During the time leading up to starting SolidWorks Jon Hirschtick had a pretty interesting life. This conversation is about that part of his life.
Deelip: I don’t want this conversation to be about SolidWorks. I am more interested in your life before that. I mean the stuff that led up to and including the movie Twenty One. Tell me about that.
Jon: Well. I grew up in Chicago and got interested in electronics when I was a kid. I started programming computers when I was 13. My dad was a lawyer. But on the side he was an entrepreneur. He had a little business selling stamps to stamp collectors. I learned a lot about business from him. Stuff like gross margins, treating customers well, being honest in your dealings with them. While in high school I worked as a professional magician. I did magic shows at birthday parties and made balloon animals. I think I did about 200 birthday parties. I can still do magic tricks and make balloon animals (laughs). Anyways I went to college at MIT.
Deelip: Was it easy to get into MIT?
Jon: Well, at least it was not at hard as it is today. I mean I didn’t have to make a very big herculean effort to get in. I had quite good test scores and decent grades. I decided to major in mechanical engineering and not computers because I liked the idea of design. I had never really built anything except electronics circuits at home. In 1981 I did an internship at Computervision in R&D. Then one day in January of 1984, as I was walking through the student building at MIT, I noticed a piece of paper stuck on the wall which read “Earn two to six thousand dollars playing blackjack with professional team”. There was a room number and time and I went.
Deelip: Had you played blackjack before?
Jon: No. Never played before. They told me that they had a hundred thousand dollars and we would play for six months. They told me that they would teach me how to play and I could keep some of what we won. They gave me a chart and told me to learn it and come back next week. And that’s what I did.
Deelip: So this is a bit different from the story in the movie.
Jon: The story in the movie is highly fictionalized, quite understandably. But the general idea is the same. A bunch of people playing cards. New guy comes on board and they teach him the system.
Deelip: So this team that you are talking about was basically a bunch of students with a professor, right?
Jon: No professor. That’s one of the fictional parts. It was a bunch of students, ex-students and friends, all loosely centered around MIT.
Deelip: How large was this team?
Jon: It was about fifteen people. Sometimes it was ten, sometimes twenty. People would come and go.
Deelip: So what was this chart all about? Counting cards?
Jon: It was a chart of basic strategy. It had nothing to do with counting cards.
Deelip: Can you explain card counting in brief?
Jon: Sure. Suppose the deck is six decks of cards mixed together. As it is dealt the cards don’t come out in a standard distribution. In other words if you deal out 1/6th of six decks mixed together you will not see exactly four aces, four two’s. etc. You will see maybe two aces and six two’s. The remaining cards will be slightly out of normal. Sometimes it favors the player and sometimes it favors the house. When it favors the player we bet big. Counting is a way of measuring which side the deck is favoring. Its about keeping track of each card that is dealt and deciding whether it is good for the player or bad for the player. A ten or an ace is good for the player. A six or a five is bad for the player. So you count the good cards against the bad cards and then you can tell whether there are more good cards or bad cards.
Deelip: So why is counting illegal then?
Jon: It’s not illegal. Some casino people will say it is illegal. But nobody has ever been arrested for counting cards. Counting cards is just a matter of taking advantage of information exposed to you and playing well.
Deelip: Yes, you are not cheating.
Jon: Not in my book. Of course, the house sees it differently. We also use some systems that were not straight card counting but were very profitable for us. So anyways I kept coming to these meetings in the classroom and they taught me how to count, how to bet, how to use the signals of the team.
Deelip: When did you make your first trip to Vegas?
Jon: Actually we gambled a lot more in Atlantic City than in Vegas, although the movie is based in Vegas. I was pretty quick. The training took about three months.
Deelip: Did the entire team go at once?
Jon: No, we would go about four or five people at a time for a weekend and play.
Deelip: And how was the loot split?
Jon: After we played six months, the team made two hundred thousand dollars. That’s apart from the one hundred thousand that we started out with. So the money was split half to the players and half to the investors, the people who put in the initial hundred thousand. As regards the players, they got their cut based on a formula depending upon how much you played in the casino. It was a bit complicated. How many times did you find decks that had good distribution…
Deelip: Oh! It was down to that level of detail.
Jon: Yeah. I used to keep a record meticulously. It was actually lot of work. We had to learn that in our training. My share was thirteen thousand dollars for the first six months. At that time I was making six hundred dollars working in the lab at MIT. So then I started to play more. The next time we started at about two hundred thousand and made it about four hundred thousand. Over the years we won millions of dollars. We would do this for six months, split it up and then reform a month later and start it again.
Deelip: How often did you make these trips?
Jon: When I was a grad student I used to go all the time, every other weekend. I went six weeks in a row once. I loved playing.
Deelip: So did you like the act of winning or making the money?
Jon: Both. I liked earning money and I loved being able to go to the casino and go on this adventure. Do it in a way that you knew was good and not bad.
Deelip: So I guess you lost as well.
Jon: Sure, you lose a lot, all the time. Its just that over time normal players end up lose more than they win and we are the other way around.
Deelip: So in your system the loss is due to luck or due to a distraction or faulty math.
Jon: Luck. We took every effort to see that our players played the system accurately in the casino.
Deelip: Did you ever fall into trouble?
Jon: All the time. That’s the reason most players stop playing. Because the casinos recognize you and then they chase you out. So after a few months I was becoming well known. So I changed places, grew a beard. Stuff like that. For the first three years I did this very actively. Then later it got to be too much of trouble and they were chasing me out everywhere (laughs).
Deelip: Did this affect your academic life?
Jon: I actually finished my thesis during all of this.
Deelip: So did you stop after you left college?
Jon: Yes. After college around 1987 I started my first company. During that time I played a little and began to teach other players as well. In fact the book on which the movie is based was written on the team during that time frame.
Deelip: What was your first company about?
Jon: It was called Premise with a product called DesignView. Started in 87, shipped the product in 89, sold it to Computervision in 91. It was a 2D sketching and equation solving product, kind of like GrafiCalc. So then I joined Computervision for the second time. I stayed there two and a half years and decided to leave.
Deelip: Why did you leave?
Jon: I didn’t want to work in a big company anymore. I wanted to be involved in business decisions. I wanted equity. I did not have any trust anymore in the leadership at Computervision. I wanted to do my own thing.
Deelip: How old were you?
Jon: I was 31 when I left Computervision. I had some money saved up from gambling. I knew about 3D while at MIT. What PTC showed was that it could be made into a product. I realized that everyone is going to use 3D and that’s why we decided to get it to Windows. And you know the rest.