Niches & Opportunities, DecisionMaking, and Repetition (on Omar Elattar & The Passionate Few) Pt. 2 Aug '21 Ep 431

In a revealing discussion on "The Passionate Few" podcast, hosted by Omar Ellitar, entrepreneur Alex Hormozi shares his insights on business success. Hormozi emphasizes the importance of selecting the right niche for sustainability and growth, detailing his decision-making framework for tough business choices. He debunks the myth of instant gratification, advocating instead for the value of repetition and skill development. Hormozi's approach to business is exemplified by his program's impressive client results, a testament to his focus on delivering quality over marketing gimmicks. He also discusses the significance of pricing and value, the distinction between service and traffic businesses, and the long-term vision required for enduring success. Hormozi encourages entrepreneurs to invest in learning and to understand that mastery and opportunity come from persistent effort, not chance.

• Identifying the appropriate niche is crucial for the success of a business opportunity.
• The niche should align with the entrepreneur's expertise and market demand.
• A well-defined niche can lead to significant financial outcomes and scalable business models.

"We're the only ones in a niche. And we are 50 times, you know what I mean? Bigger than anyone who's in one tiny little sliver of a niche."

This quote emphasizes the success Mozi Nation achieved by focusing on a specific niche, which allowed them to dominate and scale within that market segment.

• A strategic framework is necessary for making difficult business decisions.
• Entrepreneurs should focus on a few key factors that will have the largest impact on their business.
• Price and value provided are critical components of this decision-making process.

"It's just like, what handful of few things will make the absolute biggest difference? And price is obviously the biggest factor in that."

Mozi Nation highlights the significance of concentrating on pivotal factors like pricing that greatly influence business outcomes and customer perception of value.

• Emphasizes the need to move away from the expectation of immediate gratification.
• The journey to success involves consistent work, skill enhancement, and learning from failures.
• Results are earned through sustained effort and improvement rather than instant rewards.

"Just because you do the work doesn't mean you deserve the result."

Mozi Nation points out that hard work does not automatically guarantee success; results come from persistent effort and continuous learning.

• The quality of product delivery is more influential than marketing funnels in replicating business success.
• Providing significant value through products or services is essential for maintaining a good reputation and sustaining business growth.

"It's because of the delivery, it's because of the product."

Mozi Nation attributes their business success to the delivery and quality of their product, not just the marketing strategy.

• Achieving a high ROAS is indicative of an efficient and effective marketing strategy.
• Entrepreneurs should aim for a business model that allows for significant returns relative to advertising expenditure.

"So, yes, the lifetime return on ad spend that I have is 36 to one."

Mozi Nation reveals an impressive lifetime ROAS, demonstrating the effectiveness of their business model and marketing efforts.

• Positioning a business model correctly is crucial for maximizing profitability.
• Entrepreneurs should focus on creating high-value offerings that can justify premium pricing.
• The business model should be designed to stand out in the market and provide unique value.

"Most people are just not like everyone here is. Everyone who's listening has the same time, right?"

This quote suggests that while everyone has the same amount of time, the way they use it and the focus they choose can lead to different levels of success.

• Entrepreneurs should critically assess their niche to determine its potential for financial success.
• Realistic expectations should be set based on the scalability and demand within the niche.
• It's important to avoid chasing unrealistic goals that do not align with the market dynamics of the niche.

"People say that the biggest niches are the things like real estate, fitness. The traditional things that were here 50 years ago will be here in 50 years."

Omar Ellitar discusses the enduring nature of certain niches, implying that they offer ongoing opportunities for business ventures.

• Traffic businesses focus on marketing arbitrage, aiming to buy attention for less than the cost of selling a product.
• Service businesses prioritize providing value through services, which can lead to higher profit margins.
• The type of business model chosen should align with the entrepreneur's goals and market opportunities.

"You have traffic businesses and you have service businesses."

Mozi Nation distinguishes between two types of businesses, highlighting the different strategies and outcomes associated with each model.

• Mozi Nation discusses their company's relatively low advertising budget compared to competitors.
• They focus on a service business model aimed at market penetration and client retention.
• Emphasizes the importance of building a business with enduring and enterprise value, unlike traffic businesses that rely on constant traffic for cash flow.

"We do 880,000 a week, and we have not a lot of advertising budget... it's less than 100,000 a month in advertising that we spend, which is wildly less than everyone else."

This quote highlights the company's success despite a smaller advertising budget, illustrating efficient market penetration and client retention strategies.

"In a service business or a business that has enterprise value, the business should be able to grow independent of your ads, get turned off for a day."

The quote underlines the resilience of a service business model where growth isn't solely dependent on advertising, contrasting it with traffic businesses that lack intrinsic value.

• Mozi Nation argues that success in any niche is not about the niche itself but the individual's skill level.
• Highlights that there are billion-dollar players in every niche, and perceived difficulties often stem from personal inadequacies or lack of knowledge.
• Stresses the importance of mastery through repetitive practice and being prepared for opportunities when they arise.

"The reality is most people just not that good. And so they think it's the niche, but it's really themselves."

This quote emphasizes that individual capabilities, rather than the market segment, are often the limiting factor in achieving success.

"Most people are trying to forego the four years where you rocky cutscene and put in all this volume and you learn mastery of a skill like Russell... and the only way that they're able to have that explosive growth is because they are ready."

The quote discusses the necessity of skill mastery and preparation for significant growth, using the example of Russell and his years of experience prior to the success of ClickFunnels.

• Omar Ellitar notes that Mozi Nation's businesses, including fitness, photography, software, and supplements, generate substantial weekly revenue.
• Mozi Nation is focused on acquiring and scaling businesses to increase their revenue significantly.
• Prestige Labs is mentioned as an example of leveraging an existing customer base for a new revenue stream.

"Half of them are in the fitness space. The other half are right now. I have four companies, we're acquiring two more... But we have a business in the photography niche. We have a software business. We have the supplement business which is adjacent to gym launch called Prestige Labs."

This quote provides insight into the diversity of Mozi Nation's business portfolio and their strategy for growth through acquisition and leveraging synergies.

• Mozi Nation discusses their approach to decision-making in business, emphasizing the rarity of huge decisions as a company grows.
• They mention the importance of making decisions slowly or sometimes not at all, to avoid unnecessary pivots.
• The goal is to reach $100 million a year, achieved by seeking advice from experienced individuals and paying for their time.

"The decisions that are huge decisions are fewer and fewer... the bigger the ship gets, the rarer you're pivoting the direction of the ship."

This quote reflects on the strategic decision-making process in business, suggesting that significant decisions become less frequent as the business scales.

"I will massively overpay for people's time... I paid ten, and I was happy to do it because I just knew that if I could get 20 years of experience in six months, why would I not do that?"

Mozi Nation expresses the value of investing in expert advice to accelerate learning and decision-making, even if it means paying a premium for their time.

• Mozi Nation shares their personal experience of learning through direct coaching, paying experts for their time to gain specific skills quickly.
• They highlight the efficiency and effectiveness of one-on-one coaching over traditional courses, focusing on the thought process behind actions.

"Every single major skill that I've ever acquired, every major decision that I've needed to make, I just say, what would it take for you to get on the phone with me?"

This quote illustrates Mozi Nation's proactive approach to skill acquisition and decision-making through direct engagement with experts.

"I asked him, how would you run Facebook ads? For my business, I will run them, and then you tell me what decisions you'd be making, what do I turn off and why? So I can understand the thought process."

Mozi Nation details their method of learning by asking experts not just how to do something, but how they would approach it specifically for their business, emphasizing the importance of understanding the reasoning behind actions.

• Mozi Nation emphasizes the importance of word-of-mouth for growing his podcast.
• He explicitly states that he doesn't use traditional advertising methods like ads or sponsorships.
• Mozi Nation requests that listeners share the podcast in the same way it was shared with them, to spread good karma for entrepreneurs.

"The only way this grows is through word of mouth. And so I don't run ads. I don't do sponsorships. I don't sell anything. My only ask is that you continue to pay it forward to whoever showed you or however you found out about this podcast, that you do the exact same thing."

This quote underscores Mozi Nation's reliance on organic growth strategies for his podcast, eschewing paid promotions and asking listeners to share the podcast to help it grow.

• Omar Ellitar compliments Mozi Nation on his creative advertising strategies.
• Mozi Nation is recognized for not conforming to standard advertising norms while still caring about the success of his ads.
• Omar inquires about Mozi Nation's mindset and approach to advertising, especially regarding the willingness to take risks.

"The one thing I love about your stuff, even when I see your ads, because you have some of the most creative ads I've seen online, half of it is like, you don't give a shit to play in the confines of everybody else, but you obviously give a shit for them to do well."

Omar Ellitar acknowledges Mozi Nation's unique approach to advertising, which balances nonconformity with a clear desire for the ads to perform well.

• Mozi Nation advises entrepreneurs to allocate a specific percentage of their income or advertising spend towards learning marketing with no expectation of immediate returns.
• He suggests treating this expenditure as an educational investment rather than a loss.
• Mozi Nation shares his own experience of allowing himself to experiment with advertising, leading to occasional successful outcomes and valuable learning experiences.

"If you want to learn how to market better, take a percentage of your advertising spend or a percentage of your income, if you're still working a job and say, this is what I'm willing to spend, and I'm willing to see zero return because I'm spending this on education."

Mozi Nation provides practical advice on how to approach marketing as an educational process, emphasizing the importance of dedicating funds specifically for learning and experimentation without the pressure of immediate success.

• Mozi Nation discusses the common issue of entrepreneurs setting unrealistic expectations for themselves.
• He uses analogies to explain why it's unreasonable to expect proficiency without significant practice and experience.
• The "story of the dice" analogy is used to illustrate the importance of persistence and the role of luck and talent in success.

"Everyone sabotages themselves simply based on expectations. That's it. What it comes down to is people sabotage themselves because they think that they should be more successful than they are, independent of a realistic assessment of what they have done."

Mozi Nation highlights the detrimental effect of unrealistic expectations on entrepreneurs' progress, suggesting that a lack of success is often wrongly attributed to personal failure rather than a normal part of the learning curve.

• Mozi Nation uses the dice analogy to explain the role of chance, talent, and persistence in entrepreneurial success.
• The analogy emphasizes that success is not solely dependent on one's actions but also on factors like natural talent and the amount of time one has been engaged in their endeavor.
• The key takeaway from the analogy is to keep taking action (rolling the dice) regardless of the outcomes and not to compare oneself to others.

"So let's say you and a friend are both given a die, right? Many sided die. And so let's say one of you has a 20 sided die and the other one of you has a 200 sided die on your die. Only one side is green, the other sides are red. Both of you. The catch is, no one knows how many sides each person has."

The dice analogy illustrates the unpredictable nature of entrepreneurial success and the importance of perseverance, with the green side representing a successful outcome and the act of rolling symbolizing continuous effort.

• Mozi Nation introduces the concept of risk-adjusted return and applies it to entrepreneurial decision-making.
• He references Jeff Bezos's philosophy on taking calculated risks for potentially high returns.
• Mozi Nation suggests that entrepreneurs allocate a percentage of their income to learning and skill acquisition rather than betting everything on a few chances.

"It's a risk adjusted return. It's a concept I like a lot. So Jeff Bezos says, if you have a 10% chance of 100 times payout, you take that bet every time."

This quote explains the concept of risk-adjusted return and its application to entrepreneurship, advocating for a strategic and calculated approach to investing in one's own growth and learning.

• Entrepreneurship inherently involves risk-taking.
• Comfort with risk is a prerequisite for successful entrepreneurship.
• Avoiding risk can indicate that entrepreneurship might not be the right path for an individual.

"Everyone has to go through is the thing that no one's willing to do, which is you have to risk."

This quote emphasizes the necessity of risk-taking as a fundamental aspect of entrepreneurship and suggests that it is often a barrier for many.

• Extending the time horizon for goals can lead to more reasonable plans and a higher likelihood of success.
• Short-term goals may lead to undue pressure and a tendency to jump between opportunities.
• Long-term perspectives can result in steady, reliable growth rather than unpredictable, rapid fluctuations.

"If I extend my goal, let's say it's make a million dollars a year, and let's say I give myself a decade to hit that. I would probably come up with a very different plan than if I wanted to be a millionaire in 90 days."

This quote highlights the difference in strategy and mindset when setting long-term goals versus short-term ones, suggesting that a longer time horizon can lead to more thoughtful and sustainable planning.

• The focus should not only be on getting rich but also on staying rich and continuing to grow wealth.
• Shifting focus from quick money to reliable money can lead to sustainable wealth creation.
• The key is not just making money but also keeping and continually making money.

"The question isn't whether someone gets rich, but if they stay rich, right? It's not whether they make money, but whether they keep money. They keep making money."

This quote underlines the importance of not just achieving wealth but maintaining and growing it over time, which requires a sustainable approach to business and financial growth.

• Selling products that help people make money can have high ticket sales but may not necessarily offer the most longevity.
• B2C (business-to-consumer) markets have more scale than B2B (business-to-business), offering opportunities in sectors like fitness due to a larger potential customer base.
• Operational skill is crucial for scaling in areas like fitness, where the volume of sales is higher but individual ticket prices are lower.

"So, helping people get fit. There's 300 million Americans, and half of them are overweight... So if I'm selling to gym owners, I got 40,000. If I'm trying to sell weight loss, I got 150,000,000."

This quote compares the potential scale of B2C markets to B2B, using the fitness industry as an example to illustrate the vast difference in market size and the opportunity it presents.

• Many online marketers lack the experience they claim to have, which can lead to deceptive practices.
• High-ticket items in the make-money-online niche can generate revenue with less operational effort, which appeals to inexperienced marketers.
• Sustainable businesses require a foundation of operational excellence, including the ability to build infrastructure, culture, recruit, manage, and build teams.

"Because if we're being real, the vast majority of people don't have the experience that they're claiming they do, because they are, quote, expert. Except they never have done it, or they did it. One time."

This quote points out the discrepancy between the claimed and actual expertise of many online marketers, which often leads to misleading business practices.

• Longevity in business comes from offering products or services that can withstand the test of time.
• Businesses based on temporary arbitrage opportunities are inherently unstable.
• A business that addresses a fundamental, unchanging need, such as fitness or consulting services that improve any business, is more likely to last.

"Will this be here in 20 years? Will the thing that I'm selling, seize candy, Warren Buffett, going to be here in 20 years? That's stuff that can last."

This quote encourages evaluating the long-term viability of a business concept by asking whether it will remain relevant and needed in the distant future.

• Alex provides resources for those interested in learning more about his business insights.
• He has a YouTube channel, a book available on Amazon, and a podcast where he shares his knowledge.

"I've got a YouTube channel that I just started. Just search my name, auction Mosey. I've got a book you can get on Amazon or you can get on Alex's book. It says it's called Gym launch Secrets, but it's 90% business book, 10% about gyms. And I've got a podcast called the Game."

This quote lists the different platforms where Alex shares his expertise and resources, offering avenues for the audience to engage with his content and learn from his experience.