Lessons in Strategy and Risk Management
Sitting at a poker table for hours (and days…) on end teaches you more about life and business than you'd expect. The tension, the calculations, the silent reads of your opponents - all of it sharpens your instincts in a way few experiences can. Little did I know that those nights spent weighing odds and managing risks would become the bedrock of my real estate strategy.
The Art of Calculated Risks
In poker, every hand is a lesson in risk versus reward. You learn quickly that chasing every pot isn't the path to victory. Instead, it's about making calculated decisions based on incomplete information. Transitioning into real estate, I found that the same principles applied. Before jumping into a deal, I surgically analyze every facet - the property's potential, market trends, financial projections, and possible exit strategies.
I recall a time when a seemingly lucrative property came my way. On the surface, everything looked promising. But my poker-honed instincts urged me to dig deeper. After a thorough analysis, hidden issues emerged that could have led to significant losses. Walking away wasn't easy, but it was the right move.
Reading the Room—and the Market
Poker isn't just about the cards; it's about reading people. Their tells, their betting patterns, and the subtle shifts in behavior are all factors that you take into consideration when playing a hand. In real estate, understanding the market and the stakeholders involved is crucial. Whether it's sensing a seller's urgency or anticipating market shifts, being attuned to these signals can give you a significant edge.
Focusing on Mobile Home Communities wasn't a random choice when we founded Evoke Capital. We observed market trends, recognized the high demand and limited supply, and saw an opportunity that others overlooked. In under three years, we've acquired over 2,250 doors, all because we read the market accurately, acted decisively, and approached every investment with integrity.
Emotional Discipline: The Unsung Hero
One of the toughest lessons from poker is mastering your emotions. Letting frustration or overconfidence dictate your decisions is a surefire way to lose. The same holds true in real estate. I've seen investors make rash decisions based on excitement or fear, only to regret it later.
At Evoke Capital, we prioritize data over emotions. If a deal doesn't align with our criteria, we pass - no matter how enticing it might seem. This discipline protects us and our investors from unnecessary risks and keeps us focused on our long-term goals.
Playing the Long Game
Success ultimately boils down to consistent performance over time. In poker, that means knowing when to fold and when to go all in. In real estate, it means choosing investments that offer sustainable growth rather than quick flips. Evoke Capital’s strategy involves holding properties for the long term, resulting in predictable cash in perpetuity, both for us and for our investors.
By refinancing and returning initial investments around year five, we de-risk the investment for our partners while maintaining ownership of the asset. This approach allows us to build wealth over time, much like accumulating winnings through years of correct plays rather than risky bets.
Final Thoughts
The parallels between poker and real estate are remarkable. Both require a keen understanding of risk, strategic thinking, and emotional control. The lessons I've learned at the poker table have been invaluable in building Evoke Capital into what it is today.
Whether you're making investment decisions or navigating life's challenges, remember that success comes down to making informed choices, managing risks wisely, and keeping your emotions in check. Stay focused on the bigger picture, and don't be swayed by short-term temptations. That's how you build lasting success.
