Bill Benter did the impossible: In the mid-1980s, he invented an algorithm that increased his chances of winning. He managed to win at the Hong Kong horse races, and nearly forty years later, his net worth is estimated at nearly $1 billion.
Bill’s achievement is impressive, especially since horse racing is a sport that involves thousands of unpredictable factors, such as the jockey’s fall or the horse’s nutrition.
Many gambling enthusiasts are still inspired by the mathematician and hope to someday create a similar algorithm for video slots. According to www.twinspinca.com, many Canadians playing on CAD use similar strategies for betting.
Despite creating innovative software to determine the outcome of horse races, Benter didn’t start his journey as a gambling code cracker by betting on horses in Hong Kong.
At the age of 22, after spending several years traveling the world, Bill Benter decided to drop out of university and move to Las Vegas to play cards. His fascination with the mathematics of gambling began after he read Edward Thorpe’s 1962 book “Beat the Dealer.”
Inspired by the book, Benter began spending more time at budget casinos practicing card counting while working for $3 an hour at a 7-Eleven store. Bill made about $40 during a successful game, but he was thrilled to see the mathematical principles work in reality.
In 1980, after landing a new job as a night janitor at McDonald’s, friends introduced him to Allan Woods, a former insurance actuary who headed an Australian card-counting team. He convinced Benter to join his team by telling the story of how he had gotten through security at Manilla airport with $10,000 hidden in his underwear.
Bill accepted the offer, realizing that card counting is easier to put into practice when there are more players at the table, as it minimizes their risk.
In just six months of work, Benter earned about $ 80 thousand dollars a year just on counting cards. But in 1984, everything changed – security guards took him from the table to the back of the casino and intimidated him.
A few months later, he and his partners earned a spot on the Griffin Book, which meant essentially being blacklisted from Vegas casinos.
Fortunately, Woods realized that their next focus should be the horse betting industry in Hong Kong.
Even though horse racing is a very unpredictable sport with thousands of variables, Bill Benter and his club worked hard to crack its code.
Benter began studying statistics and using it to develop sophisticated software. At the same time, Woods flew to Hong Kong and sent him yearbooks with the results of thousands of races.
They hired two women to insert the results into a database, and he spent the next nine months developing code and studying regressions. In 1985, Bill Benter flew to Hong Kong with three IBM computers in his luggage.
At first, Benter’s algorithm made strange predictions, so they studied the shape of the jumps twice a week, which helped them improve the accuracy of the program, but it resulted in a loss of $120,000. In the first year, a dispute between Woods and Benter started.
Since Woods had more money, he wanted to own 90% of the business. Predictably, Bill rejected his offer, and they went their separate ways. But now he had no money left and needed more time to perfect his software.
By 1988, he returned to Hong Kong with an algorithm that took into account twenty horse racing variables and could divide the horse’s actual odds. So, if a bookmaker put the odds on a horse at 3.50, and the model calculated it to be 2.80, he would bet on that preponderance. This strategy brought about $600,000 within a year, but it was still not enough.
Bill believes that the most significant update of the algorithm occurred after the Hong Kong Jockey Club made its betting odds publicly available in 1990.
The information he received was crucial because he no longer needed to calculate the odds from scratch. All he had to do was to refine the odds offered by the club. Over the next year, such a change brought in $3 million dollars.
Before Benter and his team lost the right to place bets via computers and telephones in 1997, they had earned more than $50 million in Hong Kong. As you might expect, he came up with the solution of printing the results on blank betting sheets and feeding them into terminals.
Does Bill Benter’s algorithm still work in the 21st century?
By 2001, his algorithm had over 120 variables for each horse and was more accurate than ever. The last bet was on Triple Trio in 2001 (a complex bet in which you have to guess the first three horses in three different races).
Benter won the bet and left $118 million unclaimed. According to club policy, the prize money went to charity.
Today, Bill Benter is a billionaire philanthropist and the proud owner of the Benter Foundation, an organization that supports education, health care and the arts.