At the end of October, BetRivers Poker, the new, US-based version of Phil Galfond’s Run It Once Poker, launched in Pennsylvania.
Barely more than a week later, Galfond announced the site was embarking upon a three-month experiment to try to build a player base in which it will return all its rake to its customers.
Key Highlights
- Phil Galfond said online poker’s purpose for big gambling companies is to bring players to the casino and sportsbook.
- Lowering rake has not historically attracted more players to poker rooms.
- Rewards to online poker players are a way to “shape player behavior.”
- BetRivers Poker will return all rake to players in the form of rakeback and rewards for three months.
Poker’s Purpose Is to Bring in Casino and Sportsbook Players
In a lengthy post on X, Galfond said that he and Rush Street Interactive (RSI), the owner of BetRivers Poker, decided to see if running the poker room effectively rake-free will grow traffic.
Of course, generating zero revenue is not a normal business plan, but Galfond explained that poker is by far the smallest “slice of the pie” for gambling companies, dwarfed by casino and sportsbook revenue.
He went on to say that poker’s purpose at a “large, multi-vertical gaming company” is to “acquire and retain players for the other, more lucrative verticals.”
At the same time, Galfond wants to have a poker site that does right by its players, as he is a poker guy first and foremost. He acknowledges, though, that one could argue that funneling poker players to other forms of gambling isn’t good for them.
His answer to that is twofold. First, just like poker players may spend money on the casino and sportsbook, casino and sportsbook customers will also migrate to poker.
And second, the entire reason he was able to get Run It Once/BetRivers to the US was the promise of cross-promotion.
Lower Rake Has Not Proven to Attract Players
Bringing his focus back to rake, Galfond said that one would naturally think that if poker rooms reduce their rake, they will attract more players. But that hasn’t happened.
“Poker industry leaders have raised rake far beyond levels even considered by the poker platforms we were used to,” he said. “I’m in no position to argue with their business strategy given their success, but as a player, I wish it could be different.
“Members of the poker community have expressed their unhappiness, too. They’ve staged boycotts. They’ve complained and criticized. But they haven’t made much of a difference.”
Want to build up your tournament fields? Give out more tournament tickets. Want more volume per player? Create leaderboards to incentivize grinding.
– Phil Galfond
No matter how much poker players say they want lower rake, Galfond said, they haven’t “consistently voted with their wallets for platforms with the lowest rake.”
The other side of the coin is rewards. Rather than lowering the cost to play, give some of that cost back to the players.
Galfond said rewards can be useful because “you can use those rewards to shape player behavior.”
“Want to build up your tournament fields? Give out more tournament tickets. Want more volume per player? Create leaderboards to incentivize grinding.”
BetRivers Returning 100% of Rake to Players
And so, BetRivers Poker, at least for this three-month experiment, has decided to forego revenue from poker by returning all rake to players in the form of both rakeback and rewards.
All to achieve the dual goal of a better poker room and to increase revenue for the casino and sportsbook.
“Much of that rake will be given back via our bonus store,” Galfond explained. “Whether you prefer poker, casino or sports betting, you’ll have flexible redemption options. If you choose to redeem your points in casino or sportsbook instead of poker, you’ll benefit from significantly enhanced rates.”
Galfond hopes that by going all-in with poker as a loss leader for the rest of BetRivers it will both make the poker room the best in the business and boost overall company revenue.
“If it doesn’t play out as we hope, we’ll remain committed to building the kind of site we want to play on — with unique features, thoughtful design, and a focus on innovation and delivering what we believe players want.”
Sources
https://x.com/PhilGalfond/status/1854973393441112348
https://www.cocosapps.com/news/betrivers-poker-launches-pennsylvania-419287/
