POKER

Rob Yong airs his views on partypoker’s roadmap, PokerStars and much more

TAGs: audio interview, partypoker, PokerStars, Rob Yong

Lee Davy sits down with Dusk Till Dawn owner, and partypoker partner, Rob Yong, to talk about his role with the resurgent online poker room, his thoughts on PokerStars, and much more. 

Rob Yong airs his views on partypoker’s roadmap, PokerStars and much more Audio

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Rob Yong is chocolate milk.

More cotton, than silk.

Rob Yong airs his views on partypoker’s roadmap, PokerStars and much moreIf he wears a mask then it’s Mission Impossible grade, and talking to him, as he prepares to take a seat in one of the biggest cash games in the world at the Triton Poker Series in Jeju you realise that taking on impossible missions is his forte.

Yong is one of the masterminds behind the resurgent partypoker, but where does he sit in the hierarchical order of things?

“I’m a partner with GVC, and my agreement with them is to help them with partypoker because they don’t have the poker expertise within the company,” says Yong. “Tom Waters is the Managing Director of partypoker, Mike Sexton is the face – one of the founders of the original partypoker – and we all know that John {Duthie} is the face of the live events. My role is in the centre, really; working with everyone, giving that expertise that GVC doesn’t have.”

An old man dying of lung cancer stares up at me from a pack of smokes on the table.

I can’t peel my eyes off it.

To help me focus on something else, I ask Yong what his metrics were?

‘We set out with a plan to stop partypoker from declining,” says Yong. “It was 30% down YoY, and it was difficult to stop that curve. In 2015, it stopped declining, which was a challenge in itself. Then we noticed it began increasing as they started to do more player-centric things, and over the last couple of years, party has started to ramp up and be competitive. I wouldn’t say that party was competitive software wise, live event wise, customer-service wise or product offering wise, but now party is getting to be competitive, and that’s the result of a lot of effort from a lot of people in poker.”

So, Yong’s relationship with partypoker goes back some years.

“I’ve been working with partypoker since 2014 when we first did the World Poker Tour at Dusk Till Dawn,” says Yong after a little cough. “Jeffrey Haas, who was in charge of the WPT, we did one event at DTD, and WPT was owned by party at the time, and that’s where I met the owners, and we started to work together. I have been working for them for four years, and it will continue for at least another three.”

I ask Yong to describe the tipping point.

“The biggest change was decentralising partypoker from bwin.party,” says Yong. “It used to be ran as what we call ‘horizontals’, so everything centralised, and the brands operate under this centralised infrastructure. GVC decided to decentralise poker into a vertical, so effectively poker has it’s own Managing Director, has it’s own marketing people, CRM people and makes its own decisions, and that’s when you saw a big difference.

“Before, it was the same customer service team dealing with a casino, sportsperson and poker person – as we know poker is quite different than sports and casino, so that was a big different for them to make. Fundamentally, underlining that was a commitment to the business model. I sat down with the CEO of GVC, Kenny Alexander, when they first bought the company and talked about poker, and what the business model would be, and they signed it off and let party get on with it.

“It’s quite a different business model. Effectively, having high revenue growth, but giving more back to the customers and players, taking less out of the ecology, and therefore not getting the same returns as someone like Stars would, but having a more sustainable poker market, which is something I advised them to do. If you don’t throw a bit back into the pot as an operator the games dry up.”

I sense that it must have been important for Yong to receive buy-in from the higher-ups.

I’m wrong.

“There are no higher-ups,” laughs Yong. “There is no board at party. There is Tom Waters, and he makes the decisions. You have Nick Whiten over at partypoker Live. You’ve got John and Mike who are your experienced older faces, and myself who helps everybody, really. It’s agile. For example, let’s say we like this venue {Landing Casino, Jeju} or Macau, and want to announce a MILLIONS Asia tomorrow, we could do it in a minute.”

I ask Rob if he has ever worked for a company tied up in red tape?

“I have always worked for myself since I was 21,” says Yong. “I just have a partnership with a big PLC. I have done it before in previous businesses. I have made agreements with big PLC’s and worked with them because you can take advantage of their leverage, and scale with the advantage of your agility. It’s not the first time I have done this.”

With partypoker so broken when Yong moved in, what did they concentrate on first?

“We had a five-year plan: 2017-2021, and we spent the first year doing the brand repair,” says Yong. “We wanted to repair the partypoker brand, which had been affected by charging withdrawal fees, segregation of player pools. They had made a lot of mistakes. We thought the best way to repair the brand was to meet the customers face-to-face. Tom is at nearly all the live events. We decided to create partypoker Live, and we felt within 12-months we wanted to make that number one in the world. I don’t think anyone can say that partypoker’s not the strongest live tour operator in the world outside of the World Series, which takes place once a year.

“In 2018, we wanted to improve the online offering, which meant some improvements in software and tournaments. We took a lot of gambles. We increased the guarantees from $3m a week to $10m a week. We took a lot of bruises from that. We took a lot of risks doing million dollar events every Sunday. We had a really good go online, but we found that more difficult, to be honest with you.

“2019 is about stabilising the first two years; improving the software, and creating a more stable platform everywhere: software, CRM, live events. The first two years just go for it live and online. Year three consolidate and tick a few boxes, and clear up some of the mess we created in the earlier years, and then years four and five creating some sheen and making things even better. It’s been a well thought out plan. There have been some bumps along the way, but I think we’re 40% up again so far this year; 40% last year – if we continue to be 40% up YoY it won’t be long before we are near the competition.”

I ask Yong to talk about some of those ‘bumps.’

“What we used to do was copy Stars,” admits Yong. “Stars would hold a festival, and we would hold one at the same time. Being a bigger size, when you do your big series at the same time as your biggest competitor you split the liquidity, and hurt each other. When we were small, we would leach off PokerStars, and everything was fine. Now when we do $60m, and they do $60m there is only so much money to go around, and we both suffer. So that’s something we will move away from this year. We will do our Powerfest in April, and stay away from their WCOOP. Taking some beatings on festivals, overlays and marketing costs. Taking some beatings trying to match their Sunday Million, we failed at that; we weren’t able to get the liquidity. Trying to compete, really, we took some knocks. I think we also got a lot of data and learned from it.

“Then there are the successes. We hit the MILLIONS Online; nobody thought we could hit $20m. We have had some massive success online. The schedules are now $11-12m from $3m in 15-months. You tend to focus on the pain you took, and not the successes.”

And what about those overlays?

“I never mind overlaying because it’s putting money into customer’s pockets,” says Yong. “In reality, 50% of the money you put back into your customers’ pockets ends up back in your pocket, that’s what nobody admits. Let’s say you overlay a tournament for $100k; $50k ends up going back down the rake chute anyway. I think operators are scared to admit that. They want the customer to think they overlayed for $10k, but no you didn’t. You put $10k into your customers’ accounts of which $2k is going to be spent in your casino, $2k raked on cash games and a grand raked on Mtts, so in reality, the churn rate of the cost of an overlay is only 50%. It’s not such a bad strategy to spend your marketing money on your customers.

“Let’s look at the size of PokerStars versus party. It’s roughly 5:1. So let’s pick a tournament. We do a big Bounty Builder with a $100k guarantee, $530 buy-in. Stars guarantee $100k as well, but they are five times bigger. We are asking for an accident, aren’t we? When people say party have had another overlay – with respect, Stars are five times bigger than party, and we’re matching them on many tournaments, so we are asking for nosebleeds aren’t we.”

I ask Yong if he ever has conversations with PokerStars about scheduling?

“Never.”

That was quick.

What’s Yong’s relationship like with Stars?

“I don’t have a relationship with them, because all the guys that I used to get on with, like John Duthie, they work with me now,” laughs Yong. “I don’t have a relationship with anyone from Stars, and I don’t think I have met anyone from Stars. I used to go to EPT’s, but a lot of them are now working for partypoker Live. Pretty much, everyone, we have met along our travels; they are all working with us now. All the friends we have made all work in this chaos we have called partypoker. I don’t have any relationship with Stars, and ultimately, I don’t like them very much.”

I ask Yong if partypoker spends much time focusing on PokerStars?

“I think, initially, 2-3 years ago, we would talk about how we could compete with PokerStars,” says Yong. “They were a world-class company, and you should emulate world-class companies. But now, we don’t talk about PokerStars. They don’t have an impact on us. We have our own live event operations, and our own things going on. They were a motivation for us 3-4 years ago, but I think now – it’s out of our control what they do.

“To be fair, PokerStars and 888, they’re not poker companies anymore. They are more corporate machines with KPI’s – whereas party is a true poker company. I don’t think we are comparable to anybody else at the moment. But 3-4 years ago I would look at PokerStars and use them for inspiration on how we can get better.

“Why wouldn’t we copy the good things. People ask why did we create Diamond Club and Diamond Club Elite. They are VIP programs, and Stars had some great VIP programs. We haven’t copied them, but they are similar – high rewards for high volumes.

“Stars had 10-11 world class things that only Stars did. Why would we not want to do those things? Everyone would want to. 888 would want to do what Stars do. If the owners of 888 said guys go and do 888 Asia or 888 Caribbean, they would do it. I am not on social media myself, but Patrick Leonard is always sending me these tweets, and I know Joe Ingram has been on saying partypoker are recruiting all of these pros. It’s not true. We have a lot of employees who are poker players, but we don’t have many that we pay to wear badges at poker tournaments. We have brand ambassadors like Ike {Haxton} and Jason {Koon} who are representing the brand. They are saying, ‘I wear the partypoker patch because I trust partypoker’, but the rest of the team, particularly the streamers we just added – they are here to work. Isai {Scheinberg}, when he was at Stars – his policy was you have to understand poker to be in his business. There is a misconception that we are signing lots of poker players. We are employing lots of poker players.”

I ask Yong if he approached PokerStars streamers to jump ship and join partypoker.

“I approached them,” says Yong. “I wanted to put a team together for Twitch. I like Twitch, so I looked around, saw who was the best and approached them. I told them we were putting a team together called Team Online, and how we want to do what’s best for poker. I asked them if they knew any other guys in the industry. We are going to have a team of 30 people, but they are going to be working.”

I ask Yong if the streamers are moving to party purely for financial reasons?

“People are relieved when they leave PokerStars,” says Yong. “Let’s be honest, when a pro walks in with a PokerStars badge on…we know it’s all bullshit. There used to be pride. We all know what PokerStars are like. When you join party from PokerStars, I think they’re relieved and feel fresh that they don’t have that stigma attached to them.

“I think it’s difficult for anyone representing that brand. However, it’s a business. Isai didn’t run PokerStars like a business. He ran it as a passion. If you’re asking me if the Stars Group or Amaya or whatever they call themselves – are they doing anything wrong? Absolutely not. They are just doing what businesses do – maximising profits. I don’t think they are doing anything wrong at all. I just think we got spoilt.

“When I used to be partners with PokerStars, they would say to me run a satellite at DTD, and we will add a $10k Monte Carlo seat for the players. I would run a satellite, get 200 players in my venue, guarantee five seats, and then add one $10k seat – that was the type of things that PokerStars used to do, and we got spoilt, and now we expect it. In my opinion, all Stars are doing is what businesses should do. However, I liked those good old days, and PokerStars used to make a profit doing that so why can’t party do that.

Rob Yong airs his views on partypoker’s roadmap, PokerStars and much more“The model works. Party had no turnover. Dead company. Party gets a lot of revenue, makes some profit, not as much as Stars, but it’s better than it was so everyone wins. party are better off than they used to be, the players get spoiled, and everyone wins. The only way you can do this model is because everything was dead and buried for party. We can be this caring company because it was screwed five years ago. It’s all upside, isn’t it?

“The problem with the PokerStars model is sustainability. Let’s say four of us sit around and play a cash game. If I rake as an operator too much, eventually everyone goes broke. That’s the thing about poker. The operator needs to keep putting a bit in the pot to keep the game going. They call it ecology – the posh word for it, but essentially it’s the operator keeping the game going.

“In terms of the industry at the moment there are other hungry operators such as ACR, GGPoker and some other guys that are doing challenging stuff, it’s not just party. I think 888 do some good stuff like that rakeless Sunday.”

And then there’s Run It Once Poker.

“I spoke to Phil {Galfond} before he launched his site. He has some great ideas and is very committed. I did tell him that I have learned that the loyalty of players to your brand is not as strong as we think. He has a great following, great brand, great blogs, good guy – but ultimately will players support him with their money, I’m not sure.”

I ask Yong why he doesn’t hunt down the people who created the Full Tilt software and hire them to make partypoker’s software world-class?

“party is built on an old platform, and integrated into the group’s infrastructure,” says Yong. “To rewrite the software, or rip it out, there would be a lot of disruption for the group. In hindsight, had we had known three years ago what we know now we would have tried to do that. However, I think Tom has come so far down the road now with the software, and what he has on his roadmap that he would be comfortable over the next 9-12 months that party has got considerably better software.

“It also takes time to rip it out and rewrite it. Also, resources. partypoker isn’t this huge company with thousands of people working for them. We have around 400 people. Everyone is focused on growing the business, and I think doing a complete software rewrite would distract from that. But going back three years knowing what I now know how difficult it’s been for Tom and the guys I think a complete rewrite is what should have been done. I think it was a mistake. We have so much in the roadmap to be delivered this year; we need to see how good the new stuff is going to be. There are lots of changes that are happening. There will be no HUDs on the site very soon. It’s not sunk costs; it’s a case of seeing how good it works. But definitely, three years ago a complete rewrite would have been the better way to go.”

And how does working alongside the many heroes in partypoker make Yong feel?

“I have known John and Mike for a long time,” says Yong. “I knew Tom from the WPT. We’re all really close friends. Everyone talks all of the time and tries to do their best. Patrick Leonard is a big influence on things. And of course all of our partners all over the world. It’s a collaboration of people, trying their best to bring party back from where it was.”

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