The Entrepreneurial Mindset Thriving in Uncertainty (with Erika Kullberg) Pt.2 Apr. ‘23 Ep 570

In a thought-provoking conversation, Alex Hermosi and his guests delve into the intricacies of business growth, content creation, and personal development. Hermosi challenges the notion of being the "greatest of all time," suggesting that true success lies in paving the way for others to surpass you. The dialogue covers practical strategies for entrepreneurs, such as providing high-value content for free, adopting a "watch, do, watch, do" learning approach, and identifying and overcoming business constraints. Hermosi also shares his personal journey, revealing a mindset shift from dismissing social media to leveraging it for brand building and deal flow. He candidly discusses his ambitions, including becoming the "most jacked billionaire," and emphasizes the importance of enduring discomfort for long-term success, a sentiment he hopes to impart to aspiring entrepreneurs.

• Being the GOAT implies a failure if it means not passing on lessons to others.
• The true measure of greatness includes the ability to teach and influence future generations.

"A lot of people were like the goat, and they want to be the greatest of all time. And I think that if you're the greatest all time, then you failed."

The quote emphasizes that true greatness is not just about personal achievements but also about the ability to contribute to others' growth.

• Content should be tactical, actionable, and free.
• The goal is to create content that people can immediately apply to their lives or businesses.

"I want to make stuff that people would otherwise charge lots of money for and then just give it away for free."

This quote reflects the intention behind the content creation: to provide high-value, practical information at no cost.

• The recommended approach is "watch, do, watch, do" to ensure practical application.
• The focus is on executing learned strategies and seeking specific content when new challenges arise.

"I want everybody in mozination to do is consume, execute, and keep executing until you realize you hit another point where you need to consume more and consume the next thing."

This quote outlines a cycle of learning and applying knowledge, suggesting that continuous improvement comes from action after consumption.

• Growth is limited by constraints within a system.
• Identifying and resolving these constraints is crucial for business development.
• Skill, trait, and belief deficiencies can be significant constraints.

"A system will grow until it is constrained, and then it will grow no longer until that constraint is fixed."

This quote highlights the principle that businesses must overcome limiting factors to continue growing.

• Kylie Jenner's success prompted a reevaluation of beliefs about business growth.
• Recognition that brand and social media presence are critical for scaling a business.

"I saw her on the COVID of Forbes, and I was like, she's younger than I am, and she's a billionaire. And I feel like I know more about business, and I need to learn from that."

Alex Hormozi acknowledges the impact of Kylie Jenner's success on his understanding of modern business strategies and the importance of brand and social media.

• Realizing that paid ads and outbound strategies are not the only factors for business success.
• Branding is a key element that was previously underestimated.

"But for me to be a billionaire, I didn't understand brand, and it was my big deficiency."

This quote reveals a personal revelation about the importance of branding in business growth and success.

• Influenced by the impact and mindset of Dean Graciosi and Tony Robbins.
• The willingness to accept fame as a necessary trade-off for making a significant impact.

"If that's the price I have to pay to make the impact I want to have, I'll do it every day of the week."

The quote captures the moment of realization that influence and impact may require a level of fame and public visibility.

• Alex Hormozi had existing infrastructure from Gym Launch to support his social media initiatives.
• Initially, he utilized a video guy to post content, finding it a "low lift."
• Alex emphasizes the importance of volume in content creation, drawing parallels to paid ads and outbound marketing.
• Quantity is seen as a forcing metric for quality, with the belief that more content leads to more impressions and growth.

"Well, I had infrastructure with gym launch, so I just had the video guy post it at the time. So I just did that because it was low lift for me."

This quote explains that Alex leveraged existing resources from his business, Gym Launch, to facilitate his entry into content creation without significant additional effort.

"The more content you put out, the more impressions you get. Everything grows that way because quantity is the only forcing metric for quality."

Alex is highlighting the principle that consistent and voluminous content creation is essential for improving quality and increasing visibility.

• Alex started by posting videos three times a week, despite them being of "terrible quality."
• He gradually improved his content by hiring an editor and exploring new formats like shorts.
• A vendor approached Alex to create shorts from existing content, which contributed to growth and served as a blueprint for approaching new platforms.
• Alex's strategy involves hiring experts, learning from them, and then bringing the skills in-house.
• The process of vendor to in-house transition is ongoing, aiming for total in-house production within six months.

"And then slowly added an editor. And then I was like, okay, well, maybe I should do, a guy approached me, he was like, I could do shorts for you."

This quote illustrates Alex's incremental approach to improving his content quality and experimenting with new formats through collaboration with others.

"Our entire goal is not to just have them do it, but for us to study every aspect of what they're doing and why they're doing it, so that we can bring it in house."

Alex describes his strategic approach to learning from external vendors with the ultimate aim of internalizing those capabilities.

• Alex views media as a compounding vehicle and recognizes the value of building an audience as the real asset, not just the content itself.
• He admits to initially not understanding the lasting value of content and the importance of an audience.
• The realization of media's compounding nature led Alex to focus on building a brand and investing in media.

"It took me a while to figure out that media in and of itself grows in a compounding way."

Alex acknowledges his delayed understanding of the exponential potential of media and its impact on growth.

• Alex is comfortable with the fame social media brings, acknowledging both its pros and cons.
• He emphasizes his primary goal of making money but also highlights the importance of having a motivating vision for employees.
• Alex's vision includes donating to educational charities and documenting best practices for building world-class companies.
• He aims to build credibility to make it easier for people to trust and learn from him, citing the lack of documented journeys from successful entrepreneurs like Jeff Bezos and Elon Musk as a missed opportunity.

"I'm always here to make money. That's what I'm trying to do."

Alex clearly states his primary objective of making money, ensuring transparency about his intentions.

"The big vision is to document and share the best practice of building world class companies."

This quote outlines Alex's broader mission, which goes beyond financial gain to include educational and inspirational goals.

• Alex's personal income has not grown due to the negative impact of Covid on the gym industry.
• He reflects on his lack of understanding regarding reinvestment and mergers and acquisitions (M&A) in the past.
• Alex shares his financial figures from 2018, highlighting a significant profit but also a missed opportunity for reinvestment in the business.

"So it hasn't grown because Covid was not good for gyms."

This quote indicates that despite past success, Alex's personal income has been affected by external factors, specifically the pandemic.

"I also didn't understand the concept of reinvesting the business, or M and A at that point."

Alex admits his previous lack of knowledge in key business growth strategies, which has since become an area of learning and application.

• Alex Hormozi discusses the financial growth of his business, even during the COVID-19 pandemic.
• Despite the challenges of COVID-19, the business saw a consistent upward trajectory in revenue.
• Alex describes the impact of COVID-19 on gyms as a "smiley face" with January being the middle point, indicating a period of downturn followed by recovery.
• The business closed a deal in December 2021, which contributed to their financial success.

"And so we still grew, though. We did 37 million top line, and then we did, I think 13 million is what I took out that year. And then 2020 was Covid, which was three months in, and we actually had planned to sell. We went to market the month before COVID started." "But because we were on an upper trajectory coming out of January and they loosened some of the COVID stuff, we just pretty much started going straight up to the right."

The quotes highlight the resilience and growth of Alex's business despite the initial negative impact of the COVID-19 pandemic. The business continued to thrive financially, with an upward trend in revenue post-January.

• Alex Hormozi explains his decision-making process behind pursuing business acquisitions.
• The experience of successfully conducting three deals in 2021 influenced Alex's decision to continue with acquisitions.
• The business expanded to include eleven companies with a portfolio doing just under 200 million top line.
• The companies in the portfolio are characterized by being bootstrapped, profitable, cash flow positive, and with high net margins.

"And so we went super aggressive in acquisitions because that year, in 2021, the reason I actually decided to go through the sale, I actually almost backed out of the sale twice, was because I had done three deals that year, that year, and all three were going really well." "So we have eleven now. And so we do minority stakes and so the portfolio right now does just under 200 million top line."

The quotes explain Alex's shift in focus towards acquisitions after realizing his passion for growing companies. The portfolio's success is emphasized by its substantial top-line revenue and the strategic choice to take minority stakes in profitable, growing businesses.

• Alex Hormozi outlines his social media strategy to increase deal flow for his business.
• The strategy hinges on several "need to believes," including gaining a social media following, content creation leading to deal flow, increasing popularity, and the ability to add value to companies.
• The strategy has resulted in a significant increase in portfolio company profits.
• Alex acknowledges the challenge of influencing change in companies where he holds a minority position.

"So we have a strategy deck that's like, what are the need to believes for this to be true? So one is that Alex can gain a social media following." "The fourth need to believe was that we would be able to add material or outsized returns or value through our own experience by taking on companies that fit our, we call it the vam, but it's like our value acceleration method."

These quotes detail the strategic plan Alex has for leveraging social media to attract investment opportunities and enhance business growth. The "need to believes" serve as a foundation for the strategy, highlighting the importance of social media influence and the ability to significantly increase company profits through their value acceleration method.

• Alex Hormozi identifies the risk of brand damage, particularly from being "canceled," as the biggest threat to his success.
• He expresses confidence in his ability to adapt and overcome such challenges by potentially using different figureheads or personalities.

"Me saying something and getting canceled for some reason. That's what I think. Threats wise? Yes. Do I think I would adapt? Yes, but in terms of like, because I will either win or I will die." "I think in a single word, it's like irreparable brand damage."

The quotes convey Alex's perception of the current "cancel culture" as a significant risk to his business and brand. He emphasizes his determination to succeed, regardless of the challenges, and contemplates strategies to mitigate the impact of potential brand damage.

• Alex Hormozi shares his personal goal of becoming the "most jacked billionaire" and views it as an amusing yet attainable target.
• He compares his fitness level to that of Jeff Bezos, humorously suggesting that while Bezos may be wealthier, Alex believes he is more physically fit.

"Thought it was funny mostly, but I figured it was just become a billionaire, and at that point, I will probably be the most jacked guy in the room." "He's not more jacked than I am."

These quotes reflect Alex's lighthearted approach to setting personal goals, tying together his aspirations for both financial success and physical fitness. He uses humor to address the topic while also expressing confidence in his fitness achievements compared to other wealthy individuals.

• Alex Hormozi sees becoming a billionaire as a milestone rather than for the wealth itself.
• His aim is to provide comprehensive education on how to succeed in business, documenting each step of his journey.
• Hormozi believes in paving the way for future entrepreneurs to surpass his achievements.
• He emphasizes the importance of learning from the mistakes and successes of predecessors.
• The concept of being the "greatest of all time" is seen as a failure if it doesn't lead to others surpassing that greatness.
• Hormozi values documenting his process both for others and for his own understanding.

"I think it's really just a milestone. It's way less about the actual billion dollars. But I do think to the point earlier about having the credibility to." "I want to go all the way and show every single step of the process how I did it so other people can do it."

These quotes highlight that for Hormozi, reaching a billion dollars is about credibility and providing a blueprint for success to others, not the financial status itself.

"We've talked about this a lot, but Gary didn't have Gary. Right. Gary just paved the way for people like us to go do what we're doing, and we learn from their mistakes and their best practices, and we don't have to wait ten years to learn it."

Hormozi stresses the value of learning from those who came before and how it accelerates the path to success for the next generation.

"If you're the greatest all time, then you failed because especially if you want to be a teacher of some kind, which is a relatively loaded word, but if you want to pass on lessons to other people, if you were the greatest of all time, then you failed."

This quote conveys Hormozi's belief that true success as a teacher or mentor comes from enabling others to exceed your achievements, not just being the best yourself.

• Start working towards your goal immediately and commit to it.
• Emulate the volume of work done by those you admire and stay consistent over time.
• Gain depth of knowledge in a particular field or sector.
• Understand that mastering something takes time and you will initially not be good at it.
• Choose a path that genuinely interests you, as passion can drive long-term commitment.
• Expect to spend a significant amount of time, possibly a decade, to achieve significant success.

"You have to start, you have to do the same amount of effort that the person who you think you want to emulate has done."

This quote suggests that aspiring millionaires must be willing to put in the same level of work as those they look up to in order to achieve similar success.

"It comes from having deep roots, you know what I mean, in a subject or a sector."

Hormozi emphasizes the importance of deep, specialized knowledge in a field as a foundation for success.

"So the only way to be the greatest of all time is to not be and to have set the stage for people who are younger who, I don't know, to beat me."

The quote reflects Hormozi's philosophy that the true measure of greatness is setting up future generations for success beyond one's own achievements.

• Feelings are separate from the character traits one aspires to develop.
• Being courageous means acting despite feeling fear, and being patient means persisting despite wanting to stop.
• Hormozi advocates for enduring short-term discomfort for the sake of long-term goals.
• The key takeaway is to start on your path and not allow yourself to quit.

"Alex taught me that the feelings that I have are independent of the character traits that I want to espouse."

This quote encapsulates Hormozi's message that personal growth involves acting in accordance with desired virtues, regardless of emotions.

"It's enduring short term discomfort for long term achievement."

Here, Hormozi summarizes his philosophy of personal development, emphasizing the importance of perseverance and resilience in the pursuit of long-term success.