Texas Hold ‘Em: A Great Tool for Learning About Business and Life

This past weekend I attended and won a poker tournament held at a colleague’s house.  The tournament is held every quarter to raise funds for a local charity and this particular tournament was the fiftieth one – so it was a special occasion.  The event has generated over $24,000 in donations which I’m proud to have participated.

When I think about the game itself I don’t consider myself the best player.  I don’t play all the time and don’t really have many friends that play the game.  Back home and in college the game to know and play was spades.  You couldn’t find a college campus that didn’t have a spade game going on in the student union or sometimes in the barbershop.

When I think about the game and what you have to do to be successful in business and life, it reminds me of what an entrepreneur and/or business person has to do to compete in the marketplace.  Here are a couple of things I picked up from the game that helps me with my ventures:

  • You cannot win if you don’t get in the game.  Before the game everyone paid $40 and got the same number of chips.  I can guarantee you that the people that don’t pay to play in the tournament will never win the tournament.  I think the same goes with being an entrepreneur or business person where you have to pay the cost of admission into the space you are trying to compete in and win.  If you have to study, take courses, get mentoring, work for someone else to learn your craft, then do it.  That education and/or experience will be the best thing you can use to set yourself up for a great entry into a market or introduce a new service.  But the thing you have to realize is that the business or venture you want to sell for millions won’t get sold unless you first start it – so go start it and learn what you need to learn as you need it.
  • Standing still and doing nothing will eventually kill you.  The game has what’s called a big blind and a small blind.  These are the bets that 2 players have to make that sit clockwise from the dealer – before they see the rest of the cards.  If the cards are good then they can play the hand but if the cards are bad then they lose the chips they had to bet.  The blinds in our tournament increase every 30 minutes so in the beginning they were $25 and $50 and by the end of the tournament they were $400 and $800.  This is designed to speed up the game by weeding out the players with short stacks of chips.  In life, if you don’t decide to get into the game and create your opportunities, the cost of getting into the game later will continue to increase and take what you have – until you don’t have anything else and you are kicked out of the game.  That resource could be time or funds or confidence so you have to watch what the game of life requires of you.  Some people choose to stay where they are because it is comfortable, but those who chose to play the game of life realize that they have to “keep it moving” and take advantage of opportunities when they reveal themselves or are created.
  • Make the most of every hand you play – whether you have a logical system or you can calculate all the probabilities for getting the cards you want, play the hand you are given the best you can every time.  Sometimes you can win with a bad hand if you play it right.  There was one time in the game where I had a couple of deuces and decided to play the hand since I had put in one of the blind bets.  When the flop came (the 3 cards you start with from the dealer to build your poker hand) I got another deuce and a seven of hearts.  Then later I got another seven which gave me a full house – which has a higher probability of winning than most hands.  Normally I wouldn’t have played that hand but something inside my head said “play this hand.”  The same goes with life – when you are given what you are given then use it to the advantage you have to be successful.  You can make your situation better than it is if you don’t focus on what you’ve got and focus on what you can do with it.  There are many successful entrepreneurs and business people that started with nothing and turned that nothing into something.  Pull the vision of success you have out of your head into the reality of your life by using what you have.
  • Always know what hand can beat you – some people would call this knowing the competition and the threats in the marketplace.  While making the most of the cards you have, you have to know what combinations of hands that can beat you; so you know if someone starts to bluff or play aggressively you know what you are up against.  There are many times in poker that the possibility of having a better hand was there for my opponents, but you cannot play effectively if you don’t know what hand can beat you.  In life, know your limitations, your development areas, and your shortcomings so that you can prepare to either shield yourself when competitive threats come against you or exploit those moments, when opportunities come, to get ahead of your competition.  Partner with people and organizations that can complement what you have so you can limit your exposure to competitive threats.
  • Mitigate, accept, or transfer your risks – Sometimes you have to see the flop before you go further with a hand.  You may have to pay more money just to get the privilege to keep going forward in the game at that moment.  There are many hands that I could have won but decided to fold because the cards were just too bad to play.  You can’t win if you don’t take risks so you have to learn how to read a situation to determine if the risk is worth taking.  I’ve played some crazy hands of poker and still won because I took some chances that just happen to pay off.  The same thing happens in life when you take certain chances to improve your outcomes.  It would not be wise to play every hand but it is wise to take some calculated chances.  That is what most successful entrepreneurs do – they don’t always jump all-in on an opportunity without some way to increase their probability of success.  They make sure they are shielded from the downside of a move they make while maximizing their upside potential. This is where entrepreneurs and business people have to learn how to take the right changes and risks to get where they are supposed to go.  Some smart person said that the fruit on the tree is always out on a limb so you have to sometimes climb the tree and go out on the limb to get the prize.
  • If you don’t succeed the first time keeping trying.  This was the third tournament I have played in 2 years.  The first time I played I was done and bowed out early.  The second time I played I made it to the final table but was out shortly thereafter.  Then the third time I played I outlasted the competition won the tournament.  In life, if you want to achieve something, you have to keep at it consistently and believe that one day everything will be in place for you to win.  But you must first believe that you can win before you do win.  When I made it to the last table something told me that I could really win this tournament if I believed I could win.  I started believing and the outcome was my first trophy.

As I reflect on my weekend fun, I can’t help but see the similarities in the game of poker and starting a business or taking on any major project in life.  You’ve got to take changes while mitigating your risks, you have to know what can bite you, you have to keep things moving, and you have to continue to learn from what you do.

 

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