Wie Hormozi auf 1,2 Millionen im Monat kam

0:57you you and then go to uh you what's up sud mr hermosie how are you man i'm doing fantastic better than i deserve as they say i don't know if i agree with that comment i think i deserve it yeah yeah i think you deserve the best like we're all we're all amazing human beings and we all deserve the best right it's so interesting i actually have a completely contrary thought to that i think that we don't deserve anything oh touche um well maybe we can talk about that some more uh sure um so we have i don't know if you remember we're updated but we have a live audience right they're not in yet but they'll be in soon so we're going to live stream as well and um i'm in austin over in travis heights so in the same hood as you are and uh you were actually on my good friend's youtube channel just uh last week leon uh leon hendrix yeah yeah so we have a lot of overlapping friends but uh but uh running around in similar type of circles but it's very nice to meet you thank you for having me uh-huh um and i know if you've done a lot go ahead i said thank you for having me i appreciate it oh yeah yeah um yeah i know of you podcast a lot uh we'd like to do a fun informal chat talking about your background and then we'll dive into the book i read the book i've got it here um amazing book by the way and hardback for the hardback look at this one i didn't i did i got the paper back actually so yeah out to get the upgraded version um so we'll dig through that and then we'll do some q a towards the end and um if you have a drink you know feel free to drink feel free to you know be informal and have a good time so any questions i just realized we're going to be on for like 45 or 50 right let me let me move you real quick okay yeah yeah and turn off your video just so you know all right all right um we just so you know we've got you booked for 90 minutes you said 45 to 50. i just wanted to yeah and and sometimes i take notes during the podcast alex to ask you other questions so if i'm looking down i'm not checking my phone i'm just updating some notes here so cool rock and roll okay i'm going to start letting the crowd in here and then i'll hit the record buttons all right guys welcome welcome everybody please turn your videos off and put your microphones on mute there we go thank you everybody please turn your videos off as well uh daphne if you don't mind turning your videos off there we go cool cool uh so welcome everybody and welcome alex we're gonna hit the record buttons and start to rock and roll oop we got one more okay i got a thorough intro for you alex so i'm gonna dive into this real quick so the listeners know all the details about you and then we'll hop into the podcast all right in three two one today on the business method podcast we have the author of the recently successful and trending book for entrepreneurs 100 million dollar offers and his name is alex hermozy alex took home more in a year than the ceos of mcdonald's ikea ford motorola and yahoo combined as a kid in his 20s using the 100 million dollar offer method in 18 months of business alex went from 550 000 to 28 million in the previous three years alex has taken home 1.2 million in profit every single month not year you guys month alex didn't start out this way he started out as a small gym owner struggling in the early days with competition forcing him to sleep on the floor of his own gym because he was unable to afford rent anywhere else eventually alex started to learn and implement systems in his gym to add ten thousand dollars a month to his revenue and over time he became the owner of six gyms while everyone else was going out of business once other gym owners saw alex's success they started asking him how he did it he quickly recognized an opportunity to help existing gym owners by sharing everything he learned the this company called gym launch was born in 2017 and it didn't take long for that business to take off alex and his wife started out traveling from gym to gym helping owners build more sustainable businesses gym launch continued to grow to over 24 million dollars per year with over 40 employees servicing thousands of gyms and making over 37 gym owners millionaires using his consulting and methodology alex reinvested everything into another business that would further support gem owners thus prestige labs was launched in 2019. prestige lab started out as a supplement company but quickly grew into another product line in 2019 they launched done-for-you meals alex's vision was to give gym owners the tools not only to get their clients better results but also make the gym owners more money through commission unlike everyone else alex didn't have great funnels great ads or a wealthy niche in fact he didn't even send emails until he'd crossed 50 million dollars in sales what's his superpower alex creates offers so damn good that people people feel felt stupid for saying no today alex has generated over 120 million across four different industries service ecom software and brick or mortar and we're going to talk to alex about creating the best offer for your business that you could possibly have so you can charge a lot more than you currently are you can make products so good the prospects find a way to pay you and enhance your offer so much prospects buy without hesitating he's on the podcast today alex welcome to the show man how are you good thank you for having me it's a it's a very nice introduction to it i i think i hope you can too no i think you really can um some quite often we get people on the podcast and i do a really good intro for them and they're like man chris i need to bring you along so you can open up for me when i speak and do speaking engages and um yeah but welcome to the show man i i just got done with your book 100 million dollar offers fantastic book read it in a weekend so anybody that uh that likes a good quick in-depth read um check it out and it's in layman terms it's third grade third grade reading levels so thank you for very much for that and it's sketched out really simply so we can all figure out and we can apply it to our businesses and i actually went through and kind of created an offer of myself as we do in the book it's kind of an exercise go-to sort of thing so so yeah i love the book and um we've got an audience here we've got great people to chat with and and i think like the the best point to start is just how you know where did you let's talk about your background where did you get your start at like where did all where'd it all come from um i had so i mean i i went to vanderbilt um i graduated in three years uh magnetic mladi only reason bring that up is because i feel like a lot of entrepreneurs who actually did okay in school um somehow feel like ostracized by the entrepreneurs who didn't do well in school oh yeah yeah do you go to college or not to go to college sort of thing yeah we're like and i i'm actually very against going to college um nowadays if you want to be an entrepreneur but uh i think there's like you can also be good at school and become an entrepreneur as well and i feel like it's it's been it's been so the pendulum swung so far the other way that's like if school didn't fail you then you can't be an entrepreneur um so i don't know if that's really true um but yeah i did that and then i became a management consultant um i was between that and investment banking and i thought management consulting sounded cooler um and i it might still be cool i have no idea uh but the two years that i did was was not ideal for me i didn't really enjoy it that much um and it was uh only in facing my own desire to stop living um that i was like you know i think there are other things i could do that would not make me want to feel this way or would at least give me some chance of not feeling this way as much and so um i quit my job and then i emailed 40 gym owners because i knew i liked fitness one guy got back to me and then i drove my car 36 hours from where i was to where he was and i sold everything i had before leaving and so that was what uh kind of got me into the gym industry and that was uh that was the first business that i had was um was the gym and so uh from there i you know really struggled to figure out how to sell stuff um i was it was hard for me to even give away memberships and i was like i gotta figure something else out because this is way too hard and so um i thought about you know and this was honestly a combination of me talking to lots of gym owners and luckily i didn't have any friends or a girlfriend or a wife or a dog i had nothing and i didn't know anybody in the area because i moved across the country and so as a result i had a lot of time and so with that i used every hour i could to drive and visit gyms and visit other gym owners and learn what they were doing and you know piece by piece i was able to assemble a better business um you know i tried the stuff the stuff that was good i used stuff that didn't didn't work for me or whatever i i cast out and over time were able to grow the business into an actual business i think by month nine i had the whole gym outsourced um and then every six months after that i opened a new location off cash flow and that was kind of what what started to create the reputation for me um was was opening each gym at full capacity on day one which is actually pretty interesting i explain how i did that but um and that was kind of what gave me some notoriety and um but i i invested every dollar back that i was making into new locations and then i ended up i think in the book i allude to it i ended up losing all the money from selling my gyms um shortly thereafter so i basically had four years of my life that almost just disappeared within a matter of like 30 days which was awesome highly recommend um for interpersonal growth um but what i was stuck with or left with were the skills and the beliefs and the character traits and so i think that those are the those are the things that we collect as entrepreneurs far more than the assets we accumulate um and i think ultimately that was why the next thing that i did was so successful and then you know everything after that has been pretty good how old were you at the time when you started that first gym 23. okay and you met you said you sold some of the gyms and then lost all of that what what was that like for you um when you sold the gyms and then lost all of that i know pretty much all entrepreneurs that reach a decent level of success lose a [ __ ] ton of money right it's just kind of like you're going to have to lose a lot of money sometime in your life if you're going to be an entrepreneur right so so as a young guy like what was it like for you and if you want to share like how much money was it oh i mean it wasn't a ton i think it was like it was like a hundred grand maybe 150 grand but it was everything i had that's a lot for somebody in their mid-20s right yeah um and so it was yeah it was just it was it was i mean it was miserable um but i think what it was so it was i don't know how if i can describe this the right way but it was so painful because it was like the only thing that i felt like i had to show for it that it forced me to think differently about what i had to show for it and so in thinking differently to cope with the pain i think i made better realizations about what i actually had to show for it which is all the skills that i had and i think that that is if there's anything that i can pass to entrepreneurs it's like the entrepreneurial journey is far more about the the character traits of skills and beliefs that we collect along the way than it is about actual business that we work on and i i have a saying that i like a lot which is like the work works on you more than you work on it um and i think that that is very true and if we if we see it that way then it means the work itself is the is the result um and then it it releases us from the outcome-based thinking that ends up destroying our businesses because it forces us to think longer um because we already have achieved the outcome by doing the work i love how you put that i love how you put that and it's so true too because like once in my life i was donating plasma and eating cans of corn and green beans for dinner you know and i was like you know one day i'm still going to help people and i'm going to keep doing this entrepreneur thing even though it's it's it's not easy so that takes us to so you you had the one gym sold it lost a bunch of money and then um i had six gyms you had six sold all six of them and then lost a bunch of money right yes and then in that money where did that go what were we reinvesting into other business ideas yeah so that was part of how i lost it so um i also fire sold so this all of these kind of so people like to tell linear stories but they were much more mushy i mean like that thing started and ended as all entrepreneurs at the same time and so um you know my gym launch started in april of 2016 um is when i founded the business um and then i spent that year flying around and launching gyms right actually doing gender rounds but i still owned my gyms at that point okay and so i you know so it's a little more a little more muddled right um and at the same time i had when i started gym launch i i that i think the month before i started it i joined um russell brunson's inner circle was like five years ago yeah and i got up and i was like hey this is how i feel gyms this is how this my plan to get from six locations to ten locations i already have the locations picked out and i wanted to be like america's gym so i owned united fitness and that was kind of the plan and so um the biggest gift that he gave me and i've said this many times um is that he shifted my perspective and he said alex i think you're really good at this i think you have a level 10 skill set in a level two opportunity and um that hit me really hard but i was like huh he's like i don't think you should be running gyms i think should be teaching people how to do what you do and so um that was kind of the first kind of pivot and that was what took me from running the six and then moving to selling them all within the next you know six months or so um got it so that obviously was really hard for me because it was everything that i built at that point and it was completely shifting my vision for what i wanted my life to look like um but i'm a big believer that you know if you pay someone for mentorship if i do not listen then i might as well earn the money uh and so you're paying someone for advice and you'll take the advice a good a good use i mean that being said take it with you know green assault etc but i think what he said made sense to me and so um i took the i took the plunge so you said too you were so busy like you and your wife were so busy i think girlfriend or fiance at the time flying around non-stop that you you're almost forced to to start you know saying here you do it on your own i'll teach you and and figure it out right like you know that happens to a lot of us because we we're running these businesses they turn into jobs for us and then it's just to the point of frustration where we're like we have to hire somebody or we have to tell somebody to do it on your own i'm still going to charge you but i'll walk you through it but i can't be there in person sort of deal i can't hold your hand anymore the way that you were right we um it's that that's a that's a much cleaner uh version of yeah yeah okay okay what ended up happening was um we were launching gyms for honestly the dates are muddled for me i think the first one was like may of 16 and i think last one was march of or april maybe it was april of 7th so it was about a year-ish um but it felt like longer because it took me before i did the first gym i had to like find the first gyms and then set the dates and so it's like and then i had was dealing with stuff afterwards so it felt more like 18 months but um we we were launching the gyms and there was a week where two of the six or two of the seven gyms are something that we had launched that month the gym owners had gotten up on like their stools in the middle of the classes that we had just packed and just told everyone to just refund and go home and so the issue was i was the one who controlled the processing so i processed sales that we had generated for those facilities and so i got a hundred and fifty thousand dollars in refunds in about a week between two facilities and so that was about all the profit i had at that point because i just started again at zero like not that long ago um after losing everything the first time so this is really just me losing everything again um and so i was like you know what i'm i think i'm done with the gym industry like it's been a ride i was just like emotionally tired of it and so we were really good at selling weight loss obviously and so layla who was my girlfriend at the time she had a little a little weight loss business like coaching online i said how about i just direct all my attention to this let's see if we can scale it and just go direct to consumer and so within about 14 days we're doing a thousand bucks a day selling digital products 14 days yeah wow i mean amazing what happens when your ass is against the wall and you need to do [ __ ] um so it started working so i was like okay cool i'll take the eight sales guys that we got on the road we'll bring each of them in we can do a thousand day each we'll do 8 000 a day or 240 a month this could work you know like we can do this and so that was the plan and so um i had eight gyms that were supposed to launch the next month so eight guys who fly out and we do the turnarounds are on all of them it wasn't just layla and how we scaled the team up um and so when we were launching uh i called those gyms up and said hey you know um we're not gonna be doing this right and the first guy was like dude i need this i just mortgaged my house again like i maxed out my credit cards like i need this to work yeah um and i was like dude i'm not i'm not coming out i'm sorry and um he's like please help me somewhere and so that was when i was like well i thought you know what i'll i'll show you what i'm doing but i'm not gonna fly out there to save your ass if you can't sell i'll show you how to do it and he was like okay that's fine that's fair uh how much and i picked the highest number i could think of at the time because i didn't want to do it and so this was i ended up unlocking high ticket pricing by accident because i didn't want to do it and so at the time just to give you perspective the highest price i could think of at the time was six thousand dollars and so i said for six grand i'll i'll i'll show you how to do it and he was like okay and i was like i just like i remember like looking at the phone and and i was like holy cow and then i and i so then i called the next gym that i was supposed to to to get rid of you know like to not launch um at the same conversation he was like how much and i was like eight grand and he was like okay and i was like holy [ __ ] the next call same thing i was like 10 grand he was like holy you know he said yes the next call i did was 12 grand and he was like yeah and i was like this is unbelievable and so we made um i ended up making 60 grand that day um and i remember looking at layla and i was like i think we're still in the gym business i was like i think we're just doing it wrong and so over the next two days i didn't sleep and i made everything that that i that was missing from my because i already had a training for the gym owners for after we left on how to manage the clients and how to upsell them all that kind of stuff then i had the sales training for my team on how to sell the memberships because i had them i they needed to be able to sell uh because i was pumping real money at them and like spending hotel airfare rental car food ad spend commissions every day i was spending 3 300 today as you know from the book and so i needed them to be successful so the sales training is still one of the core sales trainings it's like the training that i had for those guys was a good sales training uh because it worked and so um anyway uh i had to just create the other aspect of it which is like how to generate the demand what the ads look like how to market it et cetera and so um each of those gyms made thirty thousand dollars on average in their first thirty days um and then that's when it just blew up and then yeah you know we had more demand than we knew what to do with um i called the other 30-something gyms that we had launched over the last year i was like hey remember that thing i did where i filled your gym up i was like you want me to show you how i did it they were like okay and so i just resold all those the next month and then and then just the the word of mouth was huge and i think it's well um professor bergerman who's the mba from stanford uh bergamo trap um talks about it's more dangerous to not know why you are successful than to fail and know why you failed and um i think what i think being the subject of a lot of uh screw not scrutiny um uh interest a lot of people have have have cast their opinions about why we were successful and i think what is wildly undervalued um is that our product was exceptional and i think that is what people do not understand in the internet space as a whole if you can call it a space um is that there is an over emphasis on promotion and an underemphasis on product right and if you have a good product the amount that you get back from your promotions are significantly higher and what i find ironic is that the book that i wrote is not a marketing book it's a product book um but it is marketers who are reading it right the book is a product doesn't talk about how to get leads it doesn't talk about messaging it doesn't talk about copy headlines literally talks about how to make a product yeah but no but there are no product books in the marketing space and so it's like for a lot of people it's like this brand it's like the product is a thing right it's a marketing title right that catches them and gets them in just like yeah yeah go ahead and so that's the and so um that is what is still to the state and as i've continued to weather and and age as an entrepreneur uh the business that we look for now to invest in as a part of acquisition.com are companies that have superior value propositions like how good is the thing if the thing is good um then it's very easy for me to build all the other stuff around it was that the same timeline when that started to take off on that side when you went from 550k to 28 million or was that the the year following that later so time would be did um 2018 we did 28 million and 17 million dollars in profit as a 28 year old so um it's not lost on me it's nuts and then the next year we did 37 million i think we did 13.5 million in profit that was when i started the supplement company so i invested in all the inventory all that kind of stuff i also made one really massive pricing mistake which cost me about four million dollars which sucked which i can happy to talk about if you want and then 2020 uh we started we at the end of 19 in the beginning of 2020 we started allen which is our software company we actually um yeah throw the software company um and uh scaled that to just under two million a month within the first six months and then um and then in the middle of kind of 2020 is when we started acquisition.com um and that was that was the that was when we started it now we have um three companies outside of the companies that i own um explicitly that are in that portfolio yeah before we move on because i want to start to dissect the book but um i want to ask you and i talk i ask a lot of entrepreneurs this but it's fascinating to see so much rapid growth in somebody's timeline because i think mindset wise so many of so many people out there just get stuck at like the six figure mindset or maybe half a million mindset or seven figures or or you know even eight figures right and and and you were almost forced to kind of blow that mindset out just by circumstances but what do you think are some of the best things that you did throughout your timeline to help you shift your mindset rapidly and then accept that oh i'm an eight-figure entrepreneur right now i'm a nine-figure entrepreneur right now what any any any any things that happened or any tidbits or or tips you got from anybody or courses or mentors or anything that really kind of kind of helped you through that so interestingly like i've never it was just funny you said that i've never identified as a quote eight-figure entrepreneur or a like i've never said those words like in my entire life right i've never even um and so that just figured out at least address that um but i'm actually a big believer in the theory of constraint and so it's i think what appears quick to the outside fast from the outside feels like clarity from the inside right and so when you're inside of this it's are we clear on the one thing we need to be focused on right now what feels what what feels fast on the inside is slow on the outside it feels like everything's so frenetic and of all these things i have to do and if you have all these things you have to do and you're not prioritizing and i think that ultimately like all of us are all given more or less the same resources we're most people here in a developed country most people have access to the internet we have access the same information we have access the amount of time and so why is it that some people are able to outperform others and it's because of how they prioritize their time and um or rather the actions that they do and so when i look back on 99 of the decisions that i've made in the last year almost none of them mattered um but the one percent of decisions that did matter are the ones that a lot of leverage on and so um i think you had the original question was how how do you break that mindset of like speed etc um i think i focus not on what the outcome is but is what is the constraint that is stopping us from growing right now and so i think if we ask better questions we'll get better answers and most people don't even ask the question which is um if i'm at a hundred thousand a year what is stopping me from being at a million dollars a year what is stopping me from being at 10 million a year and um i do like grant cardone's concept of the whole 10x thing and i think i like it because it forces us to ask better questions if you say how do i double you're going to get doubling answers if you say how do i 10x the answers are different because you can't do twice as much you can't start you can't do 10 times as much as what you're doing you have to think differently and so i think that when we ask those types of questions then we'll be able to answer them and have those better answers and then execute on them and i think that the actual drive though which is different than what you're asking but i think still equally important is that for me um i was just incredibly insecure and really wanted to be untouchable from all angles mostly just to protect myself because i think i'm soft on the inside and so i try to portray as much unbeatableness as i possibly can mostly so people just leave me alone mm-hmm for me that pain is what drove me right um i think that i think people are driven proportional to their perceived pain irrelevant from what actually occurred in whatever created who they are i think everybody's had quote uh you know difficult times in their lives most people have difficult childhoods and that's because you're a child in the real world with no coping mechanism so of course it's hard for you right um but we all experienced that and then the question is to what depth did we experience that pain and then what did we use that pain for or did that pain use us have you targeted what what that pain is for you exactly and oh yeah for me 100 was approved for my father that i didn't think i was good yeah and and as you've gone through this journey have you learned to accept that that pain more um or come to terms with it or even let go of it or i think that over over my so i had to i had to go from pain to numb um and then from numb to selectively turning on emotions again um and that was probably a a four-ish year process no that's not true it's probably more like an eight-year process so i'm thinking about from gym launch so from the original me starting my gyms until maybe like a year or two ago um it was it was rage that that built the gyms and it was fear that built gym launch and i would say that ego probably built the software company and then i think acquisition.com finally um is coming from a place of abundance and i'll define abundance because i think people throw the word out a lot right but abundance is as i define it you need nothing it's not about how much you have it's about how little you need and so i think that you can be abundant because by definition if you need nothing then everything is in excess which allows you to give because i don't need anything in return yeah and sometimes it takes all that trial and error and fear and rage to get to a place of abundance right to really know how to tap into it and appreciate it mind you i made millions of dollars off fear and pain so like i'm not saying that it is not an effective means of motivation and i think another interesting thing is that people don't know the difference between motivation and fear and what happened that's interesting at some point some of you hopefully will experience this is that when fear disappears motivation actually feels different and i don't think i'd ever felt motivated until maybe recently because it was still fear that drove me so like that that that thing inside of you that's like i gotta start working that's usually fear not motivation right it's fear of some sort of failure insecurity or judgment or whatever your thing is so how do you know like if you're feeling uh fear and not motivated like do you have a do you have something you do to switch like you wake up in the morning you're feeling fear you've got to do this this this this um is there something you do that can help you switch on a regular basis i don't feel i don't feel fear nearly as frequently now that could be because i have put real world totems in place that kind of quell those fears and insecurities so it's like so like just being real for a second right it's like i look the way i look right i'm very wealthy i'm young i have an attractive wife um whom i enjoy and so i check off all of the boxes that i think that are important for perception and i think that i could stand here and say ah it's because i'm so secure now or i just quality insecurities with changing the environment in which i live so that i can just continue to function and have real evidence to contract or contradict the fears or insecurities that i speak to myself in my head um well put all right i love this but we've got to dissect the book let's talk about offers we got some listeners that want to talk about offers um so your book you have three or four main sections pricing value creating uh your value creating your offer enhancing your offer and an execution and starting off the the the thing that pulls people in from the book you end up talking about product but you're tired you start talking about how to make an offer so good that people feel stupid to say no and me personally i've experienced this um a handful of times when the offer is so good just people walk away just feeling really you know silly for not buying it right now and i think that's what we're all trying to get at but some of us aren't that great at creating offers and you call that a grand slam offer and and i love this part in the book alex i actually wrote it down while i was reading it but you said no offer no business no life bad offer negative profit no business miserable life decent offer no profit stagnating business stagnating life good offer some product okay business okay life grand slam offer fantastic product uh fantastic profit insane business in freedom and it's never been like cut out like that for me before and i've been an entrepreneur for over a decade right and i've never seen offers laid out in that description so it was really eye-opening eye-opening for me so so maybe if we can just dive into exactly what a grand slam offer is and how some of how the people out there can really start to form their own in a better way so i think it's useful from uh from a thought perspective to to show extremes um and then kind of walk backwards from there so if i wanted to so let's if we wanted to start with the query um i want everyone to say yes right so what would i have to say to get everyone to say yes and so let's say i was selling a make money off them right which fundamentally anybody who's b2b is selling to make money right it's just down and said differently but more or less that's what it is and so if i were to say cool um i guarantee you that you will make twice as much money as you do now um in 30 days or i will pay you all of the money that you paid me plus twice as much back right and you don't have to do anything besides buy today um most people would say yes to that right and so the question is if we if that's the offer someone say yes to is there and then the other offer is pay me right now i give you no promises there's nothing you might experience an outcome you may not right you're gonna have to do a lot of work and it's gonna be really painful for you if that's the other extreme is there a point in between here and here that's closer to this side that we can um do that will get people to buy and that we can fulfill and so i think that that's kind of the thought experiment is like i would start here and then just walk back as few steps as i can until i find something that i feel like i can fill on that i know most people will say yes to and so the components of each of those things is what's kind of outlined in the book and so um the first section of the book is around pricing because i think a lot of times most entrepreneurs like there's four major marketplace i don't talk about this in the book but there's four marketplaces that exist within within like pricing strategy you've got at the top you have luxury then you have premium then you have low cost and you have ultra low cost ultra low cost is like third world country like 99 cent book that i have ultra low cost right uh low cost is walmart it's amazon is target right uh premium is uh bmw mercedes right audi those are premium luxury is rolls royce right and so the i mean i probably should have just done all car examples there but it would like the the lowest one would be like uh cars they don't even sell here in america and only sell for like under four thousand dollars in india yeah i mean like that would like they don't even exist here and then we only have like the pinto or whatever you know that way right and so the idea is that it's not that i want i want to just color this for a second the reason i give the broad advice of raising prices is that for most businesses they're not going to win unless they're a more complex entrepreneur that's funded etc right which most of us are not um with some sort of ultra low cost strategy because they can acquire market share etc most people normal service to a normal avatar and if that is you then you don't occupy any of the four spaces and if you're selling a normal product to normal avatar you're probably not intentioning to create a luxury business which is one where the more someone pays the more status they have which you may think that because you are expensive you are a luxury but you are not right so it's clear like demand should go up when you increase the price and that's not the case for most people and so the idea is if you're in the normal then you need to decide whether you're going to be low cost whether you're going to be walmart or you're going to be premium like you're going to be bmw right that's the decision most businesses need to make and most of them try and do something a little bit more for a little bit less and they find themselves in the middle which a consumer does not understand and so we have to decide what we're going to be and i think that if you're going to be the low-cost leader there can only be one or two per marketplace and so unless you have a very strong operational background and you've dedicated all of your effort to how can we optimize costs and pass on those savings to the customer so we can give the the highest value per dollar then the only kind of reasonable alternative besides that is to become a premium leader and so i don't describe that in the book but that is the reasoning behind the the broad the broad brushstroke recommendation of just becoming a premium leader which means you have to increase your price and the benefits of increasing the price are that you're going to attract more qualified customers and when you attract more qualified customers your product even if you don't change it will increase in its quality if i attract uh people who are doing a million dollars a year and i try and help them go from one million to two million it's significantly easier than helping someone go from zero to ten thousand dollars a month right right because it already has all these other things and so i might have the exact same product let's say it's how to run facebook ads which i think is the most commoditized thing in the world but you get the idea right so if i how to run facebook ads and i'm trying to consume to go from zero to ten thousand dollars a month it's much harder and my product will not do nearly as well or provide nearly the value as it might to somebody who's doing a million dollars they get one thing from it and it boosts them by 25 percent it's 250 000. so for them i can in a real way provide more value and my product was more valuable because of the prospect that i'm choosing to sell to and so that was kind of the idea behind the the pricing component of this and then when we have more pricing power we can spend more in the acquisition we can spend more in the fulfillment and then fulfill the promises that we're making and then actually feel like we're we're we're making the impact that many of us want to have when the reverse of that is you have less profit left over you have to cut down on your expenses you provide less value and then in so doing you lose conviction then ultimately burn out so you have one quote in the book alex and it applies to this where you say there's absolutely no benefit of being the second highest um the second cheapest uh service or product in that industry or in that niche but there's a ton of benefit of being the most expensive right and this is and i guess that would regard both premium and luxury areas of of price range okay cool and and and that's where you decided you wanted to be uh using that method basically you decided you wanted to be the most expensive company out there that helps gyms launch your businesses right makes sense so much so that people have to stay they have to pause and think wow this is so much more expensive than everything else i've seen something different must be going on here and in so doing you can use price even as a as a primary signal to a prospect that you are different like price in itself can be a differentiator even in the opposite direction right that makes sense uh but then you still have to deliver on the back side of it or you'll lose business eventually like that's the only way to sustain it right so so i guess the next part of pricing is is finding the starving crowd and so and you dissect this in the book as well so the starving crowd being a crowd that you know the hot dog stand outside of the baseball stadium at midnight or whatever and people are really really hungry and there's no other food and um it seems like you kind of almost naturally kind of dropped into a starving crowd and this is just from what i know from you of the book i could be completely wrong about that but i see a lot of entrepreneurs that that struggle finding a starving crowd or here's the other thing they kind of get their their ego or their concept of themselves wrapped up in a non-starving crowd and they continue to build a business that's that is for a non-starving crowd and maybe a crowd that's really you know fat and hungry they don't even need your service right so so let's hone in let's talk about how people can find a more starving crowd so four components um which are in the book is one is that if like what are the components of this right of a starving crowd and it's not always going to be perfect but i at the very least want to make sure that i'm not in a dying market right so the first is is it a growing market is this market either growing at the pace of the marketplace or growing faster right if it's growing faster that's plus right if it's just growing the same then i just consider that a neutral point and if it's shrinking then that's something that i'm going to say is a red flag and i might not want to be a part of it so an example of a shrinking industry would be newspapers right which i think for example in the book and a friend of mine had that had that business um an example of a growing market might be cannabis right it's growing faster than the marketplace because it's meaning the demand right and you use the 99 real quick nine percent rule as whether it's growing or dying is that yeah okay so nine percent what the stock market returns on a reg on average on a regular basis and so yeah and so if if the if you're not making more than nine percent a year you're not growing you're dying correct yeah yeah okay exactly yeah and so that's the that's the growing component um the second is do they have buying power right um it's the difference let's say i was a relationship i changed this example in the book it's like if i were a relationship coach i would rather deal with uh you know finding your second half of life love with old timers then uh uh well not alzheimer's for old timers um then uh then like find a hookup made in college because that that marketplace has more purchasing power even though the problem is the same so i'd rather deal with that um the third component is are they easy to find and this one's important um because this is more of a tactical example but like if you can't find your market or they're just more difficult to find um they don't have associations they don't have lists now nowadays with the internet it just usually just takes a little bit of ingenuity and sometimes that can be a competitive advantage if you find something that might be a little bit harder to find but you find a way to contact those people then that can be that that can be like secret sauce for you um but i want to make sure that i have a way that i can easily target them um and ideally a way to target them that is cost effective right and so um i was trying to assure the visual in this puppy um for for our uh for our growing marketplace maybe i can find it it's my book i should probably know where it is um here it is so for everyone who's watching so you've got um and i'll get to this one last but you've got the pain you've got the purging power you're easy to target and that they're growing right and so i'm doing these in reverse order but pain is the is the last but also maybe the most important one which is i don't want them to be aroused by what i'm saying i want them to be ravenous um for the thing that i himself right and that comes down to timing so right now if you're asked is the gym owner market um a starving market i would say maybe in that they have pain but overall i think they tend to be jaded by the fact that like a hundred other gym launched copies have come in um to the marketplace not delivering on the promising but still trying to keep our premium pricing um and so i think timing matters right timing matters a lot when it comes to these things and i think we also um to a large degree had a lot of our success because the timing was good um and as much as people want to be like oh it was all our entrepreneurial prowess i think part of it was timing i think there was a lot of things that you know facebook ads were cheap uh clickfunnels had just started um you know what i mean like there was there was no one really doing what we were doing at that time and so a lot of those things volapalooza together to create a really outsized outcome yeah but from a marketplace standpoint if everyone here is looking at their niche that they're trying to find which is probably the next point and the pricing is that we want to find a niche and um if you want i can go through that pricing example because i think it's powerful i'd love to yeah so right now i use weight loss a lot partially because i come from that background but also because everyone understands it um if i were selling a generic wait actually no that's not the example in the book i'll use it i'll use a weight loss example do something different so if i had a generic weight loss product right i might be able to sell that product for like 19 to find an e-book on weight loss right that would be just as mark is just weight loss right there's nothing crazy about it if i were to niche down and say um i want to do weight loss for women then it might be something that it's only for women that i might be able to charge maybe 99 for that same thing right if i were to say i want to work with women who are nurses or shift workers um and help them lose weight and this diet plan is specifically for that type of woman then it might be a 500 thing right and then if i said i'm working with uh shift working nurses um between the ages of 35 and 55 um in you know highly urban areas or something you know whatever um then the pricing power of that thing might be a 2000 price for the same thing and ultimately the ebook is going to say stop eating [ __ ] and move but the thing is is that the prospect will perceive the solution is far more tailored to them and the messaging can so clearly articulate their pain in a way that they feel understood and if we can talk in that way then they would a very real way get more convicted that the product is going to work for them and then in a very real way we'll get and receive more value from the product because they perceived it as being tailored to them and so we can take the same product a weight loss ebook and make it 200 times the price or whatever a hundred times as expensive as it was before simply by niching down and selecting a market that we believe now in that example that i would say that's an easy one to find they have purchasing power because they would be nurses so they probably you know they're making 70 to 110 000 a year um they're in pain because they're overweight right and they and they have a lot of other pains of like their time and their scheduling and all the other pains i would try and hit on um and they're easy to target right and so i they would check all the boxes i'm sorry they might not be growing but i would say they're growing at the pace of the marketplace i don't know if maybe maybe nurses are in a lot of demand right now okay so who knows that might for right now it might actually be a growing market um but that would be the idea it's like okay if i'm looking at this and i'm currently selling weight loss or selling it to everyone how can i sell it to one person um and how do i pick that person well and a lot of times i feel like entrepreneur entrepreneurship is very counterintuitive which is why a lot of people don't succeed at it it's like you have to give more in order to get more it's backwards yeah yeah people think it's all about asking it's all about giving right um you have to say who you're not serving in order to find who you are going to serve right and so strategies are about saying what we're not going to do rather than we are going to do and so there's lots of lessons like that that are belief shifts that i think are important in the entrepreneurial journey and the first one begins with who we're going to sell our thing to yes that makes sense that makes sense okay um there's once okay we can dissect this more but there's one story that i i think in the book you shared really well how people created um grand slam offers and it's when you went to arnold schwarzenegger's house i believe for the first time and you were there for his charity event which you're now i think you're a board member of this charity all-stars um what was all-stars i forgot the name after school all-stars yeah that's right and you went and you don't i think you donated a million dollars or something and you were just rubbing shoulders with all these really impressive people what were some of the things that they were doing i think they ended up raising 5 million at that auction or something like that what were some of the things that they were doing that the the entrepreneurs out there can can use um to get these really high prices and um for a product that they perceive is really worth it and and apply it to our own businesses so i'll add a little bit of color to this that i i cause whenever you write a book there's always i could have said this here i could have added this right yeah that they did um that i would i would add into an updated version which i'll probably do later um is that philanthropy in of itself is something that can help you command high premiums or you'll get a you'll have more people will buy things if they get because what happens is in a real way they're getting more value because they're getting value from the product and they're getting the value from feeling good about donating something and so there's two types of value that they're getting and with philanthropy the more you give the more you get that value in terms of how much you gain now i'll tell you this it's not proportional but um but anyways uh they had a philanthropic edge which made everything everyone always feel good and they're in the right mood there's and the biggest one this is what i kind of beginning begin the whole i use that story as the entrance to the chapter of enhancing the offer is that scarcity and urgency are two of the most powerful forces scarcity in my opinion being almost the most powerful um of forces that that produce pricing right and so um the story that i tell is uh i was there they introduced me to a guy named george he was one of the biggest donors um besides us and um they had told or george was in the hot he was a luxury good seller so he was selling million dollar two million dollar watches or timepieces as they call them um and he was a master of understanding scarcity and pricing and so he understood that there was more demand this year for attending the charity event and i think in the year prior they had sold um i want to say i can't remember what it was but it was a lot you know a few more tickets than they sold that year but for ten thousand dollars and so what he told them to do was with more demand to cut the supply he said so whenever demand goes up he said you cut supply and so by doing that they were able to two and a half x the price they charged for the tickets and they still sold out even faster and by doing that i just remember i tried to display it in the story in the book but like i remember how much it like it impacted me because i was like man like and this guy has made zillions of dollars understanding this one concept and i'm trying to give an example which is like if i were to say right now hey um i'm gonna do a workshop right for for 10 grand for five people i could probably have that filled in 60 seconds right if i made a post right um because i don't do that um but at the same time if i were to say i will take one person for as much as i you know as they were willing to pay me for a day um i've had people offer me 250 000 for a day um and so i would actually have made five times sorry 25 times the money or five times the money excuse me um by just selling that one person and still have the four other people who might have originally purchased for ten thousand dollars wanting to buy again later and as long as the first person gets an exceptional experience even more people would find out about it and the next time i might sell two tickets right and so the idea is how can we always stay ahead of our supply demand curve so that we always have fewer spaces than is demanded of us and so what happens for most entrepreneurs is that they have an itty-bitty minimum amount of demand and they immediately need to go for the ask right the idea is the longer you can delay the ask the more demand you can build up and then you just open up the door just a little bit and then close it that's a little bit closer right and by doing that that is how you can have unbelievable pricing power right right it doesn't work that's a that's a that's a service-based perspective obviously or if there's a one-time or limited edition but the thing is and i put the strategies in the book for for creating this kind of scarcity is that there are still ways and this is probably the most tactical one that i can give on here is that right now um if you have a client based business and i were to say i'm gonna send you a thousand customers like you have tomorrow you would probably not be able to pick a number but that i'm just using that as an extreme example for most people so most people probably have a certain amount that they could probably maximally handle and do a good job and so the ethical way of showing and creating scarcity is just actually saying what your limit is and so if you normally can handle let's say five clients a week then just saying that five clients a week is your limit and then actually enforcing that limit and this is the thing that people [ __ ] up and actually enforcing them or even limiting it to three and then increasing the price so you have fewer people to service you have less operational cost and more margin because again the goal is not to sell the most people but to make the most money right right with that right we can then after we tell the first person we're like we have two spots left for the week and after we throw the second person like this is the last spot i got a handful more calls and you are being truthful and so you put a genuine dem uh scarcity line and here's the cool thing is that next week you can change it to four yeah but if you just as long as you ethically stick with the line that you draw you can always say exactly the amount of spaces that you left which is normally what you hit anyways but it creates the perception of scarcity which can can get more people to buy when they otherwise might not yeah it's so difficult too like it's appealing there's a carrot in front of the horse's mouth and you're like oh one more client an extra five thousand ten thousand dollars i can handle it as opposed to just saying no this is where i'm going to limit myself and then scale that but it's it's difficult for people to do i can put you on the waiting list for next week if you want yes yeah that's a good way and then as soon as you text them next week what do you think is going to happen they're like [ __ ] yeah i'm in it's like yeah we ran right or next month whatever um i want to dive more into uh the last part of the book execution but we're going to leave that for the end of the podcast we've got some audience q a right now so we're going to bring some of the guys in that want to ask you some questions aaron nunez hop on in buddy turn on your video and your audio and then you can uh say hello to alex and go ahead and ask alex what's up i've been a huge fan for a couple years now read a bunch of stuff i love your youtube videos uh i just wanted you to dive into if you can get into more specific and how you removed yourself from your from gym launch as a personal brand i got a ton of questions around that like one it looked like i i saw an ad it looked like you basically brought in another guy to replace you as the face of the company and why did you choose that instead of just like a company brand and then not only that what was it what was it compensated how did you take over like how did you manage the research and development i imagine jim launches a lot of research and development like how did you put that into the operations and then not only like where the like i know you said profits went from like 16 million to 8 million like where did that go did that go to like is it decreased revenue or just your profit sharing it out or what did that look like it's a good question um so there was a lot of there so i'll try and start at the top um well i'll start backwards you know what i'll do in whatever order it comes to mine so to answer the profit question part of that was because we just got kicked in the nuts with covet so i think that the i think the decrease would have been significantly less if we were not brick and mortar gyms during covet for that year right so i think it's somewhat unfair to say that the team was somehow half as effective as they were otherwise um but during that period of time um we still did do you know all the replacements that i was referencing the individual that you're talking about has been with us for five years and was a customer first so he's been in our world for almost five or six years now right and so uh he was a customer did the experience turned his stream around sold his gym successfully came on board as a sales guy became a sales manager then became general manager of the whole company and so he's been getting groomed this whole time right um for this and then at a certain point i think the entrepreneurial journey in general is a relinquishing of control right and so a lot of it comes from the emotional side of the entrepreneurs that we have this desire to control things and have things in our way when you have to get over that right it's hard that's why most people don't do it so that's hard they always want to jump back in it'd be so much easier if i just did it myself it's like yeah it would be but you'd also continue to always do it yourself until someday you let someone else do it from a compensation perspective the executives in my company have phantom stock and so they get a percentage of stock every year which is you know usually generally so i'm not going to share their compensation but i'll say in general rule of thumb um it depends on the size of the company obviously but you can usually have like a a half a percent or a one percent per year vesting uh with a one year cliff what that means is that they don't get anything for the first year and then after that first year they'll get that first percent and then every quarter thereafter they'll get you know 0.25 or or i'm just using fake numbers here but that that would be the idea um and then after that you cap that at like year three or four and then the idea is if they have three percent of the company after four years because they have one year that they had to earn it um then after that that like the the growth of the company itself is going to be where they're going to gain like their three percent will become more valuable if the company's twice as valuable right um and so that is and obviously they had they have they have bonuses and they have um uh and the bonuses we split between company performance and individual performance so we try and split those 50 50. so i'm gonna i'll give you round numbers um just for illustration's sake so let's say it's let's say the person is making uh 200 thousand a year that's their targeted income right uh so 200 000 a year is what they're making 100 000 a year might be base 50k would be based on the company hitting company objectives and then 50k would be based on them hitting their personal objectives that they have sold control over so if the company does shitty then but they still hit all their stuff they get half of what they could otherwise have achieved on the flip side if they do a terrible job but then the company still crushes it they still probably had some if they're in a leadership level they still probably had some contribution to that and suddenly they would get the other 50 right and so but they'll have a base of you know whatever it is which is about half of their comp now that's going to be dependent on the type of person this is a conversation that you'd have with an executive some executives are more uh risk-averse and some are more entrepreneurial and want to have the higher upside potential for higher downside um so it really depends on their appetite for risk uh and that's more of an individual conversation and figuring out what they value um a mentor of mine actually had an executive that he felt like you could never incentivize with money and then he finally had a long like long walk on the beach with him and he was like i just want my kids college to be paid for and so he just paid for all the guys college kids so like i think it's the incentives is far more about finding out what the thing is um that drives them more than one cookie cutter approach um but yeah and then in terms of how we turn it from a personal brand um into what i would consider now just a gym consulting company um is one is that people try and do it way too fast right like this was a like he had already been with us for three years and then it took about two years from when we said this is when we're gonna start to now where we're completely out um it took two years and it was like okay well alex is gonna go from taking five calls a week to taking three calls a week and then two months later it's gonna take two calls a week and then another month is one call a week and then it was okay well now i'm just taking calls for the higher level clients and then from there it's like okay i'm not taking i'm doing every other call right or then it became now i'm just doing the big release calls and then it was okay now i'm not on any client facing stuff but i'm still in the portal i'm still running the ads not me running this but i'm in charge of the marketing component of it it's like okay now we have someone else who's going to charge the marketing equipment and i'll just film ads four hours once a month right i'm telling you these are the transitions that we went through um and then it went from me not filming the ads at all which is where we are now um to finding someone else who can film this ads and then also what i what i call creating the gl marketing machine and so for us there are there's a lot of material that is consistently generated by our community which is good marketing material and so we have onboarding calls we have testimony you know we have coaching calls we have success calls that are recorded every single day um that we can we can slice and dice those things and they can tag them as like hey this is a good call and the marketing team can come in slice off the piece and then make that into an ad and all of that is consistently being generated without any effort and it's just about capturing and tagging it which is much easier and so by doing that worry about you've probably seen me have tons of testimonials that we've run for years right we've run new testimonials every month and it's because we have fresh testimonials to run and so that always works um because at the end of the day like the best kind of proof is social proof of other people just like the avatar and so um that is that is ultimately like kind of like the process that we went through and then and then once we were completely internal facing it was okay um now layla and i only talk to the two you know the three executives um in the company and we meet with them uh twice you know i meet with one of them for 30 minutes and then we meet with all of them for 90 minutes once a week and that's what it is now cool uh we have to bring in another question here erin if you have some more we'll circle back to you if we have some time so this very thorough man um okay davis you want to hop in davis nguyen yeah absolutely alex appreciate you coming on love the book as well as love your podcast that's why my gym routine is listening to like three episodes and continue on with that so funny thing i'll tell you management consulting at least i think it's cool just because our business actually helps people become management consultants we work with vanderbilt as one of our places where so my question for you is that i'm really looking forward to volume 2 where you talk about pricing models but for a service like mine which is placing students into managing consulting roles how would you think about the pricing on that one so if i were placing so are you so you you take okay so let me let me make sure i understand it properly so you go to elite schools you look for the people who didn't get jobs and say hey there's these lucrative you know career path here we've connected with bain mckins you know whoever you guys already have your um your consulting relations with and then you put them through what i would consider some sort of training that makes them more valuable than they currently are and then those companies are happy because you know that you've you've done a lot of the onboarding process for them so their cost of bringing them up to speed is probably a lot less and so they can start generating revenue from those people faster and they're a little bit more vetted um because you've taken them through whatever process you're taking them through am i understanding that correctly at a high level yes the only two things is that even for a mckinsey bain boss consulting group and so forth they'll still need to go through the interview process and getting the interview so what we do is we have a team of coaches who will help them polish their resumes help them with the interview and then they hopefully pass the number which we've gotten a good job of so far so still let me ask you more about that so is it are you selling them basically how to increase the likelihood that they get in into those into those businesses is that more what it is yes that's more of that okay got it no it's good for me to understand i wasn't sure if it was being sold we're finding the people who don't get in and then and then kind of selling it as an opportunity or it's like this is more of an improvement offer of what you're currently doing and make it more likely it's just it's an important distinction um okay so this is actually really similar to test prep which i um almost started instead of gyms because i love the test prep business unbelievable margins but anyways um so how do you position the offer there so the idea is i would i would i would have some sort of guarantee around the number of interviews that they'll get um if i can and you could make it a conditional base guarantee which is like um or we'll keep working with you until you get at least three interviews so that means that when you sign up you know that you're going to get this um no matter what whether it takes six months or it takes you know six years now obviously at a certain point they're gonna lose interest because they're not good enough but it still makes it still has some element of decreasing risk now that would be a conditional guarantee you can also stack that with a unconditional guarantee of um if you don't believe the value of our service in the first 30 days we'll give you all the money back anyways right and so then from a pricing perspective the question is are you selling to students are you telling your students parents we're selling to students but obviously most of them will go to their parents right okay cool so um there's a i mean there's a zillion different pricing models you can do with job placements so i mean you can do a percentage of their future income you can i mean there's lots of things you can do um i mean that's that that's limited only by your creativity um but i would probably have some sort of combination of front-end and back-end so front-end engagement to cover my fees and acquisition costs and then probably all my profit will be on the back yeah that's what we currently have right now and i'm thinking about switching it which is we collect one-third upfront so you're committed and two-thirds once you get the offer but after reading your book this weekend i was talking about the idea of huh what if we do the reverse which is we collect everything up front but if you don't get it after certain methods and so forth here's a refund yeah i mean you could do that too like these are these are the beautiful thing about testing these things you know what i mean um yeah i mean that's the like we just test stuff and i i tend to try and make the offer so good i'm scared and that's usually when i know it's right i love that i'm gonna call that helpful that's super helpful as a hey thanks chris cool thanks davis uh victoria's up next victoria hop on in hey alex really a pleasure talking to you big fan girl read all your books watch your youtubes as my morning inspiration every morning pretty much anyways um i have a question regarding um when you come into the companies because through your acquisition.com uh company you you basically buy a stock in the company and then you come and scale them so i'm wondering when you come into the company where do you start the transformation process do you start in the product in marketing in hiring proper team like how do you go about that it depends entirely on the business so i've i'll give you i've got two companies that one company i already have and one company that'll probably take equity in the next few months that are similar they're in the same space one of them is exceptionally good at acquisition and not very good at product and increasing ltv the other one is really good and has grown almost entirely off word of mouth but is really not good at acquisition so it just depends on kind of the point that i was making at chris earlier is that it depends on where the constraint is in the business and so we just try and focus on what is the one constraint what is the thing that is limiting the growth of this business and i think properly identifying that is where a lot of the expertise comes in because when you're on the inside of the business you have a hard time because you have so many things that are going on and so many things that you think aren't good because because the reality is a lot of things aren't good right i mean a lot of things are not perfect but the question is which of those things that is imperfect is the thing that is limiting the business and so which is what is the greatest fire that we have to put out first and then we put them out in reverse order um some some fires are more silent and some are more obvious so like um and a lot of times it's also like just differentiating between symptoms and causes right so for example a business might not be growing as fast as they want it to grow and they're like well i'm not getting a lot of customers and it might be a product issue and so that's where kind of judgement and discrimination on behalf of like our experience and having seen a lot of different businesses and whatnot comes into play it's like do we think this is a product issue or is this a marketing issue right or is this a team problem like you said um so it really kind of depends or is it a model issue like the first business i took on um uh was a photography company and uh the guy was like i have a working photography business they were doing 1.6 million a year out of just a single facility is 2000 feet i was like this is awesome and you take it from 300 000 to 1.6 million because of the gym launch book uh he just executed everything in the gym lunch book and photography business which i thought was funny um but anyways uh he had started his parallel business and he was doing i think 500 000 a year and mind you for everyone who's on here we don't take anyone at that size anymore like everything's five million enough but just let me continue the story and so um it was it was apparent that he was very good at the business but the model that he created was some sort of like semi-hybrid agency thing which like everyone tries to do and is really commoditized and generally shitty and i had no desire to be a part of it and so we reconfigured the entire model and now 14 months later it's doing 200 000 a week so they're doing 10 million so they just cracked a million and so um that was one where the team was right the marketing was great the product was great they just said they were just monetizing completely wrong and so we just had to restructure the model i have to change anything besides just here's here's how we're going to do money now rather than changing anything of the actual doingness of the business and so it really depends on the business like it really depends and i think that's where i mean that's candidly where a lot of the value that we we can provide comes in because we know where the bottleneck is and we can just de-block it and then move forward which is why the growth is so fast in some of the companies is because like um the like one of the companies i think will do 35 million this year they're 85 next year um that's my guess just that one company alone um and it's because like they just had this one thing that they didn't know how to do and we know how to do it really well which is build a massive scale sales team and so we're just installing a massive sales team which will allow them to four or five x their prices um and probably double or triple their conversion from the front end because they don't need to go to a purchase they can go to a call which will double or triple so i'll triple the volume and triple the price amazing do you have any like shortcut checklist that you go like this is good this is good this is not good let's start here i think i think of them in sequence um so it's more like let's start at the top of the funnel so how are people finding out about us so it's really like i just walk through the customer journey and trying to figure out where the whole thing is not enough people are finding out about this you know why and the or is that okay this is not good enough and when people do find out about it they don't want to they don't want to buy it and so you actually have you have a negative marketing campaign that's counteracting your positive marketing campaign that makes sense cool okay thank you i have more questions if there is time okay we'll we'll let's greg hop in victoria and circle back if we have some more time thank you victoria greg go ahead buddy hi alex my name is greg buddhist nice to see everybody um thanks a lot chris uh my name is greg i own a jewelry a company called the jewelry republic which is my b2c brand and i have my i have a factory here in thailand which is where i'm calling in from um so my question is regarding uh philanthropy and and working in the charity space i do run a profitable business but i want to i want to ask your thoughts from what you said earlier with working and regularly folk giving proceeds to a particular um you know maybe a non-profit so that i'm their partner and we work together and and obviously when i write them a check or give them some finances in a very loud and proud manner is it do you have any pro tips or any experience um with growing your business with a purpose i'd say acquisition.com is the first company that have grown with a purpose besides making money okay let me let me reverse that real quick so i think there patrick lincione has a book called um the advantage which is really good i highly recommend it and uh in the book he talks about there are six main reasons that you can start a business um and i'll try and remember all of them right now off the top of my head but one of them for example is like i want to better the community so you might be somebody who's like i'm starting an insurance business but it's because i want to i want to i want to help the latino community in this area right now i have that my insurance practice um you have that same insurance practice and be like i want my employees to all become wealthy right that's something that i care a lot about so that might be the reason that the company exists it might be that you are passionate about insurance in general and believe because you had some traumatic experience and you broke your neck and insurance saved your life or whatever um and so you believe that everyone should have insurance and that's the reason that you start the insurance company um there's um uh like there's like two or three more but that's that's and one of them is wealth right like you actually just want to make money um which is another reason like a lot of venture capital firms legal firms tend to be kind of more in touch and i think what's what's important is um and so like the companies that i've had have had a purpose um but that that in some way all in my opinion all capitalistic businesses must have a purpose if they're going to grow otherwise satisfy your immediate needs for financial security which i'm assuming you have already satisfied if you're in the space that you are um then they're all in a way they're philanthropic if that like i know that sounds weird but like i think in some ways a lot of capitalistic businesses that become big um are that way because most employees are not motivated by money they want to make sure that they're making a difference as well um but you can be more overt about it um i think you should be over to the messaging regardless but if you have a philanthropic um edge to it which is kind of what i'm doing with acquisition.com but not as a donating um from a money directly but more so i'm donating all the stuff that i have for free which is kind of the point why i'm doing these you know podcast like this um is because that's the cause that i'm that i'm i'm passionate about and so i think that as long as the messaging across the entire company aligns with everything has to align with that why then i think everything will operate in alignment you'll recruit the better people and then ultimately like that's the that's the stuff that all the marketing community doesn't want to talk about but it's also the reason that none of them are big um is that they don't understand culture they don't understand motivating people they don't understand alignment um and they don't and and like the only way to build a big enterprise is people right which i'm sure you you already know and so and so having that philanthropic alignment actually gives you in some ways a lot of competitive advantage in my opinion well that's really an amazing input and thanks thanks a lot i mean with my my community's all military former military guy i want to be the veteran i am the veterans jeweler and i want to be able to obviously support them serve them but we've got a lot of veteran problems so i want to take a chunk of what we make profit wise and give to them but just in sort of a way that says hey i'm just not you know buying lambos which i'm not against either but i also want to make sure my brothers and sisters out there you know they can better their by something that i can provide and it sounds like it's a perfect cause right so that's actually that's one of the ones that i missed which was the you're you're either about the industry or about the avatar so you might not be like like the the point of the jewelry business might not be jewelry the point of the business is to help veterans and you do that through the vehicle of jewelry but the end result is that you're making veterans lives better right and so that would be the fifth one of the of the different reasons that you can start a business like it's the avatar it's the industry um it's the community it's the um your employees uh it's wealth um or it's a general cause right and so yours is that you love the avatar which is awesome and so i think that i think that your perspective on it is dead on um and i would just align the uh the messaging component because i mean it seems like you already have the messaging pretty much down um because i mean that is the message like and it becomes more and more and more about them unless it's here it's just uh but i think what you just said right now to me is very clear and so it's like we are veterans this is how we do it um and this is why you know this is why we do it and then the vehicle of how we do it is through is through the um if you've watched simon's next uh start with why he's a really good talk on it i think it might actually be really useful for you thank you thank you thank you thanks greg victoria has one more question and we'll start to wrap things up yeah thank you alex i want to i want to ask a question regarding selling by phone so in all of your books you refer to selling as being a very valuable skill and i agree but i would like to know your perspective on what do you think is that threshold in dollar amounts that it's worth actually putting together sales team and starting selling by phone rather than just doing your typical you know email selling by email and what is the dollar amount depends on the space depends on depends on the space so if i'm selling weight loss the ticket would be lower than if i'm selling investment opportunities right so i'm specifically thinking about language learning space i'm helping rave live linga we want to move from just selling you know by hour to offering a program and whether it's worth it or not to go on a phone for let's say 300 yeah i think offering your program is way better because you're selling the outcome no one wants because think about this think think about how crazy selling by hour is the more hours you sell the more time and effort i have to use which means the more i have to buy the less likely i want to buy it exactly the more crazy that is right like the longer hours you sell the longer it's going to take me which means my time delay increases with my effort and sacrifice so the so literally you have two value components that are counteracting your pricing right so i would say yeah so i think having a defined end program um with being able to pass a basic language that's that you can put together right could be the guarantee which is that you'll pass our level one test that you can control right um and you can do that i mean i don't know the the time duration because you would know about it 12 weeks three months yeah 12 weeks or six months or whatever it is and then you can sell that and then the outcome is i pay this money and then i will be able to pass this test which to me is valuable right or it might be like vacation level so you could have little levels of like you know i mean you know this better than me but i'm saying like i would probably think like i have a vacation level which means i can go to that country and not get killed right and know where the bathroom is and know how to like order at a restaurant right and so that's what you can pass and it takes 12 weeks so if you're going to buy this trip and then you can anchor around the price of a vacation right so if you might have a 5000 vacation it's like it'll double the value of your vacation if you know what to order and how to get around and you'll have a way better experience and like why would you not why would you spend an extra thousand dollars a night all right 200 a night on a better hotel but the whole time you're there you hate the experience because you can't communicate with anyone and you can't really soak in the culture because you don't understand what's going on right and so then i would probably try and anchor around that so in terms of price point um i'd probably say for your space i mean this is me just pulling it out of thin air like with no no background data but probably a few thousand bucks probably two grand three grand is probably the minimum i would i would charge for something getting into that in that range and it depends again on the fulfillment like if i had if i if i had a one-on-one person who was helping me out or is it am i following a curriculum and then someone checks in with me for the verbal you know 20 minutes a week so it kind of depends on i don't know how your thing is structured so there would be some business components from a cost standpoint that would come into play there but out for for a business like that i would make sure that i was probably running 95 percent um net margins are higher i said gross margins are higher so if it cost me just for for perspective so let's say it's 20 minutes uh weekly right and it cost me whatever i don't know 50 bucks an hour so i know that that guy can do three per hour right so it'd be um uh 16 17 bucks right so 17 is what it cost me to get the 20 minutes and they're gonna get 12 of those so let's just round up and say 20 bucks times 20.

1:21:56so i'm sorry times 12. so 20 times 12 weeks is 240 so that's going to be your hard cost um of fulfillment right and so if i want to run uh you know 95 gross margin it means i have to be 20 times as expensive as that so 20 times times so it'd be got to be a 4800 product if that were the fulfillment yeah that makes sense i actually calculated all the net margins based on your formulas that you're providing yeah but you're you're not really in the service business or at least if i wouldn't make it i would try not to be in the service business i would try and be in an assisted uh assisted media learning business which is you get a lot more leverage a lot more margin yeah exactly we're in uh it's exactly that it's one-on-one coaching with all the assisted materials and everything else cool and i mean mind you me saying that price is like i'm thinking that way but at the end of the day the value the price you're going to charge is based on the value the market will perceive so like i'm saying that that would be my minimum that i would want or i'd have to reconfigure my you know maybe 90 might be the lowest i would drop for a model like that yeah thank you thanks victoria alex we'll start wrapping up here um one thing i want to point out is the the last part of your book where you talk about execution and you tell this really great story um about when you got your first hundred thousand dollars in your personal bank account yeah and i think that's a pivotal moment a benchmark moment for a lot of people a lot of entrepreneurs when they get there because we may have it in a business account we may make 100k in rev and those are all you know benchmark moments as well but when it hits your bank account and it's yours tax you know taxes are over with and everything it feels really good and it's easy to get wrapped up and motivated by these numbers 28 million 128 million 1.2 million a month profit you know people are like yeah i'm going to be there next week and but sometimes we lose focus on it's like okay the first step for a lot of entrepreneurs is just getting that first hundred k in your bank account under your name and so what can you tell a little bit about that story what it was like for you when that happened and how everything shifted yeah so um for everyone because everyone sees overnight successes right um i had now at that point been in business for four or five years like for context for everyone so it seems like you know alex is everything together but i mean it took me like four years to get there and at that point i'd already done multiple millions in revenue um and per year with the gyms but because i kept always wanting to reinvest stuff and so the most valuable lesson that i got from losing everything twice was was that a lot of times we tell ourselves this illusion that we're going to pay ourselves later right and the companies that i have had that have been the most successful this is my experience and there's probably other entrepreneurs who might who might counteract this who are maybe far wealthier than i am but this is my experience as a small business owner i was able to scale is that if the business pays you and you and you go in with the intention of the business paying you you'll you'll be able to last a lot longer because because you'll be it's much easier to deal with the many the many fires and pains that come with running a business when you're getting a paycheck every month and so um if a business is not writing me a paycheck every month then there is a problem and a lot of us like to just think oh no i'm reinvesting my business but you're not reinvesting in your business you're just not making any profit right i think that's a much more important thing but because we want to save our egos and we want to posture and most important we're just lying to ourselves that we're fee we want to feel more successful because we want to feel successful because we feel so shitty all the time about running the business so it's like at the very least i can at least tell people i'm successful so i feel better right yeah but it's still not confronting the brutal factual reality which is if you're not making a profit there is a problem and so for me that last story in the book was a combination of years of learning from failures of always selling not caring about the margins much just caring about growth wanting to quote reinvest and put more money into new equipment and new locations and new leases and new build outs and all that kind of stuff when i would have been much better served in my opinion if i had just started if i had thought how can i take this one location that i had and then juice the crap out of it so that it just pumps out profits for me every single month rather than thinking like oh i'm gonna do twice you know i'm gonna do two of them or three of them or four of them or whatever and so um for me it was a pivotal moment because uh it it finally came true i finally felt like i had some money um and for me layla and i were living on less than 30 000 a year so for me that was like three and a half years of of living expenses and so that i was going to be okay and i think that most of us have to get to that level honestly like i don't want to say as fast as you can because if you think that way it it's going to take longer but i can say that getting there i was able to get my first level of what i would consider security in place which is just like food and shelter um i felt like i was like okay and i'm somebody who needs i personally have a need for lots of safety net i'm actually fairly risk averse when it comes to the money that i have um so i like to know my wealth my expense my income to expense ratio being very very favorable like layla and i lived on less than one percent of what we made for the first two years wow um yeah we lived on nothing we lived on like i think a hundred and something thousand a year but we were making 17 million so like we really didn't live with much compared to what we were made right and i think that a lot of people get they really want to posture like so desperately want the status and i think that if you can shift the status at least to shifting it towards your net worth that's useful for most people and then if you can get your spouse on board and get play the game of how little can we live on and if you can make it a fun game where you win by living on almost nothing then you you inherently decrease the stress in your life because you need so little right and then by doing that you also have less risk because when you make decisions you're like well we can live on a thousand bucks we know how to do that right and so it's always through the back pocket whereas a lot of people do the reverse of that they overspend their income they they match their living expenses to the best month that they ever had which was a launch month or something you know yeah and then the rest of the time they're always stressed and it was 100 self-induced and so i think if we can avoid that then more people will create the personal wealth and then by you know subsequently the emotional freedom that they're looking for incredible what a way to end the podcast man um just a couple things alex uh davis wanted to ask us is there any way that we or the listeners out there can help and support you and then where we can reach you at um where we can find you online yeah um i'll give you a a medium-sized answer uh so uh youtube you can go to my youtube channel if you like that it's all free obviously um so you can go check that out uh if you like listening there's a podcast called the game you can search my name it'll probably come out um and i have the book that i just uh released that um that chris was referencing uh i mean in the first it's selling a thousand copies a day right now um with no ads and no funnels and no upsells so i think that most people seem to be liking it and telling people about it um which is cool and i think part of that is because of where the book came from um which is kind of including the very beginning of this conversation which is this is the first business in my opinion that i've created um from a different place right we've made this because the goal is how can i help as many entrepreneurs as i possibly can um and so the idea was kind of counter what i'm saying in the book but the the goal is different in this business so the book uh is 99 cents it comes with the course it comes with the downloads it comes with the checklists and i'll create a new book book 2 and 3 are already done but i can't release them because i just released this book like five minutes ago so i'll release them in time but they'll each come with courses that go with them um and that's just because i believe that the education system as a whole has failed all of us and so i think that as as the education system is increasingly fragmented um technology democratizes consumption and consolidates production which means if you're the best in the world you get to do it for everyone and so my goal is to help as many entrepreneurs as i can um independent of what country they live in what if whether they have no money that whatever it is and then hopefully you know help some really cool amazing businesses get started and then once they pass you know 5 or 10 million bucks a year they can reach out and we'd love to help them get to the next level um and even if they don't i'd love to die and just know that we help a lot of people for free and i don't think i'll regret that when i'm when i'm eating yeah alex thank you so much for coming on the show sharing all your tips and tricks and wisdom with us and i think i speak for everybody for helping ask uh and answer some great questions uh that the listeners came up with and that we came from that came out of reading your book man um yeah so we'll keep you in contact listeners we'll put the links in the show notes again alex thank you so much listeners we want to thank you for tuning in once again and we'll see you all on the next episode goodbye everybody dude awesome podcast thank you so much man i really appreciate it awesome hopefully it's not bad i think it's great um when we go live do you want us do you have a marketing person you would like us to email or the person i was in touch with maybe that was your assistant okay all right sounds good and um yeah anything else like things i can keep in the back of my mind people you're looking to get connected with we come across some pretty amazing people you know always help happy to to connect if possible yeah i mean if you if you find any education and training companies um or software companies there's the two companies that i target um that are kind of over that three to five million dollar threshold 10 15 20 whatever that's fine um but really ideally over five unless it's a software company that has some unique angle um then uh then yeah they can send them our way and maybe we can help them out and maybe we can and if we can't we'll still try and help them the best of our ability mainly education and software um yeah i'll keep that in mind we have a private community of uh like seven and eight figure entrepreneurs and so uh we do deal with those people on a regular basis so media and code that's what i'm looking for sorry to say that again media and code is the base of your business you have media as the base of your business things i like zero cost of replication awesome all right okay buddy thanks so much for coming on dude really great podcast we'll talk to you soon yeah so yeah hey guys thanks for coming in glad to have y'all and um yeah we'll be doing these more in the future mainly for our private m3 members or people that are very interested in m3 going down to cabo in september anybody wants to do a luxury trip down to cabo love to have any of you guys join us and i hope you guys got some valuable tips from alex and um we'll be in touch cool thank you guys see y'all later …