What Poker Taught Me about Business
I'd played a little bit of poker in college, but like many people, I always just considered it to be a fun form of gambling and had never bothered to actually study it. Back in 1999, poker was not yet a mainstream activity. Most people had never heard of the World Series of Poker, and TV networks like ESPN were not yet broadcasting poker tournaments to the masses.
One night while battling insomnia, I randomly came across a web site that served as a community hub for people who played poker regularly. I was fascinated by the amount of analysis and information about playing that was freely available, and spent the entire night reading different articles about the mathematics of poker.
Like many people, I had always thought that poker was mostly about luck, being able to bluff, and reading people. I learned that for limit hold 'em poker (which was the most popular type of poker in casinos at the time), none of that really mattered much in the long run. For every hand and every round of betting, there was actually a mathematically correct way to play that took into account the “pot odds” (the ratios among the amount of the bet, the number of chips already in the pot, and the statistical chances of winning).
With the exception of poker, almost all games in a typical casino are stacked against the player, and in the long run the casino always comes out ahead. I was intrigued by poker because in poker you are playing against other ...