The $100K Club
If you're a wealthy businessman, secure enough to acknowledge where you stand among the world's top professional poker players, what do you say to Phil Ivey before squaring off against him for some $1.1 million in first-place tournament prize money? Maybe: Prepare to get crushed, sucker! Maybe not. When New York-based commodities trader Dan Shak confronted Ivey at the $100,000 Challenge during the Aussie Million poker tournament, in Melbourne, Australia, he looked at the icon and admitted, "We're going heads-up and I am fine with you being first and me being second." Surely, Ivey was okay with that as well. But things failed to go as expected. After catching bottom pair with a lucky flop, 55-year-old Shak emerged victorious, received a handshake and a hug from tight-smiling Ivey, and provided inspiration for a coterie of wealthy businessmen, all with seven-figure poker dreams, to join the 100K Club.
That upset took place in 2010. Back then, the so-called high-roller tournaments, with buy-ins of $25,000 and up, were relatively rare. These days, helped perhaps by a booming stock market and buzzing economy for the 1 percent, high-roller tournaments have grown into, more or less, monthly events. "The businessman is there to say he played against the best in the world," believes Adam Pliska, president of World Poker Tour, which puts on the $100,000 buy-inAlpha8 series of tournaments. "It's the equivalent of playing golf against Tiger Woods. Plus these tournaments only go for a couple of days, which is good for guys who can't spend a week away from the office."
Hence, it's become increasingly common to see successful Wall Streeters, entrepreneurs and corporate executives risking massive buy-ins to take on the greatest poker professionals in existence. "I like the challenge of trying to win a tournament when I'm going up against really good players," says Shak, who typically tracks the market on his iPad while negotiating his way through high-stakes matches. Fresh from a series of events in Prague, played as a practice run for an upcoming $100,000 buy-in tournament in the Bahamas, he adds, "I play for the challenge of competing against professionals at their own level. It feels really good to be able to play part-time, go against these pros and hold my own."
Similar impulses bring Brandon Steven, 41, to Las Vegas on a recent Monday morning. Well built, dark haired, fresh from a workout, he toggles through a series of e-mails and texts while firming up his poker schedule. Steven spent the previous day playing in a $25,000 buy-in tournament at Aria, followed it up with a long night of high-stakes cash play where his buy-ins totaled $300,000 (he managed to emerge a winner), will buy into a $10,000 tournament later today and, if he busts out, ultimately take a shot at a $100,000 buy-in tournament. If this sounds like a dizzying amount of Texas Hold'em, that suits Steven just fine. He came out from his home in Wichita, Kansas—and left behind his family and eight car dealerships—for a week or so of high-stakes card playing.
"Winning a tournament is the impossible thing, and I like that," explains Steven while sitting at the dining table of a two-bedroom suite in the Bellagio. "Just one player goes home happy. So far, my biggest cash has been for $600,000 or $700,000 [it's actually for $635,011], but I don't count cashes or final tables. I am there to win the tournament. I'm not going to get to heads-up with somebody and chop." (Split the first- and second-place money, in order to make for a more equitable financial outcome.) Though he has a good share of final tables and bubbles under his belt, Steven is strict with himself about what constitutes victory: "Since I have yet to win a big tournament, I do not consider myself successful."
Over the last seven years, Steven has become a regular presence at the World Series of Poker's priciest tables. He likes to rent a house in suburban Henderson, just outside of Vegas, and bring his family down for the duration of the tournament. Steven has accrued nearly $2 million in winnings and ranks among the top nonprofessional high-stakes tournament players. His style is aggressive and he goes for the gold every time. "Pros care about the money, but I care about the trophy," emphasizes Steven. "That's good for me."
For all of that, though, Steven stumbled upon Texas Hold'em in a fairly random manner: at a family graduation party. It was eight or nine years ago and the kids were dealing low-stakes Hold'em in an upstairs bedroom. Partial to high-stakes blackjack at the time, Steven joined in and wound up playing all night. Not long after, he won a Rolex at a charity tournament in Kansas and found himself hooked. Playing in casino card rooms near his house, Steven proved to have a knack. Poker usurped blackjack as his game of choice. He honed his people-reading skills by occasionally playing without looking at his cards, making moves based on tells he could get from his opponents. The approach rarely resulted in winning sessions, but it did teach him to read physical ticks and betting patterns.
Though Steven views himself as more than competent at the highest stakes, he acknowledges being one of the guys who make elite tournaments juicy for the pros. Recalling the $25,000 buy-in event he had just played—and busted out of unceremoniously—Steven says, "Initially, there were half pros and half amateurs registered. Then the texts went out [from one pro to the next, alerting them that the field was soft] and the pros piled in. When there are that many amateurs, their edge increases dramatically."
But Steven doesn't seem to mind. He laughs at poker players who think they are subtly dissing him (it ain't so subtle to say "nice bet" when it isn't) and has become comfortable buying in for sums that tip up to $1 million. The high stakes keep Steven focused and, he says, he learns something new about the game every time. Plus, all too often, he gets tantalizingly close to the big, but elusive, win. "I'm a competitive guy," he says. "And this is my way of competing. Once you turn 40, how else can you do it?"
Bill Perkins, the 46-year-old founder of Houston-based Skylar Capital Management, who made his fortune trading energy, jumped in with both feet when he decided to get involved in gambling with high-stakes poker pros. While in the Bahamas to play his first $100,000 buy-in poker tournament, he began mixing it up with Antonio Esfandiari. Esfandiari is known for having a soft touch with wealthy amateurs. Not surprisingly, then, he and Perkins got deep. "I wasn't afraid of gambling with Antonio," says Perkins who lives in St. Thomas. "We were betting on everything. We began double-booking blackjack and then we played some backgammon." As the story goes, Perkins suffered a steep loss. In discussing the outcome, Perkins acknowledges, "Backgammon is a very volatile game. Small mistakes with the cube can multiply very quickly."
If action was what Perkins sought a couple of years ago, when he transitioned from casual, low-stakes games to buy-ins of $100,000 or more, he definitely found it. "When I started," he says, "I looked at poker as a version of craps. If I had 6, 4 and somebody had Ace, 2, I would gamble. I wanted to ship in my money and hope to get lucky. I'd look at my cards, not be really sure of what to do, and...All in!" Then he would see the cards of his opponent, maybe a kid half his age who snap-called the bet, and say, "Oh, you have me covered? Well, I am only a 30 percent underdog."
The upside of that aggression is that he could afford to lose the money a lot more than a young poker pro could. Plus there is a certain amount of fold equity—the likelihood that the person he's betting into will fold and Perkins will not need to win the hand. "But that only works for a little while," he says, speaking with a voice of experience. "At some point, you get labeled as the guy who shoves it in all the time. The pros are good at sniffing that out. Eventually I got a little more studious and serious and goal oriented. Then I realized that I don't need to get lucky all the time." He also began to have decent results, such as a third place finish in the $111,111 One Drop High Roller event of 2013 for a take-home of nearly $2 million. "Finishing third felt bitter sweet," Perkins adds. "I could have played a lot stronger, but sitting up there with two seasoned pros and walking away with $2 million felt pretty good. And it put me in the top 100 for tournament winnings."
Though he did not ace the One Drop, his finish stands as a serious accomplishment, for reasons that go beyond the payout. "I changed my style of play three times in the tournament," Perkins says with no small amount of pride. "I don't know if the pros see that and think of me as a business guy who did well and that my winning some money is good for poker because it encourages other business guys to play. Or if they recognize me as a guy who can go deep. I've gotten better at reading fields of players, I have a conscious awareness of things at the poker table, and I'm improving on the meta game—like how to play the bubble. I've gotten some of that from conversations with Jeff Gross [a young, winning pro] and Antonio. He says that I don't listen to 40 percent of what he tells me. That is true. Sometimes it's just too much fun to do the wrong things. In fact, the biggest flaw among businessmen is that too many of us look at the game as fun. The ones who play and view it strictly as a way to make money are the ones who do the best."
Of course, though, most businessmen who want to play these tournaments strictly for money probably lack the wherewithal to buy in. Almost to a man, the wealthy guys who participate in high-roller events are doing so for reasons that go beyond P&L. They like the challenge, the camaraderie, the opportunity to blow off steam and compete at poker's highest level.
For Perkins, though, it goes a bit further. These tournaments have come to impact the way he looks at his day job. Though trading energymay seem like a risky, cowboy-style profession, in reality, he says, 99 percent of the time he trades with an edge. He understands what he's doing there a lot more than he does at the poker table. In light of that, goes his reasoning, maybe he is too timid at work. "Money is money," says Perkins. "If you are willing to ship it when you have an edge in an area where you are not an expert, shouldn't you be willing to do the same thing in a field where you are an expert? If you have a certain risk tolerance, you should press a little more when you have the best of it away from the poker table. By playing in these tournaments, I have become more reflective about risk tolerances."
He's also availed himself to certain business opportunities that might not have come his way otherwise. When Bloomberg TV decided to air an invitational charity tournament that took place at the Borgata in Atlantic City, hedge-fund kingpin David Einhorn suggested that Perkins be recruited to play. "I knocked him out of the tournament!" Perkins enthuses. "Poker afforded me the privilege to play with him." In another instance, he says, his presence at the table yielded a massive profit just by putting him within proximity of the right person. Recalls Perkins, "I was playing with Dan Bilzerian. Dan's dad gave me a pep talk and advice that saved a business deal for me. It was a crunch deal on New Year's Eve and if not for poker it would never have happened. He gave me something better than money." Dan is the son of Paul Bilzerian, a top corporate raider in the 1980s, sought for years by the SEC, and currently living in the Caribbean.
Perkins acknowledges that between cash games and tournaments he is an overall loser. However, if he factors in situations like the one that involved Bilzerian, his poker adventures are well into the black.
"The goal is to make it a net zero or cash positive hobby." Perkins says. "I can't see quitting my day job anytime soon."
Even without the help of Bilzerian, there's a good chance that high-stakes poker will eventually become profitable for Perkins and others of his well-heeled, success-driven ilk. Daniel Negreanu, poker's winningest tournament player (with nearly $30 million worth of earnings), figures that the game's highest-rolling amateurs should not be viewed as dead money. "They're smart for having gotten where they are in life and are not as bad as you would think," he says. "I don't have anything left to prove in poker and I don't work as hard at it as I used to. Part of what makes you good is being hungry and feeling a need to win.
"For the business guys, poker is new. Plus by playing in the high-stakes tournaments, they put themselves on a fast track. They're learning from the absolute best by sitting down and playing against them."
This past December, when Kathy Lehne, 52 years old and among the newest members of the 100K Club, made it to heads-up against poker pro Jason Mercier at the Alpha8 tournament in St. Kitts, Perkins gave her good advice. "I told Kathy not to play a million hands against Jason," says Perkins, who first met Lehne at a home poker game. "I told her to be aggressive, to get fold equity, and that, unless worse comes to worst, with him having an over pair against her, she'll still have a chance of taking down the pot. Playing against a skilled pro, you want to put on maximum pressure and get aggressive rather than playing a bunch of hands. The law of averages will eat you up."
Lehne took the advice, but still wound up finishing second. While she doesn't seem too upset with her consolation prize of $436,500, some regrets linger. "I might have played too aggressively," admits Lehne, founder and president of the Dallas-based gas and petroleum company Sun Coast Resources. "Jason bet the river, I shoved, and he called me with a pair of pocket aces. I felt disappointed with myself. I could have found a better spot. I didn't even have to call his bet. But right now I'm just getting out there and enjoying myself. While I don't want to say it's therapy, I do like sitting at the table and having my mind off of work and the kids at home and everything else other than poker. The risk and the challenge both appeal to me." So much so that she's playing more: a few weeks after placing in St. Kitts, Lehne flew to Las Vegas and bought in for another $100,000 event.
Like most of the other business people who find themselves drawn to the high-stakes tourneys, Lehne is in no rush to brag about her $100,000 gambits. But when you get close to winning one of these things, a little bit of publicity is inevitable. "Most people hear about a $100,000 buy-in and they think it's kind of crazy," she admits. "But when my picture got up on the Internet, I did hear from some poker-playing friends. They thought it was great. They were probably thinking, ‘If she can get that close to winning one of these tournaments, so can I.' "
And therein lies the allure for high-rolling amateurs who can more than afford their $100,000 entry fees. No doubt, it will be further burnished by the appearance of software mogul Roger Sippl riding high as chip leader at the final table of Poker Stars Caribbean Adventure Super High Roller this past January. Not only do past performances show that business guys have a shot at winning, placing or showing for pocket-bulging paydays, but photos and TV appearances advertise the caliber of players they get to go up against. What poker-loving high-flying executive wouldn't want to test himself against the likes of Antonio Esfandiari or Andrew Robl? Pull off one crazy bluff, and it's bragging rights for life.
Michael Kaplan is a Cigar Aficionado contributing editor.
