Fear of Losing, Finding HighLevel Employees, and Simplifying Offers (with Tanner Chidester) Pt.1 Aug '21 Ep 440

In a comprehensive discussion with Tanner Cheddaster and Alex Hermosi on business acumen and success, key insights emerged about leveraging pain for growth, simplifying offers to enhance sales, and the importance of asking the right questions. Hermosi, known for his book "100 Million Dollar Offers," emphasizes the significance of a compelling offer and the role of pain in driving success, contrasting fear-based motivation with a more sustainable pull-based drive. They explore the pitfalls of scaling too quickly and the necessity of focus, especially for businesses under $10 million. Hermosi's approach to maintaining an uncluttered schedule and his philosophy on continuous play in business underscore the conversation, along with the value of learning from mistakes and seeking guidance from those with relevant experience.

• Having general business acumen is essential for overall business success.
• Business acumen involves understanding and dealing with different business situations effectively.

This is part one of a podcast that I was invited on with Tanner Cheddaster where we talked about, one, how the role of having general business acumen can contribute to general business success.

The quote highlights the importance of business acumen in contributing to the success of a business. It sets the stage for a discussion about the various aspects that constitute business acumen and its impact on achieving business goals.

• Pain can either strengthen or weaken an individual's drive for success.
• The personal choice to use pain as a motivator is a distinguishing factor between individuals.
• Blaming others for pain can hinder success, while taking control can lead to empowerment and growth.

I think humans experience pain, and then it just takes a certain type of people take the pain and let it beat the strength into them, and other people take the pain and let it beat the strength out of them.

This quote suggests that pain is a universal experience, but individuals' responses to it can either build or diminish their strength. It emphasizes the concept of personal agency in channeling pain towards success.

• The simplification of offers is crucial for making them compelling and easy to understand for customers.
• A simplified offer should deliver value and be easy for customers to purchase.

And third, how to simplify your offers in such a way that they're both compelling, easy, valuable, and get people to buy them.

This quote introduces the idea that offers need to be designed in a way that is straightforward and attractive to customers, which is a key aspect of successful sales strategies.

• Failures and lessons learned along the way are part of the business journey.
• Reflecting on these experiences is beneficial for business growth and improvement.

Failures and lessons we have learned along the way.

The quote acknowledges that failures are inevitable in business, but they are also valuable learning opportunities that can lead to future success.

• There is a stereotype that professionals in the fitness industry may not think deeply.
• Alex Hermosi is recognized for his unexpected depth of thought and valuable insights.

I think one of Alex's strengths, in my own opinion, is you think a lot deeper than I thought maybe you would.

This quote challenges the stereotype that fitness professionals lack depth and highlights Alex Hermosi's ability to provide valuable insights.

• Alex Hermosi's book, "100 Million Dollar Offers," is mentioned as a valuable resource.
• The book is packed with years of knowledge and experience in scaling businesses.

About today is his book, 100 million dollar offers.

The quote introduces the book "100 Million Dollar Offers" as a topic of discussion, suggesting it contains valuable information for business scaling.

• Making mistakes is a part of the entrepreneurial experience.
• Reflecting on these mistakes can lead to significant profit savings and better decision-making in the future.

A lot. I can directly attribute probably like $7 million in profit of mistakes that I did not make just from. Just from just like one chapter in that book.

The quote conveys that by learning from past mistakes, one can avoid future losses, as illustrated by the speaker's personal experience with his book's content.

• It can be challenging to find mentors or coaches who have achieved a higher level of success.
• Seeking advice from those who are more successful can provide new perspectives and valuable insights.

The people who were giving advice hadn't even made the amount of money that we had made.

This quote highlights the difficulty in finding advisors who have achieved a higher level of success than oneself, emphasizing the importance of seeking out truly experienced mentors.

• Asking good questions is a critical skill for entrepreneurs.
• The quality of questions reflects the depth of thought and can lead to better answers and insights.

I think asking good questions is probably the single greatest skill that an entrepreneur can have, because asking a good question shows depth of thought.

The quote suggests that the ability to ask insightful questions is a key entrepreneurial skill, as it demonstrates a person's depth of thought and can lead to more meaningful answers.

• Alex Hermosi's friend needed to increase profits without additional effort.
• Hermosi helped her achieve an additional $4.5 million in profit through a single pricing change.
• The solution was found by asking the right question with specific constraints.
• Hermosi applies constraints to questions and goals to find innovative solutions.
• He sets ambitious goals with constraints, such as reaching $100 million while only working two days a week.

"She does about 50 million a year, and she takes about 20 home. And she came to me and she was like, alex, I need your brain. And I was like, okay, what's up? And she said, I need you to show me how I can make $5 million in extra profit without doing anything extra. And in 60 minutes, we did it."

• This quote highlights the importance of asking specific, constrained questions to find targeted solutions in business.

"How can I get to 100 million working two days a week?"

• Hermosi is focused on achieving high financial goals while imposing personal constraints to maintain work-life balance and prevent burnout.

• Hermosi values challenges but avoids sacrificing personal well-being for success.
• He believes in creating sustainable habits and systems for long-term success.
• Hermosi's approach to business is to play the "long game" by finding a sustainable and enjoyable work pattern.
• He emphasizes the importance of not resenting one's work and choosing activities that bring joy and fulfillment.

"The only games worth playing are games that you can continue to play."

• Hermosi believes that long-term success comes from sustainable practices rather than short-term sacrifices.

"If I can create the structure under which, or circumstances under which I could continue to do this for perpetuity, then I will win because I won't quit or switch gears."

• The quote explains Hermosi's philosophy on the importance of creating a work environment that allows for consistent effort over time, leading to ultimate success.

• Hermosi does not believe there is a direct correlation between fitness and business success.
• He suggests that work ethic can translate to success in fitness, but being into fitness does not necessarily mean one has a strong work ethic.
• Hermosi differentiates between enjoying fitness as a hobby and having the discipline required for business tasks like messaging and running ads.

"I actually don't think so at all. I don't think they're related."

• Hermosi dismisses the notion that fitness background is a reliable indicator of business success.

"If you find me an entrepreneur who's a winner and who has the work ethic, and then you say, hey, go into fitness, that person will be successful."

• This quote highlights Hermosi's belief that a strong work ethic is the underlying factor for success in any field, including fitness.

• Hermosi does not run ads or sell products on his podcast.
• He asks his audience to help spread the word about the podcast by leaving reviews and sharing it.
• The goal is to reach and assist more entrepreneurs in achieving success.

"The single thing that I ask you to do is you can just leave a review. It'll take you 10 seconds or one type of the thumb. It would mean the absolute world to me."

• Hermosi emphasizes the impact of community support in growing the podcast's reach and helping more entrepreneurs.

• Hermosi shares that starting his first gym was the most emotionally challenging period for him.
• He faced loneliness and insecurity, which made the experience terrifying.
• This period of hardship was exacerbated by being in a new area without friends or family.

"The worst and most painful period was when I started the first gym. That was by far emotionally the hardest."

• The quote reflects on the emotional difficulties Hermosi faced when starting out as an entrepreneur and the feelings of isolation that came with it.

• The fear of failure and judgment from others can be a significant driving force.
• Pain from these fears can either strengthen an individual or weaken them, depending on their response.
• Success can initially be proportional to the pain experienced, but motivations often change over time.
• As one becomes more successful and their basic needs are met, fear-based motivation tends to shift towards a more positive, pull-based drive.
• Understanding the difference between fear and true motivation is crucial for long-term success.

"Fearing failure and feeling the judgment of what I thought other people would say about me, that that was, like, the only thing that really compelled me."

This quote emphasizes the role of external judgment and the fear of failure as primary motivators for the speaker's actions.

"I think that most people, though the level of success, I think in some way in the beginning, is proportional to the pain that you experienced."

Here, the speaker suggests that the intensity of initial success may correlate with the amount of pain or adversity one has faced, which fuels their drive to succeed.

"I think that it does switch from a fear based drive to a pool based drive."

The speaker is highlighting a transition from being motivated by fear to being motivated by more intrinsic, positive goals once basic needs and success have been achieved.

• Experiences, the people one interacts with, and the books one reads can all shape an individual's perspective.
• The speaker spends significant time reading and discussing ideas, which contributes to their unique viewpoint.
• Conversations about mortality can provide clarity on what is important in life.

"I think a lot of time, I occupy my time just reading stuff that seems interesting."

This quote indicates that the speaker's perspective is influenced by diverse reading materials and a lifestyle that allows for contemplation and learning.

"So we talk about death a lot because I think a lot of people don't like talking about death."

Discussing death is presented as a way to gain perspective on life's priorities, which in turn shapes the speaker's thoughts and actions.

• People may have a tendency to overcomplicate offers, but clarity is key to making them valuable.
• A compelling offer structure includes an outcome, timeline, guarantee, and scarcity.
• The ease of selling an offer is directly related to its clarity and the value it provides to the potential customer.

"Almost no one's following me on the book. We've gotten a lot of good feedback from the book."

The speaker has received positive feedback on the book, suggesting that the concepts presented are well-received and clear to readers.

"That is an offer structure. There's an outcome, there's a timeline, there's a guarantee, right?"

The speaker outlines the components of a strong offer structure, emphasizing the importance of clear and compelling elements in an offer.

"Best case. Worst case, here it is. Right?"

By presenting the best and worst-case scenarios, the speaker is demonstrating how to make the decision-making process straightforward for the prospect, which is essential for a successful offer.

• Scaling a business should be considered after establishing cash flow, not before.
• Focusing on providing value to get initial clients is more crucial than worrying about scalability at the start.
• Alex Hermosi's experience of launching gyms for two years showcases the importance of hands-on experience and expertise in one's field for successful scaling.
• The process of scaling involves starting with a comprehensive offer and then peeling back to retain only the most valuable aspects.
• Determining what is valuable to customers is a key step in refining an offer for scalability.
• The concept of scaling is also about focusing on a single product or service before diversifying.

"I spent two years launching gyms. So people are like, alex, how'd you build such a big coaching business in gyms? It's like, because I launched gyms for two years."

This quote highlights the importance of gaining direct experience in a field to build expertise and credibility, which can later contribute to the successful scaling of a business.

"Get the yeses, get the cash flow, and then determine what people find valuable, what they don't find valuable, and then peel back the offer until you still have the ultra valuable stuff."

This quote emphasizes the strategy of initially focusing on securing clients and cash flow, then refining the business offer based on what is most valued by the clients.

• The challenge in scaling is to avoid overextending by having too many offers or services.
• There is no perfect answer to identify when an offer has become too convoluted, but there are indicators to consider.
• Changing the target avatar or market position can be a sign of overextension.
• The market can be segmented into ultra-low, low, premium, and luxury, and businesses should aim to occupy one strategic position.
• Context, such as the entrepreneur's skill set and the presence of champions for product lines, can influence the ability to manage multiple offerings.
• For most entrepreneurs under $10 million a year, the advice is to focus on one product in one channel.

"The easiest litmus test that I would think of is, are we changing avatars?"

This quote suggests that a shift in the target audience or customer base can be a red flag for overextension, indicating a potential loss of focus in the business's core offering.

"If you can run multiple companies, you can run multiple product lines, but most people don't have the skill set to do it."

This quote acknowledges that while it is possible to manage multiple offerings or companies, it often requires a skill set that many entrepreneurs may not yet possess, suggesting a focus on a singular product or service is advisable for most.

• Understanding the four major strategic positions in the market is crucial for proper business positioning.
• The distinction between premium and luxury products is important, with luxury implying status associated with higher prices.
• Occupying a consistent market position and serving a single avatar are key to maintaining a clear business strategy.
• Context and the entrepreneur's skill set are important when considering the expansion of offerings or starting new ventures.
• Scaling from one to three million dollars in revenue is usually about focusing on one product, while scaling from three to ten million involves increasing lifetime customer value.

"No one has statuses associated with how much they pay you."

This quote clarifies the difference between premium and luxury market positions, indicating that most businesses fall into the premium category rather than luxury, which is characterized by status associated with high prices.

"Focused on selling one product in one channel, and then the second, going from three to ten million, is just increasing the back end lifetime gross profit per customer."

This quote outlines a strategic approach to scaling a business, emphasizing the importance of a singular focus on product and channel before expanding to increase customer lifetime value for further growth.

• Part two of the conversation will address the topic of acquiring customers profitably.
• A formula will be discussed that applies to every scaled business to date.

"Hope you guys enjoyed that as much as I enjoyed making it for you. And in part two, we talk about how to acquire customers profitably and the formula that I use to approach this problem in every business that we have scaled to date."

This quote serves as a teaser for the next part of the conversation, indicating that a method for profitable customer acquisition will be revealed, which has been successfully applied across various scaled businesses.