Few card games require a greater awareness of shifting probabilities than poker.
Jonathan Little discovered on-line poker in 2006 and got pretty good at it: so far, on-line and at actual tables, he's won more than $6 million playing mostly Texas Hold Em. These days -- while continuing to play and to win -- he coaches others about how to play the way he does at jonathanlittlepoker.com.
I wanted to find out more about how he does it and he was gracious enough to answer a few questions. Here's how it went:
John Navin: I read that when you were in college studying psychology, you began playing online poker -- in 2006? -- and discovered that you could make money at it. So, you quit school and became a poker pro. Is that what happened?
Jonathan Little: That is the short version of the story. The long version is that I played many games throughout my childhood. As a teenager, I played a lot of Magic: the Gathering and one day, someone asked if we were interested in playing a $1 buy-in poker tournament. We all agreed and, of course, I lost.
After a few months of consistent losing, it became clear that I was not good at poker, so I bought a book and started studying. Within a few months, I read every book on the market and was by far the best player in the $1 buy-in games.
From there, I deposited $50 into an online site and played in all my spare time. After a year or so of grinding, I was winning roughly $100 per hour, which in my mind justified quitting my two minimum wage jobs and eventually giving up my academic scholarship to college.
Navin: What was it like to realize you had the skills to win steadily and it wasn't just luck?
Little: As a young boy, my dad taught me chess, which is clearly a skill game, and I was also quite good at Magic: the Gathering, which has elements of luck, but is also skill-intensive. I assumed poker was like Magic, which happens to be true.
While anyone can win any individual tournament, in the long run, the best players win far more often than the bad players.
Navin: The online game has changed since you began back then. In what ways is it different now?
Little: When I started playing back in 2003, there were relatively few analytical tools to help you figure out the optimal plays in various situations. Now there are robust solvers that can definitively tell you the optimal play in essentially all situations.
The best players today study the game extensively and understand roughly how to play in essentially all situations, making them close to impossible to beat.
Navin: Do you prefer to play live and in person at a card room or to play online? What's the difference?
Little: I like both venues. In general, I like mixing up my activities. I currently have my life situated so I am home for a few weeks at a time working on my various educational projects and then I travel to play poker for a week or so, where I play roughly 12 hours each day.
Mixing up my activities keeps them fresh, allowing me to enjoy all aspects of my life. The main differences between live and online poker are that online, you cannot physically see your opponents and the game moves much faster.
This results in you having to play a much more fundamentally sound strategy compared to live poker.
Navin: When you play live, do you prefer a location like Las Vegas where plenty of tables are available? Or somewhere else, for what reasons?
Little: I am quite easy-going in terms of where I play, as long as it is decently nice. I love playing in Las Vegas. Like golf, there is a tournament circuit that all the top pros follow. The best games are usually wherever the large tournaments are taking place.
Navin: You win at poker for a living. It's a business. If a venture capital firm approached you about investing in your work and eventually taking it public, what would be your thoughts?
Little: There is a thriving poker backing industry where people/groups put up the buy-ins and players play in exchange for a percentage of their profits. I have been both a backer and backee at various points throughout my career.
I would not be interested in giving up a sizable chunk of my normal games, but if a venture firm wanted to buy me into $25,000 buy-in events and higher, where the edges are low and the variance is high, I would be happy to consider it.
Navin: Now that you've made all of this money and now that you have your own family, what have been doing, investment-wise, with your winnings? I'm guessing a house and an IRA, but with your analytical skills, have you thought about picking stocks?
Little: The majority of my money is invested in rental properties and ETFs. I have coached many people in the finance industry and essentially all of them have told me to put my money in ETFs and forget it, unless I want to devote my life to the trade.
Navin: You were studying psychology when you discovered poker -- what's the relationship between psychology and poker?
Little: The information I learned about psychology in college did not pertain to poker at all. The psychology in poker essentially involves figuring out how your opponents perceive the current situation and how to take advantage of it. It also deals with how to play your best as often as possible.
Navin: Can you describe your parent's reaction when you told them you'd decided on Texas Hold Em rather than getting a degree?
Little: Fortunately, I had a large set of data essentially proving that I was a winning poker player when I decided to drop out of college. By that point, I was consistently winning $20,000 each month, which was far more than I would have made from completing my degree and getting a job. Presented with definitive results and a solid plan for my future, quitting college was the only reasonable decision.
Navin: You managed to find a way to profit from the skillful approach to a complicated, difficult game -- what advice, if any, would you give to other game-oriented players, such as investment managers?
Little: I suggest everyone figure out what their advantage is in their profession. If you do not have one, work hard to find one. In general, all games (like poker and finance) get more difficult as time progresses.
If you are not working harder and smarter than your opponents, you are certain to be passed by. So, find something you are passionate about and work harder and smarter than everyone else.
Navin: Jonathan, thanks.
