Why Venture Capitalists Should Invest Like Poker Players | INSEAD Knowledge

Talk about card games, and the first name that comes to mind is poker. Ever since it caught on in the United States in the early 20th century, this card game has gone from being just a recreational activity to becoming a key element of some classic movies and eventually spawning a multi-million dollar competitive card game industry. It may look like a fun way to kill some time with friends, but playing slot game online it at a professional level requires a good understanding of probability, psychology, strategizing, and even some game theory. Of course, players need lady luck on their side too. 

A brief history 

The history of this game can be traced back to the 10th century in China, and some form of it was also played in 16th century Persia. Historical mentions of an early version played in the 17th century France called ‘Poque,’ and a German variant called ‘Pochen’ can also be found. The card game truly caught on when it landed in the US somewhere around the early 1800s. Soon after, the modern 52-card deck system was born, and by the early 21st century, Poker truly became the worldwide card game phenomenon it is today.

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The fundamentals

A standard pack consists of 52-cards with a fixed hierarchy. There are many variations of the game, such as Omaha and 7-Card Stud, but Texas Hold’em is by far the most popular, and it is the one played in world series tournaments. In Texas Hold’em, the goal is to make the best five-card combination called ‘hand’ out of the seven players are dealt with. 

Winning strategies

 

The first two cards you get in Poker are ‘hole cards,’ while the remaining five are community cards. Players can use a combination of these cards to make the best hand of five cards. Once all the cards have been dealt and the bets are closed, players show their cards to create a flush of five cards that can be of many types and has a fixed hierarchy to declare a winner. Listed below are the highest-ranking combinations in order: 

 

  • Royal Flush: The top-five highest-ranking cards of the same type, i.e., A, K, Q, J, and 10.
  • Straight Flush: Five cards of the same type in sequential order.
  • Four of a Kind: Four cards of the same type, irrespective of what the fifth is.
  • Full house: Three cards with the same number and two cards of another identical number.
  • Flush: Five cards of the same type, but not necessarily in sequence. 
  • Straight: Five cards in sequence, but not of the same type. 
  • Three of a kind: Three cards of the same rank, irrespective of the remaining two. 

The World Series of Poker (WSOP), held annually in Las Vegas, is the biggest professional poker tournament globally in terms of the prize pool. Some of the biggest names globally in the game are Bryn Kenney, Justin Bonomo, Daniel Negreanu, and 27-year old Fedor Holz, who has raked in over $32 million throughout his career. 

 

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