Texas billionaire Andy Beal has made his mark in both the business and poker worlds. And he has experienced variability in both.
Variability – unpredictability, ups and downs, good luck and bad luck – is common in poker and business, and in all aspects of life. That’s not at all surprising when you realize the game of poker is a microcosm of life. How often do you start off losing at the poker table but, with patience and perseverance, combined with your great skills, soon find yourself ahead for the session. Keep playing, and before long you may lose back your winnings and go into your original buy-in – maybe have to invest more money to try to win it back.
Hopefully, with skill and a few smiles from the poker gods, you can end the session a winner! It’s not predictable. It’s just part of the ups-and-downs of the game. You might even go several sessions without going home a winner. The same happens in life.
Even the most successful entrepreneur suffers ups-and-downs – variability. For example, let’s take Andy Beal.
D. Andrew Beal was born in November, 1952 in Lansing, Mich., and now lives in Dallas, Texas. Beal, who made his fortune in banking and real estate, is the founder and chairman of Beal Bank and Beal Aerospace Technologies. He also is a high-stakes poker player with an estimated worth of $6.6 billion according to Forbes magazine.
Anxious to become a businessman, at age 18, young Beal purchased Spartan and Jackson Speedway as a business venture. It failed. At age 19, Beal bought a house in Lansing for $6,500 and rented it out for $119 per month, eventually leading to his first net gain as a businessman.
In 1981, Beal developed his business strategy: buying properties no one else would want, but which he expected could be turned into a profitable venture. His business strategy paid off. Seven years later he was able to open Allegiance Savings and Loan Association, his first bank, a Dallas company that would later be renamed Beal Financial, and now includes Beal Bank, Beal Bank Nevada, Loan Acquisition Corp., and Beal Mortgage Services.
During the 1990s, Beal tried to expand Beal Bank’s services to include international markets. The venture failed and Beal withdrew from foreign expansion. Then, in 1997, Beal started an aerospace company to launch satellites into space. After several years of financial losses, Beal closed the company and its operations.
In 2000, three years after his latest loss, Beal Bank bought over $1 billion in commercial loans from the SBA. These included loans made to businesses in Palau and the Virgin Islands that had borrowed money to recover from Hurricane Hugo.
After the Sept. 11, 2001 terrorist attacks Beal bought considerable airline debt, certain they would recover from the tragedy. Aircraft debt prices were very low at the time. Currently, from those bonds, Beal Bank earns about $70 million in profit each year.
Despite lots of variability along the way, with patience and skill, Beal has enjoyed huge business investment wins in the long run.
A blackjack player in his youth, Beal became interested in the game of poker and in 2001 began visiting Las Vegas to play in high-stakes games, mostly heads-up limit hold’em. He played against some of the “greats” of professional poker, including Doyle and Todd Brunson, Chip Reese, Ted Forrest, Jennifer Harman, Howard Lederer, Phil Ivey, Gus Hansen, Barry Greenstein, and others, who called themselves “The Corporation.”
As described in the book, The Professor, the Banker, and the Suicide King: Inside the Richest Poker Game of All Time by Michael Craigpoker, Beal had a strategy – force the pros into such high limits that their play would be influenced by the amount of money at risk.
At one point the limits reached $100,000-$200,000 in heads up games he played with more than $20 million on the table. While the games described in Craig’s book ended in 2004, Beal continued to return to Las Vegas to compete in very high-limit, heads-up hold’em.
On February 5, 2006, Beal was down $3.3 million! Shortly after, he returned to the Wynn and won approximately $13.6 million during poker sessions from Feb. 12-15. On Feb. 21-23, with Phil Ivey representing The Corporation at limits up to $50,000-$100,000, Beal lost $16.6 million to Ivey.
Beal is believed to hold the record for the most money won in a single day of poker. On May 13, 2004, at the Las Vegas Bellagio, Beal won $11.7 million from Chip Reese, Hamid Dastmalchi, Gus Hansen, and Jennifer Harman.
(PS: Thanks to Dan Paddock of Dallas for bringing this story to us. Reach me at [email protected].)