LESSON #2 of 5
Subject: The Six Levers Of Poker Profits
Yesterday I asked the question:
“Why do you think you get stuck in poker?”
Thanks to everyone who replied, there were lots of interesting and enlightening responses.
Today I’m going to share a framework that I call:
The Six Levers Of Poker Profits
It explains how you can work incredibly hard on your technical game, but still feel stuck.
(Along with a whole host of other poker profit “bottlenecks”)
Let’s start with a quick exercise:
Imagine that you’re in a large control room.
This control room represents your mind, and it regulates your thoughts, emotions, and actions.
As you’re looking around the room, you notice a door. Above that door is a sign that reads:
You open the door to find a dimly lit room and a large lever labeled:
Next to that lever is a digital display that shows:
“Expected Profit Next 12 Months”
You grab hold of the lever and start to push it up. At first, it lifts relatively easily, and you see your “Expected Profits” number rising at a similar pace.
The more you push, the harder it gets. You also notice that the “Expected Profits” number is only going up a fraction of the amount it was before.
You keep pushing and pushing trying to get that number higher, and finally, your “Expected Profit” number doesn’t budge, even as you slowly lift the lever higher.
You push and push and push with all your might, but no luck…
That “Expected Profit” number just won’t move.
Eventually, you give up and sump down against the back wall.
As you sit there trying to catch your breath, you notice a light switch in the off position.
You stand up and flick it on to reveal that the room is much larger than you initially realized.
Along the wall next to “Poker Skill” are five additional levers, six in total.
You get up and start adjusting them, and notice that as you manipulate these new levers, your “Expected Profit” number changes. You see that adjusting some of the levers affects the others, some positively and some negatively.
You’re not quite sure the perfect combination just yet, but feel a sense of relief with the realization that there is more than only Poker Skill that affects your profits, and that all these factors are under your control.
Have you ever felt like you were putting in the work to improve your game, but you just couldn’t get that profit number to budge?
This scenario is all too common for those who are dedicated to being more profitable players but just can’t seem to break through to the next level, even though they work very hard on their game.
If you’ve ever felt like your results never match your skill level, and studying harder and learning more about the game never translates into more profits, it’s because you’ve only been focusing your attention on one of these levers of poker profits.
In my one-on-one work with many of the game’s best players and two years of running a training site solely dedicated to teaching non-technical poker skills, I’ve discovered that there are six levers that affect your profitability.
The Six Levers Of Poker Profits
- Skill – Your absolute knowledge of the game.
- Edge – The gap in skill between you and your opponents
- Efficiency – The percentage of time you apply the full extent of your skill to a hand
- Volume – How often you apply your poker skills for real money
- Stakes – The size of the games you play
- Rake – The fee you are charged by the house to play
If you’re not making the poker profits you desire, it’s because one of, or a combination of, these levers are holding you back. There are many scenarios where you are crushing it in five out of six areas, but a deficiency with just one lever, causes a complete bottleneck of your profits.
In today’s email, we’ll take a deeper look at Skill and Efficiency, and see how they interact with the other levers.
When I talk about the interaction between the levers, I’ll mention positive and negative correlations.
When a lever positively correlates with another lever, it means that raising that lever will often raise the ones mentioned.
When a lever negatively correlates with another lever, it means that raising that lever will often lower the ones mentioned.
(Note: This is neither a good or a bad thing, simply a consequence. Your “Expected Profit” number is the only thing that matters, so sometimes raising one lever and lowering another will optimize that for you. For example, playing in a tougher game but at higher stakes (Raising Stakes and Lowering Edge) will often be more profitable than playing against weaker opponents at lower stakes)
When a lever is neutral with another, it just means that raising or lowering it usually has no effect on the ones mentioned.
Remember, these correlations are just general statements and examples.
You’ll have scenarios and combinations where raising a lever will have a positive effect for one person, but a negative effect for another.
This isn’t about coming up with an exact formula; it’s about understanding where your profits come from and how these factors interact with each other.
Once you have this understanding, you’ll be able to apply it to your game and unique situation.
Let’s get started with…
Your skill represents your absolute knowledge of the game.
If 0 is someone who has never heard the word poker before and 100 is completely solving every aspect of the game, your number falls somewhere in between.
(An Aside: Your number on this 0-100 spectrum is likely much lower than you think. Many players worry that the game will be solved at any moment. However, the very best players I work with all agree that scenario is a long way off and that the very best in the world are only in the 30-40 range currently.)
This is the area most dedicated players work on, and the vast majority of poker training products are focused on increasing your absolute skill.
There is good reason for this, as Skill positively correlates with all the other levers besides rake.
If you increase your Skill and your opponents do not (or yours is going up at a faster rate), then you will increase Edge.
Having more skill also gives you a wider selection of lineups to choose from. The best player in the world can sit down in any game and be profitable (pre-rake).
Increasing Skill will often increase Efficiency. The prime example of this is a new player who goes on stone-cold tilt if their AA gets cracked. A skilled player has a deep understanding of how the game works and where profit comes from. Thus, they see AA getting cracked as just one of the standard outcomes and are more resilient to these standard “bad beats.”
Confidence is closely tied with Skill, which is closely tied with Volume. Confidence is simply trusting that you have the skills to accomplish a task, which comes from putting in the work to gain the Skill. Putting in Volume is much easier when feeling confident, thus raising skill can mean raising Volume. As mentioned earlier more Skill gives you a wider selection of games to choose from, which also makes it easier to put in Volume.
As Stakes increase, the level of competition usually (but not always) increases alongside it. As Skill increases, so does your ability to be profitable at higher stakes. To be a top earner in the game, beating high stakes is essential, and to do that you need a lot of Skill.
So, as you can see Skill is very important, yet still just one part of the overall system that determines your profit.
There is often a “Technical Training” Vs. “Mental Game/Mindset Training (what I call A-Game Poker) debate, with each side trying to prove which is more important.
The smartest players in the game sidestep that debate because they know it’s all integrated and that debating this issue is just a waste of time.
This will start to become crystal clear when we breakdown the other levers, such as out next one…
Now we have Efficiency, which is a major bottleneck for most players.
You probably know someone who seems to have all the right answers when doing work off the table but is constantly making big mistakes in game.
They “should” know better but keep making them anyway.
These are what are known as “Unforced Errors” in the sports world.
Efficiency represents the percentage of time you apply the full extent of your Skill to a hand.
All the skill in the world is irrelevant if you’re not actually applying it at the table.
When someone is performing to the full extent of their poker skills, it is often referred to as playing their “A-Game.”
While my coaching and training courses touch on all the Six Levers in some capacity, much of my content (including a brand-new Masterclass I’ll be announcing next week) is dedicated to making the gap between absolute skill and applied skill (Skill & Efficiency) as small as possible.
An extreme example would be a very good player playing highly intoxicated. The skill is there, but the state of impermanent prevents the full application of that skill.
Tilt and Emotional Decision Making (which are also covered in my upcoming Masterclass) are another reason why you might not be applying your full skill every hand you play.
Poor health, lack of focus, and stress are all other factors that reduce your Efficiency.
Efficiency positively correlates with Edge and Volume.
When there is a large gap between how well you CAN play, and how well you DO play, your Edge becomes smaller.
Playing below your abilities is incredibly frustrating and a definite motivation killer. So when Efficiency drops, Volume usually comes with it. On the other hand, when you’re playing at your absolute best, you can gain serious momentum and easily put in extra Volume.
Alright, that’s a ton of info to pack in one email, so I’ll end it here for today.
Tomorrow I’ll touch on the final four levers (Edge, Volume, Stakes, and Rake), and we’ll start to discuss how you can use this framework to pinpoint your biggest opportunities for growth in the game.
See you tomorrow,