When you’re thinking about starting a business, poker is probably the last thing on your mind. After all, what can a card game teach you about starting and running a successful business?
I had this thought when my wife and I opened a children’s clothing store. But, having played poker for many years, I quickly began to see how my poker skills helped me manage parts of our business.
Sure, knowing when to fold pocket jacks doesn’t balance the store’s budget. But knowing how to play poker and how to play it well has immense benefits from a broader perspective — no matter what type of business you’re in. That said, here are five important skills for starting a business that you’ll learn from poker.
1. Dealing with High Levels of Risk
You’ve likely heard countless times before that most small businesses fail within their first 5 years. But it’s worth reiterating this point because, when opening a new business, you’re taking a significant amount of risk. According to the Small Business Administration, only about half of business stay open for at least 5 years.
Staying open isn’t the only risk you will carry either, because you’ll be facing a number of tough decisions on a daily basis. Do you take out a short-term variable loan? Is hiring two more employees going to improve profits? There are constant risks.
Poker is all about calculating what measures as a good risk. By using math like pot odds and implied odds, you can figure out whether a risk will pay off in the long term. The very same skill set can be used to weigh up the chances you will take in business, too.
2. The Ability to Identify Strengths and Weaknesses
Former Chrysler CEO Lee Iacocca once said, “Know yourself, know your business, and know your men.” Few things are more important to entrepreneurs than knowing your own strengths and weaknesses, as well as those of your employees.
And there’s no better game to teach you that fact than poker, which is all about observing your opponents’ betting patterns, the range of hands they play, and the occasional live poker tell.
Poker is also about identifying your own style of play and what you can do to improve. A great way to do this is by looking at hand histories after online poker sessions, or at least thinking back through difficult hands that you’ve played.
3. Ability to Deal with Losses
If you want to equip yourself to deal with failure and rejection, then start by playing poker. Again, opening a business carries many risks and sometimes those risks don’t pay off. For example, my wife and I have ordered entire clothing lines that bombed, relegating them to our sales racks at a big loss. On a larger scale, some of history’s greatest entrepreneurs failed again and again before finding success.
Despite having a definite skill element, poker also features lots of variance, and even the best poker players will have downswings due to poor card runs and/or bad beats. Having the ability to overcome these lean periods and stay on track is something that serves you well in business.
4. Managing Your Assets
You can be great at managing your employees, picking out products, and crafting clever advertisements but if you can’t handle your company’s money, then you have no chance of surviving.
This is yet another area where poker is helpful because pros must properly manage their bankroll to succeed long term. Specifically, you need to figure out what stakes you can comfortably play while surviving any potential downswings.
5. The Drive to Succeed in a Competitive Environment
The market is only big enough for so many businesses in each niche, so having experience in a competitive environment always helps your business succeeds. Poker can give you this type of experience because it’s the world’s most competitive card game.
With some pros making millions of dollars per year, players are willing to do anything to climb the ladder to bigger profits. This means pouring hours into reading strategy articles, watching training videos, and analyzing your sessions with due diligence.
Just like in business, the more time you put into poker, the more likely you are to rise above the competition.
(sourced from Irma Hunkeler via Business.com)