It was Isai Scheinberg’s love for cards and ingenuity that led him to cofound one of the world’s most successful online poker sites—PokerStars.
Today, PokerStars hosts over 50 million players, single-handedly making it the largest poker room on the planet. Isai’s innovative ideas and willingness to take risks is what made PokerStars the industry leader that it is today. Many of those risks paid off tenfold, while others almost cost it all.
To discover more about Isai Scheinberg, his contributions to the ascension of PokerStars, the risky decisions that backfired, and the hand he’s playing today, please feel free to read through this comprehensive biography. We bet you’ll learn something you never knew before.
Isai Scheinberg was born in Israel in 1946. His family moved to a small town in Lithuania, where he was raised, when he was just one years old.
Life in Lithuania
Since his father—a Holocaust survivor—struggled to make ends meet, Scheinberg was forced to clean a local distillery on the weekends to help support his family’s financial needs.
He is the oldest of five children, and naturally, his younger siblings looked up to him. Since there was a 10-year age gap between him and his other siblings, they viewed him as more of a father figure than a brother.
Not wanting to let them down, he worked extremely hard at both his part-time job and school. He would often pick up extra shifts at the distillery and spend any free time studying.
He excelled in school, earning himself a 4.0 GPA. When it came time to choose what college to attend, the answer was easy; he had earned himself a full-ride scholarship to Moscow State University in Russia.
Moscow State University
He originally planned to pursue a business degree but ended up changing his mind toward the end of his freshman year. After doing exceptionally well in a couple of different math courses, he chose to major in mathematics instead. He earned both his Bachelor’s and Master’s degrees in mathematics from Moscow State University.
Israeli Defense Force
Before he entered the workforce, he was drafted into the Israeli Defense Force. He served for three years during the War of Attrition. He was one of the soldiers responsible for the production of Israel’s first custom-made weapons. His background in mathematics enabled him to design weapons that were known for their accuracy.
It was during his time serving in the military that he first learned how to play poker. He played in the evenings with the other soldiers in his barracks, quickly becoming an excellent player. He developed his own strategies for winning and was known for his aggressive style of play and willingness to take risks.
An Offer From IBM
Once he left the Israeli Defense Force, he accepted a job as a programmer at IBM’s office in Israel. He was so successful at his job that they sent him to their offices in Canada to train the programmers there.
The Family Settles in Canada
Isai is offered the role of senior programmer for IBM Canada and he decides to stay and raise his family there. His son, Mark, was 13 at the time of the move overseas. They settled in Richmond Hill, Ontario. At IBM, he made instrumental contributions to the creation of Unicode during the early ‘90s.
A Love for the Game
Isai was a passionate poker player, and he was good at it. He frequently played cards throughout various clubs in Toronto, eventually deciding to put his skills to the test at the 1996 World Series of Poker Main Event.
He ended up taking 25th place overall. While he didn’t place as high as he hoped, the experience sparked his first vision for PokerStars, a user-friendly online poker site that would revolutionize the poker industry.
Upon returning home from WSOP with this brilliant new idea in mind, he began the groundwork on his very own poker site. While he was business-savvy and had extensive computer knowledge, he knew he would have to recruit a capable team of skilled players for this to be successful.
He hired talented programmers to join his team, some of them being of his co-workers from IBM. One of the company’s very first employees, Terrance Chan, with whom he met through an online poker forum, said this of Scheinberg’s resolve:
“Scheinberg was absolutely convinced that with world-class software and a high standard of customer service, he could be successful.”
Chan’s in-depth poker knowledge made him a winning asset to the early team. His last, and most instrumental recruit was his son, Mark, who would eventually become the company’s CEO.
“Mark does not live in the shadow of his father,” says an associate. “On the contrary, father and son know how to work together. They have a division of labor, and it’s a close-knit family. He is simply a good guy.”
In 2000, Scheinberg founded PYR Software (now known as Amaya Software). It later became the software provider for PokerStars. The software company was based in Toronto, and was the location where team members would meet to brainstorm ideas.
Their goal was to create a poker site that offered a personalized experience, advanced software, and vibrant, high-quality graphics. They accomplished all of this and more through the development of PokerStars.
In 2001, they did a soft launch of the site. They recruited players to test out the site’s features using only play money. It was a huge success. Players remarked on the site’s easy-to-use interface and were impressed by the unique atmosphere the online casino offered. Just a few months later, the site was ready to start accepting real money wagers.
WSOP: The Perfect Marketing Plan
The company continued to flourish, bringing in millions of dollars’ worth of revenue. To boost the site’s popularity even more, Scheinberg came up with a brilliant marketing plan. The site would host two poker tournaments.
The winner would receive a paid entry into the WSOP main event, plus an all-expenses-paid trip for two to travel to Las Vegas. Creating enriching and rewarding experiences for his players was always a top priority, so this idea came to him naturally.
The marketing initiative would prove even more successful than imagined, thanks to a dark horse from Knoxville, Tennessee. Chris Moneymaker, on a whim, entered a $86 buy-in satellite tournament at PokerStars.
His goal? To earn enough money to pay off his overwhelming credit card debt. At first, he was content to lose on purpose, so that he could walk away with the 4th place cash prize of $8,000. That was, until, a friend convinced him to go for 1st place.
Moneymaker, an occasional online poker player and average Joe from Tennessee, beat out 838 of the world’s best poker players in the 2003 World Series of Poker. He was presented with $2.5 million in cash and the signature gold bracelet. His soon quit his job and pursued a career in poker full-time, becoming one of PokerStars main spokespersons.
Thanks to his inspiring success story, thousands of people began showing an interest in online poker overnight. New accounts were opening on PokerStars left and right. It was marketing gold.
Commitment to Excellence
Scheinberg remained diligent in his continued efforts to provide unrivaled customer service through PokerStars. He required that all customer service agents undergo strenuous training before they could join his team.
He wanted to make sure they were not only knowledgeable about poker and the ins and out of the PokerStars website, but that they also knew how to communicate well with the players. PokerStars had a faster customer service response rate than other poker sites that outsourced their customer service to third parties.
There were even talks of a seven-digit deal that involved hosting actor Ben Affleck and his friends on a boat to play poker. In the end, operation “Celebrity Poker Yacht” couldn’t be mounted, but is a clear glimpse into Scheinberg’s sheer commitment to marketing his business well.
Former Vice President of Marketing, Dan Goldman, who was given a $600,000 marketing budget within his first year with the company, said this of Isai’s powerful business influence:
“If I had dealt with someone else, I would have asked many more questions. But there was something about Isai that naturally inspired me. It may sound a bit naive on the part of someone who was already in his 50s at the time, but I tend to trust my instinct when it comes to business. I had no doubt about the financial ability of PokerStars to implement such a plan.”
2005- A Year of Big Changes
Scheinberg makes the bold decision to relocate the company’s headquarters to the Isle of Man, saving significantly on tax costs.
In the same year, a blog gets added to the PokerStars site, making them the first online poker site to have one, making PokerStars a billion-dollar enterprise by years-end.
Unlawful Internet Gambling Enforcement Act (UIGEA)
In 2006, the United States passed the Unlawful Internet Gambling Enforcement Act (UIGEA), making it illegal for gambling transactions to take place. Many online casinos and poker sites chose to close their doors to US customers as a result. Scheinberg took a different approach.
He made a deal with several small banks that were facing financial difficulties and agreed to invest millions of dollars into them if they were willing to process his customer’s gambling transactions.
This was a risky move, but Scheinberg was willing to do whatever it took to keep serving his US customers.
This worked for several years, until April 15th, 2011, the day that would later become known as Black Friday. This is the day that the United States seized PokerStars’ domain name because they were still catering to US customers. It was at this time that Scheinberg was charged on accounts of money laundering and bank fraud.
PokerStars was forced to pay the Department of Justice a hefty fine of $765 million in order to get their domain back. As an additional part of the settlement, they agreed to buy out Full Tilt Poker and pay US players the funds that were owed to them, as Full Tilt Poker did not have the necessary funds to do so.
Poker Hall of Fame Snub
As a result of his charges and business dealings, Scheinberg has also unfortunately been repeatedly passed over for inclusion in the Poker Hall of Fame. Some of his public enemies include executives from Caesar’s Palace, who also serve as the gatekeepers for the Poker Hall of Fame.
Scheinberg’s exclusion remains a big disappointment throughout the poker community. The community continues to recognize the grand contributions he’s made to the rise of the online gambling industry.
“He was very much a political person. He knew who his allies were. He knew who the people were who disagreed with him.” – an acquaintance speaking about Isai Scheinberg
Despite the negative legal implications associated with it, PokerStars began to flourish once again. Scheinberg’s personal charges, however, were never dropped and have yet to be dealt with directly to this day.
As long as Scheinberg avoids entering the United States, he will not have to face any jail time or pay the Department of Justice the fees that are owed. Scheinberg has stepped down from the day-to-day operations of PokerStars, but he still influences the board’s decisions when it comes to technological advancements.
Since stepping down from direct management of PokerStars, Scheinberg spends more time with his wife. The two of them travel together often, with their favorite places to visit being in Europe. While traveling, they have paid to restore several different historical buildings in both Madrid and France, as they believe in the importance of preserving history.
Isai maintains an extremely private life in the public eye. While it’s unclear exactly where he resides today, many speculate he still lives on the Isle of Man, although it’s not confirmed.
Scheinberg is passionate about helping those less fortunate than him. He donates money to many different charities, including One Acre Fund and Living Goods.
One Acre Fund supplies impoverished farmers with the training and equipment they need to grow food for their communities. Living Goods trains health advocates to go door to door in third-world countries to educate people on how to stay clean to prevent the spread of common diseases.
As of right now, Scheinberg appears to be retired. Does that mean he will never make things right with the Department of Justice and return to the US? Or that he won’t take an active role in PokerStars once again?
Only time will tell. But, for the man that was able to turn an idea into a billion-dollar online casino empire, anything is surely possible.
Michael Stevens has been researching and writing topics involving the gambling industry for well over a decade now and is considered an expert on all things casino and sports betting. Michael has been writing for GamblingSites.org since early 2016. ...
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