Response to Negreanu's 'Don't Be Such a Nit! - Part I'

I just read Daniel Negreanu's recent column, in which he talked about how he would often play in bad games against tough locals "for the good of poker." My first thought after reading his column was: It takes a nit to know a nit. I figured that either Negreanu has won so much money playing tournaments that he can afford to be charitable or that all of those cold winters in Canada have led to permanent frostbite of his brain.

Every winning player knows that game selection is everything. Those "nits" to whom Negreanu refers who wait for the $80-$160 game to fill in with tourists, in my eyes, aren't nits. They're just plain smart. They are the same "nits" who don't post their blind out of position and wait until it's their big blind before leaving a game.

What Negreanu needs to do is differentiate between "nits" and "nitwits." Nits are tight, and may not be the most fun to party with, but you can't fault them for their pragmatism. Nitwits, on the other hand, are just bad for poker. A nitwit leaves it up to the other players to tip the dealers. A nitwit chases a live one from the game by criticizing him when he gets drawn out on. A nitwit asks for setups, slow-rolls, and is flat-out bad for poker.

The more I read Negreanu's column (and checked the tournament results at Commerce Casino), the more I understood where he was going. He understands the value of an investment. He wrote: "I was living in Vegas and this game was to be my living. By helping to start games, I would show my peers that I respected them and was willing to contribute to the room, which was important if I was to spend the next few years working with them." In other words, spend a little to make a little – in the long run.

Back in '95, I played in a wide-open Omaha high game at the old Harrah's in New Orleans. I was sitting to the left of Kenny, arguably the best player in the room at the time, in a $20-$40 game that started off uncharacteristically tight. With the big blind to his right, he whispered to me, "Let me show you how to make a good poker game, kiddo," as he threw in a $40 blind straddle. The next hand, I did the same, and sure enough, the regular crew was again drawing to straights and flushes after the board had paired.

A nitwit would never make such a move. It would kill him to part with $40 now – so much so that he wouldn't part with money that could make him more in the future. What Kenny and Negreanu understand is that poker is a grind. Every action sets up future action. In the Omaha game, the immediate result of a blind straddle was a more profitable game. And what did it really cost? With six to 10 players seeing most flops, it isn't like putting in an extra bet is going to mean much in the course of a session.

In business, a nit is a smart, seasoned negotiator who gets multiple bids and won't overspend. I know one such nit, Stanley, who said, "A business doesn't make money when it sells a product; it makes money when it buys it." Wal-Mart does roughly $200 billion in sales every year. Assuming its products cost about half that amount to buy, if Wal-Mart can buy its products from suppliers for one-tenth of a percent less, it will earn $100 million a year more. Sounds pretty nittish – and pretty darned smart.

Wal-Mart will run into problems only if it becomes nitwitish and starts squeezing suppliers. Sure, a company of Wal-Mart's size has a lot of leverage and should use it. But if Wal-Mart is so brutal in its negotiations that it alienates its suppliers, what happens when it needs a product faster or makes a special request from a supplier? It's likely that the supplier will say, "Sorry, it's not in the contract," and not honor the request. The result of trying to save a little is making less because a product isn't in stock.

What the nitwits don't see in a poker room is how their inability to spend a little prevents them from making more money. My friend Ace plays in Los Angeles, treats everyone in the cardrooms with respect, and tips the floormen generously. One night, the floorman on graveyard shift called Ace at 3 a.m. to let him know that a few big-shot movie producers had arrived and were throwing their money around. Ace threw on some sweats and hustled over to the casino, threw the floorman a twenty-spot, and before Ace could say thanks, he was up $8,000. Do you think the nitwit who thinks he saves money by not tipping the floor personnel would ever get that phone call?

In poker and business, earnings boil down to revenues less expenses. Nitwits see any money out of their pockets as a drain on earnings. Winners see the value of investments. A penny saved may be a penny earned, but without any revenue, it still leaves you broke.

Greg Dinkin is the author of The Poker MBA: Winning in Business No Matter What Cards You're Dealt, which will be published by Random House's Crown Business imprint in April 2002. For a book review – plus a joker – send an E-mail to [email protected], subject heading, The Poker MBA.