I love poker and consider myself a life long student of the game. Oddly, I don’t think of poker as “gambling”, but then again I don’t think of being an entrepreneur as gambling. Many do. I see the real gamble as not playing the game and not playing many hands at all.

Long before the rise of Texas Hold’em and Chris Moneymaker’s ESPN televised 2003 victory captured the public’s imagination, poker has been a dominate force in the technology and startup circles I run in. Aside from the obvious “playing poker is like running a business” I’ve put together some basic metaphors that draws relationships to some of the finer points of playing the game of poker and building startups. The point is to paint a picture of why playing a hand of poker is like running a technology startup.

Meet Your Startup. The Pocket Cards.

In Hold’em the game begins with a total of two pocket cards being dealt. This is all you have to work with so you have to make it good.

Table Image is Your Brand

In poker your table image is how your opponents perceive you at the table. Some poker players alter their physical appearance with sunglasses, clothes and jewelry to project a certain type of image. The obvious difference between poker table image and brand is that the objective of a table image is to project one thing and mean another. For example, in a poker game you may wear flashy things to project a loose image when in fact your play is conservative. Regardless, the question is what kind of “table image” is your startup projecting to your target audience, potential investors and friends and family. What do they know about you outside of the game, if anything? Are there opportunities to alter your table image?

The Chip Stack Becomes Seed Capital

This is what you’ll have to work with to market your hand. Are you up on the chips? Down on the chips? This will impact how you market the two cards you have face down on the table.

Betting Rounds Are a Marketing Tactic

I like to think of the betting rounds as an opportunity to market the hand you’ve been dealt. What does the amount you’re betting say about the hand you’re marketing?

Table Position. The Research Department.

Where you’re sitting in relationship to the various rounds of play is referred to as table position. The last person around the table to bet, raise or fold has the most information to act on and the opportunity to do “research” that guides how they’ll play the hand. The first person to go has the least information and has to retain information about the players patterns from previous rounds of play to guide how they will their hand. What’s your research strategy?

The Odds Win/ Fail

I always try to know the odds of what I’m up against. Sometimes I decide to play against the odds and sometimes I don’t.

How to “Play” Your Startup Like a Poker Hand

Fold Often, Fail Fast

The Ace King is said to be one of the hardest hands to play. Some even jokingly call the hand Anna Kournikova AK (the pretty, but bad tennis player). Players will often get blinded by that hand because they fail to read the rest of the game and fixate on what they think is a guaranteed winning hand. Don’t get blinded by what you’re certain is a “guaranteed win” in your startup. Pay attention to the market, constantly do your research, adjust and fail fast if need be.

Create Randomness, Act and Test

If you predictably play ever single hand the same way you’ll be a poor poker player. Creating randomness means you have a strategy switch up how you play. Sometimes you’ll play aggressively, other times you might play conservatively and every other style in between. Startups are the same way. You need a strategy to create randomness, act on it and test it. Going to the same 3 coffee shops over and over is pretty much a guarantee you’ll never expand your network.

Skill vs. Luck

One benefit of poker is that it gives you a psychology model to deal with winning and losing. At the heart of this model is a balance of skill and luck. I tend to remember the big hands I lost more so rather than the hands I’ve won. The more hands you play, the more you refine your skill set. It takes a lot of skill to lose big money in poker and the same holds true for startups. A serious entrepreneur may play a lot of hands to achieve the right balance between skill and luck. The point is constantly be on the lookout for opportunities those skills. They may present themselves in obvious, and not so obvious ways.

Have Fun and Detach From Money

If it’s not fun there’s really no point in sitting there for hours at the poker tables and of course the same holds true for startupping. Working for hours and hours and sometimes years on a project, which may not be fruitful can suck. If it isn’t any fun then it really, really sucks. You have to be committed to having fun and quickly weed out toxic relationships and situations, which can kill the fun.

The biggest thing though is not fixating what you’re sure “you’re gonna make”. You almost never make what you think you’re going to in poker or running a startup. I’m not saying not to be sensitive to costs, but what I am saying is not to over-fixate on a financial outcome that isn’t even a reality. If you do detach from that you’ll have a lot more fun.

——

Poker players what do you think? Are you running a startup and a poker player? How do you perceive the similarities between poker and running a startup?

——

images via Flickr

If you liked this post, please consider leaving a comment or subscribing to the feed to have future blog posts delivered to your feed reader.