In the middle of his poker “rush” Lyle Berman was dancing toward bigger fortunes in business. Beginning with his involvement as a limited partner in a blind pool (1990) he was searching for businesses in which to invest . He recalls casually, “I did a couple of deals. “The blind pool was a public company that merged G3 Leather Company (a company he knew well) and Northgate Computer Company, a Dell look-alike except for going out of business in 1990. In the same year, two of Lyle’s partners in the pool had negotiated a gaming deal with an Indian tribe. They came to Lyle thinking he would join as a limited partner and help raise $3,000,000 for the venture. Says Lyle, in explaining his enthusiasm to commit more money to the endeavor, “I knew the power of the slot machine.”
Aside from poker and the slot machine business, which he had calculated as a goldmine, Lyle had also been intrigued by the gaming business for years. Refreshing his memory, I reminded him that shortly after we met at the World Series in 1986, a group of us had piled into a limo and headed over to Caesar’s Palace, the hottest property on the Strip at that time. After dining on a “comped” meal in the ultra chic Palace Court (thanks to the right connections) and roaming around the palatial casino, Lyle eyed the environment. He pondered aloud, “I could probably do it better.” As a “player,” Lyle had a critical eye toward the way casinos took care of their customers.
The businessman steps up his game
When the chance arose to become both a limited partner and general partner in an Indian UFA casino venture he seized the opportunity. His voice becomes animated as he lays out the picture for me. “I wanted to put up all the money. They (two of his partners in the blind pool) saw the wisdom of my money and we started Grand Casinos as a private company. We opened the first one in northern Minnesota, the Grand Casino Mille Lac, and it was very successful.” This led to a more ambitious project- yet another Indian land-based casino, at an anticipated cost of $12,000,000 to $15,000,000.
Extraordinary successes notwithstanding, Lyle was not holding that kind of spare cash, in his hip pocket, in those days. He says, “Since I didn’t have that much money, we decided to go public and built Grand Casino Hinckley. We quickly realized there was a big future in Indian gaming and emerging gaming.” From there Grand Casinos moved into Mississippi to build (and retain ownership) of three more casinos plus two casinos on Indian trust lands of the Cushatta Tribe and the Tunica/Biloxi Tribe.
From retirement in the rags trade, Lyle emerged as the Chairman of the Board of the Grand Casinos when it went public (1992) on the NASDEC, alternately housing himself in his public company’s headquarters office in Minneapolis and on the reservations of multiple tribes to grow their product. And he continued to jet hither and yon for “big bet” poker games that always held his rapt attention.
An evolving poker game
Until 1993, when the big limit games came into vogue, he rarely played “limit poker,” but during the mid nineties their popularity forced Lyle to “get with the new program.” He says, “Even today I don’t like playing HORSE unless it’s the only game at the moment.” The combo of Omaha high and Omaha Hi/Low and a broader menu of mixed games, also known as rotation games (with monikers such as HORSE, HOSE S.H.O.E. and HOE) have become the rage over the last several years). Mostly, he developed his game for four and five handed high limit games. He says thoughtfully, “I don’t always use my best skills all the time. My problem is execution. Sometimes my hand beats my brain!” Referring, to his purchase of a computer analysis back in the 80’s for Omaha hands, Lyle opines, “Sometimes when I make a call that I know I shouldn’t make I say to myself, I paid $20,000 to learn not to do what I am about to do.” He continues with a bit more philosophy, telling me that as far as he is concerned, “Poker is like business. It teaches on an every minute basis that there are ramifications to every decision you make. In poker you learn almost instantly. In business, sometimes it takes years to learn the consequences.” In poker and business he has enjoyed a string of successes, but not all ventures turn out perfectly and he has faced those challenges, too. Such was the case with the Stratosphere.
Poker buddy Bob Stupak taps Lyle on shoulder
Lyle’s “new 90’s program” extended beyond the poker tables. In mid 1995 one-time Las Vegas Mayoral candidate, Bob Stupak was mid-way in a major project to rebuild and expand his Las Vegas World Casino when fire broke out on the property. The costs of the disaster left him strapped. Lyle saw a spot to make it “big time” in Las Vegas when Bob approached him for financing. In no time, Lyle and his longtime poker buddy wrapped up a deal between Stupak and Grand Casinos for the purpose of building the Stratosphere Casino and taking it public. While things started off well enough for the new towering Las Vegas landmark, eventually the venture lost $150,000,000.
Despite the losses, Lyle does not look back in anger; instead he talks candidly about the facts. He was bullish during the building stages, but once opened it became clear that “there was a bad combo of too few rooms, too few visitors, and visitors didn’t gamble as much as projected.” Ultimately the company went to the bondholders during the bankruptcy, and all the equity holders including Grand Casino’s $150,000.000 investment went down the tubes. As if anticipating the question, Lyle emphasizes, that of course, he and Bob Stupak remain friends. He promptly returns to poker talk.
Hip poker games
Unless it’s the only game at the moment, Lyle generally steers clear of the mixed games. As in the 80’s, Lyle still gravitates to the revived (but bigger blinds than in the past) PLO and NLH games, with $10,000 Buy-In requirements-more suitable to the tastes of a man with a distinguished gaming career. And in differentiating the modern day high stakes player with the ones of earlier days, Lyle chats me up about the past day’s “high stakes” games at Bellagio where he says, “I was the only American born player at the table. Every time I play, it is a different group of foreigners. In poker, Jews, Muslims and Arabs all get along just fine. The game has definitely changed over the years. It was originally played by Hold’em players with feel and raw talent. Today it is played with more experience and sophistication, and the Europeans are more lively, play more hands and raise more.”
The conversation reverts to big business
The switch in conversation between poker talk and business talk is a constant with Lyle. We take a step back to review his vast gaming industry experience. He ticks off one success after another among seven of the eight casinos built by Grand Casinos: “the three we built in Minnesota and ran for an Indian Tribe, the three we owned outright in MS, and two in Louisiana for Indian Tribes. Then there was the Stratosphere.
Lyle returns to Caesar’s!
In December of 1998 the three Mississippi Casinos were merged with Hilton Hotel Casinos resulting in three separate companies; Hilton Hotels, Park Place Entertainment and Lakes Gaming Inc. Lyle obtained a seat on the board of Park Place Entertainment as part of the deal, which by its acquisition of Caesar’s World, Inc. soon included Caesar’s Palace, the casino where twelve years earlier while eying the environment after dinner, he had said “I could do this better.” His position on the board was terminated a year later, at the Board’s initiative.
Lyle speaks his piece on Park Place
According to Park Place Entertainment’s public statements, Lyle’s involvement on the Board was a potential conflict of interest. Though Lyle disagreed, he went on his merry way as Chairman of Lakes Gaming Inc, a gaming company that has specialized in building, financing and managing Indian casinos ever since. Lyle says, “He still just doesn’t understand why he wasn’t more highly valued,” adding that he was “the only Board member with practical hands-on casino experience.” He says “He is mystified as to who felt threatened by his strong presence.”
Lakes Gaming Inc. goes forward on its own
Although Lakes Gaming, Inc.’s contracts with all of the Indian Casinos that have been built under Lyle’s watch have now expired (and as expected have not been renewed), the company is busy with five current contracts to develop Indian Casinos for three tribes in California (San Diego, Sacramento and near San Francisco), one in Michigan and one in Massachusetts. (None of them have the legal rights yet to build, but Lyle hopes to begin construction within a year or so. There is also a full plate of prospective deals in the hopper, and the new WPT is now center stage.
Genesis of WPT
The WPT began as a casual discussion. Lyle and Steve Lipscomb met at the WSOP. Lyle says, “I was impressed right away. We talked in generalities. Finally he made a proposal. I liked it. Lakes liked the research; the idea that poker could be a major entertainment vehicle on TV looked viable. After all crows Lyle, “More people play poker than watch football, tennis or golf! I think it is close to 50 million.” (The New York Times recently suggested 30-50 million people play poker somewhere between their kitchens and the card rooms of casinos around the world).
Steve Lipscomb reaches out
The joint venture between Lakes Gaming Inc and Steve Lipscomb took time and Steve graciously points to his friends and WPT consultants Linda Johnson and Mike Sexton who urged him to go forward with the idea. Before his first big serious meeting with Lyle at his new Las Vegas condo, Steve put together a brief business plan. He sat with Mike and Linda over lunch to discuss it, before the three of them went together to visit Lyle. Steve says, “Their moral support as well as Andy Glazer’s suggestion to consult with Linda about the idea proved invaluable” to his confidence during his presentation to Lyle. That was in November. Lyle and Steve carried the ball from there. When Lyle brought the massaged idea to his Board, they were instantly impressed. On February 25, 2002 a signed term sheet placed Steve as President and CEO and Lyle was installed as the “Grand Poohbah” of the World Poker Tour. (Later Lyle accepts his nomination as Chairman of the Board of WPT). Today Steve sits as a confident partner with Lyle as Steve televises, directs, markets, lawyers, researches, analyzes and otherwise coddles every aspect of the WPT in his office on the old Warner Brothers lot in the middle of Hollywood.
Steve’s formative years
Steve was born November 1, 1961. The Southern boy was delivered in Texas but spent his growing up years in Knoxville Tennessee where he went to grade school and got his sparkling high school diploma. His mother, Dixie is a strong feminist who made a mid life change from teacher to Baptist minister in the Deep South, where women were not welcome in such jobs. His Dad who like his Mom is remarried, was a professor at the University of Tennessee. And like his partner Lyle, Steve is the middle child with a brother two years older, and a sister ten years younger, and an extended family through his Dad who had two more children after Steve had left for college.
Steve took his near genius IQ to Dartmouth, obtained a degree in philosophy (1984) and then took off a year from school to work before continuing his academic journey at the University of Chicago Law School, where he was awarded his JD degree. His grades were easily in the top 15% of his class, and that was with a part time work commitment in improvisational comedy- eventually appearing at Chicago’s 2nd City.
Steve moves across the country
A year after law school, Steve made a sudden move to California to be with his ill brother who had been diagnosed as HIV positive. (It later proved to be a “false positive.”) Steve reels off the chain of events that followed, “I went off and loaded up the truck and moved to Beverly Hills and went to the (nationally recognized) law firm of Gibson Dunne and Crutcher and practiced big corporate anti-trust litigation. I decided this was not going to be my life. I looked for temp work as an attorney and began writing screen plays and doing comedy related things. I gravitated toward these types of people.”
Steve goes into business
Steve started one of the early legal temporary agencies in 1991 and kept it going-briskly- for several years, but his heart remained in screenplays and television production. Steve’s commitment to film making and television production started with great passion.
During a Sun Dance Film Festival, he mumbled to himself, “The only difference between them and me is they made something this year.” He talked to his mom while studying for the ministry in the middle of the “women can’t be pastors anymore controversy” and decided to film her experience at the seminary. He says almost incredulously at his brashness of the time, “I had never been on a film set. I sold my biz off to a competitor and went and showed up with film and crew and everything I was told I needed and shot Battle For the Minds, which was praised to the hilt by NY Times critic Walter Goodman. It won a ton of awards, which brought the attention of Norman Lear. He continues “Norman called me to his office, spent an hour with me and we eventually submitted a pitch called the ‘Big Pitch’ for TV,” which they sold to Twentieth Television (syndication arm of Fox). He was off and running.
The gem of an idea was born
Around the same time, Steve shot the 30th anniversary of the WSOP for Discovery channel (first time on American television the WSOP was filmed without charge to Binion’s Horseshoe). That assignment earned him the honor of the highest rated cable poker show in history (1998-1999). “That was the kernel of the idea that eventually became the WPT. It was the proof that if you build it they will come”.
Chuck Humphrey makes a proposal
Steve began to familiarize himself more with poker rooms and became more and more interested in the game as a sport. While playing at a poker table, he met TOC President Chuck Humphrey. He says, “Chuck invited me to dinner, got me drunk and got a great deal. I video taped the 2001 TOC. He says, “Chuck and the TOC put me back in touch with people in the poker world and reminded me that there was something special about poker people.”
WPT, here I come!
Right after the TOC, Steve got busy with his business plan for the WPT, “mindful that the market I wanted to reach was all of those 30-50 million people who play poker- the guys of poker that Jesse McKinley talks about in his New York Times article (Feb. 3, 2002 Low Stakes High Hopes) from his home poker game.” Steve emphasizes that while he wants to attract the casino poker player, “The real market is in kitchens, rec rooms, living rooms, and dining rooms across the country. I want to appeal to doctors, lawyers, cops, accountants, fireman and other recreational players” from all walks of life.
Show me the goods!
“If poker is done right, there will be a large audience that will watch poker tournaments on a regular basis, says Lyle. He insists, “While watching the final table (of a poker tournament), the television viewers must see the cards as they are being dealt to every player.” The concept of showing the players’ holdings for the viewer to see was discussed and written about at least as far back as 1984 by both Mike Caro “the Mad Genius of Poker” and Jim Albrecht, the highly experienced poker executive. More recently inventor and WSOP bracelet winner Henry Orenstein obtained a patent for the design of his glass table through which to see the cards. Henry’s technology was used at the Poker Million.
WPT, the royal flush!
Lyle and Steve have since researched and perfected their own concept- showing cards to the public while retaining complete security of the hands amongst the players. The result is that the hands in progress are viewed by the spectator, providing the ultimate television reality experience.
The Inaugural Tournament
The Bellagio May 27th tournament begins and continues in its poker room for four days. On the fifth day, the finalists will be in the Ballroom at 2PM sharp. There will be a magnificent set and dramatic lighting waiting for them and the three hundred spectators who can be accommodated in the bleachers. The magic of the set is produced by Jim Cuomo and John Conti- set designer and lighting designer respectively. (I will not spoil the drama by describing the logo, the pillars and the more than dozen cameras that will be trained on the gladiators and all that is about them. As in billiards and other sports, major sponsorship banners (tobacco and hard liquor excluded by TV) will be evident, too. Each player will be introduced and ushered onto the set to sit at the table one at a time. A crystal trophy for each of the nine will be waiting at his/her place.
Let the broadcasts begin!
Experienced poker commentators Mike Sexton and Vince Van Patton will be ensconced on a riser stage and Linda Johnson will be an official Voice of Poker with announcing and interviewing duties while another female host will familiarize the audience with the sponsor’s property.
A new poker era
Again we hear the unified voice of Lyle and Steve: “The aim of the WPT is to widen the audience of poker by reinventing its image as a stylish and exhilarating sport, in which neither physical size nor formal training are necessarily required to excel-just nerves of steel, cunning, memory, a feel for numbers and an uncanny ability to make the right judgment instantly.” With the combined expertise, drive and love for the business and the game, Steve and Lyle are positioned to make the WPT a huge winner.