Poker Rules Every Entrepreneur Needs to Know
April 12, 2013
Poker players use many unofficial rules of conduct to give them an edge in the game. These same principles can be applied in your small business, giving you an advantage over your competition.
Entrepreneurship and poker. The two seemingly have little to do with one another; owning a small business is work, while a game of poker is play. But the two have a host of similarities, and savvy small business owners can apply poker’s rules to gain an edge over their competition.
Choose the right environment
The most crucial decision you make in poker is where you’ll play. Will it be at the table or in a tournament? In Vegas or a friend’s garage? Players have to choose games they thoroughly understand, and tables where they won’t be outmatched or out-funded. And they can never be afraid to switch tables if they discover it’s too hard to win in their current location. As Tony Hsieh, CEO of Zappos.com said in a 2008 blog post, “If there are too many competitors (some irrational or inexperienced), even if you’re the best it’s a lot harder to win.”
The same rules hold true for your business. Choose an industry and market space you thoroughly understand, one where you won’t be behind the competition in experience, financial resources, or the ability to gain market share. Starting a consulting business is imminently do-able: You’ve got years of experience, entry costs are low, and growing a client base is challenging but possible. Trying to launch the next Zappos.com would be foolish because you probably don’t have a decade of e-commerce experience or millions of dollars for online infrastructure and inventory.
Maintain your image
In poker the most common way to create your image is through bluffing. An essential tool in a poker player’s toolbox, bluffing is all about acting confident even if you’re not. It sends your opponents the message that you have a strong hand and can earn you the winner’s place even if you don’t.
In business you create your image through branding, which isn’t deceptive like but shapes others’ impressions of you just as strongly. Let’s say you’re starting a graphic design studio and won’t have an office right away but know that many potential clients expect their design partner to have offices. A physical mailing address at a UPS store will give you the address you need, while your website can send the message that you’re an experienced, polished, and professional firm. Once potential clients meet with you they’ll learn that you’re a good fit for their needs, and the address issue will become moot.
There are over a dozen ways you can apply the rules of poker to your fledgling or established small business, and we’ll be bringing many more to you over the coming weeks. Come back soon, poker fans!