My Business Isn’t Growing. What Do I Fix? | Ep 891

In this Q&A, Alex (@AlexHormozi) answers real questions from entrepreneurs at every stage from how to hire your first team member to whether it’s time to quit and start over. He tackles pricing strategy, customer churn, partner dynamics, and what to do when growth stalls. Just tactical answers from someone who’s actually built and scaled real businesses. 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?

  The other piece that I will tell you that is worth writing down is that we need to be reminded more than we need to be taught, and that goes double for your audience. Maybe some of you guys watch some of my content. You've probably heard me say work more before. And yet, when you see the seventh video of that in a slightly different context, it's like, well, I kind of wanted the reminder.

• 0:23Speaker 01

  Please help me welcome author of The Hundred Million Dollar Offers Leads in Soon To Be Money Models, Alex Serbozy.

• 0:32Alex Hormozi?

  How are you guys doing today? Good? Good morning so far? Yes, very tactical. Awesome, I appreciate that. So, I normally do a little bit of a preamble, just kind of top of mind stuff. I feel like it's more common that we will keep our goal the same, but then be unwilling to change ourselves to accomplish it. And then we just stay on the same path when we know we should probably be doing something different than we currently are. It's just something I'm thinking about. Like I heard the last bit of, you know, you've got a bunch of stuff that's in your way. It's like, well, if you had to accomplish the goal, you probably do something a little bit different than you are. And I think rather than saying, you know what, the path I'm currently on will never accomplish my goal. We kind of mentally masturbate to the idea that we have this goal, but our actions don't align to it, just because it's very easy to say and much harder to do to change you. So you don't change your goal, you also don't change you.

• 1:17Alex Hormozi?

  And so you just stay there, basically doing nothing. It's just something that I've observed on a continuous basis. And in having a lot of these discussions, I've had kind of the unique benefit of seeing the common mistakes that are made as business owners, kind of at all levels. And they're thematic, meaning they're very strategic in nature, less tactical. Because a lot of times, like for sure, tactics, we can help you with all that stuff. But the big things that move the business are going to be the decisions that sometimes are just left unmade. And typically, that is what slows the decision down more than anything else. And so right now, you probably have some decisions you need to make. And the amount of time you choose to deliberate can take weeks, months, years, and sometimes you just never make the decision, so you stay the same.

• 2:00Alex Hormozi?

  And so I see a lot of businesses stuck in those places because there's typically rock and hard place scenarios where you either choose short-term pain today or long-term pain persistently. That's just slightly less painful than the short-term pain, which is why I think people get stuck in these ruts. And so, just by show of hands, who here is in around the same revenue they were last year?

• 2:21Alex Hormozi?

  Okay, keep your heads up. Would you guys like to change that? Yeah, okay. So these are kind of the seven rock and hard place scenarios that I see with founders in general. The first is focus. I talk about it a lot. I have, you know, a laundromat, a real estate business, any commerce company, like whatever, right? Like, and they all somehow work together, but like, let's be real, no, they don't. I mean, just in that they have customers and the customers have money and money, you know, combines all the businesses. Sort of, but for the most part, it's like you need to fix one thing and go all in on it. The difficulty is that when you have quote two businesses or more than one business that's kind of live at one time, the short-term pain is that you're going to see a dip in revenue because you're going to lose the revenue from the one that you choose to give up.

• 3:04Alex Hormozi?

  So you either have that or you have the long-term persistent not achieving of goals. The next one is over-expansion. So this is the classic, like I had one location, it was doing well. And so then I opened up a second location and I took the best person from my first location, put it over there. My first location dropped to here, my second location didn't get up to my first one. And that pretty much destroyed two thirds of my margin, but now I have two times one third of the margin. I'm making about a little bit less than I was before with two times the liability. And so I think the solution is I should open up a third location, right? Which whenever, like to be clear, every business needs to expand. So how are you quote over expanded? It's easy to say that, but the reality is that you're just under talented. Meaning that it's the team that you have is just not sufficient.

• 3:47Alex Hormozi?

  If you had two rock stars or somebody who's better than you at the first location, then it'd be fine for you to open up the second one. But it might be a model issue or a cash flow issue that prevents you from getting the talent that you need, which ultimately is what's keeping you stuck. So in this situation, again, what do you do? Do you kill the second location? It's like, well, that kind of hurts. On the flip side, it's like, or do you just give up all of your profit for a year or two in order to get somebody else in? Also a risk. So what do you do? You just stay the same. Because it's easier. The next is a compensation, which can be over or under. So I'll give you an example. Physical therapy clinic came here, doing really well. Full, all the beds were full. You know, all the therapists were staffed up, just wasn't making any money. And so, you know, after a couple of questions, it was like, oh, well, you know, I do a rev share with my therapist. I was like, oh, okay. Well, how much? And she was like, well, 50%. I was like, okay.

• 4:32Alex Hormozi?

  Well, are they like, kind of like a hair salon? Like they just rented, you know, rented a chair or room and then they handle everything else? She's like, no, I, I spend the money to get customers. I close them. I out for the facilities. I'm the one who cleans everything. They just show up and do work. And I was like, well, yeah, you're running the entire business on half your margin. And there's just nothing left. Right? You know, that's an example of a compensation issue. Another one, very common, is underpriced. I bet over half of you guys are underpriced. And I think the reason there is again, it's the same rock and hard place scenario. Well, undercompensation, underpriced, equal side of the same coin. One's for employees, one's for customers. But if I tell my staff that I have to change their compensation, I'm going to lose my team. But if I don't, then I'm never going to make money. Underpriced, same, same. If I raise my prices, then I'm going to lose my customers.

• 5:17Alex Hormozi?

  But if I don't, I'm not going to make money. Let's see, what is my S here? Ah, thank you. Single product, which is like, you have a business where you have one thing. That's it. And you do that thing relatively profitably, but over time, your margins continue to shrink. And so then you're like, well, I guess I should just start another business. When maybe you just need to sell those people something else, having a backend. Next one is avatar. This is again, classic heart, rock and hard place. Well, I have to accept everybody who has a pulse and a credit card. Really, the pulse is optional, but I have to accept these people. And if I don't, I won't be able to make payroll next month. But I do need to get more narrow and more focused on my services and who I'm servicing and the messaging around it and the pricing that goes with it and my actual delivery. But if I do that, I'll lose money in the short term. Right? And so then we stay again in this rock and hard place scenario.

• 6:01Alex Hormozi?

  And this last one was the last one I added to this list, which is data. There's not really a rock and hard place scenario here, more so that I guess the rock and hard place is you need data, but the resources and time it takes to get data, you're unable to do because you don't have data. And so you're like, well, how do I expend the resources to collect the data and forego my short-term goals of putting out fires and growing? It's like, well, you can't grow because you don't have the information to make the bets you need to make. So these are just kind of seven recurring themes I've seen. I saw a bunch of you guys nodding your heads. As we go through the Q and As, I will do one of these so that, you know, we can kind of be in on it together. With that being said, let's rock and roll. I'm guessing you're a yoga clinic instructor.

• 6:42Speaker 02

  The doctor.

• 6:43Alex Hormozi?

  Yes. I should have gone with doctor. That would have been better.

• 6:46Speaker 02

  So my name's Colton. We sell tattoos to tattoo clients. Doing about four million in revenue. Would love to be at 35 million in revenue. And what's stopping us is focus. So we've got multiple parts of the business. Stop me if you've heard this before. We do the tattoos. We also have continuing education for other tattoo artists. And what I was alluding to earlier, I've started to get into coaching studio owners and things like that. And so Ed was talking about maybe doing something like Gym Lodge for tattoo industry.

• 7:16Alex Hormozi?

  Yeah.

• 7:16Speaker 02

  So, yeah.

• 7:17Alex Hormozi?

  So normally I wouldn't recommend doing something like Gym Lodge because Gym Lodge was a unique situation. It's actually similar to tattoos in that probably tattoos actually even more in that direction because it's so dependent on the skill of the operator or the artists that are in each shop. Unless you are absolutely like mechanized it, so it doesn't matter if anyone's good. Like there's 100 tattoos that everyone gets. I don't know. Is that true?

• 7:39Speaker 02

  No.

• 7:39Alex Hormozi?

  Okay. Yeah. I don't know about that part. So what's the goal?

• 7:43Speaker 02

  Goal is to have a company that I can exit.

• 7:45Alex Hormozi?

  Okay. So you want to exit. So this, these are conflicting. Very, very tough to exit a business that's like that. It was unique for us and very difficult to do that mostly because it's very face driven. And so people don't typically like unless it just over time becomes, you know, Gym Lodge became its own brand. It was like I stepped out the back door for almost two years, leading into the sale where I wasn't involved in delivery or even the last 18 months for the, for the ad side. So you can do it. It's just significantly harder than you might expect and profitability will take a hit. But let's outline the decision paths. So you have number one, go into the kind of information, et cetera, space. Very difficult to sell. You will make more money in the short term. The second option is that you just continue to grow corporate and build a large brand. And then that will for sure

• 8:29Alex Hormozi?

  be easier to sell when you come to sell, but it will take longer to get there. I don't really think there's an option three. So which of these sounds more tasty to you?

• 8:38Speaker 02

  It all sounds good to me. The only, when I'm thinking about scaling the studio side of things, I would need a lot of studios, which is just a lot of personnel. It's like 20 people per studio, you know? So, I mean.

• 8:48Alex Hormozi?

  Panda Express has 2,600 locations.

• 8:50Speaker 02

  Yeah, that's true. Yeah. I mean, I'd really be happy with any of them, I think.

• 8:56Alex Hormozi?

  Well, then which one are you gonna do?

• 8:58Speaker 02

  So should I not do gym launch for tattoos?

• 9:01Alex Hormozi?

  No, I think you can. It's like, that's what, the thing is, is that either way, you're gonna have to shoot a kid in the head.

• 9:05Speaker 02

  Yeah.

• 9:06Alex Hormozi?

  I know, aggressive.

• 9:07Speaker 02

  Maybe multiple.

• 9:08Alex Hormozi?

  Well, it feels that way, I imagine. You know what I mean? It's like this spawn that you created and you're like, you made it in your own image, you know?

• 9:15Speaker 02

  Yeah.

• 9:16Alex Hormozi?

  And it hurts. It hurts a lot. Has anyone here ever shut a business down before? Painful as shit. Like so much harder than starting one.

• 9:24Speaker 02

  Cause I'm assuming to pursue one of the other options, I'd have to shut the studio down.

• 9:29Alex Hormozi?

  Yeah.

• 9:29Speaker 02

  Yeah. Yeah.

• 9:31Alex Hormozi?

  Now, there's the narrative that you're saying, well, isn't it good that I have these studios that I can prove that I'm legit? Nope.

• 9:39Alex Hormozi?

  Nope. Doesn't matter. I owned exactly zero gyms when I had gym watch. I had six prior, but zero when I did it so that I could focus on gym watch.

• 9:48Speaker 02

  Yeah. Makes sense.

• 9:50Alex Hormozi?

  So which direction are you going?

• 9:53Speaker 02

  I think, I think the educational or the, the tattoo studio owner facing thing.

• 9:57Alex Hormozi?

  So here's the thing, you will make more money over, like, let's paint it out over 10 years, right? Like over 10 years, you'll make more money every year. You just won't make as much the last year. And so there's a lot of romanticism around selling a company and as somebody who has done it, I can appreciate it. But the thing is, is like, I don't see one way is right or wrong. If you offered somebody, hey, would you like to make a mill, like when you're 85 years old and you look back, would you be happier that you made, I'm just making up numbers, three million dollars a year in personal income for 10 years? Or basically made a hundred thousand dollars a year for 10 years and then made 50 on the last year in your 30s? Or 40s, whatever. Pick your, pick your number. I don't know. When you look back on it, like, I mean, it's 10 years of living.

• 10:40Alex Hormozi?

  So I, I'm not as polar on the decision. It's totally personal. But if you do want an exit, then the corporate path is the way. If you want to make more money, then the gym launch version is probably a better path, which I don't normally say, but just because of how difficult it is to attract star artists and that being kind of the core of the delivery. I could imagine wrapping their model in something that you have. And then ultimately what you'll have to weave in is the things that make it sticky. And that's why Jim Lanza was able to win. Because basically everything in education, what makes it so difficult to sell and also honestly to run, is that once someone has gotten your secret or your bag of tricks, then what?

• 11:20Speaker 03

  You have to have consumables. And so that's one of the things that, you know, we can help you with. But like putting the consumables in there so that it does stick and that's what's going to drive LTV long term. Putting the sales motion in place, all that kind of stuff. It's different, but ultimately the thing that's going to make it work. Cool. Awesome. Thank you. Rock and roll. Thank you. A doctor of the year. My name's Tony Cooper and I sell plumbing and air conditioning to residential customers. And I would like to, we're currently doing around, we'll pace them for 15 million this year and I'd like to be at 40 million. And what is stopping me is the chaos. We, I recently hired two new leaders from outside the industry and we went from four million to eight million, 11 million. We're pacing for 15 now. Awesome.

• 12:00Speaker 03

  The chaos, I'm worried about the over expansion or just, just to, because we're making a lot of errors. Our, our profits are staying level and I expected them to go up, but we're not, we're growing top line and we're just flat. We're just chewing up a lot of mistakes. Yeah. Why the aggressive growth pace? It's actually, I'm kind of bent more towards perfection and going slower. The, the guys that I hired are from outside the industry. They're, they're just top line revenue driven and it's almost like they, we just keep driving it and it's working and I'm making more absolute dollars than, than I could have imagined when I first hired them. So it's a good thing, but I'm, I'm wondering if they'll be. And net or, I mean, cause you're netting two, right? You're at 13%?

• 12:44Speaker 03

  No. Yeah, we're, we're netting about, you're at 14% right now. We landed last year 50, 52.7 and we're like 16 something whenever I, at the four million mark. So we're staying flat net, but the gross dollar is coming to me. I'm, I'm the single owner. Everything's paid off. We're not acquiring debt to, to grow. So I'm, I'm stacking up money, but I'm just wondering if we're going to make a mistake that rams it backwards. What are those guys compensated on? Net. And they're driving top line? It's just how they're built, I guess. They, they're, they're, they're driving top line and, and I, the guy that's the biggest driver, he really, uh, I just, just in love with big numbers. He's come from the corporate world where they did hundreds of millions of dollars and, and that's what he's, uh.

• 13:26Alex Hormozi?

  Yeah. So your issue one is data, I'll bet unless you have real time gross operating margins on each of your product lines, because by doing that, you'll be able to drive EBITDA through the roof. And in your business, being tax efficient is actually super achievable. Do you have a good CFO?

• 13:43Speaker 04

  I don't know. I don't think we do. I would want more of that function. My background's kind of accounting as well. So I'm kind of a little bit lent that way.

• 13:51Alex Hormozi?

  Okay. Are you, do you want to exit it? Or what do you want to do?

• 13:54Speaker 04

  I just want to grow it. I want a good running business that's just a cash cow, kind of a lifestyle business. That's what I want.

• 14:00Alex Hormozi?

  Okay. Well, what if you said our goal this year is to not increase top line at all and to triple bottom line?

• 14:08Speaker 04

  Yeah, I like that.

• 14:09Alex Hormozi?

  I feel like, yeah, that's chill.

• 14:12Speaker 04

  Yeah, no, I like that. That would, I would be perfectly happy with 15 million and run 30% in that.

• 14:17Alex Hormozi?

  Yeah. Yeah. Cause I mean, if you had 13, 14% or whichever one it is, if, if you're around there, I would for sure, like you for sure, I'd be targeting plus 30 minimum. I, I don't pay much attention to industry averages, mostly because like American averages is like fat overweight and divorced. So like, why would I care about industry averages? I kind of take the same position with, with most service businesses. I'm going to bet right now that you probably have some sales motion that can be improved and probably some pricing that can get optimized that would improve, improve cash flow. Basically the sequence goes like this. It's like, okay, we have to look at the sales motion so that we can fix the pricing and packaging of each of the services so that we can generate sufficient cash flow, so that we can get the talent that we need so we can shore up the infrastructure.

• 15:03Alex Hormozi?

  And so that would probably be the sequence that I would do it in. And then I would set the years like, here's our four part plan. This is what we're doing for next year. And this is how we're going to go from, you know, whatever two and change or three and change, whatever it is to, you know, six in EBITDA.

• 15:16Speaker 04

  Fair enough.

• 15:17Alex Hormozi?

  Congratulations on the business though. Rocking and rolling.

• 15:19Speaker 04

  Cool. My name is Ricky. I, I sell coaching to real estate agents. I do two and a half million in revenue. I say I, well, it's really I, because I'm a sole entrepreneur. I have no employees. I, everything's a hundred percent organic. I'd like to double it. What's stopping me? That's a good question. Your boy Ed, he seems to think he's real passionate too.

• 15:41Speaker 04

  He seems to think I could be just super famous.

• 15:43Alex Hormozi?

  Uh huh.

• 15:44Speaker 04

  And he's like, you need a brand manager.

• 15:46Alex Hormozi?

  Yeah.

• 15:47Speaker 04

  And so, you know, he's like, you need somebody that has already kind of achieved that with someone else.

• 15:52Alex Hormozi?

  Yeah.

• 15:52Speaker 04

  So I guess my question is, how do I find that person? Cause 99% of the stuff out there is scams.

• 15:58Alex Hormozi?

  Yeah, totally that kind of thing. And I would even define them as scams, just people that are not that competent. I think it comes down to deception, whether they intended to deceive or just aren't that good. But back to your point, I agree. So fundamentally, if you want to just make more money and you are a brand that promotes itself, then you need to advertise more. Are you constrained on your delivery?

• 16:16Speaker 04

  Delivery as far as the fulfillment?

• 16:18Alex Hormozi?

  Yeah.

• 16:19Speaker 04

  No, it's group coaching. It's easy.

• 16:20Alex Hormozi?

  So you could double the amount of customers you have right now and it will quadruple.

• 16:24Speaker 04

  Yeah.

• 16:24Alex Hormozi?

  Okay. Well then, yeah, I mean, this is a pure advertising play. You probably, I mean.

• 16:29Speaker 04

  I'm, I'm interviewing sales guys and I'm looking at paid ads, like hiring people. Yeah, that's like, I'm getting into that.

• 16:35Alex Hormozi?

  Yeah, the paid side is going to give you, call it like a one time three to five X off of a baseline. Not a promise or guarantee, just saying like, that's, that's what I would say is kind of typical. If you've gotten to this point off of just organic, obviously we can help you with that stuff. But like the long-term kind of like well that you need to keep digging is you want to, so think about it like this. So you have, just imagine this is your audience. Right now you're monetizing these people, right? The people who are just like super hot, they love you forever and you continue to promote. And you know, this gets filled up with new eyeballs and then they come up because they see your stuff and then they give you money. Yay. Right? When you start doing, if you do more organic and do it across more platforms, do it more consistently, do it with higher volume, do it with higher quality.

• 17:19Alex Hormozi?

  That we're going to do is you're going to grow this, this base. This percentage will stay about the same, but now it's going to go to here, right? So then that dollar sign goes out. That's a great long-term play and you just want to keep growing the pyramid. What ads will do is that ads will keep this the same and then it'll move this line down. And so you want to do both. So like in the short term, if I was like, how do I like double your business? It's like, that wouldn't be that difficult. I would just be like, cool, just pull the ad lib, it's done. But if we're looking at a 10 year horizon, then I would say, well, we need to do both of these in parallel. We need to continue to plant the seeds and then the ads kind of reach off the top and, and skim.

• 17:53Speaker 04

  Hmm.

• 17:54Alex Hormozi?

  That makes sense. Yeah, for sure. So how do you find a ad manager? I mean, I mean, I mean, I mean, a brand manager. So that that's good. Yeah, the best thing, I mean, I just, we just poach. We just, I mean, just outreach. Hey, you've crushed it with so and so. Can I pay you more to do it here? Right. And sends to where I go, I guess, how do you realize who those people are to poach? Like who? Look at the brands that you admire and then reach out to them and offer them more money to do it for you. But you see the brand, but you don't really know who's behind the brand. LinkedIn, like Frank and Hut, like, yeah, solvable. Gotcha. For sure, solvable. Yeah. I mean, and most of the people who are really good at media stuff do have some presence anyways on their own.

• 18:34Alex Hormozi?

  So they don't make themselves invisible. Like you could probably chat GPT search, who are the people who are involved with that? Here's my question. Like, like, is that something that could be outsourced? You mean recruiting? No, no, no, no, not the recruiting part, like the, like the brand manager part. No, I wouldn't recommend it. Yeah. Bring somebody in house. It's the thing is, what are the, so what are the core things to the business? So for every business, you have attraction, you've got conversion, you've got delivery, right? Those are the things that are core to every business. IT, recruiting, finance, I see all of these functions as ancillary that aren't core to value creation for the customer. There are things that must occur for the business to continue to be a business, but not things that are core for you value to be created. And so for you, your brand is arguably the most important asset that you have, and for sure would not be something that I would outsource.

• 19:19Alex Hormozi?

  So bring somebody in house, work in direct performance. Yeah, I would poach somebody. Obviously, we've done, we've hired a lot of media people, you know, help you with that. But beyond that, I would probably, if I'm doing order of ops, it'd probably be, because the thing is, is right now, are you selling? You're selling, who's doing the sales? Well, so I do it in a challenge. Okay. That's the only time I offer it, you know? You do one to one, one by day thing, something like that. Yeah, okay. And so I'm going to switch to book a call, I'm a single sell guy. And do it on a recurring kind of evergreen basis or still do it in this long? I'll do it both. Okay. Yeah. But, okay, but you're selling straight to checkout. Got it. Yeah, that motion, as soon as you turn on ads, is going to break in all likelihood, because it's totally different selling to cold than it is to to warm. And so the motion. Break.

• 20:03Alex Hormozi?

  You will not convert the same percentage I currently do. Yeah, no doubt, no doubt, no doubt. Buy a lot. And so the whole, the whole, the economics of the entire funnel will change. And so that'll take some adjustment.

• 20:13Alex Hormozi?

  In motion. So just more like preparing you for that because that's what comes next.

• 20:16Speaker 05

  Yeah.

• 20:16Alex Hormozi?

  So high level recruiting for brand manager, that's going to start building the base. And then ads plus sales motion are going to have to come in tandem. Because they both have to be good. The ads have to be good and the sales motion has to be good. If the ads are great and the sales motion sucks, it won't work. If the sales motion is great and the ads suck, it won't work.

• 20:32Speaker 05

  Cool.

• 20:32Alex Hormozi?

  That makes sense for next steps?

• 20:33Speaker 05

  Yeah. Yeah. Go to LinkedIn and poach somebody.

• 20:37Alex Hormozi?

  I highly recommend outbound for, for high level roles, by the way. Like your stars, one, already have a job and two, are not looking on a career list.

• 20:46Speaker 05

  That answers one of my questions.

• 20:48Alex Hormozi?

  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. 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. Once you answer the questions, it will tell you exactly where you're at and what you need to do to grow.

• 21:28Alex Hormozi?

  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 forward slash roadmap, R O A D map, roadmap.

• 21:43Speaker 05

  Bingo. My name's Austin. I am a chiropractor. We do right around 2.4. Been stuck there for five years. Like to get to 3.6.

• 21:53Alex Hormozi?

  Been stuck in the swamp. Stuck or growing over five years?

• 21:55Speaker 05

  We've been at 2.4 for five years.

• 21:58Alex Hormozi?

  Yep.

• 21:58Speaker 05

  And so I don't know what's stopping us. I'd like to get out of the swamp.

• 22:02Alex Hormozi?

  Heard. And then profit margins, you're at 30%, right?

• 22:06Speaker 05

  Yes, sir.

• 22:06Alex Hormozi?

  Yeah. Okay. I remember seeing 600,000 as a profit number. I don't know if that's still accurate.

• 22:11Speaker 05

  Yep.

• 22:11Alex Hormozi?

  Okay. Okay. So you have 600,000 in profit and you and a partner, you're a hundred percent?

• 22:15Speaker 05

  Hundred percent.

• 22:15Alex Hormozi?

  Okay. Well, what, what do you want to, you just want to like, what do you want to have happen? Do you want to, like, what do you want to do? Do you want to go to many locations?

• 22:21Speaker 05

  No, I want to, I want to grow a main big location.

• 22:25Alex Hormozi?

  Okay.

• 22:27Speaker 05

  You know, create a space for family to eventually, I mean, grow in there. If they're, if they don't want to do that, then that would probably change my goal to be in an exit.

• 22:33Alex Hormozi?

  Okay.

• 22:34Speaker 05

  Standpoint.

• 22:34Alex Hormozi?

  What's your square footage?

• 22:35Speaker 05

  Right now we have 7,700.

• 22:37Alex Hormozi?

  Okay. So decently large.

• 22:38Speaker 05

  Yeah, we occupy about 4,700 of it.

• 22:42Alex Hormozi?

  Okay, got it. And so are you at capacity within the space right now?

• 22:46Speaker 05

  No, we used to have a supply issue till about two weeks ago.

• 22:50Alex Hormozi?

  All right.

• 22:50Speaker 05

  And then we hired another doctor. So now it's become a demand issue.

• 22:54Alex Hormozi?

  Mm hmm.

• 22:55Speaker 05

  That's where we're at now.

• 22:56Alex Hormozi?

  So how do you get faster stuff?

• 22:57Speaker 05

  We, our highest is referral. Then we get about, the next highs would be paid ads through Facebook.

• 23:03Alex Hormozi?

  What percentage are ads?

• 23:04Speaker 05

  We do probably about 20% from ads. About half is from referrals. Another 20% is from Google.

• 23:13Alex Hormozi?

  Okay, so you separate Meta Ads from Google Ads when you talk about ads?

• 23:17Speaker 05

  Yep.

• 23:17Alex Hormozi?

  Okay, got it.

• 23:18Speaker 05

  We don't actually currently do Google Ads, but that's where they said they came from.

• 23:22Alex Hormozi?

  Heard.

• 23:24Alex Hormozi?

  Got it. Which I would probably see as word of mouth, like I Googled you or Google somebody here. It's probably SEO or something like that. But

• 23:29Speaker 05

  Okay.

• 23:29Alex Hormozi?

  Okay. So two and a half million, like what stops you from just spending more money on Meta Ads?

• 23:33Speaker 05

  Trust that we're doing it right.

• 23:35Alex Hormozi?

  Are you making more money than you put in?

• 23:37Speaker 05

  Yeah.

• 23:39Alex Hormozi?

  Well, so you might have one of the

• 23:41Speaker 05

  Very nice.

• 23:41Alex Hormozi?

  Which is that we need, we need attribution tracking. So that you can know if you're putting a dollar in and getting $5 or $10 or $20 back out, we have no clue. But as soon as you have the attribution tracking, because fundamentally, what, what you lack right now is an input output equation for the business to grow. And so every business needs to know, what are the, what are the core actions that I do that increase how much money I make? And if you can't define that for the business, then for sure as shit, your employees don't know what it is. If you don't know what it is, right? And so for you, if you are not supply constrained and you're demand constrained, that means lead generation is the issue. If lead generation is the issue, what's the activity? The activity is going to either be, I'm going to be making content. I'm going to be getting affiliates that are going to be promoting my shit for me. I'm going to be running paid ads. Right? Those are going to be kind of like the, the bigger buckets that you're going to be going into. And then you got people do those things on your behalf. And so right now, do you make content?

• 24:24Speaker 05

  Yes, sir.

• 24:25Alex Hormozi?

  Okay. What percentage comes from that?

• 24:26Speaker 05

  We just started it about two months ago.

• 24:29Alex Hormozi?

  How much do you do?

• 24:30Speaker 05

  Uh, we

• 24:31Alex Hormozi?

  I'm not going to tell you to do more. I'm just curious.

• 24:33Speaker 05

  We do four videos that gets created into short and long.

• 24:36Alex Hormozi?

  Per week?

• 24:37Speaker 05

  Four videos for the month.

• 24:39Alex Hormozi?

  And

• 24:39Speaker 05

  Heard, okay.

• 24:39Alex Hormozi?

  That's true.

• 24:40Speaker 05

  Yeah.

• 24:41Alex Hormozi?

  Don't.

• 24:41Speaker 05

  Chop it up.

• 24:42Alex Hormozi?

  Yeah.

• 24:42Speaker 05

  Okay, got it.

• 24:43Alex Hormozi?

  Okay, so you've got four longs and you chop this into little shorts and things like that. Okay, got it. All right. So short term, long term. Short term, we gotta get the data tracking in place. Second step is gonna be the ads funnel in place and kinda like what the sales motion is behind that. For local, the good news is that it's easy to do. Because there's already so much trust locally that you don't need to have nearly the complexity of kinda like the funnels and indoctrination and education prior to someone making a purchasing decision. You can pretty much just like one call close, two, two conversation close. Anybody, even at very high ticket numbers, which is one of the benefits of local. The downside of local is that you've got a market that's this big.

• 25:18Speaker 05

  Correct.

• 25:18Alex Hormozi?

  That's the downside, right? So if you don't want to expand markets, then you need to dominate the market you're in. And so it's gonna be a multi-pronged approach. And it's kinda like I was saying earlier, like, we're gonna start with ads. Because that'll just get you more in. Because I'm guessing right now, if you have a good reputation and good brand, then the ads will actually help you more than they would help somebody who doesn't have that footprint. But then we're gonna start probably layering in the content as the second, kinda the well that needs to continue to get dug. Again, this is gonna be long term, and so you're gonna wanna be a thought leader. And then what happens is that if you can, if you can succeed at building the brand long term, and it sounds like you're more long term guy, so I'll, I'll speak in these terms. What happens is your radius actually continues to expand. And so if you take it to the natural extreme, you can go to the Amen Clinic in New York, or whatever, I think it's in New York, because they have a national reputation. But people fly there.

• 26:02Alex Hormozi?

  And so that's how, that's what it looks like as you continue to expand the brand. Because people would just be more willing to travel to you and pay premium prices. Which I'm sure if we looked under the hood, the prices probably get tweaked too. But like, this, those are some things. And if you're in the swamp, cash flow is actually the biggest thing that you need.

• 26:18Speaker 05

  Right.

• 26:18Alex Hormozi?

  And so again, the pricing and packaging is probably like, again, if I was to do order of operations, pricing and packaging will probably be number one. So we could free up cash flow, the freedom of cash flow, we'd then funnel into the ads so that we could get data, well, data attribution. Then we'd put the ads in place, putting flow through there. And then the baseline that happens after that is we're just gonna increase the cadence on the, on the content that demonstrates thought leadership. That's the path.

• 26:39Speaker 05

  That makes sense. Thank you. We're, we're having trouble also hiring good, high-quality doctors.

• 26:44Alex Hormozi?

  Mm-hmm.

• 26:45Speaker 05

  In Wyoming.

• 26:46Alex Hormozi?

  It's actually, that is a bit the first problem, cash flow.

• 26:49Speaker 05

  Okay.

• 26:49Alex Hormozi?

  We need to fix the pricing so that we can generate more cash flow, so that we can pay doctors, so that we can actually get the business to not rely on you as much.

• 26:56Speaker 05

  Oh.

• 26:57Speaker 06

  Appreciate you. Thank you. Yeah, happy to help. Hi, Alex. I'm Rob Jenkins. Hello, sir. Hey, I'm a 25-year recovering attorney. I have a very specialized practice. I'm so sorry. My condolences. We serve as an officer of the court for judges throughout Texas. Uh huh. About 1,400 judges, 250 counties. The, our revenue currently is standing at 15 million. Okay. 74% profit margin. Okay. Uh, based on a proprietary piece of software we developed. I'd like the revenue to get to 20 million. It's a nice round number. Me too. It's, and it's, it is progressing that. For both of us. Yeah, it's progressing that way. Uh, so what's stopping me is we have conquered the market in Texas. We are number one by a, a large magnitude.

• 27:41Speaker 06

  Number two, three, and four combined still don't do what we do. And so we're about half of the entire industry in the state of Texas. Love it. So where we are now is this crossroads of we have solid relationships with five of the seven whales that could possibly exist in Texas. And the whales being the law firms that ask the judge to appoint a receiver. Mm hmm. We have relation, like I said, locked down relationships with five out of the seven. There's two that we will choose not to serve. Yeah. Dicks. So we, we just don't align. Yeah, our values come together. So we're kind of at this crossroads of do we go to another state? Mm hmm. Or as kind of came from yesterday's discussions, perhaps I go out and do some whale hunting

• 28:26Speaker 06

  and bring some new whales into Texas. And so, uh, meaning find other national, big, high-volume law firms that choose not to do business in Texas. Because Texas is a tough state to practice in. And so it's really that fork in the road of what makes more sense. We're a single business building operation outside of Dallas. We cover the entire state with our, our abilities. So we have a massive efficiencies. Yeah. We are tight. I have a rock star team. Three of them there up front on the front row. Versus going into uncharted waters. Yeah. And saying, all right, well, we did it in Texas. We can do it in Oklahoma. What prevents you from doing Oklahoma?

• 29:08Speaker 06

  It's never been done. There would have to be a tweak to the law, the legislation might need to pass. So there's a two-year journey to pass a law to make it more available.

• 29:17Alex Hormozi?

  Okay.

• 29:17Speaker 06

  But the good news is, the, you know, one of the particular wells we have in Texas is saying, hey, come to Oklahoma. We're already here. We need this remedy here.

• 29:27Alex Hormozi?

  Yeah.

• 29:28Speaker 06

  But my natural inclination, based on efficiencies and processes and systems that are in place, is we'll figure out how to do what you're doing here bigger. And so I'm kind of in that fork.

• 29:38Alex Hormozi?

  Yeah.

• 29:38Speaker 06

  Which mountain is worth climbing?

• 29:41Alex Hormozi?

  Well, it's a great, you even used the analogy I was gonna, I was gonna use. So the good news is that both ways will get you up the mountain. And I think one of the things that I used to get, I'd lose too much leap over was obsessing over which path when both of them lead you up. So then I would end up deliberating for way longer than I should have because I wanted to find the perfect path rather than just knowing both of them will take me up. And so that's allowed me to take, make big decisions faster, just as a overarching frame. The second thing with regards to the actual decision, so when I think about something like this, I think, okay, how do I maximize the risk-adjusted return on this move? Right? And so if I call a whale up, so you have five whales that you like, are there any other whales that you like that are not those five that you have relationships with?

• 30:21Speaker 06

  Not in Texas. But the idea is there are, you know, there's firms out there that do eight states. They just don't do Texas. And so not a lot of cost into pursuing, hey, let me encourage you, let me tell you what Texas can hold for you and try to get them to come to us.

• 30:37Alex Hormozi?

  Is there, and you would know this, are there laws that prevent you from kind of doing a joint venture or something like that with a whale firm? So that you can do as an exclusive?

• 30:46Speaker 06

  It is critically important that I am independent.

• 30:50Alex Hormozi?

  Okay. Yeah. Heard. Yeah. Cause otherwise I would have been like, you could put a very big, you know, check on the table for them to get there. Which I guess you could still do, but you would have to have no agreement, like they could just take the money, obviously, and then not send it to you. They probably still would, but as, as a, as a risk consideration, the thing I don't like about that one, my big hangup, which might be yours, is I just don't want the growth of my business relying on somebody else opening their business and doing a good job. Whereas I'd rather go where the fish already are. So if Oklahoma has a two-year delay, I mean, that is a pain in the ass. But are there other states that don't have a two-year delay?

• 31:24Speaker 06

  That's just the most logical first step.

• 31:27Alex Hormozi?

  Because of the one whale that's already there.

• 31:28Speaker 06

  I mean, it's literally our north.

• 31:30Alex Hormozi?

  Yeah.

• 31:31Speaker 06

  And we already have a relationship with a Texas whale that is in Oklahoma saying, please, I'm here also.

• 31:36Alex Hormozi?

  How much business does that represent, though?

• 31:38Speaker 06

  That's the big question is, it's unknown.

• 31:40Alex Hormozi?

  Cause you're doing Texas and you're at 15, right? Oklahoma is way smaller by, you know, head count than Texas, and this is one of five. So it's like, if we had one fifth current revenue, you know, you're at three and that's of Texas slice of pie. Now, whatever the Oklahoma slice of pie goes from three to less than three.

• 32:01Speaker 06

  Exactly.

• 32:02Alex Hormozi?

  And like, to me, I'm like, I don't know if I care.

• 32:06Speaker 06

  You nailed it.

• 32:08Alex Hormozi?

  Yeah.

• 32:08Speaker 06

  That's really a big piece of it is, you know, the growth piece of, great, we could take on another state. And of course, Texas could lead to Colorado and Colorado could lead. But you're talking about, all right, you just added 10 more percent revenue.

• 32:22Alex Hormozi?

  Yeah, incremental for sure.

• 32:23Speaker 06

  But now you have something else dragging and on your brain at nine, three in the morning, you know?

• 32:28Alex Hormozi?

  Yeah, I'm with you. So then what stops you from going to New York hypothetically? Like if you, if you operate remotely fundamentally within the business, like what, why does, if, if it's another state is another state is another state. Do you need to be local in order to do it?

• 32:43Speaker 06

  It might have to do with the laws that are in place.

• 32:45Alex Hormozi?

  Yeah.

• 32:45Speaker 06

  You know, and this remedy that is a Texas law based remedy makes sense in Texas because Texas protects wages. And you can't do wage garnishment. It protects your homestead. We can't force you to sell your house. It, it has a lot, you know, it's, it's considered of the second toughest state in the nation to recover unpaid debt in or judgments in. So we come in as a tool that works. And so we, there would be just a handful, I would estimate three to four states where this would make sense.

• 33:13Alex Hormozi?

  Okay.

• 33:14Speaker 06

  It's a matter of, is the view worth the climb? Is adding 10, 15% more top line revenue worth taking my brain, my overthinking brain?

• 33:24Alex Hormozi?

  Yeah.

• 33:24Speaker 06

  To Oklahoma?

• 33:25Alex Hormozi?

  I would say this will actually be fun. I'm going to do this because it'll apply to probably half the room because this is a really cool fundamental decision. So bear with me, this will be a little bit longer, but you'll hopefully like it. If you don't, don't tell me. So let's say that this line represents normal revenue of the business. In my experience, I've, I've noticed that I get a 20% decrement or decrease in performance whenever I change anything about the business. Before any kind of gains can then get accrued from whatever that change was supposed to bring. And so I see this as my guaranteed cost of change, no matter what that I have to pay. And so what's ended up happening after observing this over and over, over again, is that number one, if I'm going to take an guaranteed 20% cost, then I'm not going to take a potential

• 34:08Alex Hormozi?

  for a 20% gain on a guaranteed 20% cost. And so for me to take a 20% dip, it's like, I need to see 50, maybe a double in the business for me to be like, okay, this is worth it. And so what ends up happening is that I think this can, I'm speaking to everybody now, but you get out of this constant desire to tweak everything in your business and drive your employees insane because you're always having a new idea every week and they're like, well, we just did this other one. Because what ends up happening is you're like, well, this thing's gonna net, well, you're like, okay, well, what if this does net me 20, I should still do it, right? Okay, sure, let's play that out. But the thing is, is that this week, you're going to think of something else. You have another 20%. And so people actually have like persistently far below a potential businesses that are operating way below what they should be because we just constantly are changing shit.

• 34:53Alex Hormozi?

  And so to ladder back to what we were talking about, my question would be, what state can generate the same amount of revenue as Texas?

• 35:03Alex Hormozi?

  None. None? Okay. You have to grow the pie of Texas. So you have two, two growth paths, right? You go from 40 or 50% where you're at now to 70, 80%. So it's like, what monopolistic levers can we employ so that like, we can starve everyone else out, which then just increases the value of the business a ton, which is awesome. And so there's share of pie and growing pie of Texas. And if none of the other states really make this feasible, then I think that probably answers that, at least in the short term. So I don't love the, I have to get other people here as my growth path. And so it's like, number one, the thing that requires the least amount is increased percentage of pie.

• 35:45Alex Hormozi?

  Number two would be increase pie percentage or sorry, yeah, pie percentage. And then number three, if I've done both of these things well enough, then that might already be, I mean, for sure, getting your 20. But then it's like, okay, I'm going to look at New York. I'm going to look at some of these other, other states that might have opportunity that's still not as good as Texas, but I have truly tapped this. And that's probably the order of operations I would do it on. So then solving for the constraint of, okay, why do these other 50%? Why are they allowed to breathe? And then how do I take the oxygen out of the room? Would probably be my approach if I were swapping places.

• 36:20Speaker 07

  Love it. Thank you.

• 36:22Alex Hormozi?

  Yeah. No, thank you. Congrats on the business. Very cool. Yes, sir.

• 36:25Speaker 07

  My name is Chris. I sell welding accessories to welders. We do 1.7 million revenue. I'd like to be at 10 million revenue. What's stopping me is I feel like demand has plateaued and we have about 300,000 followers on TikTok and I was wondering if you think-

• 36:42Alex Hormozi?

  That's amazing. So you're doing this on, from TikTok?

• 36:45Speaker 07

  TikTok is our main channel. I kind of got things going and then we had a Shopify store.

• 36:49Alex Hormozi?

  Yeah, but I'm still amazed.

• 36:51Speaker 07

  Thank you.

• 36:51Alex Hormozi?

  Yeah, TikTok has just the worst monetization of, of audience. So kudos.

• 36:56Speaker 07

  I was wondering if you think it'd be worth trying to double that audience from 300,000 to 600,000 or jump into another channel? Like Amazon is what I was really considering.

• 37:06Alex Hormozi?

  You were seeing Amazon as a channel?

• 37:08Speaker 07

  Like as, as a means to sell more things.

• 37:11Alex Hormozi?

  Well, so, okay, hold on. So are you saying I have such limited resources that my decision is I can either list my stuff on Amazon or I can make more content? Is that what you're saying? You said go from 300 to 600 on TikTok, right?

• 37:27Speaker 07

  Yes, make more content with TikTok. The thing, I made videos for about a year, just every day I was trying to make like good original content. And over the past few months, I've been experiencing a lot of burnout.

• 37:39Alex Hormozi?

  Sure.

• 37:39Speaker 07

  And I think that's what's kind of

• 37:41Alex Hormozi?

  Yeah.

• 37:41Speaker 07

  made me interested in looking in other avenues of

• 37:44Alex Hormozi?

  Yeah.

• 37:44Speaker 07

  selling my shirts.

• 37:45Alex Hormozi?

  So this is, this is like awesome. I'm really glad you asked this question. You have to reverse engineer you. So what are the things that you actually like doing?

• 37:52Speaker 07

  Making content.

• 37:54Alex Hormozi?

  But you're burned out though. So

• 37:55Speaker 07

  Yes, yeah.

• 37:56Alex Hormozi?

  So is there a type of content you enjoy and other types you hate?

• 37:58Speaker 07

  More educational content. I like, I like educator, educational content because I feel like

• 38:04Alex Hormozi?

  Yeah.

• 38:05Speaker 07

  when I post it, people can come back to it anytime and it'll kind of create-

• 38:09Alex Hormozi?

  What stops you from making that?

• 38:11Speaker 07

  Ideas like coming up with good, original ideas. I feel like it's hard and like, I know they say just like post the video like no matter what, but sometimes when I look at it, I'm like, man, I could be better, maybe.

• 38:25Alex Hormozi?

  Yeah. So I, I don't think you should just do this other random thing for no reason. So if that, if you want that initial answer, I can give you that one right away. I think that the long-term play for you is figuring out how to make the content that you enjoy so that you can keep making it. And so it's either you like the stuff you make or you capture yourself doing things you already like. Those are kind of your options. And then the rest of it is just pain tolerance.

• 38:49Speaker 07

  That's fair.

• 38:50Alex Hormozi?

  Being real. And to be fair, going from season to season of content creation, like you'll probably notice many people, myself included, like the nature of my content shifts over time. And it's for the same reason, which is that like, I have to give myself permission to do whatever I want. Because there are no rules and no one's, there's no content police that's going to come arrest me. If I don't make a video today and they're not going to arrest me if it's not algorithm optimized. I'm just going to make what I want to make and that changes because I changed and I focus on different stuff. The other piece that I will tell you that is worth writing down is that we need to be reminded more than we need to be taught. And that goes double for your audience. Maybe some of you guys watch some of my content. You've probably heard me say work more before. And yet, when you see the seventh video of that in a slightly different context, it's like, well, I kind of wanted the reminder.

• 39:34Alex Hormozi?

  And so it's not like you're diserving the audience by reminding them of something they want to be reminded of. In a context that is slightly novel. And so I think one of the big burdens that creators or people make content put on themselves that they believe that the content has to be as novel for them as it is for the audience. And it is just not true. Dave Ramsey has been answering, I'm broke questions for 35 years. Stop spending the money you make. That's it. That's it. That's, that's what you gotta do. Right? And then everything else goes up. That's how it works. World's shortest content piece. But the thing is, is that it's the nuance of this unique situation. Well, there was a girl who won a lot. I mean, how, I've seen multiple lottery winner call-ins to Dave Ramsey. Have you seen those? Like little clips of him?

• 40:17Alex Hormozi?

  I've seen multiple. So you think, oh, well, we can't make another lottery clip. We've already covered what to do with lotteries. It's like, well, that was a $22 million lottery. This is a $2 million lottery winner. What's different now? Well, this guy has a wife who hates him and this guy doesn't. Now what? Well, the answer is stop spending so much money. You get where I'm going with this, right?

• 40:38Speaker 07

  Yeah.

• 40:38Alex Hormozi?

  So if you weld stuff and you like making cool projects, the nice thing about your business is super visual. So it's so made for making content around, which is a huge advantage. Whereas if you like teach stuff, you have a big box of intangibles. It's like for me to demonstrate client finest acquisition, not nearly as fun or cool as you welding some shit. Never.

• 40:56Speaker 07

  That's fair.

• 40:57Alex Hormozi?

  Right. I also follow a handful of gym equipment accounts. Like that's probably one of my hardcore side hobbies. I will look at reels of the same piece of equipment 30, 40 times until another one comes up. It'll be 31 or 41 times, right? And so I think you underestimate how much your audience might just like your shit. And then you just be okay with posting today's version of that thing. So just keep Dave Ramsey top of mind. And part of the reason that he's been able to make the content for 35 years is that he enjoys doing it. And so it's just find a format that you like and then figure out all the algorithm bullshit around it to make it, you know, all nice and clickable and all that, all that kind of jazz. But I'd say start with you and kind of reverse backwards. And then long-term, that's what's going to build

• 41:42Alex Hormozi?

  it. But was that really the core problem? I just, I wanted to answer that because I know that probably affects a third of the room. So.

• 41:48Speaker 07

  Yeah. Now, the other big problems that I've kind of realized being here, data, like I don't know my numbers like I should. That's a big thing that I've realized. Focus.

• 41:56Alex Hormozi?

  You run ads?

• 41:57Speaker 07

  Big thing. And that's what like you're saying, like we need to be blinded more. That's what I think coming here and just having that laid out has helped.

• 42:04Alex Hormozi?

  Do you run ads?

• 42:05Speaker 07

  Yes, we do. Google and Meta Ads.

• 42:08Alex Hormozi?

  Okay. What percentage comes from that versus organic from TikTok?

• 42:12Speaker 07

  It's probably 50 50, I'd say.

• 42:15Alex Hormozi?

  Okay. Interesting. Got it. And so what stops you from just running more ads?

• 42:18Speaker 07

  I've talked to my marketing guys about it and they say.

• 42:22Alex Hormozi?

  We've saturated the market.

• 42:24Speaker 07

  Not like that. They say we just want to like trickle up slower. So we're planning on spending more leading into the holiday season.

• 42:29Alex Hormozi?

  Okay. Cool.

• 42:33Alex Hormozi?

  I agree. Spend more.

• 42:34Speaker 08

  I appreciate it.

• 42:36Alex Hormozi?

  I know you're not the only person who's dealing with that content issue as a side note. Yeah, shoot.

• 42:40Speaker 08

  Uh, my name is Derek. I sell real estate advisory services to C suite execs and business owners. I do about one point two right now and I'd like to be at 10.

• 42:50Alex Hormozi?

  You're running like 60% margins, right? Like 700 or so a year profit.

• 42:54Speaker 08

  As an example, the guy who wrapped you to buy this building, that's like what I do. So my, my hypothesis in Seattle, I'm in Seattle suburban market in Seattle doing one point two. Hypothesis, I'm moving to Phoenix next year, so I'll be, I'll open the office in Phoenix, much larger TAM. I want to hear your framework about how do you think about customer acquisition strategy for C suite execs in a brand new market where you don't know anyone?

• 43:18Alex Hormozi?

  Yeah. So how many people do you have working under you in Seattle?

• 43:22Speaker 08

  I have one guy. So you can just let him meet him for meetings for me.

• 43:26Alex Hormozi?

  Well, first, okay. Are you concerned that your revenue in Seattle is going to drop?

• 43:29Speaker 08

  I'm starting over.

• 43:31Alex Hormozi?

  So you're cool. Just you're like, this is going to zero.

• 43:33Speaker 08

  It's more like lifestyle too.

• 43:34Alex Hormozi?

  Okay. Heard. Okay.

• 43:36Speaker 08

  Yeah. So.

• 43:37Alex Hormozi?

  Well, then what'd you do to get the first one point?

• 43:39Speaker 08

  Brute force, calling and emailing one to one.

• 43:41Alex Hormozi?

  Yeah, that'll do.

• 43:42Speaker 08

  So like, yeah, for sure. But zero to one, but how do you think about from zero to 10 in a brand new market? Would you change that strategy up?

• 43:52Alex Hormozi?

  Yeah. If you're going for high level people, then it's gonna, it's gonna be more outreach driven because most high level people are going to get everything from referrals or from meeting people in specific, you know, arena. Yeah, I'm just being real. I'm not responding to a meta ad for buying this building, right?

• 44:08Speaker 08

  For sure.

• 44:10Alex Hormozi?

  And so.

• 44:11Speaker 08

  And you don't pay that, you don't pay out of pocket. I mean, the landlord or the seller pays my fees. So like the customer itself isn't paying for my services.

• 44:19Alex Hormozi?

  Or you do, you do renters? Is that what it is?

• 44:21Speaker 08

  Tenants. So like.

• 44:22Alex Hormozi?

  Yeah. Okay. So rent.

• 44:23Speaker 08

  Yeah.

• 44:23Alex Hormozi?

  Yeah. That is actually kind of interesting. I remember. Yeah. I know. You know, it's coming back to me. Yeah. Unique model, only focusing on tenants.

• 44:30Speaker 08

  Tenants and buyers. Yeah.

• 44:31Alex Hormozi?

  Oh, but and buyers.

• 44:32Speaker 08

  Yeah.

• 44:33Alex Hormozi?

  Okay. And buyers. Okay. Got it. What percentage is not landlords? Yeah. What percentage is tenants versus buyers?

• 44:37Speaker 08

  Oh, in this market with interest rates, it's like 80 or 90% tenants.

• 44:42Alex Hormozi?

  Okay.

• 44:42Speaker 08

  And buyers.

• 44:43Alex Hormozi?

  Interesting. Huh.

• 44:44Speaker 08

  And I do industrial in the office building, so.

• 44:47Alex Hormozi?

  Yeah, like, yeah, I'll say this. If like that specialization is kind of unique, at least I haven't, and I feel like I get solicited constantly. And so.

• 44:56Speaker 08

  You're not getting beat on by a commercial estate brokers problem. I mean.

• 45:00Alex Hormozi?

  Not really. Zooming all the way out. You go into a new market, right? It's like, you gotta either be face to face, networking, et cetera, like conferences, meetups, like.

• 45:09Speaker 08

  Right.

• 45:09Alex Hormozi?

  Pounding the pavement. V1. V2 is outreach just digitally, right? Which if you have some organic following that can help, or you have to go true cold outreach on LinkedIn, things like that. That can work for sure. Again, volume. The ad strategy, I think because of the, the unique angle that you have, I actually am more okay with it. Given it's like, if you just lean in on the tenant side, I actually think you might have a better shot because it just feels unique rather than like. I have to buy these buildings, you know? So that, because if you're like, I, I am a specialist at negotiating leases for commercial buildings. Under these conditions, then it's like you're niching down and that messaging could pull someone who otherwise would like. I have multiple brokers that I use.

• 45:52Speaker 08

  That's, yeah.

• 45:54Alex Hormozi?

  But I currently don't have a, I own all my shit, but like if I didn't, then I would, you know, I would probably be responsive to a message like that. So I think I would probably just from a speed perspective, because I'm guessing you have cash. Right. I mean, your margins are good. So I would probably start with ads first. And I would do the rest as though ads don't exist. But the ad strategy would be probably one of the primary things that I would want to crack in the new market. Because otherwise it's going to take you however long it took you to do it the other time.

• 46:22Speaker 08

  How would you, 80, 20, I mean, from cold outreach to ads, what's that disparity look like?

• 46:28Alex Hormozi?

  Yeah, I don't normally recommend doing more than one thing. Yeah, my only exception is for local. Because local, there's just, it's a smaller, you just have to just hammer a market. The thing is, is that ads don't take a tremendous amount of time.

• 46:40Speaker 08

  Yeah.

• 46:40Alex Hormozi?

  I basically would want you to spend, call it a hundred to $200 a day in local ads. And your primary priority is to work the shit out of those leads and get the sales motion in place.

• 46:52Speaker 08

  Yes.

• 46:53Alex Hormozi?

  And in the meantime, you do the normal playbook.

• 46:57Speaker 08

  Okay.

• 46:58Alex Hormozi?

  So it's like, this is my guaranteed path. This is my fast path that I'm willing, I'm spending this money.

• 47:03Speaker 08

  Right, right.

• 47:03Alex Hormozi?

  To learn to get it, to, to, to crack it. That would be my approach. Now, the good news is that there's plenty of Realtors who are super social, running ads in local markets.

• 47:11Speaker 08

  Platforms, LinkedIn, obviously.

• 47:13Alex Hormozi?

  Um, no, I mean, I think, like, again, I like the super niche messaging. So I would actually be more willing to, I mean, LinkedIn for sure, but I wouldn't be as opposed to a meta strategy, given that unique angle. Just being generic Realtor number six, no.

• 47:27Speaker 08

  No chance, yeah.

• 47:27Alex Hormozi?

  Right.

• 47:28Speaker 08

  Okay. Real quick, and then decommoditizing my service, I guess. I already had that kind of specialty, so that probably helps.

• 47:34Alex Hormozi?

  I would be shown before and afters. You know, this is what the tenant was originally offered. This is what we're able to negotiate. This was the difference.

• 47:41Speaker 08

  Right.

• 47:41Alex Hormozi?

  Just, I would be.

• 47:42Speaker 08

  I thought about a guarantee, you know, landlord offers this. If our, if where we end up is 20% less than that, or not, I'll rebate my fee kind of deal. The landlord paid fee back to you.

• 47:53Alex Hormozi?

  Yeah.

• 47:53Speaker 08

  But it's like, yeah, tough to guarantee that when sometimes it's 8% savings, 10% savings. I mean.

• 47:59Alex Hormozi?

  I would probably go with dollar amounts, if you can.

• 48:01Speaker 08

  Okay.

• 48:02Alex Hormozi?

  And then only take projects over X.

• 48:04Speaker 08

  Right.

• 48:04Alex Hormozi?

  That way you could probably, it'll, it'll, because you want to anchor to the, the biggest number you can, and that would probably be how I'd approach it, because percentages get eaten up real fast and going from like, if it's less than five, it's like, that's not impressive. But if it's like, I'll save you 50, but it's like over a six-year term, it's like, okay, that, I did save the money. It's just backloaded and they're fine. So I'd rather anchor to the big number.

• 48:23Speaker 08

  Okay. Appreciate it. Thank you. 100%.

• 48:26Alex Hormozi?

  Congrats, by the way. Allsy.

• 48:28Speaker 09

  Hi, Alex. My name is Dylan Larson. I sell beef protein chips to athletes and outdoor enthusiasts. We do about a million, uh, revenue. We want to be at 12, want to be doing about a million a month. Up until this point, up until this point, we've been severely, what I've identified as supply constrained. We've been in the supply chain purgatory for a while. I say a while, period of like six to nine months, trying to find a manufacturer that's going to make our stuff. Or because we decommoditized away from jerky, didn't want to price raise to the bottom, changing their lineup a little bit dissuaded so many of them. So we finally found one and we're working through that right now.

• 49:12Alex Hormozi?

  Okay. So what else is distracting you?

• 49:15Speaker 09

  The approach, now that we've unlocked the volume, this new manufacturer can do about 20,000 units a month,

• 49:22Alex Hormozi?

  Okay.

• 49:22Speaker 09

  which will get us to about 280,000 a month in revenue.

• 49:25Alex Hormozi?

  Okay.

• 49:25Speaker 09

  At that point, he has a proprietary machine that can spit out a tray of our product every 12 seconds.

• 49:31Alex Hormozi?

  Okay.

• 49:32Speaker 09

  But that machine is too large for his facility, so we would need to kind of come together and find a solution and a location to employ that, or the alternative option, which I think is the ultimate end state anyways, would be to stand up our own facility, understanding the timeline, the red tape.

• 49:51Alex Hormozi?

  How much is the machine cost?

• 49:52Speaker 09

  I didn't think about buying it from him.

• 49:54Alex Hormozi?

  Yeah, and you could buy it used. Okay, so basically, how big are your dreams for this business?

• 50:00Speaker 09

  Large.

• 50:00Alex Hormozi?

  Well, you want to get to 12, but do you want to do beyond that? Do you want it to be a big brand?

• 50:03Speaker 09

  Yeah, absolutely.

• 50:04Alex Hormozi?

  Yeah, well, if you want it to be a big brand, then owning the manufacturing for something that is novel or different is probably a good idea. The issue is obviously cash flow, is that you're super constrained right now, I'm guessing. A couple of things. If I were to, like, one, there's probably a renegotiation of terms if I absolutely could to just increase my, my payment. So like, can I beat net 30? Can I beat net 60, etc. That'd be the first thing I would look at. We had a company I was looking, investing in. Just taking terms, like, we just really hardcore negotiated one from net zero to net 90. And then the company went from 2 million a year to 5 million a month in 18 months. Not a promise or guarantee, just saying. The second thing, okay, so one is cash flow from a terms basis. The next one is, what's your influencer game?

• 50:46Speaker 09

  Oh, well, right now, we're heavy in the CrossFit space, very heavy, and we were able to secure his name, Austin Hatfield. He's, he has a high, high likelihood of a podium at the CrossFit Games and, you know, a shot at winning. And so we contracted his head, and so he's, he's our primary influencer right now. So we're kind of pumping everything into him, and we got a couple more athletes like that. And then we do everything else through podcasts and on the unscripted live reads.

• 51:13Alex Hormozi?

  Got it. You don't run any ads then? It's all organic?

• 51:15Speaker 09

  No, yeah, we just kept hitting the inventory ceiling, trying to solve for that and.

• 51:19Alex Hormozi?

  Okay, so right now, you have a double sitting in front of you that you think you can hit with the guy's existing capacity?

• 51:25Speaker 09

  Yeah.

• 51:27Alex Hormozi?

  How many months of that do you need in order to save up enough to buy the machine with terms and lending?

• 51:32Speaker 09

  Oh, I mean, not that.

• 51:34Alex Hormozi?

  Not that many?

• 51:35Speaker 09

  Not that many.

• 51:35Alex Hormozi?

  Okay, so I mean, I think that you're spelling out kind of the plan. So meet existing volume requirements. I also, it might be worth leaning into selling out because then you can just kind of pent up some demand. In the, in the meantime, that's number one. You can also do pre-orders, do you do that?

• 51:52Speaker 09

  Uh, we did before, but we just, we ended up letting go of another manufacturer just a couple of weeks ago. Because they, there's the whole nightmare QA dropped, everything wasn't on time. So we were technically sold out, you know, for this last month and we got the team together, rented. We just kind of flew by the seat of our pants and solved the problem. So we did the sold out play and I'm sorry, I forget if that addressed your question there.

• 52:15Alex Hormozi?

  You're good, I was just trying to pull cash forward. Okay, so we have, we have our terms. I think you can use pre-orders as a mechanism. You have your existing volume that you think you can hit these new volume caps that are twice as big. Cool, so that, so the three of those things bring you cash flow forward. Then it's, where are you based out of?

• 52:30Speaker 09

  San Diego and the manufacturer's in LA.

• 52:32Alex Hormozi?

  Interesting, okay. Well, yeah, ideally you'd be central so then you could get.

• 52:35Speaker 09

  Yeah, or three PLs in Georgia, so it doesn't.

• 52:38Alex Hormozi?

  Okay, okay, so yeah, then you can, I mean, I still just hate California stuff. But yeah, you can, then you could basically open up the facility there. I'd still hate that, but, but you do live there.

• 52:50Speaker 09

  Right, originally from Montana, so that's probably a more appetizing location, but if we.

• 52:55Alex Hormozi?

  Much more appetizing.

• 52:56Speaker 09

  It sounds like if we, you know, scale into this, this guy's volume, um, we're able to acquire the machine from him, then.

• 53:03Alex Hormozi?

  Or just from whoever makes the machine.

• 53:05Speaker 09

  Right, it was proprietary, he assembled a bunch of things together, at least he said so.

• 53:08Alex Hormozi?

  Yeah.

• 53:08Speaker 09

  And then grab the own, the, the new facility that we would own and then inject that machine to.

• 53:13Alex Hormozi?

  Yeah, it'd be interesting, like, the machine is a big question mark for me. Like, I would call up a couple of really good machine guys and say that this is my partner of marketing. And roll in and check the machine out and be like, all right, how proprietary is this? Cause we might find out it's like, you know, a $75,000 machine that has, you know, $25,000 add-on that they're pretending is $400,000. A good friend of mine was in. Machine business murdered it. They were, you know, they're doing 70 million a year selling machines. The average cost they'd sell machines for was like 400 grand, cost them 17. Yeah. So like printed, destroyed. So I say this because like, again, I mean, a smart machine builder prices off of value, which is if I, you know, I replace your entire workforce, that cost you 2 million.

• 53:56Alex Hormozi?

  For 400 grand, it's a steal. And if it just happens to cost me 20 grand to build.

• 54:03Alex Hormozi?

  Right. More for everybody. Right. So I would, I would really lean on that because there's, there's probably a big delta there. Because the core of your business, if it really is this proprietary thing, that machine right now is the core defensibility that you have. So knowing everything about how that thing works is everything. Because if you're, again, like we, we have to take this to natural extreme. Let's say we hit that. Okay. Then we have this machine and then we build it out. It's like, well, we're going to need more machines. And that's the only thing differentiates us from everybody else. Then it's like, that actually is a huge point of leverage for the business. And so getting as much intel as you possibly can on that, so that you can ultimately grow.

• 54:39Speaker 03

  Got it. Thank you.

• 54:41Alex Hormozi?

  Yeah, you bet. Rocking on. I should have prefaced this earlier, but I, I tried to answer the questions in a way that, you know, obviously affects more than one person in the room. Whether it's, you know, should I do this business or this business? Should I, you know, go to a different state? Should I buy the machine, you know, for, for meats? Do I need to expand the brand? How do I go, you know, how do I go about doing that? If I'm at 15 million and my margin isn't what it is, and we've been going like crazy, should this be a year to prune the tree? And get it really lean so that we can then set up for our next year of expansion. Like, these are all everyday business problems that affect more than just the people in the back of the room. And part of the selection that we do is we try and have different questions that are representative of more people's problems than just one, rather than like seven people in a row. They're like, I think I need to grow my brands.

• 55:24Alex Hormozi?

  With that being said, so we gave a talk on basically maximally converting an audience to our sales team. So this is something Benson and I put together. One of the big reasons that I stayed at between 30 and 40 million dollars a year for like three or four years of my career was because I didn't understand how to convert the widest percentage of an audience. And so Benson's going to go through a talk that kind of explains our thinking around this. So you can maximally convert as many people as you want within your given target market. Business owners, quick question. Can I get your email address? Because I want to send you a gazillion dollars of free value in my next book, 100 million dollar money models. Okay. Who here read one of my other books? Yes. All right. Was it worth reading? Yes. Okay. So August 16th, this book comes out.

• 56:07Alex Hormozi?

  It is the crowning achievement. I've been working for years on it. And on top of that, every single person who shows up live will get a product I've been working on for not one, but two years that is better than an NFT, less than a Bitcoin. And every single person who shows up will get one. All right. And it will be for sale afterwards. So this is not, this is legit. All right. So click, register. The event's absolutely free. I've got five, five mystery headliners. And out of 10, what would you rate the last two books? Can I get some fingers? Hell, yeah. All right. So you're not going to miss it. Click, register. I'll see you there. All right. Thank you guys so much. I appreciate it. Back to Benson.