I've been a Netflix customer for about three years.  I've happily paid the $9.95 per month charge months on end to receive a quality service: DVDs delivered directly to my mailbox.  I was, for the most part, happy to be a Netflix customer.  There was a time a few years ago that my wife and I cycled through the entire Sopranos DVD series over the course of a month or so, watching 1-2 episodes every night after the kids went to sleep.

But, other than those 5-6 DVDs, I didn't use the service.  Did I cancel?  No way!  What if I wanted to get a DVD-by-mail or a movie sometime in the near future?  No, my last Netflix rental, the Curious Case of Benjamin Button sat, unwatched, by the DVD player for a good 6 months.

And then, Netflix announced their price increase.  Now, finally, I had an excuse to cancel my membership.  The price increase, though not a life changing amount of money per month, made me realize that I wasn't getting my money's worth from the service.  Cancellation was easy -- just a few clicks on the web page and dropping Benjamin Button back in the mail (still unwatched).

I'm a huge fan of subscription businesses -- they are easy to evaluate from an investment perspective, and they are, by far, the easiest way to "big money" -- find a product business that excites people enough to buy a subscription, and you've got yourself a money printing machine.  Even subscription service businesses are great.

One of the key components to these businesses is "underutilization" -- effectively monetizing those who pay for your service or product but don't use it.  When the subscription price is small enough, it disappears into the credit card statements and lazy people won't bother to cancel.  Only a major shift in business strategy and the associated announcements will awaken these sleeping customers and get them to act, removing very valuable margins in the process.

Another great example of this happened recently: Bank of America hiking the price of some ATM cards to $5 a month.  As soon as that happened, I knew it was going to be a disaster for BofA and unlikely to stand.  ATM cards are the equivalent of a subscription business with small fees.  Raising those prices would likely send millions to the bank to close their accounts.  My thesis held true in my local branch of BofA here in Newport, WA.  Immediately following the price hike announcement, the branch was overrun with customers looking to close and/or modify their accounts.

So, here is my investment thesis for you:  any time you see a subscription business make a change to their pricing, "back up the truck" and sell that stock short.

I'm thrilled that my "Little Gold Book" is released worldwide tomorrow.  This is my fourth and last poker instructional book.  I gave it everything I had.  I had tons of help, including insights and tutoring from some of the very best in the game: Phil Galfond, Annette Oberstad, and Daniel Cates.  I also spent a great deal of time with one of the truly great "young guns" Anders Taylor.  This book, and the revamping of my game, couldn't have happened without them.

Writing is very difficult, especially when under intense stress.  Poker 2.0 (combinatorics, range analysis, combined probability, simulation, heads up displays) is complex and difficult.  Teaching to a worldwide, diverse audience of different skill sets and keeping it readable for all is more or less near impossible.  And still, I gave it my best shot.  There is something in the Gold Book for everyone -- of that, I'm sure.

I have enormous pride in my books.  I can't begin to tell you how great it makes me feel to walk the halls of the WSOP and have people come up to me and say that they loved the Black, Green and Blue books.  I've had many sessions at the table where the guy next to me was actually listening to the Green book on his iPod while I'm sitting next to him -- strange, but awesome.  There are 500,000+ copies in print as of today, and I have 12 different translations sitting on my shelf.  That is amazing and humbling.

As my "professional" poker career comes to an end, I realize that beyond the television shows, unsuccessful bracelet chase, successes and dramatic failures, I am most proud of the fact that I've helped hundreds of thousands of people understand and enjoy this great game just a little bit better.  

My results and reputation as a player won't get me into the Poker Hall of Fame -- of that I'm certain.  But, I'm equally certain that there are players out there -- perhaps you, dear reader -- that learned from my books that absolutely will end up in the hall and wearing bracelets.  That is good enough for me.

This Gold Book is for my two sons, Xander (now 3 1/2) and Zachary (almost 2).  In the dedication, I say: "With everything you do in your lives, go all-in."  And now, with the publication of this book, I'm all-in too.

October 10, 2011
Phil Gordon

Order your "Gold Book" on Amazon.

Hardback
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When my family moved to the inland northwest a few years ago, the property we bought had a "shop" on it -- essentially 2000 square feet of "man space" full of equipment I've never used.  A jointer, planer, table saw, drill press, all kinds of grinders, belt sander, routers, etc.  "This is my woodshop," I said proudly to guests.  "What have you built?" they'd ask.  "Um, I'm working on a few things."

Like every guy, there has been a special place in my heart for "The New Yankee Workshop" since I was a teenager.  I have the geeks from the "Woodsmith Shop:.  I've marveled at Roy Underhill on "The Woodwright" and how he insists on doing everything by hand -- no power tools!  I've come to like Tommy Mac and "Rough Cut" and I have a subscription to "Fine Woodworking Magazine" too.  I envisioned throwing together a few reclaimed boards in 30 minutes or so using the table saw, jointer, planer, and a few well placed mortises and tenons along with some Titebond 3 (good for outdoor applications).  I thought I'd just whip up a humidor, a jewelry box, a chest of drawers with perfect dovetail construction.

So, off I went to my wood shop.  And then, I quickly realized that these pieces of equipment can really hurt you.  Every woodworker I know has missing fingers or some war story about a close call.  I play piano.  I like my fingers, thank you very much.  So, I hired a coach and took a few classes.  We built the obligatory first projects: a checkerboard cutting board followed by a breadknife.  I thought I was ready to make a mission style inspired chest of drawers.

For the next year, projects sat half started, half baked, and mostly screwed up beyond repair.  I spent a few hours a week noodling around, not really accomplishing much, but it was a good distraction nonetheless.  I had a few small wins when I made my wife a jewelry box that didn't suck and fixed the boys broken wooden toys (cyanoacrylate glue rules the world).

All along, I of course kept buying more advanced tools.  "If I just had that new Festool Domino I could build XYZ," I thought.  And so, I bought the domino, used it twice on practice boards, and haven't found a purpose for it again.  There aren't many joints that require a domino in a 6" wooden airplane that needs its wing glued back together.

Here's the bottom line: woodworking is very hard.  Those guys you see on TV?  I call bullshit.  One second they are cutting a panel using the mitre sled, the next they are dadoing perfect half lap joints.  They don't show the 17 minutes it takes to change to the dado blade and they certainly don't show the 19 minutes it takes to cut the test piece to make sure the dado is set correctly.

It reminds me a little of poker on television, come to think of it.  The audience at home sees the "highlight reel" -- the big bluff, the 50/50 race with QQ vs AK, the great call, the final table.  They rarely get to see the 200 hands that were played the eight hours before where the studious player was taking careful notes, measuring up the opponents, carefully calculating a winning strategy, and then waiting for a chance to execute.  Those "prep" hands aren't all that interesting, but that is where all the skill is.  Hell, put me in Norm Abrahams shop and have his assistants set up all the machines and I can push the wood through the saw and make a perfect angled, haunched tenon too!  And you can be sure that tenon will glide into the mortise with just a little bit of resistance -- the perfect fit.

I'm proud to be known as a good poker teacher.  I know how much work it takes to distill the elements of the game into an easily digested video or text that can help take someones game to the next level.  I have put thousands of hours into teaching -- those books don't write themselves!  I labor over the set up, each word.  I know that the devil is in the details.  Much like woodworking.

I needed a teacher, a mentor that could help get me going.  Fortunately, I found Marc Spagnuolo at thewoodwhisperer.com.  Here is a guy that really knows how to teach.  He shows every step in the process, not just the highlights.  He gives really detailed plans.  He patiently explains the traps, the problems you are likely to encounter.  He doesn't pull any punches about how hard something is going to be.  And he's willing to admit and show his mistakes.  In short, his teaching style for woodworking is exactly what I try to do with my teaching style for poker.

I just finished building my first project -- an Adirondack chair in the style of Greene and Greene.  It is built with Honduran Mahogany with Walnut accents.  I couldn't resist.  You can never have too many outdoor chairs, and I loved the design.  I have about 50 hours and $400 in wood and various accessories into the project.  After the teak oil dries, I'll be sitting on my chair, cracking a beer, and proudly telling my very patient and understanding wife, "Honey, I finally built something."

A few months ago, I was desperately searching the web for information about caring for an our pet Western Painted Turtle.  His shell got accidently smashed a bit, and he was lethargic, sitting idly under the heating lamp, and wouldn't eat much.  This went on for about five days, and I wanted help for the little guy.  There wasn't a qualified herpetologist anywhere nearby.

After scanning the internet for a few hours, I found a website that seemed to be authoritative and helpful.  I emailed the website owner, sent a picture of the little guy, and described the symptoms.  A few hours later, I was delighted to get a return email that addressed most of my concerns (this is normal behavior for slight injuries, turtles face much more challenge in the wild, he'll be fine in a week or so).

A few things struck me about my interaction with the turtle-expert:

* I would have gladly paid the "expert" a nice sum of money for his knowledge.  Had a qualified vet been in my area, I'd have taken the turtle in for a visit and paid around $50-$75.  The world-class expert would have been a much better value at the same or higher price.

* The time the expert spent on my problem was valuable -- giving away that time is large unsustainable, and should he get many requests like mine, he'd probably be forced to remove his email address from his website or stop responding.

* There wasn't a readily accessible internet-driven mechanism in place for me to do so.  The expert could have asked for a PayPal donation after the fact, I suppose.  I might have even offered one.  But, the fact is, the expectation of "free" advice was implicit by the fact that he posted his email address on the website.  If he had a convenient link that said something like, "Click here to buy a 30 minute consultation for $50" I would have clicked.

There are plenty of everyday items that require "Expert Insight" that I'd gladly pay for:

* I have a sick Maple tree in my front yard.  Is there a Maple tree expert out there that can tell me what to do?
* My son is having a hard time with the "SP" sound -- any one out there with suggestions?
* My woodworking planer blade has a nick in it.  How do I sharpen it?

I'm currently investing in technologies that allow consumers to tap the pool of "Expert Insight" that exists in the world.  There are a few companies that are making attempts at solving some of these issues:

* Skillshare.com -- a portal for people to offer classes on just about everything, accept payment, and offer enrollment .  Currently, Skillshare is offering classes only in NY, but this idea and platform can scale.

* ExpertInsight.com -- a portal for one-on-one video consulting via the internet.  With more than 150 experts in diverse fields (poker, chess, economics, architecture, etc.) this is a model that can and will grow.  I'm currently offering my time at $150 / hour -- we can talk about just about anything.

* Vokle.com -- one-to-many video broadcasting.  Again, another way for people to interact and share knowledge.  Interactive Q&A is done quite well.  The ability to charge for these sessions is coming soon.


The writing is on the wall -- the company or companies that facilitate the transfer of expertise as smoothly and as quickly as possible will be a big, big winner and the next household internet brand name.

A year ago, my friend and fellow poker player Brandon Adams and I had breakfast.  He had a "great idea" -- a marketplace where experts from around the world and from various disciplines could offer consulting services via video over the internet.  I loved this concept.  In my estimation, this is the next great category of growth for the connected world.  I imagine being able to video chat with the world's leading experts in all fields at a moment's notice, with completely transparent and easy payment.

I liked Brandon's idea so much that I convinced him to let me and my tech team build it for him.  We spent a few hundred thousand bucks building out the initial phase of the technology and got Brandon to his launch.  Since, he's done an incredible job attracting some of the world's leading experts to the platform, including Nobel prize winner Gary Becker (economics), Steven Levitt (Freakonomics author), and Tom Dwan (online poker phenom).

This month, I'm trying an experiment.  Instead of the "usual" $500/hour rate, I'm listing my time at $150.  I am available to discuss any and everything with you -- have a start up company?  Thinking about taking the entrepreneurial plunge?  Need some contacts in the poker or tech community?  Have a problem with your poker game?  Thinking about a backpacking trip around the world?  Let's talk about it.  One on one, via internet video.

I'm available for about 6 hours every weekday, scheduled at your convenience.   Let's get Brandon and ExpertInsight off to a great start.  I look forward to speaking with you soon.

Interested?  BOOK HERE.
Phil

I loved ESPN's live television coverage this year.  The commentators did an excellent job, particularly Antonio.  Even Hellmuth was palatable.  This is "real poker" -- not just the highlights.  You could see the anguish on the player's face real time, and experience the ups and downs of each card dealt.

There was some concern early on that those that were televised would be giving up too much during the middle of the tournament.  I don't believe that was the case.  Rarely were hole cards shown, and when they were, it was usually an obvious spot.

I hope that ESPN got excellent ratings for this endeavor -- this type of coverage can take poker to the next level.

I'd also like to take this opportunity to thank all of the players that wore the 1% patch and made a pledge for the Bad Beat on Cancer.  The green patch showed up great on the coverage, and our website was bombarded by fans.  We raised more than $100,000 this year at the WSOP and we're still working to get a few of the guys from the final table to make their pledge.