13 Habits of Highly Effective Risk-Takers

I played poker professionally before I ever wrote about politics or built an election model. What really fascinates me about gambling is the mindset that drives this behavior—a way of thinking that unites a cohort I call “the River.”

The River is a sprawling ecosystem of like-minded people that includes everyone from low-stakes poker pros to crypto kings and VC billionaires. It is a way of thinking—analytical, abstract, competitive, contrarian—and a mode of life. Most “Riverians” aren’t rich and powerful, but rich and powerful people are disproportionately likely to be Riverians.

I call the following the “13 Habits of Highly Effective Risk-Takers.” The quantitative risk-takers of the River and those who take physical risks—astronauts, deep-sea explorers, NFL players—have these traits in common. Based on my research, I hold the view that there is something hardwired in people who seek out risk and wrangle it successfully. How many do you share with them?

Successful Risk-Takers Are Cool Under Pressure

Being calm when other people lose their shit is a rare quality—and one that’s essential for a winning gambler. It doesn’t matter how well you execute in everyday situations—you’ll never reach the top of your craft if you choke when the pressure is on.

They Have Courage

In poker and sports betting, the vast majority of players lose money. To be at the very top requires a careful balance. Overconfidence can be deadly in gambling, but playing poker against the best is not for the faint of heart.

They Have Strategic Empathy

They put themselves in their opponent’s shoes—but don’t mistake this for the touchy-feely kind of empathy. In psychological studies, there’s a negative correlation between systematic thinking—what Riverians are skilled at—and empathetic behavior. Strategic empathy comes up a lot in poker—which is very much both a mathematical game and a people game.

They Are Process Oriented, Not Results Oriented

They play the long game. “Don’t be results oriented” is a mantra ingrained in many poker players. Yes, in the long run, results are what count, but one good thing about the River is that our compensation ultimately depends on objective measures.

They Take Shots

They are explicitly aware of the risks they’re taking—and they’re comfortable with failure. In one episode of the American version of The Office, the endearingly imbecilic boss, Michael Scott, misappropriates a quote from the hockey player Wayne Gretzky: “You miss 100% of the shots you don’t take.” There’s something to be said for this.

They Have a Raise-or-Fold Attitude

They abhor mediocrity, and they know when to quit. The cardinal sin of poker is that most players Hold ’em too often. There are three basic actions in poker: call, fold, raise. People press the call button too much. They call because they want to gamble, but although players call when they should be folding, they also call when they should be raising.

They Are Prepared

They make good intuitive decisions because they’re well trained—not because they “wing it.” What annoyed private equity investor and explorer Victor Vescovo about Top Gun: Maverick was Tom Cruise’s insistence that you should improvise your way out of a hairy situation: “The best military ops are the ones that are very boring, where things go exactly according to plan. No one’s ever put in any danger,” he said. “You want to minimize the risks. While Top Gun looked great on film, that is not how you would try and take out that target.”

They Have High Attention to Detail

They understand that attention is a scarce resource. In poker, one of the unusual features of the game is that most of the time, you don’t have anything you have to do, exactly—there’s a lot of waiting. You need to carefully calibrate your mental bandwidth, conserving energy but being prepared to snap into action.

They Are Adaptable

They are good generalists, taking advantage of new opportunities and responding to new threats. I call this personality type a Fox. Think of the Greek poet Archilochus’ saying: “The fox knows many things, but the hedgehog knows one big thing.” Foxes rummage for opportunities, wary of complacency and getting too tied down. This is one habit to which there are some exceptions. In particular, startup founders need to be laser focused on one big thing and be prepared to see it out for a decade or more.

They Are Good Estimators

They are Bayesians, comfortable quantifying their intuitions and working with incomplete information. Does the difference between 90 percent and 93 percent really matter?

They Try to Stand Out, Not Fit In

Independence of mind and purpose are hallmarks of the high achiever.

They Are Knowingly Contrarian

They have theories about why and when the conventional wisdom is wrong. There is a distinction between independence and contrarianism. If I pick vanilla and you pick chocolate because you like chocolate more, you’re being independent. If you pick chocolate because I picked vanilla, you’re being contrarian. Riverians can be accused of being contrarian when really they’re independent. If I do the conventional thing 99 percent of the time, and you do it 85 percent of the time, you’ll seem rebellious by comparison—but really you’re still going with the flow.

They Are Not Driven by Money

They’re not ascetics, but poker players are distinct for two reasons. Firstly, they’re so fiercely competitive that money mostly serves as a way to keep score; and second, gambling for such high stakes requires a certain desensitization to them.

Adapted from On the Edge: The Art of Risking Everything, by Nate Silver.