bankroll from nothing.
Startup Application: Building a startup is all about building something from nothing. If you’ve never done it before, you’re at a great disadvantage. I consider my stint as a poker player a startup of its own. There’s a ridiculous amount of knowledge available to first time entrepreneurs that wasn’t available 10 years ago. Utilize it. When I began playing poker, its mainstream popularity was really taking off. There was more information and more people playing poker than ever before. Without those available resources, I’m not sure what I would have done.