Make Your Offer So Good They Feel Dumb Saying No | Ep 855

In this Q&A episode of The Game, Alex (@AlexHormozi) answers audience questions on shifting from small clients to whales, building irresistible affiliate offers, and crafting guarantees that don’t kill your margins. Welcome to The Game w/Alex Hormozi, hosted by entrepreneur, founder, investor, author, public speaker, and content creator Alex Hormozi. On this podcast, you’ll hear how to get more customers, make more profit per customer, how to keep them longer, and the many failures and lessons Alex has learned and will learn on his path from $100M to $1B in net worth. Wanna scale your business? ⁠Click here.⁠ Follow Alex Hormozi’s Socials: ⁠LinkedIn⁠ | ⁠Instagram⁠ | ⁠Facebook⁠ | ⁠YouTube⁠ | ⁠Twitter⁠ | ⁠Acquisition⁠ Mentioned in this episode: Get access to the free $100M Scaling Roadmap at www.acquisition.com/roadmap

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:01Alex Hormozi?

  You want to present your offers at the point of greatest deprivation, not the point of greatest satisfaction. So if I walk into a restaurant and I'm starving and I say, I want a steak. I eat the steak, waiter comes back and they're like, how's the steak? And I'm like, oh, it was delicious. Thank you so much. They're like, great. You want another steak? I'm like, no, no, I'm good. They're like, oh, you don't like the steak? And I'm like, no, I love the steak. It was great. It just seems weird. That's where we get these weird sales conversations.

• 0:22Speaker 01

  Hey, Alex, thanks for everything that you've done. I'm James. I sell custom branch railings to homeowners. I, we did 420 or so last year. I was, I've read 10x is greater than 2x. And so last night it was coming to me again, like, do I really just want to double? Or do I want to try to 10x? And so what I want to try to do is to develop a network of product specifiers, architects, designers, contractors, that can act kind of like a referral network. I want to shift away from the minnows and to focus more on rails. We had one client last year, about $50,000 worth of handrails. And if I could get 10 of those in a year, then I would double revenue just with 10 clients. So kind of what are my best strategies to go about achieving that?

• 1:01Alex Hormozi?

  So where did you source the single whale this year?

• 1:05Speaker 01

  He found me. It's all inbound. It's all through search.

• 1:08Alex Hormozi?

  Okay, so SEO or PPC?

• 1:09Speaker 01

  SEO.

• 1:10Alex Hormozi?

  Okay.

• 1:10Speaker 01

  I just started Facebook ads about three or four weeks ago. They're going pretty good, qualified about half of the leads so far.

• 1:18Alex Hormozi?

  So I would, so if you want to go whale hunting, then I think your, your initial thought strategy of finding the architectural firms and engineering firms or whatnot is a good one. I would probably try the outreach method as my primary way. Cause you can be hyper-targeted in terms of who you're reaching out to. And the, the key to making it work though is like, what's in it for them to refer you business?

• 1:42Speaker 01

  Are you asking me that? That's an excellent question. So architects will typically in a plans, like if they make a set of plans, they'll specify what kind of tiles to use and what kind of windows to use, et cetera. So I've, I've, we've gotten plans in the past where it's like, it's got the pictures from the website with the CAD drawings and everything on the plans. And so it's like, how to persuade them to do that kind of in absentia? And I should also note that we ship nationwide. So this is not like, you know, a hyper local.

• 2:09Alex Hormozi?

  Are you shipping or are you, are you doing installs or no?

• 2:11Speaker 01

  No, we haven't done it.

• 2:12Alex Hormozi?

  Are you just, you just?

• 2:13Speaker 01

  We just ship product.

• 2:15Alex Hormozi?

  Interesting.

• 2:17Alex Hormozi?

  Got it. Then who are the decision makers? Well, right now it's been primarily residential is what it sounds like.

• 2:22Speaker 01

  Right. It's primarily homeowners. We've done some commercial work, you know, but it's primarily homeowners who are, you know, looking for something different. And so it's very, what I call intentional inbound search. It's like they're looking for something. They're deliberately searching it out. They find it, you know, we have a lead magnet, kind of, which is like 250.

• 2:40Alex Hormozi?

  That's it.

• 2:41Speaker 01

  That's the, you know, yeah.

• 2:43Alex Hormozi?

  Well, this is a fundamental change in business strategy. So you're aware of that. So with that comes risk. Cause like if the, obviously the, the lowest or the, the highest risk of just return move or lowest risk, I guess, is to probably add, like if I were like tomorrow, what would I do? I'd probably just add PPC in right now. Because you already have something that's working on SEO. I would probably see, how can I get way more articles written? So that my SEO traffic can go up. Can I tackle more, you know, more keywords? That's like the for sure will work and make you more money play. The going after whales for sure can make more money. Cause why not add zeros to things? It'll just be a completely different sale and you'll have two levels of sales.

• 3:26Alex Hormozi?

  So sale number one is going to be for the affiliates and then figuring out what's going to make it worth it for them. And then the second level is what's the, you know, what's the actual sale to the, to the whale customer? So who's the decision maker with the whales?

• 3:37Speaker 01

  Like the final decision maker? It's going to be the homeowner, whoever's doing the project.

• 3:42Alex Hormozi?

  But so you just want bigger homeowners?

• 3:44Speaker 01

  The architects have the ability to specify it and to put it in front of the client. So like, we also did another one, which was about 60,000 for a guy that was doing a, a development of Airbnbs. Yeah. In Virginia, he put up like six yurt kind of things.

• 3:59Alex Hormozi?

  Yeah.

• 4:00Speaker 01

  And, you know, so I had two bit very.

• 4:02Alex Hormozi?

  So both of them were architects that sent you these.

• 4:04Speaker 01

  The one was an architect and the other was a construction company.

• 4:07Alex Hormozi?

  Okay. Yeah. So you're going to have to go B to B outreach is the, basically when you look at core four, that's going to be your, what you're going to do. And then they're going to be your affiliates. And so the, the million dollar question is what's in it for them? So my, my proposition would be.

• 4:26Alex Hormozi?

  So there's three ways you can do affiliates, at least in the world of Alex. So you have they sell you shit for you and they get a commission. That's option one. That's typically my least favorite option, but it is an option. Option two is that you give them some morsel of something that you sell that they can sell for 100% markup. They could keep all the money, but you get the introduction. This is my favorite way of doing it. The third way is that you basically allow them to just bundle in your free thing with their services. You know, with architecture firms, it's not like they're going to bundle in a railing for their service, but just for everybody else. Like those are the three things. So it's like they bundle your, basically your lead magnet in for free with their thing they sell. So it makes, it enhances the value of their overall package.

• 5:10Alex Hormozi?

  You give them the things that they could upsell your lead magnet for an amount of money that they can keep 100% of. Or they just sell your stuff and they get a kickback. Is there a version for this where they can just upcharge? Like you can do a small portion of this that they get 100% of 100%? Like, I don't think so. Like maybe some kind of contractors or architect discount?

• 5:29Speaker 01

  We want them to be stupid to say no.

• 5:32Alex Hormozi?

  Yeah, because like the generic like you get 20% kickback is just like everyone does it. Like who here does 20% kickbacks for anybody who refers you business? You can raise your hand. I'm not going to be upset. Okay. And so the point is, is that, and you probably no one here has referred anyone else's business. And because no one cares. That's, that's kind of the point. And so it has to be an irresistible offer. And so if we give away the lead magnet or something, think about it as like my CAC for a $50,000 customer is the cost of the lead magnet. And if I close one out of three introductions, then it's three X the cost of lead magnet is my cost to a hard customer, which is usually pretty darn good. But it sounds like an irresistible offer to the architecture firm because they're like, we can just sell this and keep 100%. You're like, yep, just make the introduction and I'll deliver that.

• 6:16Alex Hormozi?

  And then when you talk to the customer, you're like, yeah, I'll deliver that. Here's one rail, but you need 10 more. And then you make the sale. Does that make sense?

• 6:25Speaker 01

  I'm not entirely sure, like, people would order the entire project.

• 6:28Alex Hormozi?

  Okay.

• 6:28Speaker 01

  It's not like you can just, like, I can't just ship you a sample and be like, hey, look, here's a

• 6:32Alex Hormozi?

  Yeah, then you're gonna have to do the commission-based structure, which is not my favorite, but that's probably the way you're gonna have to do it. So either you can do the discount, I mean, I would say, guys, I have 20% that I can play with here. So you can take all 20 and give them no discount, you can take a 10% discount and then they get, and then you get 10% kickback. Like, this is what I got. I'll make it work whatever way you want, but this is my bare bottom price.

• 6:52Speaker 01

  Okay.

• 6:53Alex Hormozi?

  And I think that's what, like, that's the outbound strategy.

• 6:56Speaker 01

  So should I then, in turn, raise prices for direct-to-consumer?

• 7:01Alex Hormozi?

  Yeah, I love that.

• 7:01Speaker 01

  Okay. Thank you.

• 7:03Alex Hormozi?

  Yeah.

• 7:05Alex Hormozi?

  Love that for you.

• 7:07Speaker 02

  My name's Cody, I sell roofs to people. We did 140 million last year, trying to do 250 million this year. Trying to figure out how to follow the principle of giving away more guarantees and bonuses when I have such high hard cost.

• 7:20Alex Hormozi?

  Yeah.

• 7:21Speaker 02

  And such a high ticket item.

• 7:22Alex Hormozi?

  Yeah. Well, what are gross margins right now?

• 7:24Speaker 02

  40%.

• 7:25Alex Hormozi?

  Gross. What's net?

• 7:26Speaker 02

  10 to 15.

• 7:27Alex Hormozi?

  Okay, got it. Do you want to sell it, or do you just want to keep it forever?

• 7:30Speaker 02

  Well, I actually just sold my roofing business and now we're part of a PE firm that, that now I'm directing that, that entire

• 7:37Alex Hormozi?

  So are you the platform?

• 7:39Speaker 02

  Yes.

• 7:39Alex Hormozi?

  Okay, so you're the platform, and how many tuck-ins have they done?

• 7:42Speaker 02

  Eight.

• 7:43Alex Hormozi?

  Got it. How long has it been since they started?

• 7:44Speaker 02

  About three, four years. I just got acquired 30 days, or we just closed 30 days ago, and now they're trying to roll everything into my brand and I'm

• 7:53Alex Hormozi?

  Yeah.

• 7:53Speaker 02

  fear head, yeah.

• 7:54Alex Hormozi?

  Yeah, got it. Okay, so sorry, go back to the original question, if you have a, like, better context on this, whatever.

• 7:59Speaker 02

  So how do I give, you know, follow the principle of giveaway more value, make the, you know, offer so good, it's, it's you gotta feel dumb saying no, when I have such high hard costs, I, you know, I can't really do a money-back guarantee, I can't really give away more than a, you know, a roof.

• 8:13Alex Hormozi?

  Well, the question is, is that the constraint? Like, is that the thing that's limiting the growth of the business?

• 8:18Speaker 02

  In my theory, yes, because if I create a good enough offer, then I could roll that offer out to the other eight, eight other brands, and that would be the biggest amount of leverage I could deliver, you know, in the shortest amount of time.

• 8:27Alex Hormozi?

  And is everyone insurance-based?

• 8:30Speaker 02

  That's why they acquired us because we're retail.

• 8:31Alex Hormozi?

  And so you're the only guy selling just new roofs. Everyone else is doing storm chasing and damage repair and shit like that.

• 8:37Speaker 02

  Correct. And what they want us to do is bring the retail model to the other brands. And to add another layer is we sell everything a hundred percent virtually. So no in-home appointments. It's, it's all, you know, digital. And so that's what they, that's the vision is, is taking that, you know, nationwide.

• 8:50Alex Hormozi?

  Centralized sales, virtually.

• 8:52Speaker 02

  Correct.

• 8:53Alex Hormozi?

  So you want an irresistible roof offer. I'm going to blow the roof off. I feel like if I were in your position, the first thing that I would do would be centralize everything first without trying to change. Basically, I wouldn't, I would take the model that I already know works is what was your revenue before you did the, before you were acquired? Okay, you're doing 20. So I would like, in terms of introducing levels of change, so this is actually pretty good for everybody. Like, I, I will typically not try and change like five things at once. And so you centralizing all sales is going to get cost efficiency improvements. And you're going to be able to have higher sales utilization. So you probably cut off the bottom third of the sales force that's low performing. That alone might give you a 25% lift in general, because the best sales guys will take more of the sales. And you'll have centralized all the costs, like we have centralized all the costs, right?

• 9:38Alex Hormozi?

  And so you'll have an increase in revenue and a decrease in cost that's paired. That would probably be my first step.

• 9:45Speaker 02

  The part of the acquisition deal, that's the only way I did that acquisition is if they were going to give me full control and centralized sales.

• 9:50Alex Hormozi?

  So but like, I wouldn't, I mean, I know the question is about roofing, but like, that's what I would do first. And that will probably take you six months or more, realistically. In terms of, in terms of the offer to roofs, an offer that's worked really well in home services is instead of being a money back guarantee, I positioned it as a profit guarantee. So it's like, listen, you want your thing to be on time and on budget, probably. And so I guarantee that I will deliver it on time and on budget, or I'll give you my profit, which is 20%, whatever. And that way it's like, you're not underwater and you still have 40% gross margin. So you're not really losing on the deal. But then people are like, okay, so he's got skin in the game. And so that's a way of closing significantly more deals.

• 10:31Alex Hormozi?

  Cause the two biggest obstacles that, well, you would know this, but in most home services, it's on time, on budget. And probably for roofs, it's like, and how much am I going to be displaced? How much it's going to? Trump my life and so I would put my guarantee around those items and then just have a marginal amount that's back but it's really just because all they don't so the big thing which is right with guarantees is that people don't want their money back they want the roof and so they just want to know that you care enough to make sure the roof gets delivered and so that's really the the solve for the guarantee is it just pays down risk of them not getting what they want and so as long as that gets accomplished you don't have to do with money back you can just do it with some money back that gets them to say yes so help

• 11:08Speaker 03

  does make it

• 11:08Alex Hormozi?

  perfect

• 11:09Speaker 03

  hey Alex

• 11:09Alex Hormozi?

  hello

• 11:10Speaker 03

  thank you for the content you create my name is Mahal Fatah I'm the founder of Alfan

• 11:13Alex Hormozi?

  what

• 11:14Speaker 03

  I'm the founder of Alfan so

• 11:15Alex Hormozi?

  Alfan

• 11:16Speaker 03

  yeah

• 11:16Alex Hormozi?

  okay

• 11:17Speaker 03

  so basically we sell tools to creators have to make more money and we also simplify how brands collaborate with creators

• 11:23Alex Hormozi?

  okay I'm usually tools like software

• 11:24Speaker 03

  so software and service agency tools so we have a music label a creator agency for big creators and then a platform as well

• 11:32Alex Hormozi?

  alright

• 11:33Speaker 03

  so I'm coming to that just in a bit I know the focus topic we made around 4.3 million last year and basically my goal is try to get to 100 million

• 11:40Alex Hormozi?

  alright

• 11:41Speaker 03

  now the issue here is

• 11:42Alex Hormozi?

  with the split between the three in terms of revenue

• 11:43Speaker 03

  1 million for the creator agency

• 11:46Alex Hormozi?

  okay

• 11:46Speaker 03

  1.3 million for the music label and then the rest is on the brand side

• 11:52Alex Hormozi?

  and the brand side is you basically being an agent to do

• 11:55Speaker 03

  exactly connecting at both but basically what I've been doing is that I realized the disruption of AI that's kind of coming in

• 12:01Alex Hormozi?

  okay

• 12:01Speaker 03

  I also saw the scalability what we were doing because I've been in the YouTube space for a while so a lot of these services are going to be scaling as much so in the past two years I've been taking that profit and putting into a tech platform basically it's like a creator store where you can sell your services digital products but also items that you love so the skincare that you use the hair cream the shoes and you earn a commission and we use all of that data to make it easier for brands to know what creators to work with because right now in influencer marketing it's like a spray method right I'm gonna pay I have no idea how much conversion they're gonna actually get me but our integration shows you for 1000 clicks they get you these number of visitors and then they end up buying

• 12:40Speaker 03

  my challenge here right now is that I'm trying to scale that business but my business model is we make money when you make money so on the brand side we get a 15% commission or a margin on all the spend and on the creator's side we get around 8% from whatever they make with their fans by selling these digital products and courses or affiliate links

• 12:59Alex Hormozi?

  Okay.

• 12:59Speaker 03

  My issue here is I got forty thousand creators, but only a thousand are making money. Right? And I've been kind of struggling between going on a SaaS model to be able to scale because when I do any social marketing, we get a creator that comes on board, but they don't make money right away.

• 13:13Alex Hormozi?

  Uh huh.

• 13:13Speaker 03

  So it's not like you, you know, and the longer it takes you to recoup your ad spend is not usually a good metric for scalability. So I'm kind of pivoting. Should I go into a SaaS model? Where right whatever I make from the creator, I'll just be like, hey, like just pay me that price and I take zero percent from you. And then I just charge the brands that commission to collaborate with those creators. This way I can scale the business in a much faster.

• 13:36Alex Hormozi?

  Say the, say the last part again.

• 13:38Speaker 03

  So instead of me making percentages from creators.

• 13:40Alex Hormozi?

  Yeah.

• 13:41Speaker 03

  I provide them the same tools that a lot of them make, make money.

• 13:43Alex Hormozi?

  Uh huh.

• 13:44Speaker 03

  And I keep zero percent.

• 13:45Alex Hormozi?

  Okay.

• 13:46Speaker 03

  But then let's say they have to pay like twenty bucks a month.

• 13:48Alex Hormozi?

  Sure.

• 13:48Speaker 03

  But then I still make my money on the upside on the brand side by connecting them with these creators.

• 13:53Alex Hormozi?

  Okay, so switch to a subscription.

• 13:55Speaker 03

  Switch to the subscription, yeah.

• 13:56Alex Hormozi?

  Okay.

• 13:57Speaker 03

  Cause right now like I have forty thousand traders who signed up, but I'm really making money off a thousand.

• 14:01Alex Hormozi?

  Right, and it's free to sign up and you only get paid if they get paid. Yeah, so you're in a prosumer audience. So if you look at like Shopify, for example, it's super, it's, if you look at the amount of people who've tried to build marketplaces, almost all of them fail. And it's my opinion that the best marketplaces do run a SaaS and then once they get to scale, they can, they can kind of push more marketplace like Shopify, for example. Like it's twenty nine bucks a month or whatever it is because they know that the vast majority like they make more money charging twenty nine dollars a month than getting four percent on zero for the vast majority of stores, but people continue to pay for the hope that someday they will make money. And so I think the idea of switching to SaaS is not a bad one.

• 14:45Alex Hormozi?

  I am concerned about the four businesses that you have. So, cause in order to win at SaaS, you have to be like all in on software. And so the alternative to that would be instead of letting creators come on for free, you would charge them to come on, which you could do, has like a one time setup fee and then maybe increase the likelihood that they win. Either path would work, but if the ultimate goal is that you want to build a network of creators, then you want to have the lowest barrier possible on the creator side.

• 15:17Speaker 03

  So I'm still thinking of a free tier and a paid tier.

• 15:20Alex Hormozi?

  Hmm.

• 15:20Speaker 03

  With some minor benefits, but then if you really want to make money, you gotta end up paying subscriptions.

• 15:25Alex Hormozi?

  Yeah. Yeah, you'll have to play with the feature set because that's always a bitch.

• 15:31Speaker 03

  Adjust the path of least resistance to getting to a hundred million.

• 15:34Alex Hormozi?

  Yeah, so I think, I think adding the subscription for the base and then still maintaining the revenue that you get from the, the sponsors makes sense. I would maybe push back slightly on the hypothesis that they can't convert anything because it dramatically decreases the value of the network from the sponsor side.

• 15:50Speaker 03

  What do you mean?

• 15:51Alex Hormozi?

  Because some people will pay for impressions.

• 15:53Speaker 03

  Yeah.

• 15:53Alex Hormozi?

  And so those guys can for sure deliver those. And so maybe there's like two tiers that you can sell. You have another product on the ad side or the media side. It's just something to consider.

• 16:04Speaker 03

  Perfect. Thank you. That's huge. You validated my thoughts.

• 16:06Alex Hormozi?

  Oh, good.

• 16:07Speaker 03

  I'm thinking the right way.

• 16:09Alex Hormozi?

  No, I think it makes sense. Yeah, it either have to basically you have to position as higher ticket and do premium awake level on morning and then select only for the really good creators and that would be like you charge five or $10,000 and you really get them set up. Or you basically flip the other way, go freemium and then it's all based on like basically media arbitrage where you're just running tons and tons of ads. To get people onto the platform and you just know what your average revenue per platform user is.

• 16:31Speaker 03

  Perfect. Thank you.

• 16:33Speaker 04

  Hi, I'm Mauricio. I sell corporate training focus on soft skills to large company through.

• 16:39Alex Hormozi?

  Who on soft skills?

• 16:40Speaker 04

  What?

• 16:41Alex Hormozi?

  You help who do soft skills?

• 16:43Speaker 04

  Which I train companies in soft skills.

• 16:45Alex Hormozi?

  Okay, got it.

• 16:45Speaker 04

  Leadership and coaching, etc. We do 1.3 millions in revenue on a project based model. I would like to be at the 100 million subscription based model. And what's stopping me is project based model is more lucrative. So I feel like stuck with these whales.

• 17:05Alex Hormozi?

  Okay.

• 17:06Speaker 04

  That doesn't want the subscription model.

• 17:08Alex Hormozi?

  So project based isn't bad. You just need to demonstrate. So this is the concept of recurring versus reoccurring. Right? And so if you go project to project, there's nothing wrong with that as long as you can demonstrate that you have a high renewal rate between those things. And so I'm in general, I do like having kind of project based stuff because typically you can price two to three times higher than you can for a subscription. And so you have usually way better cash flow because people are willing to commit to a certain amount for this period of time. Versus, you know, this forever, which is what a subscription feels like, even though realistically, we know that it's not that, that, that case. So you want to get to a hundred million dollar subscription business. You have a 1.3 million dollar non-subscription business. I would say, I don't think the limited to your business is.

• 17:55Alex Hormozi?

  That. So we'd have to dive a level deeper and say like, what's stopping you from getting to 10 million with your current model? Real quick, guys, I have a special, special gift for you for being loyal listeners of the podcast. Leila and I spent probably an entire quarter putting together our scaling roadmap. It's breaking scaling into 10 stages and across all eight functions of the business. So you've got marketing, you've got sales, you've got product, you've got customer success, you've got IT, you've got recruiting, HR, you've got finance. And we show the problems that emerge at every level of scale and how to graduate to the next level. It's all free and you can get it personalized to you. So it's about 30-ish pages for each of the stages.

• 18:36Alex Hormozi?

  Once you answer the questions, it will tell you exactly where you're at and what you need to do to grow. It's about 14 hours of stuff, but it's narrowed down so that you only have to watch the part that's relevant to you, which will probably be about 90 minutes. And so if that's at all interesting, you can go to acquisition.com/roadmap. R-O-A-D map, roadmap.

• 18:57Speaker 04

  Yes, we are now aiming to, to smaller companies on the subscription base.

• 19:02Alex Hormozi?

  Yeah.

• 19:03Speaker 04

  And the whales where I stay in the same, basically. So that's our strategy to like this year, we're aiming for a 40% of subscription, subscription base model from all the revenue.

• 19:19Alex Hormozi?

  Forty.

• 19:19Speaker 04

  Forty percent, yes.

• 19:20Alex Hormozi?

  Is subscription already or that's the goal?

• 19:22Speaker 04

  No, it's the aim of this.

• 19:24Alex Hormozi?

  Okay, got it. And you said you have whales?

• 19:26Speaker 04

  Yes.

• 19:27Alex Hormozi?

  And you have small companies?

• 19:28Speaker 04

  Smaller, yes.

• 19:29Alex Hormozi?

  What percentage of companies are in either bucket revenue wise?

• 19:33Speaker 04

  Nowadays, it's like 80, 20. So the whales have, are almost everyone, every.

• 19:41Alex Hormozi?

  Just do more whales.

• 19:42Speaker 04

  Okay.

• 19:43Alex Hormozi?

  I'm serious. So how do you get whales?

• 19:47Speaker 04

  We have an outbound sales team.

• 19:49Alex Hormozi?

  Okay.

• 19:50Speaker 04

  And we are pretty good at it. So we, we get into a whale and then sell it to more departments.

• 19:57Alex Hormozi?

  Yeah, of course. So what stops? So what's the limiter on your outbound team?

• 20:03Speaker 04

  Ah, people.

• 20:04Alex Hormozi?

  Okay.

• 20:05Speaker 04

  Yeah, HR, HR is.

• 20:06Alex Hormozi?

  So recruiting.

• 20:07Speaker 04

  Yeah.

• 20:08Alex Hormozi?

  Okay, got it. So if you had twice the outbound team you have now with equal skill, would your business double?

• 20:14Speaker 04

  Yes.

• 20:15Alex Hormozi?

  Great. So what stops you from doing that? You don't have a recruiter?

• 20:19Speaker 04

  Yes, but it doesn't work.

• 20:20Alex Hormozi?

  Okay, so you have a bad recruiter?

• 20:22Speaker 04

  Yes.

• 20:22Alex Hormozi?

  Okay, so hopefully this like line of reasoning was fun for everyone, but that's what we have to work on. Like you don't like the rest of the stuff that we talked about is basically irrelevant and you need to go get another recruiter who's good and can get you outbound guys. Basically, and you will continue like my advice is to continue increasing the outbound team until you can't handle the sales anymore.

• 20:45Alex Hormozi?

  That's it. And whales and whales fundamentally like it's not uncommon for them to be work on projects for just extend the terms. So if you if you sign, you know, they're current doing six month engagements, try go for 12 or 18 month engagements.

• 20:57Speaker 04

  Okay.

• 20:58Alex Hormozi?

  Does that make sense?

• 20:58Speaker 04

  Yes.

• 20:59Alex Hormozi?

  Yeah, and that's that. That's just as valuable. Like if you have like a five year contract with a Fortune 500, it's recurring as far as like an investor would be concerned, it's the same thing.

• 21:09Alex Hormozi?

  Makes sense?

• 21:09Speaker 04

  Yes.

• 21:10Alex Hormozi?

  All right, hopefully it's simpler.

• 21:12Speaker 05

  Hey, my name's Joshua. I'm actually a chiropractor as well.

• 21:18Alex Hormozi?

  I have a great product that I would love to tell you about self-cracking.

• 21:22Speaker 05

  Yeah, yeah, yeah, yeah.

• 21:25Speaker 05

  That's funny. Yeah, so me and my wife, we run a family chiropractic center in the UK.

• 21:29Alex Hormozi?

  Cool.

• 21:29Speaker 05

  And our current revenue is around 750. We'd like to get it to 2.3, perfect the model and then scale.

• 21:37Alex Hormozi?

  Okay.

• 21:38Speaker 05

  This is what is currently my predicament. So we averaged 48 new clients per month last year consistently from two main, two main channels, referral and Facebook meta.

• 21:50Alex Hormozi?

  Okay. What was what?

• 21:52Speaker 05

  So it's 35% referrals, 65%.

• 21:55Alex Hormozi?

  Yeah, it's got it.

• 21:56Speaker 05

  Yeah, and excuse me, sorry, I'm a bit nervous. Thanks.

• 21:59Alex Hormozi?

  You're 35 65 referral versus meta. You did 48 customers per month.

• 22:03Speaker 05

  Yeah.

• 22:04Alex Hormozi?

  The issue that you have 750, you want to get to 2.3?

• 22:06Speaker 05

  Yeah, so. My question, and I think what's stopping me is determining where I should be focusing because we get great results for clients like they get. But you know, even if they have an amazing result, like a lot of those clients leave, which is fine. And then come back when they need us. It's terrible. Yeah. And I'd love to have more clients to stay with us longer term from like a membership perspective. And when I looked at our churn retention rates, our gross retention rate is forty seven percent. And then our, our net retention rate is seventy four percent. So once we've done expansions, upsells and everything else, it brings it up, but we still lose a lot of, we leave a lot of money on the table on the, because we're losing.

• 22:50Alex Hormozi?

  You lose half your customers, but you keep a little bit more revenue. So you're talking revenue retention versus.

• 22:54Speaker 05

  Yeah. So I'm like, which one do I focus on? Do we expand the marketing and just keep pumping the machine? Cause I, I literally feel like you. I've got to a stage in my business where I'm still in the clinic, still serving patients. I love my, my clients.

• 23:06Alex Hormozi?

  Yeah.

• 23:07Speaker 05

  But like, you know, even if they've had an amazing change in their life, like it's like you with the weight loss. Like I've got to the point now where I'm like, man, like this doesn't excite me anymore. Like, I know I can help serve more people. If I can just become more of the owner rather than the operator, I've stepped my shifts down from, you know, five days a week to like two now.

• 23:28Alex Hormozi?

  And if you made more money, you'd definitely be happier. So.

• 23:31Speaker 05

  Not necessarily.

• 23:32Alex Hormozi?

  Yeah, it was a joke. Okay. So you have a location, you're doing seven fifty. What does it cost to open a location?

• 23:39Speaker 05

  We own the building.

• 23:40Alex Hormozi?

  Well, outside of real estate, what's the cost of outfit the location?

• 23:43Speaker 05

  Oh, outfit it. So we, so we're pretty lean. Like we outfitted our current one. That was a hundred thousand.

• 23:51Alex Hormozi?

  Okay, got it. What's profit?

• 23:53Speaker 05

  We kind of keep it, we've kept it low the last few years, but we, yeah, it's like, it's like thirteen percent.

• 24:00Alex Hormozi?

  Okay.

• 24:00Speaker 05

  Ten fifty.

• 24:01Alex Hormozi?

  Yeah. So you need to fix that.

• 24:03Speaker 05

  Yeah.

• 24:03Alex Hormozi?

  Okay.

• 24:05Speaker 05

  So there's a lot of like, you know, owners earnings and stuff.

• 24:09Alex Hormozi?

  Well, what's SD? So seller discretion earning. So what do you make plus the profit of the business?

• 24:13Speaker 05

  So me and my wife, we draw a hundred K.

• 24:15Alex Hormozi?

  Uh huh. Each?

• 24:16Speaker 05

  No.

• 24:17Alex Hormozi?

  Total?

• 24:17Speaker 05

  Yeah.

• 24:18Alex Hormozi?

  They have thirteen percent on seventy five. So another hundred. So two hundred K on seven fifty.

• 24:21Speaker 05

  Yeah.

• 24:22Alex Hormozi?

  Okay, got it. So whatever, that's twenty, thirty, thirty percent ish margins. Okay. So you want to get to two point three? Why two point three?

• 24:31Speaker 05

  Because this is what we worked out for our build, like our practice. We could, if we were at capacity.

• 24:37Alex Hormozi?

  Okay, so that location can do two point three million. Okay. So the issue is we have to solve retaining customers. Now, if you keep fifty percent of customers, like if, let's say you lose half your customers, you're one, but then after that they stay forever, that's fine. We just have, it's like in next year you'll double. If that isn't the case, then, and you lose half of those customers the next year, and then half of those the next year, kind of thing. I would see what we could do to improve that. That being said, you're in a business that traditionally is marketing heavy. It's kind of like weight loss. Cause like people get fixed and then they're like, yeah, deuces. So the, the strategy that I've seen that has worked really well in the chiro space

• 25:16Alex Hormozi?

  is basically going significantly higher ticket, number one, and number two, niching down in terms of the different problems you solve. So this is like neuropathy, you know, diabetes stuff, those types of like kind of segments.

• 25:27Speaker 05

  Yeah.

• 25:27Alex Hormozi?

  And having more targeted advertising for those avatars and selling significantly higher price packages. And that's typically how those businesses will get to like a few hundred thousand dollars a month, just with one, like very small store. And so typically that, that model is a, you run ads for some sort of free workshop, free dinners, free whatever.

• 25:46Speaker 05

  Pretty much how we did, we built our business. So.

• 25:48Alex Hormozi?

  Okay.

• 25:48Speaker 05

  Like, cause we really.

• 25:49Alex Hormozi?

  So then what's the ticket price that you're charging?

• 25:52Speaker 05

  It's different based on the.

• 25:53Alex Hormozi?

  Well, you've sold fifty customers a month and you're doing sixty K. So.

• 25:58Speaker 05

  The the average is around like it depends because every plan's different for the client. So we don't just give like a here's your plan.

• 26:05Alex Hormozi?

  No, I know. But if I just did simple math, I'd say sixty thousand dollars a month, fifteen new customers, average customer is twelve hundred bucks.

• 26:10Speaker 05

  Yeah.

• 26:11Alex Hormozi?

  Okay, so it's not the same model because I'm talking ten thousand dollars.

• 26:14Speaker 05

  Right.

• 26:15Alex Hormozi?

  Does that make sense?

• 26:16Speaker 05

  Yeah.

• 26:16Alex Hormozi?

  More?

• 26:17Speaker 05

  Yeah.

• 26:18Alex Hormozi?

  So I think you have to get niched down in terms of so like if you're doing all those things, I think you probably need to add a zero to your price tag.

• 26:23Speaker 05

  We're already the most premium in our light area, like.

• 26:27Alex Hormozi?

  Well, then then it won't change. You'll still be the most premium.

• 26:29Speaker 05

  Okay. And which one would you focus on then? Would you just focus on like just filling the front end or would you try and fix the because you talked about like fix the chair and like get it to less than three like? Or would you double down on both? Like, would that be?

• 26:40Alex Hormozi?

  Well, if you keep half your customers, you're pretty close to three.

• 26:43Speaker 05

  So again?

• 26:44Alex Hormozi?

  You're pretty close to three if you keep half your customers.

• 26:46Speaker 05

  Right. When we track it, it varies between three and seven on the depending on the month.

• 26:51Alex Hormozi?

  I mean, are there things that you could do to improve it? Sure. I think you have more of a model issue.

• 26:57Speaker 05

  Okay.

• 26:57Alex Hormozi?

  Like you obviously can acquire customers and you're doing a decent enough job keeping them. If we need to improve how much money this thing makes, it's either a pricing thing. Basically, it's an offer and pricing thing. Is that you need to charge more so that you can make more money? And then once you have the cash flow, then the expansion becomes pretty straightforward. That goes for basically everyone. Like a lot of times it's like, you know, we're doing twenty percent and you have what I would consider is like a normal business. It makes money, we work hard, but there's no like you never feel like you really can like get ahead.

• 27:28Speaker 05

  Yeah.

• 27:28Alex Hormozi?

  It's usually because there's some significant hole in the business and you're decent at both sides. And I think that the issue is that you just you need to be making way more money.

• 27:39Speaker 05

  Okay.

• 27:40Alex Hormozi?

  Which is, I think you need to add more. Do you sell physical products and consumables?

• 27:45Speaker 05

  Not really.

• 27:46Alex Hormozi?

  Do you sell like braces and orthotics?

• 27:48Speaker 05

  I think in a care plan, it will be based on like, yeah, we do adjustments, massage, it might be like traction, whatever.

• 27:54Alex Hormozi?

  Yeah. So the the key is there's two two models that have worked really well. One is where you basically upsell them some sort of machine that they can take home.

• 28:03Speaker 05

  Yeah.

• 28:03Alex Hormozi?

  And do other work and there's a big markup on that. And the other is supplements. Because you can sell a year's worth of supplements or six months worth of supplements upfront, make a really good bit there and it doesn't increase your operational drag at all. Because you just make the sale, give them the product. Does that make sense? Yeah. That's what I would add in to justify the higher price so that you could make more money per customer, which will then make you more money overall, which then fixes the model, which then allows you to scale. Gotcha. That makes sense. Okay. Yeah. Cool. Thank you. Rock and roll. All right. Thank you.

• 28:34Speaker 06

  Hey, Alex. My name is Nacho and we sell surf coaching to intermediate and advanced surfers.

• 28:41Alex Hormozi?

  Okay.

• 28:42Speaker 06

  We do seven hundred a year and would like to be five million.

• 28:46Alex Hormozi?

  Okay.

• 28:47Speaker 06

  And what's stopping us right now, it's basically our lifetime value to CAC is three to one. But that's because we changed our program, our online program, we changed it from two months to yearly.

• 29:00Alex Hormozi?

  Okay.

• 29:01Speaker 06

  So we can.

• 29:02Alex Hormozi?

  Raise the price.

• 29:02Speaker 06

  Yeah, exactly. And also have a longer time window. So hopefully.

• 29:07Alex Hormozi?

  Govself.

• 29:08Speaker 06

  Exactly. Yeah. So my question is, how would you go about the ascension process? Once they finish the year or even do it before they end the year?

• 29:19Alex Hormozi?

  Yeah, well, it's definitely not at the end of the year. So you have four. So there's four places that you can do such ascension upsells. I'll walk through these. Okay. So these are kind of the spaces that you can, that you can do the upsells. And this is the, the order. For your business, if you already sell something expensive upfront, which I'm guessing is now the annual, then you can ignore, well, I mean, honestly, no, I'm going to say it. So you can immediately upsell people. Hey, now that you bought this thing, do you want to get something else? That's if you want fries with your Coke. So that's that type of upsell. Now, if that's not the nature of the upsell that you have, then this is where you begin offering it. So you can ignore the first one and the other four will apply. Okay? So twenty four to forty eight hours, that's probably when you have some sort of onboarding call, right?

• 30:04Alex Hormozi?

  Boarding. There you go. And so the best upsell that you can tag with this is more help with that thing you just bought. And so either that more help or better help. So that would be like a higher qualified coach. This is a master's level three coach. He only coaches people who are whatever. And so if you want, it sounds like you might be a good fit for that. Do you want me to set you, set you up with a call there? Right? So you can immediately ascend people who just bought. Number one, that'll also help you offset CAC, bring up, bring up cash forward. The next one is when you have some sort of milestone. So they get up on their board for the first time or they do their first flip or whatever, you know, whatever big milestone that somebody might have, you know, within the first thirty or sixty days of being inside of your thing, right? At that point, you say, hey, we'd love to hop on a call. Let's see what else we can do to help you like, you know, capitalize on the momentum. And that's when you say, cool, let's take this next level.

• 30:50Alex Hormozi?

  So milestone, you know it's a milestone for them. You're saying, let's capitalize on the momentum. Let's keep the party going. The halfway point is what we position as a feedback meeting, which is like, hey, we want to check in. We want to make sure that things are going all right. And the nice thing with the feedback meeting is that you have one of two options. So they're unhappy or they're happy. Here's the cool part. If you're unhappy, then it probably means that you need more help from us. So you should buy our other thing that has more help than the thing that you have. If you're happy, then if you like that, you're going to love this.

• 31:26Alex Hormozi?

  Seriously. And then finally here, what's this last chance? So this is going to be the smallest percentage of sales. And so for many of you right now, this is where you try to do your ascensions. And the reason that you're not getting as many as you want is because you're waiting till here. You have to like, that is literally the last chance. You've already lost most people. So you want to, you want, so there's these, these buying windows that occur for a customer. And you want to present your offers at the point of greatest deprivation, not value. I'll say it again. You want to present your offers at the point of greatest deprivation, not the point of greatest satisfaction. So if I walk into a restaurant and I'm starving and I say, I want a steak. I eat the steak, waiter comes back and they're like, how's the steak? And I'm like, oh, it was delicious. Thank you so much. They're like, great. You want another steak?

• 32:11Alex Hormozi?

  I'm like, no, no, I'm good. They're like, oh, you don't like the steak? And I'm like, no, I love the steak. It was great. And they're like, why don't you know the steak? You're like, I'm, I'm good. I'm satisfied. It's, I'm fine. And they're like, well, then why don't you, you don't like my restaurant? What's wrong with you? Right? And all of a sudden it just seems weird. That's where we get these weird sales conversations. But if I wanted to sell two steaks, when the person walks in the door, I'm like, are you starving? And they're like, dude, I'm famished. I'm like, cool. You want two sticks? That's when you sell two sticks. Now, once I have a steak, I'm satisfied with my steak, but I have some deprivation around sweets. And so I might be like, oh, how's the steak? It was delicious. Oh, you know what pairs really great with that? Our lovely flambe, right? Or I don't know what dessert name, ice cream and brownie. That, that, that's what goes well with this, right? You want one of those? Sure. You know what? I'll take two.

• 32:57Alex Hormozi?

  So we want to make sure that we sell, and this is a huge misconception in the sales world is that they're like sell the point of greatest value. Sometimes the point of greatest value creates deprivation for the next goal. So if I solve your leads problem, I'm going to create your lead nurture problem. And so it makes sense to then sell the next thing at that point. If the next thing I sell is lead nurture, not more leads. Does that make sense?

• 33:20Speaker 06

  Yeah, sure.

• 33:20Alex Hormozi?

  Okay.

• 33:21Speaker 06

  Yeah.

• 33:21Alex Hormozi?

  So for you, right now, it's going to probably be an extension where you can have the quality upsell that you can immediately do. And then you basically make the ask at these different occasions and it's open handed. So it's like, hey, long term, where do you see yourself? Cool. It sounds like you're ambitious. I think you might be a good fit. Can I set you up with, he's amazing. He's helped 17 people who look just like you accomplish what you want. You'll love him.

• 33:44Speaker 06

  Yeah, and you will have the closer to jump on that call or because the thing is.

• 33:47Alex Hormozi?

  You said it. You said it for the closer.

• 33:50Speaker 06

  Okay. The thing is that they only see the closer when they buy and the second time they're going to buy. So they are not in contact with, with them.

• 33:57Alex Hormozi?

  So I.

• 33:57Speaker 06

  It feels like.

• 33:58Alex Hormozi?

  I get it. I've tried to skin this a hundred ways to Sunday. And no, I have. I've tried every permutation of this and I've had everything work. So you just have different problems. You can have your kind of team of people who are doing the education. Get trained on kind of the upsell. They're going to benefit from the fact they have more rapport, more trust. And they're going to talk to them more times where it's not a sales conversation. So that's one option. Second option, and this is the, this is my favorite of the options, but require somebody with more talent. Is that you have one backend sales guy. And that guy's positioned as the master coach or whatever, the master educator, the level 17. And so when they see that guy, he's so well positioned that he's like, hey, I'm checking in on the team.

• 34:42Alex Hormozi?

  I want to make sure that they're doing a good job. How's everything going? Great. And then that guy has the positioning to just close everybody.

• 34:49Alex Hormozi?

  And it doesn't feel weird.

• 34:51Speaker 06

  Okay.

• 34:51Alex Hormozi?

  I have done the front end sales guy talks to you again, and I also still had that work, but it's a little bit more sales heavy. And so I would, I would, I would prefer if I, if I were you, I would probably find if you have one guy who's like the best guy. What happens is you've got all these leads that funnel to front end closers. And then the people who do the delivery then funnel them to one guy. And so you only need like one, given the fact that they're not working leads, they're working customers. So they're, for you to actually book out somebody who's one guy, you're going to be doing 20 million a year. Does that make sense?

• 35:20Speaker 06

  Yeah, it makes a lot of sense. Only one question about the milestone. Cause like what we do is basically like a, a fitness program where they want to get to a huge goal. And they accomplish the first milestone, but what we offer is kind of the same thing. You know, but at that point, when they reach the first milestone, that you will only go and try to upgrade in something like more quality, but the same.

• 35:43Alex Hormozi?

  Yeah.

• 35:44Speaker 06

  Yeah, okay. Yeah.

• 35:45Alex Hormozi?

  More quality.

• 35:46Speaker 06

  Perfect. Thank you, Alex.

• 35:48Alex Hormozi?

  Yeah, you bet.

• 35:49Speaker 07

  Hi, I'm Jaclyn. I know we talked.

• 35:51Alex Hormozi?

  Dentist, yes. Three million, 5% profit margins. You have five different ones, three are part time.

• 35:58Speaker 07

  Perfect.

• 35:58Alex Hormozi?

  Well.

• 35:59Speaker 07

  Great memory.

• 36:00Alex Hormozi?

  Yeah, you're in Dallas, this 30 year old business, I can hear it from your father.

• 36:03Speaker 07

  Yes.

• 36:04Alex Hormozi?

  Yep.

• 36:05Speaker 07

  And my social security number, just kidding.

• 36:07Alex Hormozi?

  I can point it up.

• 36:09Speaker 07

  So I know we talked, yes, last night, which you obviously remember, and a couple other people from your team, we talked about this issue. That my number one constraint probably isn't our cancellation rate, but it is something that I'm like really perplexed about and want to at least go back with a little bit of something to share with my team about.

• 36:28Alex Hormozi?

  Sure.

• 36:28Speaker 07

  So our show rate or our cancellation rate is a little over 30%. And this past year, we've lost like a million dollars because people made appointments, confirmed them, and they didn't show up. So if you have any insight on what we could do to start improving that, I would be really grateful.

• 36:47Alex Hormozi?

  Yes, I don't think it's the constraint of your business. So number one is you're going to want to make sure that the, I feel like that that time is the right time for them. And we ask questions like, is there anything that will possibly get in the way of you showing up for your meeting? And so we call this an integrity tie down. And so after you get a time slot, you want to ask that right afterwards, because it like gets like shakes them out of their like mind for whatever reason it works. So I could come up with some narrative for it, but it works. Number two is, I think I mentioned this yesterday, but I think it might be worth considering pulling up appointments. Like to basically, can we bring them up sooner so that we have increased show up rates? The next one is, let's see here.

• 37:32Alex Hormozi?

  You want to make sure that you have automated reminders, which you probably do, but then you want to have manual reminders on top of that. So if you have, I have an office iPhone and you want to send manual text at three times. So you want to send the manual text at 24 hours. So basically think night before, second text is going to be morning up. And then the third text is going to be 60 to 90 minutes prior. Basically when they have to like get your shit together, get in the car and.

• 37:56Speaker 07

  Three within 24 hours.

• 37:57Alex Hormozi?

  Mm hmm. And those are manuals. You want those to be blue iPhone messages if possible.

• 38:01Speaker 07

  Okay.

• 38:03Alex Hormozi?

  Now ideally, we like to have some sort of selection that they pick that we've like some cost we have incurred. So this works exceptionally well for brick and mortar, so I'm sharing it with you. And so in the gym space, obviously like we'd say, hey, Sharon, I've got this shirt. Tell me what size you're at and I'll put it, pull it aside for you. And so when you come here, I'll give it to you. Or it's like, do you want red or do you want blue? Like just do some sort of A B ask for them. And so it could be as simple as like, you're gonna, you're gonna pull, I mean, because it's a dentist office, right? And so you're like, okay, what can I give them? Well, I always get free shit when I go to this office. And so just like have them pick the free stuff that you put in their goodie bag and they, and just, and then I would send them a picture with their name on it so that they're

• 38:48Alex Hormozi?

  like, oh man, they incurred this cost just for me. I have to show up now. Right? So that's another one. The, okay, we got that. Because you're having the issue because someone books and like six months later is their cleaning or whatever, right? That's the, the problem here.

• 39:04Speaker 08

  Yeah, well, we call and confirm their appointment a week in advance and then we call and remind them again three days in advance. And then we call them and text them again a day before. And they'll say, yeah, I'm gonna be there. And then two o'clock comes and they don't.

• 39:17Alex Hormozi?

  I think you're you're reminding too far out.

• 39:19Speaker 08

  Okay.

• 39:19Alex Hormozi?

  Like if if if I schedule an appointment on Saturday, Monday morning is a different universe for me.

• 39:24Speaker 08

  Yeah.

• 39:25Alex Hormozi?

  No, I'm just being like super real. And so I think I think a lot of people are that way. And so all of the manual reminders are like, if you want to like, I use the automated ones for the far out. Like, hey, you're seven days away. Hey, you're three days away.

• 39:38Speaker 08

  Okay.

• 39:38Alex Hormozi?

  But I would have the ones that you're putting the real effort in 24 morning and right before.

• 39:44Speaker 08

  Okay.

• 39:45Alex Hormozi?

  And then have the incentive, have the personalization. And I will bet you dollars to donuts that that on its own would work.

• 39:50Speaker 08

  Okay, awesome. Thank you so much. I really appreciate it.

• 39:52Alex Hormozi?

  No, you bet.

• 39:53Speaker 08

  Hi, thank you so much for all your content you make. My name is Loriann and I sell personal finance courses and coaching to women. We do thirty.

• 40:02Alex Hormozi?

  For women.

• 40:03Speaker 08

  Pardon?

• 40:03Alex Hormozi?

  For women.

• 40:04Speaker 08

  For women.

• 40:04Alex Hormozi?

  Ah.

• 40:05Speaker 08

  With a plus.

• 40:05Alex Hormozi?

  Like, screw the guys, they don't need to save money.

• 40:07Speaker 08

  You know, they can learn from someone else.

• 40:09Alex Hormozi?

  I'm messing with you.

• 40:10Speaker 08

  So we do thirty million in revenue.

• 40:12Alex Hormozi?

  Bad end.

• 40:13Speaker 08

  Thank you. I would like to be at, I don't know, revenue, which comes to my question.

• 40:18Alex Hormozi?

  That's right.

• 40:19Speaker 08

  And what is stopping me is our CAC to LTV ratio.

• 40:24Alex Hormozi?

  All right.

• 40:24Speaker 08

  Both CAC is too high, got the team working on volume right now, LTV is too low.

• 40:30Alex Hormozi?

  Okay.

• 40:30Speaker 08

  And AOV is too low on our front end. So I think it's actually a cash flow. She's straight potentially, but I'm a little, I'm a little confused on where like exactly to go to work.

• 40:44Alex Hormozi?

  Okay. How do you acquire questions right now?

• 40:46Speaker 08

  Primarily meta.

• 40:47Alex Hormozi?

  So it's all paid ads?

• 40:48Speaker 08

  Yeah.

• 40:49Alex Hormozi?

  Okay, so all paid ads and you're running to what?

• 40:51Speaker 08

  Webinar, 2K webinar.

• 40:53Alex Hormozi?

  Okay, are you are you have a low ticket offer for the webinar? Are you charging like something as like a self liquidating offer on the front?

• 40:58Speaker 08

  Free webinar, no, never done a self liquidating.

• 41:00Alex Hormozi?

  Okay, so free webinar on the front end, you have a $2,000 offer, okay?

• 41:03Speaker 08

  Yeah.

• 41:03Alex Hormozi?

  Then what?

• 41:04Speaker 08

  $2,000 or 12 month payment plan for $200 a month, which is why our AOV is like $900.

• 41:10Alex Hormozi?

  Got it.

• 41:11Speaker 08

  And then acquisition cost like 1,500.

• 41:14Alex Hormozi?

  Uh huh.

• 41:14Speaker 08

  On the client. And then we have a backend.

• 41:17Alex Hormozi?

  Right.

• 41:17Speaker 08

  That's 10K, has a 7% upgrade rate. Yeah, it's low, outsourced, sales team right now.

• 41:24Alex Hormozi?

  That's.

• 41:24Speaker 08

  And so LTV is like 2,400.

• 41:27Alex Hormozi?

  Yeah, that's a problem.

• 41:29Speaker 08

  Yes.

• 41:31Speaker 08

  That's why I'm here.

• 41:32Alex Hormozi?

  Your ascension, yeah, no, your ascension rate is too low. You will probably have to bring the sales team in-house if you want to really fix it. It's very hard to influence the team. You'll want the ascension to be integrated into the onboarding. And so you sell the $2,000 thing. You have your onboarding call. The onboarding call, the finish of the onboarding call is they set their goal setting call with what would become a setter. And then that setter sets for a closer. So they actually get three calls. So they have webinar, buy, they have an actual onboarding call because you want them like, you want to make sure you deliver.

• 42:04Speaker 08

  One-on-one or that's a group?

• 42:05Alex Hormozi?

  One-on-one, you can do, well, you can start with, uh,

• 42:10Speaker 08

  Group?

• 42:11Alex Hormozi?

  You can start with group and then you will make more money if you go to one-on-one. It is more ops, but like we actually did this and I have a video that breaks down everything that you need to know.

• 42:19Speaker 08

  Yeah.

• 42:20Alex Hormozi?

  Okay, yeah. And so one-on-one is better, but if you're going to start, start with the, the group. And their way of getting off the call, like saying like, okay, you're dismissed is that you show me that you have confirmed your booking with your next call. So that way you have a hundred percent through, through line to the next. Now they're customers, they're going to show up. The goal setting call basically sifts for who, like what's your goal? Cool. What's that? Basically just do another sales call again, and then you push people into the ones you can afford it, that makes sense, into a closed call with basically an invitation to join something that has more help or work associated.

• 42:56Speaker 08

  Yes. Okay, great.

• 42:57Alex Hormozi?

  You'll probably need to get third-party financing in place.

• 43:00Speaker 08

  Oh.

• 43:00Alex Hormozi?

  Yeah.

• 43:01Speaker 08

  On front end. For the, for the sales calls.

• 43:03Alex Hormozi?

  Yeah. And, and front end. Like you should definitely have some BNPL options. So buy now, pay later. You should probably have a few.

• 43:09Speaker 08

  Okay. We have them on the back end. We don't have them on the front end.

• 43:11Alex Hormozi?

  Yeah. Also with the webinar, I would recommend split testing the first five minutes. So retest two or three different intros and look at LTV. That will make you money. But the biggest issue is that you're, you're upselling 7%. Like you need to be at, you want to be at at least 25 and you should shoot for 50.

• 43:30Speaker 08

  Okay. Okay. And so just one more question as that's like a longer term solution, right? That's going to take.

• 43:37Alex Hormozi?

  You mean bring in a sales team?

• 43:38Speaker 08

  To bring the sales team in-house and really optimize that process?

• 43:41Alex Hormozi?

  Why does it have to be long-term?

• 43:43Speaker 08

  Just a time it'll take to find a sales leader and recruit and like shift leads from the.

• 43:48Alex Hormozi?

  You need to hire one person, really good sales director, and then you hire six recruiting firms that do sales and say, I need 10 guys from each of you and you can get a 60-person team in four, like two weeks.

• 43:59Speaker 08

  Okay.

• 44:01Speaker 08

  Okay.

• 44:01Alex Hormozi?

  We just added forty guys in two weeks to one of our companies. You just paid a bunch of like, if we're doing that kind of volume, we're just gonna go to somebody who has a big network of people that they're, that's their full-time business recruiting sales guys. So it's like, great. These are requirements. Go get them.

• 44:15Speaker 08

  Yeah.

• 44:16Alex Hormozi?

  And I'm willing to pay for the speed. So if it's, and you can also negotiate if you're doing multiple, like the same of multiple. So it's like, hey, normally, you know, it's ten grand per per head, but I'm gonna buy twenty from you. So I'll do it for five.

• 44:28Speaker 08

  Okay.

• 44:28Alex Hormozi?

  So you pay a hundred grand, all of a sudden you have a department.

• 44:31Speaker 08

  Okay, cool. So an action on that immediately. And then while we're doing the recruiting and getting that person up to speed, just keep spending basically as much as we can afford to spend on the front end to keep like lead flow coming into the back end.

• 44:44Alex Hormozi?

  Realistically, if you spend less, you will typically ROAS will increase.

• 44:49Speaker 08

  Yeah.

• 44:49Alex Hormozi?

  Typically. YouTube's not that way, though. Kind of random. The more you spend, the more profitable it gets. It's wild. Yeah, it's shit. Anyways, but all that to say, I like, if you have a cash flow issue right now, or like, you know, it's like, it's self-inflicted. Like, you can just spend less and improve the, improve the returns, but your CAC is appropriate. Fifteen hundred dollars to our customer in that space.

• 45:13Speaker 08

  That's that much lower.

• 45:14Alex Hormozi?

  Yeah, it's like, you're not gonna like, you're not gonna get below a thousand. And so this is a backend issue. Like, you just have to increase the essential rate and that's it.

• 45:24Speaker 08

  Okay, thank you.

• 45:25Alex Hormozi?

  You bet. Awesome. Okay.