6 June 2019 – Poker Night for Startups, Entrepreneurs & other Like minded people

Decision making, chilling, like minded people!  See you there
Small group of people playing Texas Hold’em Rules.
R100 buy in
Bring your game face, and come play.

Cape Town City Centre

Some tips From: https://e27.co/startups-luck-and-poker/

“How players play their starting hand and approach the game in general can be broken into four main playing styles. To understand these four styles, we must first look at two play concepts:

• LOOSE versus TIGHT play – A loose player plays most hands whereas a tight player folds often while waiting for a strong hand to play.

• PASSIVE versus AGGRESSIVE play – A passive player tends to CHECK or CALL. An aggressive player likes to BET and RAISE.

We can cross these two pairs into four distinct playing styles: LOOSE PASSIVE, TIGHT PASSIVE, LOOSE AGGRESSIVE, and TIGHT AGGRESSIVE.  Let’s delve deeper into the first three:

1)    LOOSE PASSIVE – As the name describes, this type of player tends to play most hands and play those hands passively. Because they are not picky about the hands they play, most of the time their hands are weak and they win few POTS. When they do manage to win, the pots tend to be smaller due to the player’s passive play. This is by far the weakest poker playing style, and most beginner poker players fall into this category. Similarly, most entrepreneurs also run their startups in a “loose passive” style. They tend to spend too much time and money building to launch, don’t track metrics and do not know if things are really working or not, fall in love with their idea and are unwilling or extremely slow to pivot, and passively put in more time and money trying to SEE THE RIVER and hoping for the perfect card to bail them out. And like the loose passive poker players, even when these entrepreneurs exit, the exits tend to be small.

2)    TIGHT PASSIVE – Tight passive players tend to be very patient in their play, waiting for the strongest hands before committing to play. Their Achilles heel comes from playing their hand too passively once they’ve joined in on the action. By not aggressively betting and raising they are unable to knock out other players, decrease the odds of winning the hand, and fail to maximize the size of the pot when they do win. Tight passive entrepreneurs are those that happen upon a great idea and find traction, but then fail to raise money or raise too little, continue to bootstrap when they should be spending to increase growth, allow more aggressive competitors to overtake them, and often sell too early and let someone else capitalize on their idea (think Rotten Tomatoes and the sale to IGN Entertainment ; or Reddit’s sale to Conde Nast). Given that finding an idea with traction is essentially random luck, selling too early and not maximizing your outcome is a huge mistake; you could end up starting another 50 companies and never hit on an idea even a tenth as big. Imagine if Mark Zuckerberg sold Facebook to focus on Wirehog .

3)    LOOSE AGGRESSIVE – Loose aggressive players play lots of hands and bet and raise aggressively, often BLUFFING or overestimating the strength of their hand. These players tend to see the most swings in their chip stack as they will win big and lose big. If they manage to win a big hand early, they will use their big stack to BULLY other players, often with better hands, into folding. In the real world, the loose aggressive entrepreneurs tend to be veteran entrepreneurs or senior executives that manage to raise a lot of venture funding early and attempt to “go big or go home” on an untested idea in a big market. And just like the loose aggressive poker players, sometimes they win big (think LinkedIn  and sometimes they lose big (think Color.

The Optimal Style: Tight Aggressive
That brings us to the fourth and final playing style: the tight aggressive player. The tight aggressive player folds often and waits for a strong hand to play. When they do play, they aggressively bet and raise to knock out other players and increase the size of the pot. By folding quickly and often on bad hands, the tight aggressive player is able to preserve their chip stack to allow them to be aggressive when they finally land a strong hand. This is considered the best play style for the majority of players (although for extremely skilled and experienced players the loose aggressive style may be best).

This is also, in my opinion, the best strategy for entrepreneurs: wait for an idea that finds traction FIRST and THEN (and only then) go aggressive. If it’s a weak hand, fold immediately – as in, pivot or start something new. Bootstrap, launch with a minimum viable product (MVP), A/B test, and keep development times as short and costs as low as possible. The goal is to see as many hands as quickly and cheaply as you can in order to find a strong hand – as in, test as many ideas as you can until you find traction. At the same time, you need to preserve your cash so that you can spend aggressively once you have found traction; and have enough runway to raise additional funding without losing your leverage (if you overspend too early and have nothing in the bank when you try to raise more money, you will have no leverage when negotiating terms). This is why having tech founders is critical; they allow you to launch, test, and pivot quickly and cheaply. An all-sales-and-marketing founding team will inevitably have to hire or contract out the development of their product, leading to increased costs and development cycles. Steve Jobs would have had no computer to sell without Steve Wozniak.

For a consumer-facing tech startup, traction generally focuses around distribution (ie. traffic, downloads, installs, etc.) and engagement (ie. how often a user returns to your website, launches your app, and so on). When your idea reaches a high level of distribution and engagement and positive rates of growth in each, you know your hand is strong. Be prepared to move quickly and aggressively – drop everything that’s unrelated to the idea (see Twitter with Odeo , increase spending to speed up product development and growth, and raise venture capital.

One good recent example of a tight aggressive company is Rovio Entertainment, which subsisted on contract work and a seed investment from family for eight years and over 50 games before hitting on Angry Birds . Since then they have raised US$42 million, aggressively grown the Angry Birds franchise, and are now valued in the billions. Similarly, Mark Zuckerberg built and tested a number of apps and sites before Facebook , Max Levchin had four failed companies before PayPal, and the list goes on.