Alex Hormozi on Fatherhood, Leadership & The Cost of Success

Alex Hormozi is back on the show, and I’m telling you right now, this may be my favorite conversation we’ve ever had together. I believe Alex is one of the best business minds in the world today, but what makes him different is his ability to take incredibly complex ideas and make them immediately actionable. We get into everything from productivity and AI to leadership, leverage, risk, and why some entrepreneurs explode through barriers while others stay trapped at the same level for years. One of the biggest ideas we unpack is something I believe every entrepreneur needs to hear: the risk that got you where you are may not be enough to get you where you want to go. Alex explains why so many entrepreneurs get trapped between $1 million and $3 million in revenue. You’ve finally made enough money to become comfortable, and now the very thing that helped you survive starts working against you. You become protective. You stop making the bets that got you there. But if you want another level, your capacity for risk has to expand alongside your capacity for opportunity. We also go deep on effort, focus, and leverage. Alex challenges the obsession with complicated morning routines and explains why your best cognitive hours should be protected for your most important work. He breaks down his philosophy that "work is the goal," why winning against other people eventually becomes too low of a standard, and why some of the most successful people measure themselves against what they were truly capable of giving. And his take on AI absolutely stopped me. Too many entrepreneurs are using AI to do the wrong things faster instead of asking whether those things should be done at all. Sometimes the greatest leverage isn’t doing something more efficiently. It’s eliminating it completely. But underneath all the business strategy is something even bigger. Alex talks about becoming a father, thinking differently about legacy, redefining what a great day actually looks like, and asking a deceptively simple question before taking a risk: What will this actually change about my day? We talk about why fear lives in the vague, why failure builds the pattern recognition that eventually makes success repeatable, and why great entrepreneurs eventually stop "building" businesses and start assembling them. If you’re an entrepreneur, leader, or someone who knows there’s another level in you, this episode will challenge the way you think about work, risk, success, and what you’re actually building your life for. Key Takeaways: • Why your risk tolerance has to increase as your success increases• The $1M to $3M "swamp" that keeps entrepreneurs stuck• Why "work is the goal" can completely change how you measure success• How to protect your highest cognitive hours and eliminate unnecessary routines• Why focus is subtraction and doing less can create more leverage• The biggest mistake entrepreneurs are making with AI right now• How failure creates pattern recognition and makes future success faster• Why great entrepreneurs eventually stop building businesses and start assembling them• How Alex evaluates risk by asking what it will actually change about his daily life This one is packed with ideas I’ll personally be thinking about for a long time. If you know an entrepreneur who feels stuck at the same level, send them this episode. It might show them exactly what’s been holding them back. MAX OUT. Head to dosedaily.co/MYLETT or enter MYLETT to get 35% off your first subscription. 👉 SUBSCRIBE TO ED'S YOUTUBE CHANNEL NOW 👈⁠ → → → CONNECT WITH ED MYLETT ON SOCIAL MEDIA: ← ← ← ➡️ ⁠INSTAGRAM⁠ ➡️ ⁠FACEBOOK⁠ ➡️ ⁠LINKEDIN ⁠➡️ ⁠X⁠ ➡️ ⁠WEBSITE Learn more about your ad choices. Visit megaphone.fm/adchoices

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

• 0:00Ed Mylett?

  I hear so many small business owners say the exact same thing. They just never have enough time in the day. Well, I measure time differently. I've compressed, condensed, heck, I've bent time. My first day is 6:00 AM to noon. My second day starts at noon and goes till 6:00 PM. And my third day, 6:00 PM to midnight. I now get 21 days a week. Stack that up over a month, over a year, over five years. And my life's completely different than it would have been otherwise. And if you want to win as an entrepreneur, you have to compress your time too. And you definitely can't afford to waste it. Waiting weeks on a big bank for capital? Your best bet's to work with my friends at Cardiff. They know how to compress time for entrepreneurs. They get your business approved in minutes and funded the very same day. They're America's favorite small business lender and for good reason.

• 0:45Ed Mylett?

  Over 20 years in business, over 12 billion deployed to small business across America. Stop letting bank delays slow down your momentum. Head to cardiff.co/ed. That's cardiff.co/ed. Cardiff.co. Real growth, fast funding. Cardiff, borrow better.

• 1:02Speaker 01

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• 1:37Ed Mylett?

  This is the Ed Mylett Show. Welcome back to the show, everybody. So here's who I have with me today. Somebody that I admire a great deal. I wish I spent more time with. I think he's one of the great American entrepreneurs, actually worldwide entrepreneurs. He's, I told him this privately on a conversation, I don't know, about six, eight weeks ago. I think he's the best in the world at teaching people how to be better business people and better marketers. I think he's number one in the world. And I say that as somebody who does it myself. And so I have a great deal of admiration for him. Most importantly, his brain is huge, but his heart is bigger. That's the one thing I think most people online would not know about this young man. He's got a heart of gold. He's a kind person. He's a humble person. And he still is curious and still wants to learn. He still actually asks for advice from time to time.

• 2:22Ed Mylett?

  And so you're going to get his advice today on the Ed Mylett Show with the great Alex Hermosy. Welcome back.

• 2:28Alex Hormozi?

  Thank you for having me. And my only goal in this podcast is to live up to that introduction.

• 2:33Ed Mylett?

  You'll do great. So you've got a lot going on in your life. Congratulations on the potential, the soon coming fatherhood for you.

• 2:41Alex Hormozi?

  Yeah.

• 2:41Ed Mylett?

  Has it changed you at all? Like just the thought of it, just knowing it's coming?

• 2:45Alex Hormozi?

  I'd say the thought has changed my life maybe in two ways. One is that I'm actively really trying to get ahead on education for my son and thinking like, what inroads do I need to do so that I can set him up education wise? Because I don't like the system, obviously. I'd say that's one. I'd say two is that I feel like I've had a little bit of a shift in terms of, up to this point, I've just only had, I would say I have had reverence for the game. And that is why I continue to play it.

• 3:11Alex Hormozi?

  But I've had a weird shift where I was like, oh, I guess I am going to leave this to someone. Because until this point, it was just, I'm going to write it to charity in one check and let it go to like the Acumen Fund or some of these really good institutions that know how to deploy capital in a charitable way. Because I was just like, this was just chips to play the game. But so that's, I would say those are the two things that have changed about in terms of like, what has, what new weights are weighting my decision making? Those are those two. I'm more, I'm more likely to respond to a student outreach, you know, like something student related. But beyond that, in terms of my like internal stuff, I'm here to support Leila. And I expect the emotionality of it will probably come when he's born.

• 3:49Ed Mylett?

  Yeah, but I know, you and I have had enough conversations. I think it's more than that with you. I think it's changed your overall look on everything. I mean, you've asked me a few questions in different ways. But, but you appear to, at least to me, it seems to have almost, I don't know, broadened your perspective, made it bigger.

• 4:10Alex Hormozi?

  Totally.

• 4:11Ed Mylett?

  In what way? Like if we're using my terminology, because I think it's important. You have a lot of young people that follow your content. You have a lot of people that follow your content. But a lot of them are guys like me when I was coming up, guys like you when you're coming up. And they're not at this stage of their life yet. I wonder, knowing what you know now about you're going to be a dad, would it have changed anything you were doing or thinking prior?

• 4:31Alex Hormozi?

  Leila and I are really serious about having kids when I was 28. And we were like, really going to do it. And then we were like, you know what? Let's not. But there was like, you know, a few month period where we were like, let's do this. And I think that we could have like, again, I can't replay life. But like, I think me doing it at that point when I was 28 and she was 25, might have been like, that would have been good. It probably would have been easier to have more kids. Because I think Leila and I are very all, like all or nothing. And so as soon as we found out that she was pregnant with our son,

• 5:04Alex Hormozi?

  we were like, well, I guess we're going to have a lot more than one, or at least that's the goal. So it's either like, none or have a soccer team. You know, and that's kind of like.

• 5:12Ed Mylett?

  And we have settled on Edward. That is his name, right?

• 5:14Alex Hormozi?

  One of the great names.

• 5:15Ed Mylett?

  Yes, his name is Edward. I got to tell you, when he told me about the blessing, I think you would agree, I was almost as excited as if my own son. And the reason is, I just want to tell you, and then we'll get into content that everybody wants. I've long thought you'd be a great father. And I've told you that. I told you that before this happened. So I'm just really happy for you. I just want you to know that.

• 5:38Alex Hormozi?

  And I'll just say that for people, I mean, everyone who listens to this already knows you, but like, Ed's even better in private than he is on these podcasts. And it's one of the, one of the rare gifts. I think I had somebody ask me like, hey, what are the people, of all the people that you've met, that were, you know, different in person versus their content? And I was like, Ed for sure. And they were like, oh. And I was like, no, he's just way better.

• 6:01Ed Mylett?

  Oh, thank you.

• 6:03Alex Hormozi?

  And yeah, it's just like, there are very few people that I, that I like. If I was like having something that was kind of complex, like you have this very great depth of understanding from both like, you have the business acumen, but you have this great balance of humility without having any judgment. And I think that's super rare.

• 6:17Ed Mylett?

  Thank you. So do you, by the way. It's what I admire about you. We both at our stage, it's important for people to know, we're both still curious. We still both want to learn. You're the smartest guy in the room most of the time, but you don't ever act like it. And that's one of the things that I really love about you. You've made me think about my own content. So I want to go into some stuff. I want to ask you about some stuff. You've challenged my own thinking. So I was probably one of the early on, way back in the day,

• 6:41Ed Mylett?

  morning routine, evening routine guys, creating structure. I probably made it sound as if I was a little bit more dialed in than I really was on a given day. You know, content can come across that way. But you've sort of taken a different perspective on it. And frankly, you've persuaded me you're probably more right than I was. And so I've actually not really gone back to the old way that I teach this stuff. Meaning, I think there's a lot of things that are ritualistic we do, that are just time fillers now that are wasting time. So share with the audience kind of your view on morning routines and what is, what really matters to get a day started and a business going.

• 7:16Alex Hormozi?

  I, I basically see the time that you wake up after any period of sleep, even if you take a nap, right afterwards is where your, your processing power is going to be the best. And so the morning typically is where you're going to have the best thinking. If you can use the morning ideally, some people can't get the time, fine. You can do late at night, it's okay. But because of that, my goal is to compress the time from when I wake up to when I begin working as fast as, to as little as possible. And so for me, it's basically wake up, stimulate, meaning caffeinate, nicotine eight, protein eight, you know, creatine eight, do all my stuff, my stuff. And then just basically go right into it. I think some people having like maybe a 10 minute meditation or something like that, because it calms their, you know, emotionality so they can attack the thing, that's fine. I think anything, you know, much longer than that, like for example, I love training.

• 8:02Alex Hormozi?

  But when I am trying to be my most productive, I train at the end of the day.

• 8:05Ed Mylett?

  You do?

• 8:06Alex Hormozi?

  Yeah. Because my brain is exhausted, but my body is still fresh. But if I use, if I train the way I want to train, which is two hours, I'm using the first two hours of my day on training, which if I don't, if I'm not in a go-go season, which happens plenty, I'll train first. Because I'll use all my juice there. But I'm definitely more fatigued because I train pretty hard.

• 8:23Ed Mylett?

  Yeah, I'm seeing, I, I've had a, let's talk about this for a minute. I think it's a little bit of, and debate this with me a little bit. One, my routines were too long. You were right. It was two hour, an hour and a half or two hours of stuff to just get going. And frankly, as I step away from it, I don't even believe any of that in real life. You don't have to be perfectly prepared to do anything. In fact, you're never going to be. Some people, is it not, you don't think it's more like know thyself? Like the most successful high performers I know, know their peak cognitive time of the day. So are you saying that you think for everybody it's their morning? Because for me, I'm with you. I'm probably best like, not, not 5:00 AM morning, but I'm probably best, my best meeting should be taken. Hardest meeting should be taken between nine and noon for me.

• 9:03Alex Hormozi?

  The basis 10:00 AM meeting.

• 9:05Ed Mylett?

  Yeah, that. But do you think that it's more, if you're giving advice to somebody, it's, it's become self-aware of when your cognitive peak is?

• 9:11Alex Hormozi?

  Yeah, I think there's the, the like population versus N equals one. And so I think population wise, most people in there, the freshest is like after they wake up. Now, I'm not saying like, you get shook out of bed now write an essay. That's not what I'm saying. But 30 an hour, once your cortisol comes up and you're like alert, usually at that point, you're, you're freshest. Yeah. N equals one. Everyone's different. And so if you had a scatter plot of humans, it's like, in general, that is where it is going to be. If you don't know where to start, we're going to be more productive, start in the morning. If you have, if you're like, I for sure am a night owl, then be a night owl. Like I, I think both, I have no dog in this fight. Do whatever you want.

• 9:47Ed Mylett?

  Right, agree.

• 9:48Alex Hormozi?

  I think the only thing that I, I would say that I am adamant about that I would, you know, what sword would I actually fall on is that I would never want my routine to become a crutch. In that if I didn't have it, it would make me less capable. And so it has to be something that I can win without it. But if it's there, it's additive. So it's a preference, not a requirement. And so I think one of my favorite lines in Invictus, which is like this weird movie, we have Morgan Freeman, he's talking to Matt Damon, who's the lead, a South African player. They have some exchange and he says, you know, I, I wish we could have played better this year, but you know, we, we weren't 100%. And Morgan Freeman, who's supposed to be Nelson Mandela, says, no one's ever 100%.

• 10:31Alex Hormozi?

  And it was this really great exchange that I've always thought a lot about, which is like, a lot of like champions and winners win despite imperfect conditions. Not in the pursuit, pursuit or effort of creating perfect conditions.

• 10:43Ed Mylett?

  I want to talk about that. By the way, you mentioned something ironic, my drive over here with my Uber guy. I can't say why, but I had a recent engagement with Morgan Freeman. I spent the last 40 minutes driving over here talking about Morgan Freeman of all human beings. And now you bring up that name in the interview. I want to talk about effort and conditions. Here's the thing I think that you have. I want you to discuss this with everybody. I think for most people, effort is conditional. Like when I'm working with athletes, you know, I'll go to these college football teams or these, you know, professional teams. And if the guy's starting. And he's first string and it's, you know, 10 to 7 in the fourth quarter. You're getting 100% max effort from that person. But if he's second or third string in practice on Thursday, he knows he's not going to play in the game. Or it's 21 to nothing.

• 11:27Ed Mylett?

  Effort changes for most people based on conditions. And I think someone like yourself who's had long-term success. You've made effort unconditional, meaning regardless of the conditions, winning, losing, pregnant, not pregnant, an exit, a deal that falls apart. Effort is not based on conditions or even how the people around you are behaving. Do you believe that that's a key?

• 11:48Alex Hormozi?

  Thousand percent. For two reasons that I think the second you'll appreciate more. So I'll actually start with that one. If you were somebody who starts to win, right? And so this is maybe only talking to the 10% or 5% of people who are listening to this. You can't, you can't make your effort conditional on winning anymore. Because winning, the bar is too low. Because starting to outcompete other people who aren't as prepared, who didn't realize how much effort you were going to put in ahead of time. Like you actually end up sacrificing your potential in just trying to beat them. Rather than saying like, and this is why I love Andy's, Andy Frisella's 100 to 0. That like leave no doubt. So it's like, we have to only be playing against ourselves, especially once you get past a certain level.

• 12:33Ed Mylett?

  What a great point.

• 12:35Alex Hormozi?

  And so I'll say that as like thing one. I'll say the second part is that I think, I had a year off when we sold the company and we're going through that whole process. And it was one of the most miserable of my life. And I derived from that period, this concept or this mantra of work is the goal. And it was the idea that a lot of times even here the coaches say, hey, you know, work super hard. The score takes care of itself. But even adding on the, the score takes care of itself, still makes the score the objective or the goal. If we could just say, work as hard as you can, period. And I will judge you by how hard you worked relative to how hard you could work. And what's difficult about that is that the only person who actually knows how hard you can work is you.

• 13:19Alex Hormozi?

  And so that is both gratifying and also terrifying. Because you can win and in the world's eyes and still lose in your own if you use that as your, as your metric.

• 13:31Ed Mylett?

  Yes.

• 13:32Alex Hormozi?

  And so.

• 13:32Ed Mylett?

  Wow, very good.

• 13:34Alex Hormozi?

  What was, what was interesting about the, so we did this book launch in August of last year and we were.

• 13:39Ed Mylett?

  I heard you made a little money on that.

• 13:40Alex Hormozi?

  It worked out.

• 13:43Ed Mylett?

  You made a hundred million bucks.

• 13:44Alex Hormozi?

  And so the whole, the whole idea was, you know, the, the record was Prince Harry's record, which was 1.4 million copies sold in 24 hours, which is roughly like $43 million in 24 hours. And so we, we ended up breaking the record within the first like three hours or something like that.

• 14:01Ed Mylett?

  It's crazy.

• 14:02Alex Hormozi?

  And, but we still had, we still had 21 more hours. And so this is the 100 to 0 concept of like, well, let's, we're not going to stop now. Like let's, let's run up the score. And I think my team was even surprised when I like took a water break seven, eight hours in. And they were like, okay, so you know, what are we going to do now? I was like, we're going to keep going. And like I had almost no celebration. Part of it was because I was like, I'm not going to waste this. Like we put all of this time, we gathered all of this attention. And we're going to just deliver as much value as we possibly can during this period of time. And then we're going to go for 100. So it wasn't even like, don't, don't beat it. Like put a whole new marker for what you think is possible. And we had done the math or I'd done the math prior to it, which is why the $100 million launch was the idea.

• 14:46Alex Hormozi?

  But it was like, I think we can do this. And so that becomes the standard rather than the world standard of just winning.

• 14:52Ed Mylett?

  You know, first off, this is why I love talking to you because you make me think. And, but I, I want to stay on this just for a second. First off, we've unpacked two gigantic lessons. One is how to prepare for your day and when to take your best meetings and to be self-aware. The second one is this idea of unconditional effort. But when you're saying something, are you like this too? I have actually not really celebrated, nor have I enjoyed what I think the world would think are really normal, big like life events, like the day of an exit or like the day you had the $100 million day. Yet on the other hand, I've, I've had massive personal celebrations on days where I have no pun intended, but like maxed out my potential possible effort in a given day.

• 15:33Ed Mylett?

  Meaning almost, this is, this is really counterintuitive for most people, but so important because this isn't on social media, it's not on most podcasts. I don't think I've mentally the last year played like a results game, even though I am outcome focused. I am much more process and or effort focused. And I celebrate to the extent that I'm capable of doing that. The max effort days, not the, the actual result day. And by the way, my celebrations are pretty weak and suck too.

• 16:01Alex Hormozi?

  We both have had this conversation.

• 16:03Ed Mylett?

  But share your thoughts on that.

• 16:06Alex Hormozi?

  When I looked back on that year where I was like, what are the, what are the happiest days of my life? Because when you have, you have your monetary itch scratched, you're like, okay, well, what am I doing the rest? What are the rest of my innings for? I had this great piece of advice from a mentor who told me after I had this particularly good weekend and I was in a good mood. And she said, you're in good mood. And I said, yeah, you know, had a couple of good days. And she said, I'm pretty sure the secret to life is stringing as many days in a row like that as you can. And it was one of those very tactical pieces of advice that I've actually taken with me forever, which was, so when I looked back on my whole year, I was like, okay, what were the top 10 days of this year? And I started thinking through them and I have this written on my wall, which is, so there's like two things written on my wall, three. That are my, my constant reminders. One is focus is subtraction.

• 16:50Alex Hormozi?

  The second is my good day formula, which is work out with people you like, eat with people you like and write something. And so if I can do those things, because when I looked back at my days, when I did those three things, those are my best days. And so I was like, how can I do that as much as I possibly can and organize my day to do that? But that last one, which I would say is not on that list, but is kind of like the result of the list is to have nothing in the tank. It's like when I, when I've earned my shower, when I feel like I have nothing left to give. And I would say that like, if you think of a day as a microcosm of your life, it's like, I would like to end, end this life being like, I gave, I left it all on the field.

• 17:28Ed Mylett?

  Emptied the tank completely.

• 17:29Alex Hormozi?

  I left it all on the field. There was no one who's like, he could have done more. It's like motherfucker just squeezed from places we didn't know existed. That's what I would like every day to be. And of course it's an ideal, it's not something I hit every day, but I strive.

• 17:40Ed Mylett?

  So do I. It's funny because you reach levels of capacity and talent or what people think are skill, at least me, through doing that. So ironically, then people look at you and think, man, this guy's so skilled as an entrepreneur or what a great speech maker or. But it's actually happened through emptying the tank all of these days. How do you navigate? Because if we're not careful, you and I fall into this trap of the people that you also hear on social media that you and I privately discuss sometimes too. Like I can't believe with no offense, why someone's listening to this person if they've actually never produced anything. But I've also, I, I also don't want to fall into this. I get, you'd call it like bro culture, hustle culture notion of like the funny clip of me saying,

• 18:23Ed Mylett?

  I work a million hours a day and I can change time and cavemen lived a million years ago or whatever. It was a little miss speaking there. However, what, what I don't want to sound like is like that that's, that, that there's no meaning in other things. And that rest is not also okay. So I just want to give you a forum so that people don't think that of you also. Like what are your philosophies about rest or recuperation or reflection? Because for me, a lot of times these big efforts I make, a lot of the, the growth actually happens in reflecting on what took place and what I learned from it. And you do do that more than most people know.

• 18:59Alex Hormozi?

  Totally. So if, so tactically, if you were to look at my calendar, my five days out of seven have almost nothing on it. I do one day, I do a half day of meetings on Monday and then I do one, one filming day a week. So today was my filming day. And then if you include the weekends, those two days, I have three during the week and then two, two weekend days that are almost always completely empty. And so that is, that is how I work most effectively. And it's because I think that two weeks ago, I could not know what was going to be most important today. But today I will be able to do that. And so I have faith that I can pull things together. Like I, I put together this deal on a Sunday once after like, yeah, I'm sure you had one of these days where somebody calls you and you're like, oh, I think I can put this together.

• 19:39Alex Hormozi?

  And it was six straight hours of calls and we ended up putting like almost a $400 million stock deal together. But it was just like, just, but if I had had appointments all day, I would have missed that and that wouldn't have happened. And so there's just huge value to that. So that's like thing one in terms of organizing time and trying to create space. And that's just how I function. The second is, I think it's, it's extending the time horizon in terms of what we're thinking about output. So if you, if, whenever you shrink the time horizon, then it always creates a false narrative of extremism. And so for example, if I said, if you're going to die tomorrow, you change your behavior a lot today. But if I say you're going to die in a week, you change it for sure a lot, but it would be slightly different.

• 20:21Alex Hormozi?

  If I said you're going to die in a month, it would still be different, die in a year, it's for sure going to be different. And then beyond that, it's too far for human consciousness in reality. And so as a result, it's like, we have to think, how do I maximize my output over a year or two years or five years or 10 years? And so if we take let's say even a 10 year horizon. Then for sure, we need to rest because like it's like if I worked out every hour of every day, you're not going to get stronger. You're just going to break down your muscles too much and you're just going to look terrible and be exhausted and overtrained, right? And so like there obviously has to be some recuperation that that exists. And so it's about maximizing output of unit of time total. But if I only had 24 hours, then yeah, take as many stimulants as you can because you only have 24 hours to work.

• 21:04Alex Hormozi?

  But that's not how the world works. You have and for the the games that we're trying to play decade plus, it's like not only that, you actually have to be aligned from a meaning and purpose perspective, because we assume that we're going to win to a certain degree. So it's like, we have to find ways to make it worth it and also not sacrifice the other reinforcers we have in our life, like family, wife, kids, whatever. And so I think it's it's navigating, how do I have the highest output over the longest period of time? Which allows for a much more, I'll call it balanced with quotes approach. But it still comes into seasons. And I think, again, when we think in this longer term, when you how you work in your twenties is going to look very different than how you work in your forties.

• 21:42Ed Mylett?

  I agree. So would you say that that schedule you're running now with those open days, you more almost had to adjust to your current circumstances? But if it was startup Alex or Mosey in the gym, you're probably.

• 21:51Alex Hormozi?

  Oh, all day. Yeah, my my startup schedule, I'll tell you what it was because I still remember it. So basically I take my idea, hold on, but I did split it into thirds, kind of like you did. And so I I bake it into, I would do all my my innovation stuff first because that's when I was freshest. So I would work until like from four to 10 ish. So I got 60 showers. And then at that point, I'd have customers and the fires of the day would happen. I would spend the middle of the day on promotion and sales. So basically do marketing and meeting with sales, you know, customers to try and sell them our stuff. And then the back end of the day was all the admin stuff. So that was billing and finance and, you know, fixing broken equipment and all this stuff. But I slept at the gym. But it was basically, if you think about it from a pure big, big perspective,

• 22:34Alex Hormozi?

  if you've got, you know, attraction, you've got conversion, you've got delivery, that's kind of like how you're you're breaking down the business. And I just would say that that has to happen throughout the day, but you have to take some block every day, at least for me, that's working on it rather than in it, which how do I build the assets? That can replicate a trainer, replicate the front desk girl, replicate the sales process, whatever. But yeah, that was that was 12 hours a day, six days a week. I've been able to do 12 hours a day, six days a week, taking one day off. It's like, I can do that for a very, very long time. I'm also not saying that's right for everyone. I can do that.

• 23:06Ed Mylett?

  But I have to say, and by the way, I'm not saying that's right for everyone either, but that's exactly what I did. That's exactly what Andy did. The three of us have in common. You slept in the gym, he slept in the in the store and I slept in the office. I'm not saying get a sleep in your building either. But and the idea of this time thing, poorly chosen words in some of these clips, but you're really compressing time, meaning you're trying to do things that most people think take two hours in 30 minutes, if you can. Not all meetings need to be an hour. And that's why having a day broken up matters. Now, my hardest thing. So we're all trying to feel healthy, right? But here's what most people miss, your liver health. It affects literally everything, your energy, your digestion, how your skin looks, even your metabolism. It's time you show it some love. Dose for your liver is a clinically backed liver health supplement.

• 23:49Ed Mylett?

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• 24:35Ed Mylett?

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• 25:17Ed Mylett?

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• 25:37Ed Mylett?

  The highest level of entrepreneurship, like when I'm talking with people that, you know, that have done something really significant, there's this really interesting dance you have to have as an entrepreneur. I want you to help me understand your view on it. Okay? And it's this, I think most entrepreneurs, I am as a human, I have become a control freak. Meaning I try to control about, you're better at this than me of giving of separating from tasks and trusting people you have to handle things. I'm still not great at that. I think I'd be.

• 26:06Alex Hormozi?

  Because you're so good.

• 26:07Ed Mylett?

  Well, thank you. I think though, I think potentially I'd have been a wealthier man had I given a little bit more autonomy to people. I think I squeezed them a little bit when I was younger. But because I am a control freak, so it's this interesting dance I've had my entire career, and even to this day of I'm a control freak, yet I know the key to my progression, my growth, my expansion as a person and as an entrepreneur, is my capacity to deal with uncertainty simultaneously. So how do you navigate that wanting to control an outcome? Yet we, I want you to discuss the concept of your ability to be out of control theoretically and deal with this mass, a massive amount of uncertainty, more than most people think they can handle.

• 26:47Alex Hormozi?

  So I think there's two parts to this, at least that I that I think of immediately. So the first is one of my favorite and I think underrated quotes as an entrepreneur from Jack Dorsey. He said, perfect all the details, limit the number of details.

• 27:01Alex Hormozi?

  And so I think that is like in a sentence, so elegant for like, I think it's like, I absolutely am a control freak

• 27:08Alex Hormozi?

  at the thing that I think has the absolute greatest point of leverage in the business. And so I keep that flexibility in my schedule so that I can go full in and attack three levels down, seven levels down in the company and be like, okay, what are we doing here? What are like, what? Show me the text that we're sending for this very particular campaign. And then I can scoop back out and then go somewhere else. So I would say that from the the maniacal control, I think Elon's been an example of like, he kind of has, he's delegated everything and also nothing. But I think his, you know, his his perspective is he's always attacking the rate limiter. That's the verb that she uses. I use constraint, but whatever. It's the same idea, like there's a bottleneck somewhere. There always is one. And I think your ability to identify where the bottleneck is, is in some way predicated on your ability to recognize patterns and your skills in entrepreneur.

• 27:49Alex Hormozi?

  But if we think about entrepreneurship in general as our, we are allocators of resources. And so we have limited resource, extremely limited when you compare them to the resources of the world. Right. Time, money, energy, the limited attention of the team. We have this tiny little reservoir of resources. And all we have to do is we have to just continue to get higher returns than everyone else does on this tiny bit of resources, which is for the most part, why the second thing on my wall is focus subtraction. Is how do I, how do I subtract? What can I cut away? What can I prune from this tree in order to keep it growing? Because left unchecked, everything becomes weeds. Everything becomes cancerous. Everything overgrows because people want to take on more stuff. And I think that success at entrepreneurship has three traits. They're completely anti-human.

• 28:30Alex Hormozi?

  It's something I've been thinking a lot about recently, which is one, we like new shit. Sorry, you don't cut here. We like, we like new stuff. Number two, we like, we like stuff now.

• 28:44Alex Hormozi?

  And number three, we want things easy and low, low energy. And it is the exact opposite of what it takes to be successful as an entrepreneur, because instead of wanting new stuff, you have to be willing to do the old stuff for a long time.

• 28:57Ed Mylett?

  Over and over and over.

• 28:58Alex Hormozi?

  And instead of, so it's basically focus, one thing, patience for a long time. And then frustration tolerance, which is that if at first you don't succeed, you try again. And if you at first you don't succeed 100 times, you try again, which is why I love the one more mantra. And so if you have those three things together, if I were to say, I have this entrepreneur in front of me, he's actually a dumb dumb, but once he starts a task, he has a really hard time abandoning it. And he has an unlimited time horizon in terms of how he's thinking about doing this. And he wants to do this for the rest of his life. He's keeping all of his assets in there. He's never going to sell it. And we knew that to be true. And motherfucker cannot fail because every time he does, he just gets better.

• 29:40Ed Mylett?

  Yeah.

• 29:41Alex Hormozi?

  It's hard to beat that guy.

• 29:42Ed Mylett?

  Those are the guys I bet on, the people I bet on.

• 29:44Alex Hormozi?

  And and what's interesting, and you've seen this too, is that like, almost all of those things have to do with behavior patterns and very little do with intelligence. And so when I think about that, like your business isn't scaling, not for lack of information, but for lack of character. And I think when you, when you think about it that way, it's like, wow, when I'm presented in these conditions, I make the wrong decisions because I've, I've, I've been reinforced for doing new things too much. And so when I, when I try to adapt that for my own, to answer the, to loop back to the original question of the maniacal control, I think a lot of the control is actually in trying to get the team to do less and do fewer rather. And I think that's where a lot of my, call it exertion, they, they should feel better when I come in

• 30:29Alex Hormozi?

  because I can tell them what not to do.

• 30:30Ed Mylett?

  Right. I know exactly.

• 30:31Alex Hormozi?

  I think that's a terrible idea. We should not do that.

• 30:33Ed Mylett?

  Yeah. Do you think the, this idea that you say, you said it twice and I'm, it's what I do when I coach people. So I'm wondering what you, I want you to elaborate on it. I think great entrepreneurs have pattern recognition. Even people we've already discussed here today, they're mutual friends of ours. They're really good at seeing patterns. I'm pretty good at seeing human behavioral patterns, right? But just step away from that. How important do you think if you were coaching an entrepreneur, is it to, to, to get them to see both patterns in the business world, patterns in the economy, trends? That's a pattern recognition to me and also human behavioral patterns at the same time?

• 31:10Alex Hormozi?

  If I had to, if I had to have them pick one, I would rather have them be amazing at human behavior patterns. Because if you can do that, you can pretty, I think, I think humans are how you unlock everything, despite the world of AI and all the things that we talk about, because humans unlock everything. Like, so you might find this, I think you might actually, I was, I was really excited to talk to you about this specific. So this is perfect.

• 31:33Alex Hormozi?

  I'm gonna guess, and I don't want to go out on a limb here, but I'm gonna guess you're not spending 12 hours a day vibe coding.

• 31:38Ed Mylett?

  I'm not.

• 31:38Alex Hormozi?

  Okay. And what's really interesting is that you probably made more money than the vast majority of people by a very large margin last year, just to put it out there. And so when I was thinking about you specifically, and I was like, how do I reconcile this apparent contradiction with we're so cooked, AI is, etc., with the fact that a lot of the people that I know that are extremely wealthy are not necessarily AI maxing themselves? And so it got me thinking around the concept of leverage, which is one of my two favorite topics in the world, supply and demand and leverage. That's what the logo is built on. And so I think one of the big misconceptions that entrepreneurs are having right now is that AI is somehow the only form of leverage.

• 32:24Alex Hormozi?

  But it does not erase the other forms of leverage that are also multiplicative. So for example, if I make a decision that we say we're not going to do this gigantic initiative, the amount of time that I get back from my company is larger than us trying to AI max that initiative that was incorrect.

• 32:36Ed Mylett?

  What a good point.

• 32:37Alex Hormozi?

  Right, and so if we think about it from a boiling down to brass tacks perspective, there are so many entrepreneurs right now that are using AI to do dumb things very fast. Because they have more capacity, they're choosing to take on more and as a result are less focused than they were before. And if we look at the output of their business, they are not making more money. They're only spending more money on tokens. And so when I was thinking-

• 32:57Ed Mylett?

  Very good, Alex. Very good.

• 33:01Alex Hormozi?

  And so when we think about the different types of leverage, it's like this is leverage. We can record this one conversation, millions of people can watch it. You know, obviously, software has different types of leverage, but picking one good person has tremendous leverage. So to the idea of like, okay, well, Ed's not AI maxing, but do we think that Ed can find somebody who can AI max?

• 33:22Ed Mylett?

  Correct.

• 33:23Alex Hormozi?

  Probably. And do we think that Ed has leverage in other ways that would attract or incentivize that person to want to do their special gift within this larger business because it was designed well earlier on? Yes. And so these technologies come, but the game has remained unchanged. There's just another tool of leverage that exists. Now, to be clear, it's an amazing tool, and we use the hell out of it at ACQ, but it's understanding where it fits in the toy box. Because we still have to make the right call. And as of right now, AI still sucks at making decisions, at least from the ones that I look at, because you can pretty much make it say yes or no based on how you prompt it. And so that is something that I've given a lot of thought.

• 34:03Ed Mylett?

  That's a really good point. Maybe one of the best points I've heard on a podcast in probably 10 years. It's a really good point because it's exactly what's happening. It's actually become almost burdensome for people that are doing nominal tasks, adding more to their plate. That's really, really good. In fact, that's one of the clips I'm gonna use from this show. I don't hear you talk a lot- So you know those pieces in your closet that you find yourself wearing like on repeat all the time? That sweater that kind of just goes with everything or these perfect pair of pants? Those are the pieces that make getting dressed easy, and that's what Quince does best. Quince focuses on high-quality wardrobe staples with premium materials like 100% Mongolian cashmere, organic cotton. The styles are timeless, versatile, and designed to become the dependable pieces you reach for every day. It's what I'm wearing right now. They give you the softness and quality you'd expect from a luxury brand without the price tag.

• 34:48Ed Mylett?

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• 35:30Ed Mylett?

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• 36:14Ed Mylett?

  These statements have not been evaluated by the Food and Drug Administration. This product is not intended to diagnose, treat, cure, or prevent any disease. And maybe I've just missed it, but you know, I'm a huge fan and follower and friend. I don't hear you talk about in terms of yourself as a leader. In other words, I almost feel like sometimes you look at business as an operator, and correct me if I'm wrong, okay? But what are you like as a leader of a company? Like, that's not a lot of the content that I've seen you discuss. So how do you view like leadership? Because it's an overcooked concept and topic, right? But you're very technical, very strategic, very tactical. But if I worked for you or with you, and someone asked me his philosophies on leadership

• 36:57Ed Mylett?

  or what type of a leader he is, would he even, does he see himself as a quote-unquote leader? And what does that mean to you?

• 37:06Alex Hormozi?

  So a couple of things. So one, Leila had just finished her book on leadership, and you know, I got to edit and help out. And so I have a ton of concepts from that book, but I think I've deferred to Leila for most things, and you know Leila well, and Leila will never get the credit that she deserves for the infrastructure that she's been able to build. But Leila is the internal leader of the business, and I would say that I am the external leader of the business. And that is more or less how we've managed our working relationship. I have one direct report, which is my father-in-law. So virtually, I have no direct reports in the business, which allows me to have the schedule that I do. And we've just found that that has worked really well for us.

• 37:44Alex Hormozi?

  I would say, I would say if there are 12 core activities of leadership, the first one, which the others are all predicated on, is that we have to define what good looks like. In behavioral and observable terms. And so the second step of leadership, and I won't go through all of them, I'll let Leila do her thing, but the second one is that we have to model what good looks like. And so there's a famous story of Gandhi where a mother comes to him and says, hey, can you get my kid to stop eating sugar? And he says, yes, but come back in 30 days. And so she comes back in 30 days. She brings the kid to him, and he says, stop eating sugar. And she's like, why did that take 30 days? And he was like, well, I was eating sugar when you asked me the first time.

• 38:28Alex Hormozi?

  And so he had to quit sugar for the 30 days to make it. And so it's a great little story, but I think that's like leadership is taught, not taught, right? And it is, of course, taught, but it's taught through modeling and it's taught through role-playing, right? And so where I fit in this leadership paradigm is that I believe that I, number one, I hold the standard.

• 38:48Alex Hormozi?

  One of the things that I get feedback from, from the team, because I see the surveys of the people who at least work in my vicinity, more so than work directly for me, is that they're like, you know, I've watched the content, I've been seeing everything for all these years, but like, it was only when I came to the office and realized that Alex was literally always here at 4:30 in the morning, every single day, six days a week, that I was, basically, it's very difficult to witness consistency unless you are also consistent.

• 39:18Alex Hormozi?

  Like, you cannot witness consistency, right? And so I would say that that, I would say, defining the standard and then modeling the standard is where the majority of my work from a leadership perspective is. I think the rest of leaders in the company do a lot of the other stuff.

• 39:35Alex Hormozi?

  And then I'd say that I am more of a strategic decision-maker than true operator, because I think it would take away credit from the people who are actually doing the stuff.

• 39:48Ed Mylett?

  Is there a void of any type of emotional leadership in your businesses?

• 39:53Alex Hormozi?

  No, that's Leila. Like, Leila is for sure. And I think, and this is something that I would say, like, what's taking up my time right now is managing the transition of her becoming a mother and completely stepping away from the business, which is our intention. Yeah, so she's completely gonna check out for an extended period. And so I'm reoriented because the business works with the dichotomy, you know, it's between the yin and the yang. And when she's not there, I'm softer. And when I'm not there, she's a little tougher. And we've had this dance that's worked really well, and I'm gonna have to relearn that, and I'm gonna probably crack some shells and mess up a little bit, I'm sure. But that's something that I'm really paying attention to.

• 40:37Ed Mylett?

  I'm really watching you. You know how much I've always appreciated you and admired you. You've grown a lot the last few years. When we talk on the phone, but we haven't done this, and you're at a different level. You're at a different level. And one of the reasons is, is you're willing to take on more and more risks still. And I want you to talk about this. I've never heard this before, only you. And I'm like, gosh darn it, he's right. I wish he wasn't right, but it's just sort of like the law of the universe. People look at me or you, but I'll just speak from my own perspective, and I'll let you comment on yours. And they do sort of go, like, we're recording this now in the middle of, I've been giving speeches and doing business meetings here today, and I've got another one tomorrow, which is a Saturday, and you're cranking, you'll be in here, and I'm blah, blah, blah. And they're like, the old when's enough's enough and all that other stuff.

• 41:20Ed Mylett?

  And I'm like, I really don't feel like I'm working, but having said that, my capacity has expanded over the years to the extent where I feel like I have to take on more almost in order to remain challenged, but also to live up to the blessings and honor the perspective nuances, wisdom, skills I've developed theoretically, right? So this thing you discussed lately about risk and capacity and ability and the correlation between the two, do you know what I'm talking about?

• 41:49Alex Hormozi?

  No.

• 41:49Ed Mylett?

  Okay. I heard you say something recently where you said, my ability to take on risk is almost connected to the fact that I'm better and better, and in order to continue to grow and expand, I have to take on more risk.

• 42:00Alex Hormozi?

  That, for sure.

• 42:01Ed Mylett?

  So I never even heard this before.

• 42:03Alex Hormozi?

  So-

• 42:05Alex Hormozi?

  Well, what, so I don't read it, so I don't want to pretend like I read all day or something like that. But there are moments where I do punctuated reading and I think my favorite type of reading is autobiographies of ultra-rich people. Because usually, especially at the end of their career, they don't care at all about being politically correct and they actually tell you what it was.

• 42:22Ed Mylett?

  Finally tell you.

• 42:22Alex Hormozi?

  Yeah, they finally tell you what it was. And so it was really interesting that I found between Paul Getty, who was the richest man in the world for like 30 years, Rockefeller, and Elon Musk, and just take these guys objectively, don't get into the politics of it. Whatever, you can appreciate that they are wealthy, period, fact.

• 42:41Alex Hormozi?

  What I found is this very recurring theme is that they had multiple moments of, call it like, local maximums, where they then looked around and said, I'm pushing all my chips back into the middle of the table again.

• 42:53Ed Mylett?

  Yeah.

• 42:54Alex Hormozi?

  And so I kind of see it like, and in some ways, as much like, it is necessary for the, to take a bigger swing, to get a bigger payoff, but it's almost more necessary to keep the game interesting.

• 43:06Ed Mylett?

  Yes.

• 43:07Alex Hormozi?

  And so like, if, and we're in Vegas, so I'll just make it a Vegas theme. If you're playing $10 hands, and let's say at some point you get good enough to have this gigantic stack of chips, at some point you have to up the ante, otherwise you just don't care anymore. And so a billionaire playing $10 hands, it's like, he literally loses money playing a $10 hand.

• 43:25Ed Mylett?

  Oh, so good.

• 43:26Alex Hormozi?

  And so, um, one of the things that I think is a little bit of a mindset shift, which I don't like using the term, but like, we behave differently in different scenario, is that your risk tolerance has to concurrently increase with the size of opportunity that you want to pursue. And it's, of course, in the beginning, you don't need to take, there's lots of risk and also no risk, because you don't need to put money down, you can start a business for almost nothing. But if you want to start SpaceX, you need to put money in on the table. You know what I mean? Like, there are some, like, there, and the thing is, is capital in some ways becomes a gigantic moat, because other people are not willing to risk it. And so you start to develop more sophisticated frameworks for understanding risk and reward, which is that, like, not only will I take my expertise and my track record and my network,

• 44:08Alex Hormozi?

  but I will also take $100 million and put that on the line, because that's how I can get to 10 billion.

• 44:14Ed Mylett?

  Okay, I want to just jump in here. I don't even think you know how big, this could be a book you do, okay? Even though I know it's not the, but how big this is. And by the way, listening to you on this, how many people do you and I meet that have gone from zero to a little bit?

• 44:30Alex Hormozi?

  Yeah.

• 44:30Ed Mylett?

  And then they're stuck, and they're so frustrated, like, I just, I can't get past 400 grand a year, I'm at a million a year, or whatever it is. And what's interesting is, what happens when you have nothing and then you get a little bit? You become very risk adverse, and you don't know that potentially, the key for you to become unstuck is actually to take on more risk, and that's the stimulus to go to the next level. Do you know how big of a deal this is, what you're talking about? Because it's the thing, most people stall at 100 or 250, you're in Gooseys, right?

• 45:00Alex Hormozi?

  Yeah.

• 45:01Ed Mylett?

  When they stall, it's because you're still in the same risk tolerance category you were before, and you've mastered your domain to some extent.

• 45:09Alex Hormozi?

  Okay, so I have given a huge amount of thought to this. So there's this bullis, because we see entrepreneurs every single week that come through. There's a bullis of entrepreneurs between 1 and 3 million dollars. And for whatever reason, there's this swamp there, and I think there's a couple of factors. So number one is that usually between 1 and 3 million dollars of revenue, you've actually made enough money to satisfy personal needs. You can pretty much go to every dinner, go to every hotel, take the vacations, and like, you're good to go. And to be fair, nothing wrong with that. However, if you want more.

• 45:31Ed Mylett?

  Right, if you do.

• 45:32Alex Hormozi?

  Then you have to change the way you play. And so what's very interesting is that, we call this the swamp at acquisition.com. It's 1 to 3, maybe 1 to 5 million, it's right there. And the reason it's the swamp is that it takes more risk to get out of the swamp than to get into it.

• 45:45Ed Mylett?

  Oh, boy, so true.

• 45:47Alex Hormozi?

  And so you take some risk to quit the job, to whatever. But when you start, your first 0 to 1 million, for most businesses, especially service, which is 80% of the US, it's you and maybe some helpers, but it's almost all margin, because it's just you working really hard. In that 1 to 3, maybe 1 to 5 range, you have to make some decisions of like, okay, I can't service any more customers, my time is becoming my biggest constraint. And then there's the question of, am I going to bring help on? Am I going to, am I going to get a vendor that's going to be a legit vendor that's going to cost real money? And I think there's, one, there's the emotions of like, well, I'm already comfortable. So we're sacrificing something that I know I, I need to achieve all my personal goals, to get money that I don't need in the future, which is a big, it's a big, like, it doesn't necessarily mean it's rational to do this, to be really clear. Like, it's actually dumb in some ways, right?

• 46:32Ed Mylett?

  Right.

• 46:32Alex Hormozi?

  But if you decide, yes, I want to do this, here's the math behind the second layer of difficulty, which is, let's say it's a $2 million business, 20%, margins. If you have 20% margins in the business at this point, you have $400,000 to play with, all right? Now, you're going to leave maybe 100 grand in the account, because you want to like, have some safety net, so maybe 300 grand. If you, let's say, need somebody who's going to run client success, or be, let's say, your first real leader in the business, a director level, not just a manager, you're probably looking at high 1s, maybe mid 2s, you know, as a small business owner. So that means that on this one hire, or maybe a vendor, you're going to risk half or more of your profit on one bet. And because most people are unwilling to do this, and arguably, logically, they stay stuck.

• 47:16Alex Hormozi?

  And so there's these points where you have to increase your bet size. You have to be able to go from spending $1,000 a day on ads to $10,000 a day on ads. If you're willing to spend, go from like, I'm only going to spend $1,000 on Indeed to recruit these people, to say, I'm going to pay a head $135,000, because I think I really need this role, and it's specialized, but if I have it, it unlocks this huge amount of capacity. And so one of the, so I'll give you a couple tactical things for the audience. There's a couple tricks to getting a business through that without using as much to get them into that like, 5 to 10 range, million a year, so that then they have more cash flow, so they feel more comfortable in the bet. So I can only resolve one of the two risks, but it's still there, which is that you have to increase the leverage on one or multiple of the three elements of the business. So we have to increase leverage of demand.

• 47:58Alex Hormozi?

  So it's like, how can we create some sort of content wheel within the business, so that when customers come in, they make us content that we can then use to get more customers? And you service customers every single day, and then boom, we have more leveraged demand. The second kind of wheel of this is the leveraged conversion. And so whether you're selling, like, basically there's three ways to scale the sales. Either you have a big, big sales team, you sell one to many, or what I prefer, which is you create order takers. And so my combination of solution is, how do I sell one to many and preload the customers with as much information as humanly possible, so that my salespeople only have to make six-inch putts? Right, rather than drive and then chip and then wedge and then go all the way, right? And so by doing that, it's much easier to attract, to recruit somebody and just say, I just need you to make, drop the ball six inches from the hole and make this. You can train that person up in a week.

• 48:43Alex Hormozi?

  Whereas if they have to be a coach, a therapist, a product expert, a teacher to a customer, and then also a relationship manager, it's like, it's so hard to find them, and if they already do come preloaded with all those skills, they're way too expensive. Right? And so we have to have leveraged, leveraged conversion, right? And then the third process is leveraged delivery. Now, one, I think, I think one of the big misconceptions on delivery for service businesses is that, whatever way you started, that got you to 1 or 3 million in terms of your service delivery, you say, well, this has worked so far. And I am a big advocate of doing more of a work, don't get me wrong. But there are some tweaks that you can make in your agreements of what you plan to deliver to a customer, that dramatically expend the leverage that you have in the business to deliver, without in any way really changing how likely they are to buy.

• 49:28Alex Hormozi?

  And so, for example, if we said, you know, we have support that is via phone call at any time, you could say, we're going to do email, we're going to do chat, and all of a sudden, that increases leverage on the supply side. We could say, hey, instead of having scheduled calls, we're going to do it asynchronously. And then that allows you to batch all the work together, you can review all of the accounts, let's say you're a marketing, you know, agency, you could do them all at once, and you can do them in 11 minutes, rather than having a 30-minute call and wasting it. So it's like, great, that might triple the leverage. We can change whether components of the service are done live or done recorded. We can change whether it's in person or it's done remotely. We can change the delivery ratio, so that it's, instead of one-on-one, it's one-on-small group or one-on-one-to-many. And so there's a number of these levers that we can do on the delivery side,

• 50:10Alex Hormozi?

  that if we, at each of these points, if we expand a little bit of leverage on the demand, expand a little bit of leverage on the conversion, so we give people a couple of videos with some proof before they talk to a salesperson, all of a sudden, the sales take less time and there's fewer of them.

• 50:23Ed Mylett?

  Yeah.

• 50:23Alex Hormozi?

  And so all of a sudden, my sales, my utilization per sales rep doubles or triples. And so I don't need to hire the extra rep, I can still double or triple the business if that's the constraint. And so in each of those situations, usually one, two, or all three of those things, depending on where you're at, is where you need to employ. Notice, none of them were AI, because you can still make good decisions and increase leverage of the business, not necessarily using AI. And to be fair, I'm a big AI advocate, but I'm also an even more common sense advocate.

• 50:45Ed Mylett?

  It's, Alex, it's so good. I, when I coach, and even when I've watched your content, it is funny though. Because by the way, those of you that feel stuck or know someone that's stuck, send them the podcast today, because this is probably why you're stuck. It's the risk aversion.

• 50:58Alex Hormozi?

  Yeah.

• 50:58Ed Mylett?

  You don't, you're looking at all these other mechanisms, it's the risk aversion. But what's really funny about it is, I'll even watch it on your stuff, and when I coach too, I'm like, well, no, you're going to have to hire that 250 person. Or you're going to have to triple your ad spend. And you watch their face when you say it, and they're immediately going, uh-huh? And they're, they're immediately in their mind trying to process, is there any other way I can get out of doing this? Now, you've given a couple of great hooks here, that mitigate some of that risk, but you watch.

• 51:23Alex Hormozi?

  You're still going to take it.

• 51:24Ed Mylett?

  The reason this is so important is the tendency at this stage, even when given the counsel, is to try to find a way out of that room and not have to take it. And if you're going to get to that next level, you're going to feel unstuck. And here I am, an older guy, 55 years old, and it is, I think, the key as to why I'm still pretty fresh and in the hunt and going and excited and not stuck, is I've, and by the way, I think you would agree, it's a muscle you also build over time. Your first risk you take to start a business does not require the muscle, because you're moving from nothing. It requires a muscle over time to continue to throw, like you said Musk earlier, whatever you think of the guy.

• 51:59Alex Hormozi?

  Yeah.

• 51:59Ed Mylett?

  Are you kidding me? The amount of risk this dude's willing to take on over and over and over again.

• 52:03Alex Hormozi?

  And that's why he's been compensated more than anyone.

• 52:04Ed Mylett?

  That's right. He's adequately compensated for the risk he's willing to take.

• 52:09Alex Hormozi?

  Yeah.

• 52:09Ed Mylett?

  What about, we don't have much more time, but this is so good. Like, we need to agree we're going to do this at least once a year. And I need to expand the format of the show when you're on to like, two hours.

• 52:17Alex Hormozi?

  Dude, we can roll late and then we can do a second, a second half.

• 52:20Ed Mylett?

  That would be really good.

• 52:21Alex Hormozi?

  It's fine with me.

• 52:21Ed Mylett?

  It would be really good.

• 52:25Ed Mylett?

  There's a lot holding someone back.

• 52:26Alex Hormozi?

  Second half and I'll release it on my channel if you want.

• 52:28Ed Mylett?

  Okay, I love that. Whatever you want. I, I, there's a lot holding someone back from this risk aversion at any stage. And I don't know that I've been very good at getting somebody to sort of deal with it. Now, what I used to say, and then I want to have your version of it, because yours is frankly, I think better. I used to go, you know this like boogeyman, when I was a little kid, I thought there was a boogeyman. And my dad, when he would come back from his drinking binges, I'd be up. But I created this boogeyman and my dad would literally have to come in my room when I was a little boy and open the closet and go, Eddie, look in here, there's no boogeyman in the closet. But I had this great book, if he would open it and show me. All of a sudden, a lot of my fear was reduced. And as an entrepreneur, a lot of these fears you have, they're real things. But even if you lost that investment you made, even if the business crumbled,

• 53:12Ed Mylett?

  the boogeyman's probably not quite as bad as you think it is. You can come back, right? You teach people that have fears to actually put it down, right? Can you talk about this? Because I think this is a great tactic to get above or be self-aware of your fears or their limitations.

• 53:28Alex Hormozi?

  So it's my, it's my position that emotions exist in the vague, not the specific. Meaning fear exists in the vague. Like, because basically we abstract things to death. Because we're evolutionary beings and like, we don't want to die. Okay. But we think if, if this does not work, I will fail, I will go bankrupt, my wife will leave me and I will die. I'll get shot and I will die, right? But when you actually define out, no, no, like, let's, let's sit in it. Because we're so afraid to look at what would happen, that even the fear of looking gets people to not crystallize it. And it's like, listen, the first thing you can do is prepare for failure at least. But in preparing for failure, you decrease the likelihood that it happens. Because you actually know what's, what happens next. And so I remember when I, when I started the gym, I had to write down my plan B, which for me was,

• 54:13Alex Hormozi?

  well, I didn't have any real skills. I was in shape and I had time. And so I said, I'll drive Uber and I'll strip. And if that was, if I fail, I'll drive Uber 12 hours a day and I'll strip at night. And I'll be able to like, in a year, probably make $250,000 and I'll, and I'll do it again. You know, like, I'll start back. But the goal was to get back into it again. And so one is like, when you really play out your failure story, maybe you're sleeping on, on, like, you will only lose status in the eyes of people around you who are not taking the risk that you're taking.

• 54:41Ed Mylett?

  Right.

• 54:42Alex Hormozi?

  And

• 54:43Ed Mylett?

  So true.

• 54:44Alex Hormozi?

  And you don't want their lives. So why would I care about their opinions? And we just have to expand the time horizon because like, not to sound trite here, but like, failure and success are on the exact same road. It's just that failure is an earlier exit.

• 55:00Alex Hormozi?

  And so one is a requisite for the other. But the thing is, is that thinking about success leads you to failure. Failure leads you to success.

• 55:09Ed Mylett?

  Yeah.

• 55:10Alex Hormozi?

  And so it, so failure is closer to success than thinking about success is.

• 55:14Ed Mylett?

  Wow.

• 55:15Alex Hormozi?

  Which is ironic. And so the idea is like, like, one of my favorite things to tell sales guys, especially, especially in the cold calling outbound side. It's like, let's get some no's today, right? If we can make the failure a success, a mile marker, how many no's we collect today? Right? It stops having this emotional charge because we're saying, wait, we're not making no mean something. We're saying, we're making no mean something good. And so if we know that the, the failure that we're going to have is going to teach us something, like the $250,000 bet that we're talking about with this operator, right? We have this person who's incredibly in fear. How do we get them out of that, out of that fear is that if you don't see another way, and maybe, maybe you pulled all the levers that we just talked about and, and still there's no other way. You have to take the risk. Then you take the risk.

• 55:59Alex Hormozi?

  And, and you know, and you do that knowingly, because what you are building is the thing that we were talking about earlier, which is pattern recognition. So let me tell you the, the story of how entrepreneurship really works. Which is, if you've ever played a video game, you played and the first time you play the game, you get to a level, it's hard, you gotta beat the boss, you gotta figure it all out. You find out there's a sword under the stone, whatever, right? And then you get to the next level, you try and error, try and, you get it. Now, if you go back and play that game again, it's a straight line. How fast? Now, the character itself can't play faster because it's, it's controlled by the same algorithm of the video game. But how does it take you a tenth of the time to get three, four, five levels deep? Because you know exactly what to do. Why? Because you recognize the patterns. And so if you've ever had multiple businesses, which a lot of people are entrepreneurs, like, by the way, you know, spoiler alert, you're gonna have more than one business if you're getting into it and you have this fear that this will be the perfect one.

• 56:44Alex Hormozi?

  The second business you start almost always grows faster than the first business you start. Because you, you go through, you blow through all the bosses you had on the first one and then you get stuck at the same point and then you move as slow as you can, which is trial and error again. And so you get into the slog again. And so the, the failure that you're experiencing is, is create, is the creation of pattern recognition. And so I remember for me, just to give an analogy that might make sense for people.

• 57:08Alex Hormozi?

  The first time you hire a sales manager, or even the first time you hire a salesperson, right? You go through, you hire one person and the most expensive hire is the salesperson, your first salesperson, because you're losing, that person doesn't close, you lose all the business. I mean, it's horrible, right? But you have to make the bet at some point. And so you hire them and maybe that person doesn't work out. Okay. So we hire another one. Maybe that person doesn't work out. Now, eventually you will hire one and it will work out. And then at that point, you're like, oh, I know what this looks like now. Pattern recognition. And so when the next ones, you're like, I need to get them to look as similar to this as I possibly can. And then all of a sudden, your failure rate starts dropping and going down and down and down. And you're like, I wonder if I train harder. And then all of a sudden, you start increasing your percentages. But the same thing happens when you're like, now I need a sales manager. And you repeat that process. And so I think a lot of what the, call it the, the better entrepreneurs in the world

• 57:51Alex Hormozi?

  versus the, the non, the, the lower entrepreneurs is that it's just every single role in the business, you have to know what good looks like. And you have to fail at each one of them until eventually you find the one that works. And then that forever becomes your pattern of this is, and to be clear, there's different ways to run sales teams. But I know this way works and I know this type of person works for the way I like to run sales. And so that then, when you, when you create the next business, and this is, I use different verbiage for it, which is, at a certain point, you don't build businesses anymore. You assemble them.

• 58:20Ed Mylett?

  Wow, you're so right.

• 58:22Alex Hormozi?

  Right? I had to change my language because I was like, I'm not really building this business. I'm just putting the, we're just assembling, we're putting all the pieces, I know this is gonna work out. And also, which, one of the advantages that you don't, that we don't talk about as much, because it's only applies to a small percentage of people, is that the longer you do business, and if you, if you do business well and you do right by people, you develop this network, this Rolodex. And if I'm gonna start a new thing, or Ed's gonna start a new thing, it's like, I got 10 people I can call who are like, oh, you're doing something? I'm in, man. Let's go.

• 58:47Ed Mylett?

  And failure was one of the reasons you've actually built all of these relationships. This, in this, uh, human capital that you've actually developed.

• 58:54Alex Hormozi?

  And then you can deploy that capital. And I wonder if that has more leverage.

• 58:57Ed Mylett?

  That's what you said earlier about AI and me not having to do that. I've actually got so many other resources at this stage of my life that I can deploy AI or get access to it without having to fiddle with it myself because of these relationships.

• 59:08Alex Hormozi?

  You have the benefits of AI.

• 59:10Ed Mylett?

  You're, I have the benefits of it. This is so good. I want to do, want to finish on one thought. And by the way, I'm just gonna finish in the middle because there's so many things we could cover. But this idea of pattern recognition, it's not talked a lot about. And the video game analogy is perfect. So it's gonna give you a little runway to answer two things at once, okay? What pattern recognition has given me, if we're giving the video game analogy, and the reps that I've had in business, some of them were successes, some of them were failures. But what's happened is about this idea of assembling a business is the absolute truest thing you'll ever hear, by the way. At some point, once you kind of understand the mechanics and the mechanisms of putting these things together, it's an assemblance rather than as a building. He's completely right. He and I have actually talked privately about doing a, a type of business together. And I, I just know that if we did it together, it would be successful.

• 59:53Ed Mylett?

  Because between the two of us and that human Rolodex and what we know, we would just assemble the parts. Here's the thing that pattern recognition has given me over time, that a new entrepreneur gives them, needs to give themselves some grace to develop. And that is that I, now as I'm building businesses, there are days where I react. There certainly are. There are just things that happen. I spend some of my time reacting. When I was a young entrepreneur, I spent most of my time reacting. Now that I have pattern recognition, human pattern recognition, and also just trends, I anticipate more often than I respond and react. So I want you to talk about anticipation as a skill, as a skill. Like the thing you and I have talked about with banking, let's just be honest, right? Like, okay, so the anticipation aspect and then inside the answer to that final question,

• 1:00:37Ed Mylett?

  what do you anticipate about the world of business the next two to five years with AI as a factor in it? So why does anticipation matter and what do you anticipate?

• 1:00:47Alex Hormozi?

  Yeah, this is a really hard question.

• 1:00:54Alex Hormozi?

  So I think, I think anticipation matters a lot from an entrepreneur perspective because it, it, it reverts back to the people who get the best returns on their resources. So why, like, why would anticipation even be important? Well, it means that if I allocate resources to a new thing, let's say it's, their new platform emerges for social media and I'm one of the first people on it because I anticipate that it's going to grow because it has all the stuff that looks right. If I'm a first mover in that situation, then the minimal amount of resources that I deploy towards that, I'm gonna get a way higher return. And then when people are laggards or later, they're gonna have to deploy more resources to get even less out. And so anticipation is another form of leverage. And if we just define leverage, I know we're late on defining it, but it's just getting more for what you put in. High leverage at least, low leverage would be the opposite.

• 1:01:37Alex Hormozi?

  And so if we're trying to deploy as much leverage as we can, getting the call right allows us to get more for what we put in. And so the anticipation, I think, is, a lot of it is, uh, call it macro pattern recognition.

• 1:01:50Ed Mylett?

  Right.

• 1:01:50Alex Hormozi?

  So I'll tell you, I'll tell you something that I heard, I want to say 12 years ago or something. I heard a Gary V clip. And he said, one of the biggest regrets he had was that when he was printing money on Google PPC or AdWords for the wine business, that he didn't spend more. Talk about the risk thing. At that point, now, he's a way better, bigger entrepreneur now and he has way higher risk tolerance. But at that point, spending 10,000, 20,000, 50,000 a day, whatever it was, was a lot of money. And I remember hearing that clip right, um, in the early gym launch days.

• 1:02:22Ed Mylett?

  Really?

• 1:02:23Alex Hormozi?

  And we were printing on, on Facebook and Meta Ads, and these were new, newish ads. And I was like, well, I don't want to make that mistake. And so we're like, how do we spend more? And so that became the question is, what would it take for us to spend more rather than, I'm not sure if I want to spend more, right? What would it take? Which is one of my favorite questions in the world to ask. It assumes the success and then you work backwards. The second thing was, um, what is, you know, what is it gonna look like in an age of AI? I will give an unsexy, but

• 1:02:52Alex Hormozi?

  Accurate answer of what I'm actually doing. I like Basis's frame a lot on this, which is the future is very uncertain. And one thing that is true is that we are notoriously bad at predicting it. And so he prefers to ask himself, what things do I know will not change? And so he's made all of those gigantic bets in the business based on the few things that he knows will not change. And so he says, I believe in the future, people will want cheaper prices still. I believe in the future, customers prefer more selection to less selection. I believe that customers will in the future prefer things to get them faster rather than slower. And so there are bets that you can make in the business based on human behavior that we know will be true. Do I think that in the future, humans will eat food? Yes.

• 1:03:37Alex Hormozi?

  Do I think that they will need shelter? Yes. And so the bets that we're making in the business, I would say, and this one thing about risk, which I think is important, is entirely personal, because I get the question a lot, and I'm sure you do too. One, when do I push and when do I pivot?

• 1:03:51Ed Mylett?

  Right.

• 1:03:52Alex Hormozi?

  And the second question is, how much should I take out of the business to save for a rainy day versus double down? And both of those are unanswerable questions because they're entirely personal. Ask Elon, he'll say, put it all on the line. If you have a wife and kids and you don't want to do that, which I respect, don't do that. And so those are dials for you. But back to the point, I'll just share what I'm doing, is that I take chips off the table and put them into these places that I think are boring, that will still be here. So we have lots of real estate and things like that. But the big investments that I make in the business on, call it big swings, I think have been predicated, for at least me, on making sure that my oxygen mask is there for me and my family. People are different. Elon doesn't need that. Maybe he does, he's already so rich, he knows enough friends that he's never actually

• 1:04:36Alex Hormozi?

  going to starve. But I think that what has served me very well was that I very aggressively lived cheap when I was younger, so that I could save what I believe to be a nest egg. And that nest egg has changed in terms of what the size of it has been. But always having one allowed me to take gigantic swings and do things like the school deal, or do things like the book launch, or do things like some of the other things that we're talking about. And be okay, because the worst-case scenario is that my life doesn't change at all.

• 1:05:06Ed Mylett?

  Me too. Identical. Exact same thing. This is my favorite interview we've done. My favorite interview.

• 1:05:13Alex Hormozi?

  Can I do one more, a little bit?

• 1:05:15Ed Mylett?

  Please.

• 1:05:16Alex Hormozi?

  So one thing in terms of the specificity of risk. So we talked about like, what would it actually look like?

• 1:05:21Ed Mylett?

  Yeah.

• 1:05:22Alex Hormozi?

  One of the things that's been even more micro for me is, what changes about my day? And so this is both upside and downside. So if I'm considering like, hey, should I take on this investment, or should I do this? Anything. The question that I ask is like, what will this change about my day? Do I have to now do something that I don't want to do? Do I have to stop doing stuff that I do want to do? And most decisions don't actually affect my day, which then means that it's actually not, there's no real stakes here. It's all made up. It's literally just, it's in the air. Now, every once in a while, there are some things that, when I actually run it through that filter, for example, if your wife's pissed at you, that is going to change my

• 1:06:03Alex Hormozi?

  day, or week, or month, far more than just about any negative business consequence will. Honestly, just about more. And so it actually has helped me truly redefine priorities in a way that's actually much more tactically relevant to how I experience life.

• 1:06:19Ed Mylett?

  Wow. I'm glad you added that. That's probably best for me of the entire conversation. Because a lot of the risk that I have in my mind is made up, yet the risk I most fear is that it would alter my day, and then I would have to do things I don't want to do anymore, or actually stop doing the things that I do want to do. What a great formula.

• 1:06:37Alex Hormozi?

  Yeah.

• 1:06:38Ed Mylett?

  Turns out, you're pretty smart. Turns out, you're pretty smart. I'm real proud of you.

• 1:06:43Alex Hormozi?

  Thanks, man.

• 1:06:44Ed Mylett?

  You know what I mean? And I'm grateful that you're in my life. And I'll always be here for you. And I love Leila too. And you're really important in the world. I just want you to know. I meant what I said in the beginning. There's a lot of people that are really good at this business stuff. You're on a level that is yours. So continue to expand, because your capacity is even greater than this. Proud of you. Great job today.

• 1:07:06Alex Hormozi?

  Appreciate it.

• 1:07:07Ed Mylett?

  All right, everybody, I don't have to tell you to do this one. Share this episode. You know where to find Alex, he's everywhere. And backs out your life. God bless you.

• 1:07:15Ed Mylett?

  This is The Ed and Myron Show.