The Big Bet

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icon-tutorial-2nd-series-52About a week from now, I will make a phone call to London and place a large bet. In fact this bet will be, by far, the biggest bet I’ve ever placed — around $1,500.

There are only three rules: 1) I have to bet it all; 2) I can bet on any sport; 3) I’m not allowed to lose. (This third rule was established by my wife Jen, and also by the existence of our son’s college tuition bills.)

So the question is, what should I bet on?

Quick backstory: a few months ago a book I co-wrote was fortunate enough to win the William Hill Sports Book of the Year Award, which is sponsored by the British bookmaker of the same name. As part of the prize, I got a free voucher allowing me to place this bet.

At first, I was tempted to aim for a longshot. Like picking the Cleveland Indians to win the World Series (approximate odds: 1 bazillion to 1). Or picking the Cleveland Browns to win the Super Bowl. Or, come to think of it, any team from Cleveland to win anything.

Then, urged by my ever-wise wife, I started to think more conservatively. I started to look for a team or person whose talents I could trust with this bet. It wasn’t easy.

Because if I’ve learned anything over the past years it’s that success at the highest level — in sports, business, music — has a significant component of randomness to it. You can do everything exactly right — train, coach, prepare — but chance and chaos will have their say. Favorites collapse all the time. Underdogs win all the time. Refs make terrible calls. Freaky injuries happen. The ball bounces in strange directions. How do you beat that? It seemed hopeless.

Then I read this article. And saw this video.

They tell the story of how LeBron James, basketball’s best player, set out to improve his game. How, in a move straight out of Moneyball, James ruthlessly analyzed his weaknesses and set out to build a new skill set that would make him a more efficient teammate. How he hired a master coach and made himself a humble apprentice, showing up early for each training session, videotaping and studying, in order to learn a new set of scoring moves. How James, in short, turned himself into a master student.

Here’s James talking about the process:

“The biggest thing isn’t how much you work on things, it’s ‘Can you work on something, then implement it into a game situation?’” James says. “Can you bring what you’ve worked on so much and put it out on the floor with the finished product? I was happy that I was able to do that and make that transformation.”

James emerged from that summer transformed. “When he returned after the lockout, he was a totally different player,” [Coach Eric] Spoelstra says. “It was as if he downloaded a program with all of Olajuwon’s and Ewing’s post-up moves. I don’t know if I’ve seen a player improve that much in a specific area in one off season

So now I’m leaning toward betting on James and the Heat to win the NBA championship next month. In the larger sense, I wouldn’t really be betting on James — I’d be betting on the power of his process, his approach, his craftsmanship. I’d be betting that, in sports as in everything else, the smartest learner wins.

But before I make that phone call and place that bet, I want to ask: do you think this is the right move? Is there anything I’m missing here?

What would you bet on?

UPDATE — Thanks to all your wise advice, I did not bet on the Miami Heat to win the NBA finals — and am now looking at upcoming Wimbledon. Roger Federer couldn’t possibly lose a first-round match, right??


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27 Responses to “The Big Bet”

  1. gpo613 says:

    Well, this is simple if it doesn’t have to be a single bet with the $1500, rather that you can split that voucher into separate bets. If you can make multiple bets with that $1500 then all you need to do is split the money evenly among all the teams in the NFL and bet on all of them to win the superbowl. Hopefully a darkhorse or longshot wins a larger odds. Either way you would be walking away with some money.

  2. Grotaiche says:

    If the Miami Heat is to beat the Indiana Pacers (they’re currently tied 2-2 in the conf finals), they will face the San Antonio Spurs in the Finals and they will have court advantage. Given Miami’s record this season and the way they play, they’re a fair bet.

    However, I am not sure about your thought process here. You’re betting on James’ TEAM not James by himself. Sure, James is a smart learner and probably the best basketball player in activity. But it’s a team sports, not an individual one unlike tennis or swimming ; James’ way of learning is important but is not as relevant as if you were betting on him getting an individual award.

    Why don’t you bet on something more “single player”-centric ? Like tennis, where the current safe bet is to go for Rafael Nadal winning the French Open (provided you find any good material regarding Nadal’s training).

  3. Chris Mckhann says:

    Hi Dan,
    I do like betting on “the process”, but if it does have to be one bet, then from a probability standpoint, you are best off putting it all on one longshot. Just like if you don’t have an edge (and time) you put all your money on one bet on the roulette table
    Chris

  4. Tyrone says:

    Hi Dan,

    What are the terms and conditions of this bet? If your bet wins, will you be paid the winnings plus the original $1500 stake, or will you only be paid the winnings? This should dictate what kind of a bet you place.

    If it’s the former and you’ll be paid out your original stake plus the winnings if your bet comes through, you should definitely go for a short-odds option that gives you the highest chance of retaining your $1500, even if the winnings on this stake are minimal. For example, if you were able to place your bet today, you could go for Roger Federer to win his 2nd Round match at the French Open. His odds are 1.01 (1/100 in fractional odds), meaning he has about a 99% chance of winning. Your returns would be $1500 + $15 = $1515, and you’d be almost guaranteed to receive that money. There are lots of very short-odds options available on William Hill, particularly in tennis markets, but also in obscure markets in virtually every other available sport.

    If William Hill are only paying out the winnings on your bet, it would make sense for you to take a higher risk on a result that is less likely to happen, but would result in you winning a more substantial amount if the bet came through. A 1.5 odds shot (1/2 in fractional odds) would have about a 65% chance of winning, and would pay you $750. An even money shot (2.0) would have just below a 50% chance of winning, but would pay $1500 if it won. In this scenario it all comes down to how much you’d like to win when you compare that figure to the associated risk.

    Hopefully that’s helped a little!

  5. djcoyle says:

    Hey Tyrone, That helps a ton. Thanks. (And to answer your question: yes, it is the former.)

  6. djcoyle says:

    That’s a good point. As last night showed (James fouled out and they lost, tying the semifinal series with the Pacers at 2-2). Tennis — hmmmmmmm.

  7. Jamie says:

    How about glasgow Celtic to win the Scottish premier league next season? Biggest budget in the division by miles and miles and have won the title the last 3 years. In addition, the financial struggles of their traditional rivals, Rangers, who were demoted to the bottom tier of scottish football,mean that there is no likely challenger within celtic’s division. Also, they are a very good side, getting a famous win over Barcelona in last season’s champions league.

  8. Neil Pickup says:

    Celtic to win the SPL is nailed-on, as are Rangers to win whatever division the Scottish League decide they’ll end up in next season, if indeed they can decide how many divisions there are in their league.

    Otherwise Bayern Munich will win the Bundesliga again.

  9. Andy says:

    I would bet on the Heat too, but you had better check on Tim Duncan first. They seem possessed

  10. Tyrone says:

    No problem Dan, glad to be of assistance and congratulations on the Award! It was much deserved.

    Indeed, the NBA picks have a relatively high uncertainty about them, particularly if you’re looking for a near-cert to bet on. For example, the Heat have about a 75% chance of winning the Eastern Conference and a 65% chance of winning the NBA Championship.

    When is it that you’ll be making the bet? This week is particularly good for tennis, as it’s the first few rounds of the French Open and there are a number of mismatches as top seeds play lesser opponents. Next week the ties in general will be closer, but there will still be a few very short-odds selections early in the week, particularly with the likes of Rafael Nadal and Novak Djokovic. One really has to wait and see what comes up though. The likes of cricket, golf, soccer, rugby will all have suitable bets.

    If you’d like, as I spend a lot of time pouring through and working with odds and it’s not a great deal of effort for me, I could advise you a bit closer to the time on what the short-odds selections are, along with the chances of each bet coming in, etc. and you can take it from there. That might save you some time and make things a little bit easier!

  11. gpo613 says:

    If you do bet on the Heat to win the series here is something to think about. If the Heat happen to get up 3-0 or 3-1 in the series place a second bet with your own money to hedge against San Antonio coming back. You will get odds at that point so you will be guaranteed money. I read about that once when the Boston Red Sox came back from being down 3-0 with the Yankees. A guy had bet the Yankees to win the series for 5K. Once the series went 3-0 he placed a bet on the Red Sox for like $500 getting 10-1 odds. Guaranting him a win for 4500.

  12. Ryan Hockman says:

    Use your talent code recipe to predict where, how, and why great teams are produced. Study the divisions, conferences, etc. that make-up national leagues and find out where the “arms races” are located to narrow down the search for most predictable outcomes. An example would be the SEC in college football. While Alabama has won 3 of the last 4 national championships, the culture of the SEC and the crucible a team must endure to win that conference is producing the best in the country.

  13. Alex says:

    Don’t know, I’d spread around with high chance of winning and get some money if that money was relevant to me (not much fun but it is correct), if it isn’t it doesn’t matter if you spread out or not as the math won’t change, you will be behind anyway… just have fun then and try to use your expert insight ;D.

  14. Alex says:

    It has some relevancy to specializing early :D .

    http://en.wikipedia.org/wiki/Risk_of_ruin

  15. Brock in HK says:

    Your observations about LeBron James suggest that you should find a master better to teach you how to better gamble before making your bet. Why would you think you would be successful without any training whatsoever, particularly as it appears you have a distaste for betting in the first place?

  16. Steve Thompson says:

    In my opinion you should put your $1,500 free bet on Dawn Approach in the Epsom Derby this coming saturday (if you have the bet in time). Evens at some places.

  17. Brian Galvin says:

    I like the bet! Except you’ll be betting against the San Antonio Spurs and a chap by the name of Tim Duncan! Tim seems to epitomize every thing that’s good in sport and seems to me the be the very essence of “The Talent Code” way of learning and getting the best out of oneself…!

  18. al says:

    follow tyrone’s advice — it is accurate

    as a follow-up would check where william hills offers the best odds (vs other bookmakers) for one of those short price favourites

    easily done on a site like bettingzone

  19. doc says:

    Jimmy the Greek once said, “Don’t bet on anything that can talk.”

  20. MdM says:

    The Heat will probably be slightly favored to win, assuming they get past the Pacers (2-2 right now in a 7 game series). However, I’m not sure I’d bet against the Spurs. They are a very successful team that has maximized their efficiency from a coaching, drafting, personnel development, and talent standpoint. As impressive as James’ improvement (from the best player in the game to even better), the Spurs’ constant organizational attention to detail is an even greater and, IMO, more beautiful example of the type of ideas in your books.

  21. Nick says:

    It seems the best way to guarantee a return if you get the stake back when you win is to bet on an unequal match up, use the voucher to bet on the favourite and the a bit of your own money to bet on the long shot, as the odds will be long for that you shouldn’t need to put too much down. Boring but safe for the college fund.

  22. Alun says:

    Hi Dan
    As always your blogs touch a very interesting and thought provoking aspects of talent and excellence development.
    I believe you are betting on two main aspects: an individuals hard work, motivation, commitment and focus to learn and develop his craft; plus the availability and delivery of quality coaching. Bet on these two components every time and you have the formula to win.
    It seems to me that in all of the stories of successful talent development sustained, consistent and long term hard work and quality coaching are the two ingredients need to be successful. If the team have the same two ingredients then its a safe bet – as safe as the other many random factors allow it to be!

  23. Brock in HK says:

    I stand by my proposition that Dan should get some betting coaching before placing his bet. To use Alun’s framework, Dan’s outcome depends on a) the ability of the team / individual he favors to win and b) the ability of the sports book to set the odds in their favor. The sports book has developed its skill as an organization; What has Dan has done to prepare?

  24. Ed Chapman says:

    Hi Dan,

    If you’ve not made that bet yet then place it on Nadal to win the French open final today! Can’t see anyway Ferrer can beat him.

    Fingers crossed on whatever you bet on and like the process of choosing.

    Ed

  25. David says:

    Little late here… but assuming you’re betting against a line, you’re not really betting on a team, you’re betting against someone else’s ability to properly judge that team. So if you’re theory is that people are going to *underestimate* Lebron James then I think you’re not going to make much money that way.

    Talent code principles might be a good way to judge which players will be good over time, but if you’re betting on something coming up soon then I think statistics is a better approach, since all you really care about is getting an accurate read on what they can do now. You can look for sites like wagesofwins to see some areas where the conventional wisdom doesn’t measure up to reality and maybe get an edge that way.

  26. Scott says:

    Guess you should have stuck with your gut feeling about that prediction!! Now, who will win Le Tour?

  27. Daniel says:

    Haha Daniel, you should have bet on the Heat after all! Bummer!

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