Mirage Resorts CEO and former World Series of Poker champ Bobby Baldwin goes all in on, and off, the felt
From the Print Edition:
Camilo Villegas, July/August 2006
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Then Mirage Resorts president and chief executive officer Bobby Baldwin wants to have fun, he gets behind the wheel of a $600,000, 5,800-pound truck that has been outfitted with 39-inch-tall tires, rests on a custom-built super-reinforced frame, and boasts a 760-horsepower engine, and heads off to the most grueling desert roads on earth. Once there, he drives as fast as he possibly can without flipping the truck or ramming into another driver who's manning an equally souped-up vehicle and trying to reach the finish line first. Baldwin calls this big-budget, big-balls, strategically intensive type of truck racing "poker on wheels."
But it's not the only form of poker the 56-year-old father of two enjoys, nor is the desert wilderness his natural habitat. At the moment, far from the rutted and rocky trails, out of the flame-retardant one-piece outfit that he wears for racing, Baldwin looks impeccable in a midnight-colored suit that's been custom made by his New York City tailor, William Fioravanti. Curly-haired, tight-lipped and lanky, he sits behind a big, shiny, wooden desk in his sleekly furnished office at the Bellagio in Las Vegas. Asked about the knock-around nature of truck racing, Baldwin shrugs it off as one more calculated risk in a life that's been full of high-wire gambles: from betting paper-route money on billiards (and beating grown men at the game) to blowing his first big score ($180,000) on three months of gambling and stock-market speculating to going head-to-head with casino magnate Steve Wynn in 2005. "I'm no longer a professional card player," states Baldwin, who won the 1978 World Series of Poker championship. "But I still view the whole world as a big poker game."
Playing poker in one form or another—whether it's of the business variety, the racing variety or even the card variety—resides at the core of Baldwin's success. How successful? He's been amply rewarded for his achievements: back in 1999, he received $11.2 million in salary and stock options.
Especially revelatory about Baldwin's work ethic and cognitive abilities is that in an industry that has become increasingly dominated by computer scientists, bean counters and Ivy League MBAs, Bobby Baldwin, one of the most influential executives in the business, is a University of Oklahoma dropout.
That college dropout is currently involved in the highest stakes proposition of his almost 20-year career: the development of CityCenter, a sprawling complex of hotels, condominiums, casinos, high-end retailers and nightclubs. It is situated between the Monte Carlo and Bellagio casinos, spreads across 66 acres (making it as large as SoHo, Rockefeller Center and Times Square combined), has a budget of $7 billion and ranks as America's largest privately financed development.
Deutsche Bank gaming analyst Andrew Zarnett has said that the complex will redefine MGM Mirage—Mirage Resorts' parent company—as well as the Strip. Star architects such as Rafael Vinoly and Cesar Pelli are designing the high-rise buildings (Pelli told The New York Times that CityCenter provides a rare opportunity to work from "a clean slate" rather than needing to be influenced by existing buildings around his project). And Baldwin himself anticipates that CityCenter will further secure Vegas's status as the apotheosis of a resort and gambling destination. "CityCenter raises the bar for everybody," he says. "This is Las Vegas's next level of evolution. You're either growing or you're dying, so you need to keep pushing forward." Ask Baldwin about his business acumen and the degree to which poker has influenced it and he provides an all-in answer, beginning with the fact that poker has trained him to think in three dimensions instead of two. "Poker's a game where you have virtually no information, yet you need to make life-and-death decisions all the time. You need to fill in all the blanks with assumptions and piece together why an opponent would check on the flop or raise on the turn. The game teaches you to face adversity, it makes you leather-tough, and it helps you learn to determine who's lying and who's telling the truth." He hesitates for a beat and rhetorically asks, "You think that's important in business?"
Baldwin goes on to explain that his poker game is rooted in a rock-solid foundation that would not be apparent to the casual observer ("There are specific hands that I won't play out of position against certain players, not ever") and his moves at the table have everything to do with the composition of the game ("Successful players play every opponent differently. They play Gus Hansen [who's wildly aggressive] different than they would play Johnny Chan [who's aggressive but more measured]").
Similarly, when Baldwin has to deal with a table full of executives in an MGM Mirage boardroom, he plays the man as well as the situation. "If you need broad-based support to launch a project, you go into the meeting knowing that everyone won't receive information the same way," he says. "People have different backgrounds, different areas of expertise, some are in good moods, some aren't. It isn't one-size-fits-all. You need a different program for each person"—and that's exactly the kind of approach that top players bring to the high-stakes table. "If I played a poker game with a hood over my head, and all I saw was the cards and the pot, how successful would I be?"
Moreover, just as Baldwin does a ton of research before he plays an unknown opponent—finding out the guy's background, his skills as a player, his level of expertise, his finances—he applies the same approach to anybody with whom he negotiates on behalf of his employer. Moments before our interview began, Baldwin was on the telephone, making some calls regarding glass windows he needs to purchase for one of the casinos at the planned CityCenter complex. It's a major expenditure and he approaches it in a way that is anything but casual, thus turning what seems like a mundane transaction into a give-and-take adventure that has the drama and subterfuge of a World Series of Poker final-table showdown. "You don't influence a guy's behavior by just saying, 'Oh, you want $40 million for the glass? How 'bout if I give you 37?' That's not how you do it."
The way Baldwin does it is the way he plays poker. "Before I do anything," he explains, "I need to know what the game is. At the beginning, I know that there are three American companies and two Chinese [which all produce the product he needs]. For a variety of reasons, it would be better to use a U.S. company, but all of their prices are too high. If I need to go to China, even as a bluff, to create the right competitive environment and get the attention of an American company, I might do that. After all, if there's no threat present, how can I influence the other guy's behavior? So now he knows I went to China. And I know the cost of his bulk glass, his process glass and his tinted glass; I know about his subcontractor, how much work he's got in the pipeline, and whether or not he'll have unfulfilled capacity if he doesn't get this project. Like playing poker, my job here is about free enterprise, developing information, deciding what's real or what isn't, and learning where the truth lies."
Considering the place that poker holds in Baldwin's heart—right now he's enthusiastic about the game's recent growth, but finds the rampant showboating to be undignified and still can't wrap his head around the idea of people playing for free on the Internet: "That is like working for free," sniffs Baldwin—it is no surprise that the game has always played a big part in the properties he's developed. At the Mirage, for example, Baldwin consciously gave the card room high-profile placement, right in the center of the casino, just steps away from the main cage. One reason for this was because he wanted the Mirage to feel alive and animated at all hours, and the poker room, with its round-the-clock action, accomplished that. More subtly, it made a statement about the importance of poker to the casino: Baldwin intended for the Mirage to be Las Vegas's poker Mecca. Back in 1987, however, when Vegas casinos were typically closing their card rooms, this seemed like a strange aspiration. Nevertheless, Baldwin saw a value there that others didn't. "Poker rooms are important to the overall mix of your business," he says. "But they don't run themselves, not like blackjack. You have to know what you're doing, you have to keep the cheating out, you can't let people fight. Operated properly, though, they support everything else. They support the sports and race book. Guys play in the middle of the night when the rest of the casino is dead. It makes a lot of business sense."
It's also a point of pride for Baldwin to have the best and busiest room in town. "I remember [when the Mirage first opened] the people at Caesars had the largest poker room; my intent was to put them out of business," says Baldwin, outlining one of his early ambitions for the Mirage. "I was going to hire the right people, get all the players, and give the players a better deal in terms of room rate and food. Caesars had a big poker business, with 30 tables. But I was getting ready to open a 30-table room of my own and there wasn't [enough business] for both of us. Caesars closed its poker room 12 weeks after I opened mine."
Last year, when former boss Steve Wynn launched his eponymous casino/resort down the Strip, there was a looming threat to the Bellagio's poker-room superiority. Baldwin preempted it with the building of Bobby's Room—a luxe, semiprivate lair, within the poker room, that provides a high-stakes hideaway for the famous Big Game and its star-studded lineup of players—along with the expansion of the general poker room at the cost of a number of gaming tables and slot machines. "I always put poker at the top of the list," Baldwin says, emphatically. "Some guys around town say that you only make one million or two million or whatever from poker. They think it's not worth it and put in more slot machines. Let's just say that I have a different point of view."
Bobby Baldwin began his professional poker career in 1974 and soon found himself earning a couple hundred thousand dollars a year by barnstorming through the card rooms of Texas, Louisiana and Las Vegas; he eventually moved to Vegas, in 1982. He was so good at the game that he wrote the Limit Hold'em chapter in Doyle Brunson's legendary poker bible Super/System and attracted the attention of Steve Wynn, who tried persuading him to come work for him at the Golden Nugget (then the burgeoning mogul's only operation). But Baldwin, who had been playing in the highest stakes game at the Nugget, had no desire to be a full-time suit, and he adamantly turned down Wynn's frequent entreaties. More critically, Baldwin figured that the job would not be sufficiently remunerative. "I met Steve at the poker table and told him that I make more money playing cards with him than I could make as his employee."
Nevertheless, by 1982, Baldwin sensed himself tiring of the itinerant lifestyle and came to desire some of the stability that the job with Wynn would provide. Plus, it promised to offer him plenty of flexibility: he'd start out as a marketing executive while being able to play tournaments when he wanted and ring games on the weekends. Baldwin accepted the job and quickly discovered that he had moved from the small game of high-stakes cards to the much bigger game of high-stakes business. Slowly the poker phased itself out and casino development took over.
Working without a contract (which he continues to do), Baldwin seemed like a sure-thing to his new boss. "He was very self-contained, appeared to have a good deal of discipline, and possessed few vices considering his fraternity," remembers Wynn. "He clearly had a superior IQ and was familiar with the environment. Bobby took the job and immediately got drawn in."
Juiced by the challenge of working for Wynn, Baldwin quickly rose through the ranks, going from poker marketing to casino marketing to being named head of the Golden Nugget and playing a major role in developing the Mirage (upon opening, in 1989, it was the most lavish casino that Vegas had ever seen and proved wrong the naysayers who were blind to the upside of selling gourmet meals and exotic back rubs to gamblers). A decade later, Baldwin was integral in the creation of Wynn's Bellagio, which, like the Mirage before it, served as the template for every one of Vegas's major casinos that have followed.
Baldwin felt so attached to the project that when Wynn's Mirage Resorts was taken over by mogul Kirk Kerkorian's MGM Grand, in 2000, just 17 months after the Bellagio opened its doors, Baldwin chose not to go with Wynn to develop a new place. "I wanted to get the Bellagio sophisticated and successful," says Baldwin. "And maybe I wanted to test our business prowess against [what would be] Steve's new development down the street."
Good thing for Terry Lanni, who had stepped down as chairman of MGM Grand right before the takeover. "I said I would come back to work if Bobby was coming back," recounts Lanni, now the chairman and CEO of MGM Mirage. "I called Bobby, caught him on the golf course, and it took about a nanosecond for him to say he would do it. Bobby's got an acute mind; he's very quick, very thorough and an excellent negotiator—not the kind of person I'd want to go up against."
Though poker clearly remains a passion for Baldwin—he always buys into the World Series championship event and plays in the Big Game when the action is sufficiently juicy (i.e. at least one weak player is present)—he brings a lot more to MGM Mirage than just gambling smarts. Spend a few hours in his company and it becomes clear that he is as conversant with fabric design and the implementation of retail stores as he is with issues related to the green felt. "Bobby can't stand to know less than anyone else in the room," says Wynn. "And he has a work ethic that is tremendous. I remember Bobby taking work home every night. He loves to compete and strategize. He does not get intimidated, and his pick-up on information is very fast."
Those quick-study capabilities will surely come into play during the development of CityCenter, which is due to open in 2009. To provide a taste of what it will be like, Baldwin leads me to his tricked-out Ford F-150 Super Crew pickup truck and drives to an auxiliary office that serves as headquarters for the project.
Inside a cavernous, loft-like showroom, Baldwin stands before a tabletop model of CityCenter, complete with chic post-modern hotels, condos and a shopping mall. The scaled-down buildings are swirly and deconstructed and they look like nothing that habitués of the Strip have ever seen in Vegas. To my eye, it's a just-add-water, big-budget supercity like the Pudong district in Shanghai, looking funky and provocative and modernizing your notion of a skyline. To Baldwin's way of thinking, CityCenter is a magnet that will not only attract well-heeled gamblers but corral them away from the rest of Vegas. "The nature of the design is that you can come here and not leave," he says, emphasizing that strategic landscaping and public art will soften the glass and steel buildings and make the neighborhood more attractive. "Whatever you want is here"—restaurants, casinos, high-end shopping, wide pedestrian-friendly streets that have been modeled after Manhattan's Park Avenue—"and if you want a little more, we will have a tram that can take you right to the Bellagio or Monte Carlo."
Nevertheless, while the project seems undeniably impressive, some may wonder about the venture's timing. Several high-profile condo projects have recently been derailed in Vegas and chatter about a national real estate bubble is pervasive. "There are always going to be real estate bubbles everywhere," says Baldwin, sounding dismissive and undaunted. "They come and go. But the people with sound locations and sound projects that are properly financed and managed will always be successful." Then he ticks off several new condo developments that are selling—including ones built with the backing of Donald Trump and Peter Morton—points out that "those are all B locations at best," and adds, "It looks like we will have the only residential location on the Las Vegas Strip."
Baldwin's lips curl up as he describes the 88,000 truckloads of dirt that need to be moved to allow for foundations to be poured. He notes that there will be more than 1,000 condo/hotel units just in the curvilinear tower that Rafael Vinoly is designing, and he emphasizes the lighting and views that will help define CityCenter. As a guy who likes machines, he seems tickled by the notion of filling his property with construction equipment and the buzz of progress. "We'll have 52 cranes on this site," he says. "Dubai is the only place in the world that has more cranes working than CityCenter will."
Then the Mirage Resorts boss gets a competitive glimmer in his eye, a physical expression that high-stakes poker players with weak cards and little heart ought to fear. It looks as if Bobby Baldwin just might be considering the possibility of raising the United Arab Emirates with a few more cranes, as he continues upping the stakes in casino gambling's biggest game.
Michael Kaplan is a Cigar Aficionado contributing editor.
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