In a game where your edge is relatively small, you’ve got to use every available advantage to simply stay afloat. Successful poker pros are walking encyclopedias of methods to reduce risk and increase profit. These secret tricks don’t just work for poker. A great deal of common poker knowledge is actually invaluable in everyday situations in business or even your personal life.
Rookie poker players have their minds blown by when they're introduced to concepts such as EV (expected value) and how variance truly works. It’s an eye-opening experience to say the least. Maybe you’ll never sit at a poker table, but don’t let that keep you from benefiting from decades of knowledge developed over countless hours at poker tables around the world.
How to Hack your Life with Professional Poker Secrets
1. Odds are Your Friend
A lot of people are intimidated by math, especially when it’s used at the poker table. That’s unnecessary as it’s just one more factor to help you make a more-informed decision. The level you want to take it to is up to you. Perhaps the most basic math skill in poker is the concept of Expected Value (or EV).
If you have a good chance to win a $1,000 pot by only risking $100 that’s considered +EV. If you make enough +EV decisions you are going to be profitable. What makes a +EV decision is how many times you have to risk $100 to win $1,000. If your chances to win $1,000 are less than 10%, that means statistically you’re going to risk over $1,000 and it’s not worth it (like the lottery).
In the simplest terms: REWARD > RISK
In your daily life don’t be concerned about risk if the reward is there. For instance if you want to invest $1,000 in your friend’s start-up and you truly believe it has a 20% chance of earning $100,000 in its first year of business than that’s a very good investment.
Another way to use odds to help benefit your life is to look at some of the positive odds in life. For instance quite a few people are scared of flying but statistically you are far more likely to die in a car crash. Odds can actually give you a sense of security. It's important to realize that both poker and life are incomplete information games. Odds provide more information.
2. It's Natural to Lose Part of the Time
Here’s a secret: Even the best poker players in the world lose. Sometimes they even look like complete idiots while doing it. The reason is that poker (like life) has a large element of luck. You can get ridiculously lucky against a world champion and take his or her entire stack.
Professional poker players can have bad days, weeks or even months but generally speaking when enough hands are played they will come out on top versus amateurs. Skill will rise to the top. That’s why "professional" poker even exists in the first place.
It’s tough to argue with this approach in life when business icons like Steve Jobs, Bill Gates and Warren Buffett experienced plenty of short-term failure but eventually changed the world. The trick is that you don’t concentrate on short-term results. Don't get down when one development doesn't go your way. Instead focus on perfecting the process and results will come naturally.
3. Don’t Get Too Attached to a Hand
The problem is that amateurs get way too attached to aces -- and especially when the dealer puts out a dangerous board with cards that give opponents flush and straight possibilities. All the signs are there to get out, but players hate the idea of waiting another 220 hands to potentially win a big pot. In poker you only get dealt pocket aces once every 220 hands or so, so you want to make the most of them.
Poker pros have the ability to be more clinical and carefully assess the situation. If the situation is right, poker pros have folded pocket kings before the flop because they sniffed aces. That’s how unattached to a particular hand you have to be in certain situations.
There are moments in life when you simply have to fold. If you have a high-paying job but you hate it, then those aces aren’t as good as they looked originally. If your business partner continually makes bad decisions then maybe it’s time to move on to a new project.
4. Only Risk What You Can Afford to Lose
Most people assume that poker players are reckless gamblers who would bet their last pennies on a game of Rock-Paper-Scissors. While that's not entirely incorrect there’s also a reason that veteran poker players have been making a consistent profit from poker for decades.
A huge part of that staying ability is a strict financial system called bankroll management. Poker players put aside a special allotment of cash that is used just for poker. The first step in a poker career is scraping together a bankroll. To survive unlucky losing sessions you typically want to have more than 50 buy-ins at the stake you play (that’s a conservative measure). That means to play a $1/$2 cash game you’d want to have roughly $5,000. This varies from player to player but anyone who risks his or her whole bankroll in one game tends to broke very quickly.
The system protects players because you can usually drop down in stakes if you go on a losing streak and build your bankroll back up. It’s the same thing in life. If you want to start a business or make some investments, you need some capital. If something costs too much money then concentrate on smaller projects. It's important to separate your personal and business cash. As the adage goes: Only gamble what you can afford to lose.
5. Use Some Form of Tilt Control
Poker can be an emotional game and sometimes it’s tough to control yourself. The very best poker players can lose $100,000 in a hand and not flinch. You can’t be chasing your losses by playing garbage hands. That’s when the sharks start to swarm. Some players will walk away from the table when they lose a particularly unlucky hand or even end the session early.
You don’t have to walk away but you need to be in control. There are simply no advantages to letting your emotions control you at the poker table or in business. If you take a tough loss in your professional life it may be time to step away from the table and gain some perspective.
6. Minimize Your Leaks
Poker players consider any mistakes that lose money long-term “leaks.” Sometimes these are simple things, like calling just 5% too often or making bad bluffs with ace-king. The problem is that over time these leaks, which may affect a player’s bottom line by 5%, equal tons of lost equity.
Poker players actively try to patch up their leaks by making small changes to their games. This is easy to utilize in daily life. If you budgeting is a prioirty and you buy a Starbucks latte every day, that’s a pretty big leak when you could make coffee at home for a fraction of the price. The real skill is honestly analyzing your life and understanding what “leaks” you have that can be plugged. Every leak that’s plugged brings you one step closer to being the “perfect” player.
7. Pick Your Opponents Wisely
Athletes, whether it’s basketball, football or hockey, all want to compete against the very best in the world. Poker players want to play the worst. Or they should anyway. In fact most poker players who would gladly limit themselves to only playing the fishiest billionaire in the world if it meant they could keep pulling in a fat paycheck.
It’s even considered a skill in poker to use “game selection," which means targeting weaker games instead of swimming with the sharks. Sure every now and then a poker player wants to take a shot at winning a WSOP bracelet or beating Phil Ivey heads-up but cold-hard cash is the real goal for most poker players. There’s something sublime about that mentality.
Maybe your new business is getting crushed but it’s simply because you’re taking on giants when there is lower-hanging fruit. There’s a famous quote in iconic poker flick Rounders that says “… If you can’t spot the sucker in the first half hour at the table, then you are the sucker.” If that happens to you in poker than you should find another table. Do the same in life.
8. Word is Your Bond
In poker hundreds of thousands of dollars are passed around like $10 bills. Why? Because a poker traditionally has been an industry built on absolute trust among players. It’s a small community so if you welch on a bet or lie to a backer, word is going to get out and there will be consequences.
Poker players who have mislead fellow players are scorned on forums and sometimes blasted publicly at the tables for their misdeeds. Successful poker players understand that their word is their bond. In a community built on trust you won’t get far by lying. It's ironic considering the game is all about bluffing.
There are numerous niche fields where the same basic principal holds true. Simply don’t make promises you can’t keep. In the digital age it’s incredibly easy to destroy a business on Yelp or make sure that someone never gets a job through LinkedIn. Always be thinking about the long game.
9. Know When You're Pot-Committed
Sometimes safety is death. Sometimes you have ignore all that persistent doubt and simply put your entire stack in the middle. In poker that moment comes when you've committed so much of your stack to a hand that it makes no sense to fold.
Consider that even if you only have a 5% chance to win a hand it’s mathematically right to call if you’ve devoted 95% of your chips. One of the single worst plays in the game is calling a huge amount and then folding on the flop. It’s too passive and players will target you if you do it. This one is easy to practice in day-to-day life. Don’t commit 90% to something and then leave over a 10% issue. For better-or-worse, once you’ve committed like that, you are in.
10. Find a Small Edge, Then Multiply
When online poker was introduced to the poker world in 2000 it changed the way people could earn a living from the game. You could be a small winner at a live $1/$2 No-Limit Hold’em game but you’d have to have an insane win-rate/volume to really make good money because you’re only playing 10-25 hands an hour.
In online poker you didn’t have to be as good a player because you could be a marginal winner on many more tables. Once people figured out they could easily play four (and 10, and 24) tables at the same time profit increased exponentially.
Basically you no longer had to play the toughest games to make really good money because your 10% win-rate was multiplied by the number of tables you were playing. While most people think about quality in business, there’s something to be said for sheer quantity.
Bonus: Information is King
New poker players often underestimate how important it is to have position (act last in a hand). Having position in poker gives you the chance to see what everyone is going to do first before you have to make any decisions. It’s an amazing advantage that allows smart players to utilize weaker hands to outplay their opponents.
It’s a bit harder to apply this in all situations in real life but there are plenty of examples in the workplace - such as job interviews or salary negotiations - where tipping your hand first puts you at a disadvantage. You give the interviewer/boss information and they can use it to manipulate the situation to their advantage. Never underestimate letting the other party open up the discussion, listening to where their starting point seems to be and acting accordingly. Be wary of providing free information.