A VC - Latest Comments in Sports and Cards Analogies

Re: Sports and Cards Analogies

vruz — Wed, 26 Aug 2009 14:52:29 -0000

I'm not a bridge player myself, but I used to run a bridge club, (my mentor is a bridge master and champion) and I can attest it's all great learning if you have a curious, inquisitive mind
You learn a lot about competition and strategy, but also a lot about human nature, how people negotiate and move together socially towards goals.
It's a good example of an application of the discipline of Game Theory, and a lot more fun, practical, edificant and energising than reading those arid academic papers.

Re: Sports and Cards Analogies

Justin Smithline — Tue, 18 Aug 2009 15:40:22 -0000

A bit late chiming in here, but one of the best business books I've ever read is based on chess analogies: "Three Moves Ahead" by Bob Rice. Particularly relevant for start-ups, which often make decisions with very limited information in rapidly changing environments Highly recommended: http://bit.ly/1aBneU

Re: Sports and Cards Analogies

andrewparker — Mon, 17 Aug 2009 10:39:55 -0000

Most card games are Zero Sum whereas most business decisions are Non-Zero Sum. Using a zero sum mentality in a non-zero sum situation will often lead to incorrect rationale and execution. More here: http://thegongshow.tumblr.c...

Re: Sports and Cards Analogies

Farhan Lalji — Mon, 17 Aug 2009 08:12:09 -0000

Sorry bit late on this one - wifey just had our first child this weekend!

I wrote a post about offensive and defensive strategies in business and in sports last week;
http://www.fiftybyfifty.com...

The post was inspired by a dialogue on twitter I had with Dave McClure around Facebook acquiring Friendfeed, his opinion being Goog should have acted defensively and bought Friendfeed which I disagreed with. My favourite line in that post was " Sure defense wins championships... but great offences build dynasties."

Re: Sports and Cards Analogies

Jake — Sun, 16 Aug 2009 17:16:02 -0000

Definitely. But there's something great about losing to a friend, laughing about how she tricked you into that ill-advised raise (or moon-shoot attempt or three pointer), congratulating her, and challenging her to a rematch. Competition's a lot smileyer when it's between parties that care about and root for one another. I wonder if businesses can (should?) learn anything from that.

Re: Sports and Cards Analogies

COMRADITY — Sun, 16 Aug 2009 13:45:10 -0000

Re: 2 votes for limitation of card analogy. Make that 3. My Queen of Spades analogy is about luck and sailboat racing analogy about knowledge and skill.

Re: Sports and Cards Analogies

COMRADITY — Sun, 16 Aug 2009 13:39:26 -0000

Key olympic course sailing strategic decision - is the wind shifting persistently in one direction or oscillating? If persistent, you will shorten the distance to the next mark by first sailing towards the future wind direction, even though being headed away from the mark. If oscillating the shortest distance will be achieved by taking advantage of each lift. That gets you among the leaders. To win, execute flawlessly.

Re: Sports and Cards Analogies

COMRADITY — Sun, 16 Aug 2009 13:23:54 -0000

The Queen of Spades in Hearts. You can shoot the moon with her or lose big.

Re: Sports and Cards Analogies

fredwilson — Sun, 16 Aug 2009 11:33:24 -0000

Thanks for the links. I'll check them out

Re: Sports and Cards Analogies

fredwilson — Sun, 16 Aug 2009 11:27:17 -0000

I can't wrap my head around cricket at all

Re: Sports and Cards Analogies

fredwilson — Sun, 16 Aug 2009 11:26:16 -0000

I love the point about losing money being part of the game. It took me a long time to get comfortable losing money. I still hate it, but I now know that I need to accept it as part of the game I'm playing

Re: Sports and Cards Analogies

fredwilson — Sun, 16 Aug 2009 11:24:18 -0000

That describes my high teens handicap game. Three straight doubles, then a birdie

Ugh

Re: Sports and Cards Analogies

fredwilson — Sun, 16 Aug 2009 11:23:15 -0000

That would be fun

Re: Sports and Cards Analogies

ShanaC — Sat, 15 Aug 2009 23:50:55 -0000

Sports/Athletic things I do-
Salsa- I don't club, but I salsa. Trust your partner, trust yourself, or you will break something. (I'm female, I don't lead)
Yoga--physical strength comes from mental strength. Everyone has different needs from their mind and body. And it can take winding journeys to get there.

Sports I want to learn-
Rock Climbing- I want to get to the top of Grand Teton. It's important to see the top of a mountain, to complete one journey, so you can start another. it's also important that one sees the top of world (or at least thinks so,) and realizes that one should be humble, for one is just an individual person in a moment of time.

I would switch from Salsa to Modern- ballet/modern require great physical strength, more that latin, but without the cost of agility, nor without the cost of good timing. It is something I find taxing on a physical level in an odd sort of way, and I don't get that out of ballroom/latin. Adult intro level (I haven't taken since elementary school) are difficult to find though. In dance, there is infinite choice, particuarly with modern (pretty much the same moves as ballet, except ballet is much more, structured). There are very few disciplines that have caused riots in conjunction with the music played. Fully mastery is an exercise not just of the body, but of the mind, and the spirit. People openly stare at choreography from 80-100 years ago. This still rings as radical: http://www.youtube.com/watc...

Fencing- Epee. Weapons are dangerous. Honor them. Be aware of the people around you as well. For they can be equally dangerous, if they carry weapons, even if they honor them. (Epee also has more options, from what I have been told, of how to score)

Re: Sports and Cards Analogies

Mike Su — Sat, 15 Aug 2009 23:38:29 -0000

if you're gonna have a bouncer for the comments section, you can't go wrong with an Eagles fan Fred! :)

I agree Vick deserves another chance. Isn't that the whole point of sending people to jail? Punish them, they pay their debt to society, coming out theoretically rehabilitated. If they don't get a second chance, then you might as well keep em in prison. Besides, I find it interesting people are hardly talking about Donte Stallworth, WHO KILLED A MAN WHILE DRIVING DRUNK and only served 24 days!!!

Football wise, not sure how it'll all play out. Imagine having Vick, McNabb, Westbrook, Jackson and Maclin on the field at the same time...but at the same time, if Vick shows he's still got it, and McNabb hits another dry spell, well....things could get ugly again.

Sorry to hijack the discussion into Eagles football chatter, but once you bring sports into the equation, it's hard to stay on topic :)

Re: Sports and Cards Analogies

benjie t — Sat, 15 Aug 2009 22:11:42 -0000

Fred, last summer Paul De Podesta of the San Diego Padres had a great post inspired by his 2008 draft, and an old trip to a casino's blackjack table, in which he talked about process v outcome. Great lessons for sports, cards, and investing.

http://itmightbedangerous.b...

Also on similar lines is a fantastic (and long) speech from 2007 by Steven Crist, the publisher of the Daily Racing Form.

http://www.leggmason.com/th...

The great thing about these guys is that they elaborate on their OWN businesses in a way that shows the commonality of investing, poker, baseball drafts, and horse betting: they are all pari mutuel systems in which both the underlying performance outcomes AND the odds perceived and bet on by the other players affect each participant's individual result.

-benjie t

Re: Sports and Cards Analogies

MaskedFinancier — Sat, 15 Aug 2009 20:39:06 -0000

Fred's postings on poker and investing induced a flurry of creativity tonight.
I've tried to draw together all my own thoughts on Fred's articles at my blog.

http://texasholdeminvesting...

Feedback would be great (any from Fred would make me feel very honoured!), particularly given how the quality of the comments on this article make it even more effective.

Re: Sports and Cards Analogies

MaskedFinancier — Sat, 15 Aug 2009 19:11:21 -0000

As the promoter of the Texas Holdem Investing method of investor education I think that poker is in many ways one of the best ways to teach financial concepts and to teach the investing process.
You can read more about the details at the site, but to be fair many of the "analogy" issues are pointed out by Fred and also my fellow commenters.
However, one of the best elements of poker as an investment education tool is that it teaches you about risk management, and it also exposes you to the experience of losing money.
"Losses are like breathing" in trading (and investing, and venture capital investing(!)) according to Ed Seykota, and it you can't handle them you should choose another field.
I advocate playing alot of poker in a systematic fashion to help a would-be investor find out if he/she has the required risk management skills and emotional capacity to deal with monetary losses.
If you don't have the patience and skill to do this in poker then you probably won't be able to do it in investing.
On the issue of the poker not having same range of possibilities as investing, I disagree with this statement. Poker (and Texas Hold'em) in particular derives a significant element of its uncertainty from the behaviour of the other players at the game (and indeed your own behaviour). Introducing human behaviour as a variable into any situation expands the range of outcomes vastly. Thus, Texas Hold'em Poker in my humble (and masked!) opinion can provide a good approximation of the uncertainty encountered in the world of investing.
Anyway Fred, keep up the good work of explaining investing through poker (and other) analogies - it can only help improve the wider understanding of the subject, which is too often shrouded in the veil of academic terms and insider jargon, to the detriment of efficient capital allocation.

Re: Sports and Cards Analogies

fredwilson — Sat, 15 Aug 2009 13:22:21 -0000

I bleed green too. NY Jet green

Re: Sports and Cards Analogies

GlennKelman — Sat, 15 Aug 2009 13:01:08 -0000

Oops, sorry PKafka, I missed your Gladwell reference.

Re: Sports and Cards Analogies

kidmercury — Sat, 15 Aug 2009 12:53:53 -0000

i too bleed eagle green. good to see we have some good folks around here at AVC. :)

i believe vick deserves another chance (to be honest i think his sentence was too harsh, but maybe that's because i'm not a dog owner), although i'm not sure why the eagles got him -- i guess concerns over mcnabb being injury prone? i'm not sure another quarterback was the best investment. vick knows the type of offense the eagles run, though, so i think he will be a good fit in that regard.

Re: Sports and Cards Analogies

fredwilson — Sat, 15 Aug 2009 12:23:27 -0000

I love "portfolio theory". Some go against you but if you have enough bets out there, it will work out over time

Re: Sports and Cards Analogies

fredwilson — Sat, 15 Aug 2009 12:20:27 -0000

Yup. This is the 2nd time a reader has brought up that gladwell piece and its a great point about the limitation of the card analogy

Re: Sports and Cards Analogies

GlennKelman — Sat, 15 Aug 2009 12:16:16 -0000

Did you see Malcolm Gladwell's essay on the CEO of Bear Stearns, Jimmy Cayne? He was a great bridge player who got his job at Bear Stearns by interviewing with a bridge aficionado, Ace Greenberg (great name). Here is Cayne's account of that interview when the subject turned to bridge:

[Greenberg] says, “How well do you play?” I said, “I play well.” He said, “Like how well?” I said, “I play quite well.” He says, “You don’t understand.” I said, “Yeah, I do. I understand. Mr. Greenberg, if you study bridge the rest of your life, if you play with the best partners and you achieve your potential, you will never play bridge like I play bridge.”
http://www.newyorker.com/re...

My problem with thinking of business as a card game is that, at least ideally, a game of cards is all calculation and no heart. When you're running a marathon or riding in a bicycle race, you feel despair and elation, you love the effort and you hate it, you pour your guts out and then later wonder if you really had anything more to give and it goes on and on and on and then when it finally ends you only want to be in that place again. Anyway, startups and sports might be more visceral than cards, regardless of whether they should be.

Re: Sports and Cards Analogies

kirklove — Sat, 15 Aug 2009 12:07:24 -0000

Great topic – one I'm glad to see you coming back to you as I'm an avid Hold 'Em player and too believe it can be used as a great learning tool for so many things in life.

One thing that Hold 'Em has taught me and transfers to my life is that even when you "get your money in good" (meaning mathematically you're virtually a lock to win the hand), it doesn't always work out that way. It's tough to swallow getting sucked out on. It happens in life, too. But, the key is to remember that in the long run if you consistently make good bets the odds do indeed tip in your favor. Related: You have to let the bad bets go. Don't get on tilt at the table or in life.