Poker Backers Should Be More Like Auction Hunters
Recently, I have begun to take part in local auctions. At these auctions, I have come across numerous interesting finds and have picked up various antiques and treasures that can either make me a few bucks or will be something I can hold onto to gain future value.
Part of my ability to find these items is based on knowledge of the products and then acting according to that knowledge.
After attending a few of these auctions, I started trying to make parallels between auctions and poker. However, the more I thought about it, the more I realized that many take part in regular business practices in poker in regards to backing and lending money that would be extremely costly to those trying to turn a profit through auction purchases.
Let's talk about backing players. While there are some that clearly get backing to help reduce variance of big events like the World Series of Poker, there are many more that have to be backed in most of the events they play.
These players almost never have all of themselves and even if they hit a big score, it isn't long before they are borrowing money again. Why is this?
Well, it depends on the player. Many have leaks in their bankrolls like sports betting, playing in cash games at levels they should not, blow their money on fancy toys, etc.
Others are glorified flashes in a pan. They hit a big score and do next to nothing for a long period of time before hitting big again. That is assuming they hit again.
This is the equivalent of someone going into an auction and buying things without having sufficient knowledge on their value or how to resell them. Recently, I saw bidders go crazy trying to get lots of 1988 Topps baseball cards. Cards from that year are next to worthless by and large.
Anyone that would know this would avoid bidding. Those that did bid didn't know what they were doing, overpaid, and now have a bunch of cardboard they will probably have to give away or sucker some other schmuck into buying.
The sad thing about poker players is that many times we know that players that are getting backed have these issues, and yet we go ahead and back them anyway. As Phil Galfond said in a recent blog, part of it may lie on the fact that we don't want to be jerks. Some people like to gamble and hope the person will hit bit. They may also be trying to do the person a favor.
If someone knows that an item will be hard to turn over or has little long term value, then the chances of a knowledgeable person bidding on it is slim. It is bad business otherwise. However, in poker we tend to look at the problems with a person and ignore that hoping to hit big.
After a while, a backer usually figures out that he will never recoup his money and will cut ties. Yes, there are times they get luck and their horse hits big. However, with a few exceptions, backers have a majority of duds in their stable.
I am not saying that you should never back players. However, what I am advocating is doing your research on your prospective horse and find out more than whether they have made a huge score or two.
While you will not be able to weed out all the questionable horses, it will give you a more informed decision so that your money will work smarter.
To put it in terms of an auction, take advantage of the inspection period and if there is something you are not sure about, err on the side of passing.