Investments, Using Reinforcements, & Best Team Practices (with Vince Del Monte) Pt.2 March ‘22 Ep 455

Summary Notes


In this episode of "The Game" podcast, hosted by Vince Dalmonti, guest Alex Hormozi shares insights on business growth strategies, including investments, reinforcing customer behavior, and scaling teams for efficiency. Hormozi emphasizes the importance of front-end customer acquisition and back-end problem-solving to increase revenue. He discusses various types of guarantees, such as anti-guarantees and performance offers, to build customer trust and enhance sales. The conversation also delves into the significance of hiring the right team, focusing on roles that bring the most value and the process of delegating to achieve scalability. Hormozi advises entrepreneurs to invest in themselves and their brand before considering external assets, highlighting the journey to becoming a millionaire and the pitfalls of seeking influence over substantial success.

Summary Notes

Introduction to the Podcast Episode

  • Mosey Nation introduces the day's episode of the game.
  • The podcast will cover three topics from Vince Dalmonti's podcast from March 2022.
  • Topics include investments, reinforcing behavior, and scaling teams.
  • The goal is to enable listeners to earn money efficiently by leveraging other people's work.

Welcome back to this day's episode of the game. We talk about three topics on Vince Dalmonti's podcast from march of 22. We talk about investments, we talk about reinforcing behavior, and we talk about scaling teams so that other people can do the work for you, so that you can ultimately print that monies without doing all of the works.

This quote sets the stage for the episode, outlining the main themes that will be discussed and the podcast's objective to help listeners grow their businesses and increase earnings.

Reinforcement and Addressing Customer Service Concerns

  • Vince Dalmonti discusses the need for a dedicated role to address customer issues.
  • Reinforcement of business practices is necessary to identify and solve problems.
  • There is a fear of creating a customer service nightmare, but addressing issues is part of business growth.

This might be a question in the weeds here, but if we're going to ask you reinforcement of this, I guess this is, of course you need to reinforce it. This is probably a dedicated role to if somebody's saying, hey, didn't get results. I mean, the whole idea is to put this stuff in motion and then to find out issues as it shows up.

Vince Dalmonti emphasizes the importance of having a system to reinforce business practices and a dedicated role to handle customer issues as they arise.

Yeah. And then you have this crazy front end, and then you fix the problems on the back end, and you have a business and you're making ten times more money.

Mosey Nation concurs with Vince, suggesting that by addressing problems on the back end after a robust front end is established, a business can significantly increase its revenue.

Types of Guarantees in Sales

  • Mosey Nation introduces the concept of "anti guarantees" in sales.
  • Anti guarantees target customers who do not seek guarantees but are committed to the work.
  • Performance offers are based on proportional outcomes.
  • Sales strategies include making guarantees or owning the absence of them.

Well, the other two types of guarantees, you have anti guarantees, which is we're looking for the type of. And you can do this, which is all sales are final, which is we're looking for the type of people that don't want guarantees. We're looking for people who want to do the type of work, and we're going to be investing a tremendous amount of time in you.

Mosey Nation describes "anti guarantees," which focus on attracting customers who are willing to commit without the promise of a guarantee, emphasizing the mutual investment of time and effort.

Own it. And then the fourth one is a performance offer, which is based on some sort of thing that's supposed to happen, and it's proportional, so it's like, hey, here's the deal. You pay me $100 every pony. That's it.

Mosey Nation also talks about performance offers, where the guarantee is tied to a specific outcome, and the payment is proportional to the performance.

Vince Dalmonti's Personal Experience with Anti Guarantees

  • Vince shares his experience with anti guarantees when he first started in business.
  • He learned that success is the client's responsibility, not the coach's guarantee.
  • The concept of anti guarantees helped Vince understand the value of the services offered to him.

Vince, we don't do guarantees over here. I said, you don't? What do you mean? He's like, well, we're guaranteeing our time, but we don't know what you're doing with your time, so there's no guarantees. And that was my first introduction to the whole concept that success is your responsibility and your duty.

Vince recounts his introduction to anti guarantees, where he was taught that a coach could not guarantee success because it ultimately depends on the client's own efforts.

Elements of a Successful Offer

  • Mosey Nation outlines the elements of a successful offer: scarcity, urgency, guarantees, and bonuses.
  • The offer should be structured with careful consideration of what should be a bonus versus a core offer.
  • Positioning and pricing strategies are crucial for selling to more people at higher prices.

Scarcity urgency guarantees bonuses. Each of them has depth. And then the actual offer itself, and then which things should be bonuses, which things should be core offers, and then how you position it, how you should play with the numbers of people, how you should add in the rolling cohorts, all that kind of stuff, so that you can ultimately sell more people at higher prices.

Mosey Nation breaks down the key components that make an offer compelling, including scarcity, urgency, guarantees, and bonuses, and discusses the importance of strategic positioning and pricing.

Building and Scaling Teams

  • Mosey Nation explains the transition from solo entrepreneurship to building a team.
  • Entrepreneurs initially take on many roles but must delegate as the business grows.
  • Hiring multiple people is often necessary to cover the work previously done by the entrepreneur alone.

Yeah. So they're miniature big businesses, you know what I mean? So most entrepreneur, when you're starting, because you have to learn 100 roles and do them all fractionally. And then over time, as the business grows, you have almost enough work for a full time person, right. And it might scare you because you're like, well, I was running this business on my own, so if I have one person, then they should be able to do the same amount as me. Except it doesn't work that way. So you probably need to hire five people to do the same amount as you because they're going to do one fraction of the thing that you're doing.

Mosey Nation discusses the reality that a growing business requires hiring a team, and one person cannot replace the entrepreneur's role entirely; multiple hires are often needed to manage different aspects of the business.

Time Management and Productivity

  • Time studies are recommended to improve productivity by tracking activities in 15-minute blocks.
  • People are generally disorganized with their time, and measuring activities can lead to a threefold increase in productivity.
  • Time studies prevent time wastage by allowing individuals to see where their time goes and to feel a sense of accomplishment.

"So the easiest way to do this is do a time study. So you get a sheet of paper and put it in 15 minutes blocks, and then you look at what you're doing with your time, because most people are massively disorganized."

This quote emphasizes the simplicity and effectiveness of time studies to combat disorganization and enhance productivity.

Job Value Assessment

  • Different types of work have different monetary values based on the skill required.
  • Administrative tasks and customer success are valued at around $15 an hour.
  • Higher value work includes sales, marketing, and CEO-level strategic decisions.
  • Prioritizing hiring for lower-value tasks can give back significant time, including personal time.

"So if you're doing administrative work, that's $15 an hour. If you're doing customer success... Probably $15 an hour. Like, not a lot of skill is required there, right? Sales, higher value marketing, higher value CEO, making big decisions, strategy decisions, higher value product."

This quote categorizes different job roles by their value and suggests that outsourcing lower-value tasks can free up time for more strategic work.

Hiring and Team Structure

  • The first hires should be in roles that give the most time back to the entrepreneur, such as administrative support or customer success.
  • Operations personnel, like an office manager, are valuable for their versatility.
  • Sales and product development are also critical hiring areas.
  • Some roles, like bookkeeping, may be outsourced to vendors.

"So what we're doing is first it'd probably be frontline support or fulfillment, right? Next might be administrative... Number two would be customer success, and then number three would probably be something around product. Number four would be sales."

This quote outlines a suggested hiring order that prioritizes roles based on the time they can save the entrepreneur and the value they bring to the business.

Internal vs. External Teams

  • There is no one-size-fits-all answer to whether internal teams or agencies are better.
  • Agencies can offer speed but may sacrifice control.
  • Finding good vendors is as challenging as finding good employees.
  • Impatience can lead to poor hiring decisions.

"Sometimes an agency is a good fit. Sometimes a sales agency is a good fit. You sacrifice control for speed... There's a lot of them and not a lot of them are good. So it just takes time and effort."

This quote discusses the trade-offs between hiring agencies for speed and maintaining control through an internal team, highlighting the difficulty in finding quality vendors or employees.

The Entrepreneurial Journey

  • Growth stages are categorized by focus areas: promotion (up to $1 million), product ($1-10 million), and people (beyond $10 million).
  • Quality of the product and the marketing machine are crucial for growth.
  • Hiring experienced and high-quality people becomes essential as the business scales.
  • Entrepreneurs must balance the desire for control with the need for freedom, often relinquishing control for growth.

"The first million is learning how to promote. Right. One to ten is product. Ten to 100 is people... And what's ironic is that people entrepreneurs want freedom and control. And you have to pick, you can't have absolute control and then try and have freedom, because if you control it, you are not free."

This quote captures the progression of a business's focus as it grows and the paradox of control and freedom that entrepreneurs face. It suggests that successful scaling involves delegating control.

Reflections on Business Advice

  • The conversation concludes with an appreciation for the advice given, particularly regarding the timing of offering renewals.
  • The importance of sharing takeaways and learning from others is highlighted.

"The stuff about offering the renewals earlier on was just brilliant for me. I want to thank you for..."

This quote reflects on a specific piece of advice that was found to be particularly valuable, demonstrating the importance of sharing and discussing business strategies.

Investing Strategy

  • Investing in oneself is crucial for acquiring skills.
  • Investing in one's brand is valuable because it persists and can jump-start new ventures.
  • Investing in assets should come after significant financial success.
  • People often attempt to invest too early; Alex waited until he had substantial savings.
  • The criticism of delayed investing usually comes from those less financially successful.
  • For employees, investing in skills can lead to higher-paying jobs.
  • It's more effective to increase income than to seek small investment returns on a modest salary.
  • Wealthy individuals often make money through business success, not initial investments.

I think that's validation. I mean, overall, it's like you invest in yourself because you want to get skills. You invest in your brand because no matter what you do, your brand will still be there and it will jump start anything, right? And then you have assets, success.

This quote emphasizes the importance of investing in oneself and one's brand before focusing on assets, highlighting that these investments are foundational to any future success.

The only people who will criticize that are poorer than you. Right.

Alex suggests that criticism about investment timing often comes from those who are not as financially successful, implying that their advice may not be as valuable.

If you're an employee, then it's a totally different equation. If you're an employee and you know what your fixed income, what your income is going to be, more or less, then I would still invest in skills so I could get a better job that pays more.

Here, Alex advises employees to invest in skills to secure better-paying jobs, rather than focusing on traditional investments, especially when income is predictable.

Because trying to save on $60,000 a year when, if you just invest in yourself, you can get to $250,000 a year in a better position, like twelve months later, then why would we waste time trying to invest the excess ten grand to get the s and p return when you can forex your income?

The quote explains that investing in personal development can lead to a much higher income than modest savings and investments would yield, especially on a lower salary.

I got money by making money, not by investing every single wealthy super you see Mr. Wonderful. Yeah. A 400 million dollar exit. Mark Cuban billion dollar exit.

Alex points out that many wealthy individuals accumulated their wealth through business exits, not through initial investments, suggesting that creating value and selling for profit is a key to wealth.

You should take the two grand and buy a course on how to make more money.

The advice given to a young investor is to use their funds to learn how to increase their income rather than seeking small passive returns, emphasizing the importance of education and skill development.

Personal Journey and Marketing Insights

  • Alex's first million was not earned until six years into his journey.
  • Sharing personal stories can inspire others and combat the scarcity mindset.
  • Hearing about the struggles of successful individuals can normalize the challenges faced by entrepreneurs.
  • Alex's book on marketing is highly regarded by successful marketers.

How awesome it was to not make my first million dollars until year six.

Alex reflects on the delayed financial success in his career, indicating that significant earnings can take time and perseverance.

And most people don't hear that and they think that they're the only person struggling out there, right?

This quote acknowledges the common misconception that struggles are unique to the individual when, in reality, they are widespread among entrepreneurs.

I'm the only person going through this right now. Oh, I'm the only person that's having all this rejection. I'm like, no, that's pretty normal.

Alex agrees with Vince's point about the normalcy of rejection and struggle in entrepreneurship, providing reassurance to others in similar situations.

Fitness Industry Aesthetics and Status

  • The fitness industry is driven by aesthetics and status.
  • Individuals often portray themselves as more successful than they are to gain influence.
  • Authenticity is key to long-term success and influence in the industry.

I tell you this much too. Just in the fitness space, it's by its nature a very aesthetic status driven space overall.

This quote highlights the superficial nature of the fitness industry, emphasizing the importance of looks and status.

And I saw little really put up and it was like, how to be a millionaire before 30. And I texted him and I said, are you a millionaire? He's like, well, I mean, I've done a million dollars in sales.

The quote illustrates the common misrepresentation in the industry, where individuals may claim or imply a level of success that is not accurate.

then stop fucking pretending to be ones so that you stop feeling like a piece of shit all the time. Because you text me about how you feel like a fraud.

This quote emphasizes the emotional toll of misrepresenting oneself and the importance of authenticity to avoid feeling like a fraud.

Building Influence and Success

  • Influence should be a result of success, not a means to achieve it.
  • Having a solid foundation and evidence of success prevents feelings of fraudulence.
  • True influence comes from genuine achievements, not just stories or emotions.

it's so much easier to have influence once you've thing than to try and get influence to make money.

The quote underscores the idea that influence is more effectively gained after achieving success rather than using influence as a stepping stone to success.

Most people have no evidence. So you have to rely on your own pump up and stories and emotions which are fleeting.

This quote points out that without tangible evidence of success, people rely on less reliable and more transient means such as stories or emotions to build influence.

Entrepreneurial Journey and Expertise

  • Real expertise comes from experience and a track record of success.
  • Teaching should be based on firsthand knowledge and successful execution.
  • The journey to success often involves trial, error, and patience.

I had one gym, and that gym was very profitable.

The quote demonstrates the speaker's humble beginnings and the importance of starting small and building upon success.

I did start after six gyms, right? But even when I had six gyms, I wasn't sure if I was going to be good enough yet, so I started doing turnarounds.

This quote reflects the speaker's cautious approach to expanding their business and ensuring they had sufficient expertise before offering coaching or advice.

The Value of Patience and Depth of Knowledge

  • Depth of knowledge is achieved through diverse experiences and understanding patterns.
  • Innovators should not fear imitators as they are inherently behind the curve.
  • True expertise allows one to discuss subjects with depth and authority.

No one owns truth. This is true. Right. And so anyways, the reason people sound better than other people is because they have depth of knowledge and you create depth of knowledge through executing the same patterns in different stimuli in different environments.

The quote explains that depth of knowledge comes from varied experiences, which allows for a more comprehensive understanding of a subject.

Authenticity in Teaching and Preaching

  • Teaching should be based on lived experiences and proven results.
  • Authenticity requires aligning public messages with private realities.
  • Preaching prematurely can lead to spreading untested or false information.

You're saying TD Bishop, Jakes Pastor, he says a lot of people use language to cover up lifestyle, and we live in the Twitter nation.

This quote highlights the issue of people using language to disguise the reality of their experiences, leading to superficial understanding and communication.

And I think that's why I'm never going to write a parenting book, Alex, until my kids are about 45 years old and they're out of the house, securely married, then maybe I'll write a parenting book.

The quote exemplifies the speaker's commitment to authenticity by waiting to write a parenting book until they have fully experienced the outcomes of their parenting.

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