Straight Flush: The True Story of Six College Friends Who Dealt Their Way to a Billion-Dollar Online Poker Empire--and How It All Came Crashing Down . . .

by Ben Mezrich

  The basement was large and rectangular, with no windows, no paintings on the walls, and almost no furniture. Shane had stopped a yard from the elevator, which had since closed behind them; it seemed like Scott’s frat brother was fighting the urge to turn and try to run back upstairs. The basement certainly didn’t look like the office of a fledgling Internet company—maybe more like some sort of terrorist hideout. There was a whiteboard in one corner, covered in fairly arcane computations and sketches, and stacks of papers like the teetering walls of a hastily constructed fort, set in a semicircular pattern around a pair of matching computer stations. Both monitors were on, dueling screens of sand and green. Without a doubt, Shane immediately recognized the squiggly palm trees from Paradise’s website, even from that distance.

  “I really like what you’ve done with the place,” Shane said. He pointed toward a pair of closet doors along the back wall of the room. “Is that where we keep the hostages?”

  “Actually,” Scott said, crossing to the closest stack of papers, “that’s where we sleep. There’s a cot in each closet.”

  “You’ve got to be kidding me.”

  Scott grinned. He wasn’t kidding in the least. And he knew that despite Shane’s rumbles of discontent, his friend was completely on board. The basement was a stark contrast to the incredible mansion upstairs—but it was all theirs. When Scott’s father had offered him the use of the space for his fledgling company, he’d jumped at the chance. The beautiful home above it—a sprawling estate on Lake Washington with more bedrooms than Scott could count, manicured grounds, and even a fully operational golf course where his dad held one of the area’s premier annual charity events—acted as aspirational motivation. Scott intended to own a house like that one day. This basement operation was how he was going to get there. Besides, it wasn’t going to hurt that his dad would be entertaining wealthy colleagues and clients upstairs. Scott had agreed not to pitch himself to Phil’s clients in any overt way—but if someone wondered what the heck was going on in the basement, well, Scott would be more than happy to give him a tour.

  Even with living out of the basement, twenty-five thousand dollars wasn’t going to last very long. If Scott was going to make his company a reality, he was going to need to raise more money. And before he could go after additional funds, he needed personnel.

  Shane had been an easy first choice. Scott trusted him implicitly, knew he was a hard worker—it didn’t hurt that he was the most anal-retentive of the fraternity bunch—and his eye for detail would be a great help. Equally important, his family had a tractor dealership; they had the ability to invest in a new business venture. Most important of all, Shane had coincidentally already moved to Seattle for a job that hadn’t worked out—which made him eager and willing. When Scott had pitched him the idea over lunch at a kitschy place called Chang’s Mongolian Grill, Shane had been enthusiastic from the beginning; when he’d opened his fortune cookie at the end of the meal and read his fortune out loud, he’d been completely hooked: “A confidential tip will clue you in to a great financial deal.” Scott couldn’t have planned it better if he’d tried.

  Scott pulled one of the sheets of paper off of the closest tower and handed it to his friend. Shane saw that it was a list of names—all of which he recognized.

  “And here I thought I was just really, really special. It looks like half of our fraternity is on this list.”

  “Just the best, brightest, and those who come from a little bit of money. Look, it seems pretty obvious to me: Why go knocking on doors when we have this incredibly deep bench—SAE?”

  “Have to admit, down here in the basement it does feel a little bit like we’re back in the fraternity house.”

  There was even a pile of beer cans in a corner, along with a row of empty Red Bulls. Why not extend the frat house feel? The SAE house was one of the greatest experiences of both their lives. There was no reason to change a model that had already been proven to work.

  “Who are you going after first?” Shane asked. “Pete? Garin?”

  “I already spoke to Pete. He still isn’t on board with the idea of people playing poker online. And also, well—he did just get married.”

  At least Pete had agreed to act as an informal consultant as they moved forward, but he wouldn’t be moving into the basement. He’d married his college sweetheart, and she probably wouldn’t have liked living in a closet anyway.

  “And Garin?”

  Scott grinned. “He’s driving his Mustang up next week.”

  “And who else? You’re not going to get Brent to drop out of school early, are you? He just got elected president of the house for next year.”

  Scott shook his head. He was damn proud of his brother—it was amazing, the transformation the kid had undergone. Now he was going to be president of the whole goddamn frat. Scott watched as Shane lowered himself in front of one of the computers and started poking around the keyboard. Now that he had a little money, Scott had opened an account on the website—so they could play along and see how flawed and imperfect Paradise Poker seemed to be. He was already coming up with ways the site could be improved. But to get there, they needed money—because it was money that would lead to new software.

  None of the SAE brothers were computer programmers. In fact, none of them had ever taken any computer courses at all. Which probably made them the least qualified people to start an Internet company.

  But that would soon change. Scott was determined to put together the perfect team. They wouldn’t leave the basement until they had a working business plan and an avenue to the software that would make it all sing.

  Garin was the next piece in that puzzle, and even though he had only been hired a day ago, he had already proven himself invaluable with a simple suggestion of who they could go after next.

  Scott was going to let Garin make the call himself.

  That’s pretty cool,” Garin was saying as he squatted against a beanbag chair in the corner of the basement, a cordless phone held in the crook of his neck. “A whole semester abroad in Paris? Can’t imagine what that would be like. I’m not even sure I could find the place on a map.”

  Garin looked up from the phone and across the room at Scott and Shane, who were seated next to each other at the computer stations. He gave them a thumbs-up. A semester abroad in Paris was the kind of thing that none of them could ever have contemplated; it was obvious that the kid on the other end of the line would make an important addition to their team.

  “Welcome back,” Garin continued. “I know it’s been a while since you left Montana, Hilt, but I’ve got a little proposition for you. Shane and Scott are here too, and we’re working on a poker business. Yeah, online. It’s an Internet company, where people can play poker.”

  Garin launched into the pitch that he, Scott, and Shane had developed—a sort of mini business proposal that they had put together from the research they had compiled. Scott could tell, even from across the room, that Hilt was at least listening. If he liked what he heard, they’d be in great shape.

  Oscar Hilt Tatum IV had attended the University of Montana for only a single semester—racing back to Florida, where he had grown up, because he hated the cold—but in that short time he’d made quite an impression. He’d rushed the SAE house, gotten accepted in no time—and then had shown up with a BMW M3 convertible on the back of a truck. That sight still stood out in Scott’s mind years later.

  Hilt came from money. His parents were prominent in the St. Petersburg medical community, and his family extended deep into the professional field. Hell, he had a Roman numeral after his name. The only Roman numeral Scott had ever been involved with had been carved into his frat-room door.

  If any of them aside from Shane had access to people with money, it was Hilt. When Garin finally finished his conversation and hung up the phone, Scott could hardly stay in his seat.

  “Did he seem into it?”

  Before Garin could even answer, the phone, still in his hand, started ri
nging. Garin stared at it, then finally put it to his ear.

  A few seconds later he hung up, then rose to his full height and clapped his palms together.

  “He said he’ll be here in three days. And he’s going to bring a hundred thousand dollars in investment money with him. He wants in, and he wants a piece of the company. I think we damn well better give it to him.”

  Scott tore across the room and caught his friend in a grip that was half tackle, half bear hug.

  They had just quintupled the value of their company with a single phone call.

  The next six weeks flashed by at ten thousand RPMs, bolstered by a constant stream of Red Bull, adrenaline, and a shared determination to one day get the hell out of that basement and onto a bigger stage.

  Very quickly there emerged a strict daily routine. Scott, Shane, Garin, and Hilt were all at their computer stations every day by 7 A.M. Punching keys, doing whatever research they could, writing away at the business proposal that was growing line by line, paragraph by paragraph—all through the day, until 9 P.M., when one of them would break first, sliding off a stool or beanbag chair and onto the floor, ready to crawl toward one of the cots in those damn closets. None of them had ever worked so hard. Entire weeks went by without any of them stepping outside. It got so bad that eventually they decided to create a ritual night out: Wednesday, because Wednesday was ladies’ night at a favorite bar in downtown Seattle, a place with Billiards in the name.

  As a team, they had learned to function even more efficiently than Scott would have thought possible. Once Hilt had arrived in the basement, he had immediately been assigned the task of headlining their money-raising efforts. Polite, soft-spoken, and slight of build, especially compared with Garin, he had an amazing affinity for numbers and all things economic. He was also an intensely logical person who spoke faster the more excited he got. He quickly developed an incredibly convincing pitch of his own, which he plied over the phone as often as possible, starting with family friends down in Florida and extending through the fraternity network to anyone he thought might be willing to invest.

  They made their goal simple: $750,000, which they intended to raise within three months. That, they believed, was the minimum amount they would need to launch their company. Garin, Shane, and Scott, who were focused on editing and constantly revising their business plan, had come up with the number by both analyzing Paradise Poker’s financials and extrapolating using what data they could find about the market as a whole. In the year since they’d discovered Paradise Poker, more companies had entered the business, and a couple in particular were growing at a fairly rapid rate. PokerStars, run out of the Isle of Man, was well capitalized and seemed like it was going to rise to the top of the heap. Another, Party Poker, was growing by leaps and bounds, and was also well financed—its founders had made a pile of money on 1-900 sex lines and had poured that capital into a first-rate poker site.

  The one common denominator that they had found among the sites was that they were all based outside of the United States. Even though every lawyer they met with continued to assure them that there was nothing inherently illegal about running an online poker website, it seemed that all of the companies were being run overseas, even though the large majority of their customers were American.

  Scott and his team hadn’t yet come to any conclusions, but they began to see the many benefits of launching their company overseas: cheap labor, governments that were okay with licensing a gaming website, experienced platforms. If they were going to run an international business, there was no reason not to think internationally.

  Before any of them would be getting on a plane, however, there was one more pressing issue: they needed to come up with a name for their website. On the Internet, your future was only as strong as your domain name. It was more than just words on a monitor; it was your location, your home, and your brand. Paradise Poker, PokerStars, Party Poker—they were all strong choices, because all of them left you with a feeling, an emotion. Paradise—that was self-explanatory. PokerStars gave you a feeling that just by playing there, you were some sort of poker celebrity. Party Poker—well, wasn’t that what it was really all about? An online party with friends and strangers that never had to end.

  Scott wanted something just as powerful. Something sophisticated, something that brought to mind a classy operation, a place where you might have a martini and a cigar and play a round of poker.

  But despite their efforts, a good name eluded them. In recent days they had grown so desperate, they had taken to leafing through the dictionary, just throwing out words, adding poker.com to whatever they found. CallPoker.com, JackPoker.com, PlayPoker.com. Nothing seemed good enough. Before they did anything else, they had to solve this problem.

  An Internet company without a name was like a bar that no one would ever be able to find.

  It was a Wednesday night, a little after ten o’clock, and the BMW 5 Series sedan was positively throbbing. Techno music reverberated through the speakers built into the dashboard, making the very windows rattle as Scott navigated the sleek automobile down a dark stretch of highway. Trees were flashing by on either side and there were mountains in the distance, but it was hard to concentrate on anything other than the techno. Garin and Hilt, in the back, and Shane, in the passenger seat, had all been complaining about the music since they’d pulled out of Scott’s father’s driveway. Scott had left it on just to spite them.

  It was Garin who’d made the obscene suggestion that the radio had been left on a techno setting by one of the girls Scott had brought home the week before. Scott was seriously offended by the idea that he would sleep with a girl who liked techno; he was pretty sure that it wasn’t one of his conquests to blame, because his dad had been on quite a tear recently. The blonde whom Phil had brought home a few days earlier was wearing the kind of high heels that would have fit in well at a rave.

  So he left the music on, to punish Garin for his comment, and was fully enjoying the looks of pure agony on his friends’ faces in the rearview mirror. They had been driving for thirty minutes, which meant there was still a good ten minutes to go before they reached the billiards bar and ladies’ night. Unless one of them picked up a girl with better taste in music, Scott was going to make sure the techno continued for the ride home.

  Five minutes later, he had grown so used to the bitching of his passengers he almost didn’t hear that one of them was shouting at him from the backseat. It wasn’t until Hilt repeated what he was saying a third time that Scott realized he wasn’t yelling about the music. Scott immediately reached for the volume, and the car went dead silent.

  “Absolute Poker!” Hilt shouted again.

  The words reverberated off the windows and leather seats of Phil’s car. Eventually, Shane spoke.

  “It’s not bad.”

  “Sophisticated,” Garin added. “Cosmopolitan, kind of a lounge feel. You think there’s any way something that simple is still available?”

  Scott could feel the engine of the BMW pulsing through the steering wheel beneath his fingers.

  “Only one way to find out.”

  Without another word, he yanked hard on the wheel, sending the car careening into a skid. He made the U-turn by inches, the two right tires spitting up gravel, grass, and pavement. Ladies’ night was instantly forgotten.

  Twenty-five minutes later the four of them were hunched over one of the computer stations as Scott punched in the words. It took less than five seconds before they got a response.

  Scott leaned back and lifted his hands into the air. His friends high-fived behind him, and then he quickly punched in the information to buy the domain name. Twenty-nine dollars to lock it down—and AbsolutePoker.com was officially born.

  CHAPTER 9

  That’s got to be him.”

  Scott shielded his eyes from the late-afternoon sun, which seemed to hang like a vast and flaming Christmas ornament just inches beyond the mostly open-air glass entrance to the airport. Trying to see where
Shane was pointing, he could make out the mass of taxi drivers, swarming like flies whenever anyone who looked even remotely North American exited through the revolving doors. Scott himself had briefly stepped out to the curb before being beaten back by the aggressive cabbies; for now he was satisfied to stay in the safety of the baggage claim area with Shane, Garin, and his dad. The trip to Brazil—his first outside the United States—had certainly opened his eyes to how different a foreign culture could be. But even from his brief moment outside, his first tentative steps into the Central American country of Costa Rica—lost in the jumble of drivers shouting at him in Spanish and broken English, the thick, humid air catching in his throat and filling up his lungs, the smoggy scent of the nearby urban jungle that was San José, the country’s capital—gave him the feeling that this place was a world apart.

  “Most definitely,” Garin said, in tune with Shane. “There can’t possibly be two people who look like that in this hemisphere.”

  Then Scott saw him too, pushing his way through the crowd of taxi drivers and into the revolving door—and whistled low. Eric Tuttle was truly something to behold. Elongated to an almost comical extreme, with gangly limbs like a humanoid spider and spiky red hair above a paper-white forehead, he snaked forward in a gray business suit with wide, anachronistic lapels and an even wider eighties-style tie.

  Eric saw them pointing in his direction as he broke free of the door and entered the airport lobby. He smiled, revealing a set of oversize veneers, and raced toward them at full speed.

  “Now, where the hell did you find this guy again?” Scott’s dad coughed as he leaned back against his designer suitcase. He was the only one of them who had packed a case—the rest had small duffel bags slung over their shoulders. To Scott, seventy-two hours in a tropical country meant three T-shirts, three pairs of boxers, one pair of jeans, and a box of condoms. But his dad was decidedly more urbane.