Time Horizons Ep 374



Alex Hormozi discusses the principles of wealth accumulation and strategic long-term thinking across various life aspects, including business, personal growth, and health. He emphasizes the importance of adopting an infinite game mindset, where the goal is to keep playing, rather than winning once and for all. Hormozi contrasts rich people who sell with wealthy people who buy and build, highlighting the tax inefficiency and limitation of selling. In business, he advocates for marketing strategies that focus on long-term customer relationships over immediate sales. When hiring, Hormozi recommends patience to find the right fit, suggesting that businesses grow to the collective knowledge of their employees. In personal life, he advises against settling for convenience in relationships and instead making decisions with a long-term view. Hormozi also touches on health, promoting sustainable lifestyle changes over short-term diets or intense exercise regimens. Throughout, he shares personal insights and experiences from running acquisition.com, a portfolio of companies with $85 million in annual revenue.

Summary Notes

Wealth Accumulation Strategies

  • Wealthy individuals prioritize holding and building assets over selling them.
  • Selling assets leads to taxable events and often requires reinvesting in other opportunities, which can be less efficient.
  • Buying and building assets allows for consistent expansion and accumulation of net worth and equity.
  • Selling is only advisable when one loses interest or believes the venture's potential has been fully realized.
  • The ultimate goal is to increase financial stability and net worth over time.

"Rich people sell, wealthy people hold, and more specifically, wealthy people buy and build."

This quote emphasizes the different approaches between the rich and the wealthy regarding asset management. The wealthy focus on long-term growth through acquisition and improvement of assets, rather than short-term gains from selling.

Infinite vs. Finite Games

  • Life's most important aspects, such as health, wealth, relationships, and marriage, are considered infinite games.
  • Infinite games have both known and unknown players, no set rules, and the objective is to keep playing.
  • Finite games have known players, agreed-upon rules, and clear outcomes, with the objective being to win.
  • Adopting an infinite game mindset in business and life leads to long-term success and sustainability.
  • The U.S. involvement in Vietnam is an example where a finite game mindset was less effective than the infinite game approach of the Vietnamese.

"I prefer to play games where if I wait, I win... The point of the game is to keep the game going... He who has the longest time horizon wins."

This series of quotes outlines the philosophy of approaching life and business as infinite games, where patience and a long-term outlook lead to success. It suggests that focusing on ongoing participation and adaptation is more effective than seeking immediate victories.

Business Strategy and Marketing

  • Marketing should be viewed as a tool to improve products and services rather than just a means to sell.
  • An infinite game perspective in business involves sacrificing short-term growth for long-term improvement and customer retention.
  • The goal is to create a product so compelling that marketing efforts naturally lead to repeat purchases and word-of-mouth referrals.
  • The shift from making a sale to acquire a customer to creating a customer to make a sale is crucial.
  • This perspective change affects the overall approach to business, encouraging patience and a focus on continued play rather than immediate results.

"The point of marketing, if you have a more infinite perspective, is to get people to buy so that we can figure out how to make the product amazing... The point in the beginning especially, is to make a sale to get a customer, rather than making a customer to get a sale."

This quote clarifies the shift in perspective from using marketing solely to drive sales to using it as a means to develop a lasting relationship with customers. It highlights the importance of focusing on customer satisfaction and loyalty as a long-term business strategy.

Personal Introduction and Credentials

  • Alex Hormozi introduces himself and his business, acquisition.com.
  • Hormozi's portfolio of companies generates substantial annual revenue.
  • He emphasizes that he has no products to sell to his audience, positioning himself as an informative resource rather than a salesperson.

"My name is Alex Hormozi. I own acquisition.com. Our portfolio of companies does about $85 million a year, and I have nothing to sell you."

This quote serves as an introduction to Alex Hormozi, establishing his credibility and success in business. He also sets the stage for providing value through information and insights without the intent to sell anything to the audience.

Importance of Long-Term Thinking in Business

  • Rush decisions often lead to mistakes due to arbitrary time constraints.
  • Focusing on doing one thing right over a year or two can greatly reduce the chance of failure.
  • Businesses generally grow over time in income and value, except when they fail, often dropping to zero.
  • Taking time to get things right provides a strategic advantage as most people think in finite terms.

"And people make tons of mistakes in business purely because they arbitrarily cut their time horizon." This quote highlights the common error of setting short-term goals that can lead to poor decision-making and business mistakes.

"If I just did this one thing right over the next year or two, then it would make it virtually impossible for me to fail." Alex Hormozi emphasizes the importance of focusing on key actions over a longer period to ensure business success and growth.

Marketing Strategy: Goodwill and Audience Building

  • Short-term thinking in sales focuses on immediate gains rather than long-term relationships.
  • Building an audience by providing consistent value over time can compound goodwill faster than revenue.
  • Goodwill is the value given to customers at no monetary cost, paid for with their time and attention.
  • Withdrawing from the goodwill bucket too quickly can reduce audience growth and make a brand less viral.
  • A strategy of "give, give, give, then get" can lead to more sustainable growth and influence.
  • Large influence can lead to opportunities without the need for asking, as seen with celebrities like The Rock and Conor McGregor.
  • Direct response marketers often transition to branding with a longer time horizon between giving and getting.

"The short term finite thing is, like, I need to get them to say yes because I need this money, right? Versus what am I saying yes to by selling them, right?" Alex Hormozi contrasts the immediate need to make a sale with the broader implications of what selling to a customer entails for long-term relationships.

"Goodwill compounds faster than revenue or money because you fundamentally fix the value equation in your favor, because your price is zero." The concept here is that providing value without a monetary cost can lead to faster growth in goodwill and audience loyalty.

Long-Term Perspective on Investments and Hiring

  • Extending the time horizon can decrease downside risk to almost zero.
  • Adopting a long-term perspective can differentiate between the rich and the wealthy.
  • This approach can be applied to hiring, focusing on long-term fit and cultural reinforcement rather than short-term needs.
  • Not every employee is suited for all stages of a business's growth, but values alignment is crucial.

"Strategy is like, I want to set a strategy where if I wait, I win." Alex Hormozi outlines a strategic approach where patience and time are leveraged to ensure success, minimizing risk.

"If you just thought I was only going to buy 20 companies for the rest of my life, you would think about it differently." This quote refers to Warren Buffett and Charlie Munger's investment philosophy, emphasizing careful consideration and long-term planning.

Importance of Audience Support for Podcast Growth

  • Alex Hormozi emphasizes the value of audience engagement in spreading the podcast's impact.
  • He requests listeners to leave reviews as a means of support.
  • Reviews are seen as a way to help more entrepreneurs and can potentially change lives.
  • Hormozi expresses gratitude for the audience's help and highlights the importance of their role in the podcast's success.

"Real quick, guys. You guys already know that I don't run any ads on this and I don't sell anything. And so the only ask that I can ever have of you guys is that you help me spread the word so we can help more entrepreneurs make more money, feed their families, make better products, and have better experiences for their employees and customers."

The quote underlines Hormozi's reliance on the audience to promote the podcast, as he does not use ads or sell products. He believes that audience support through reviews can extend the podcast's reach and positively impact more entrepreneurs.

Hiring Philosophy and Talent Acquisition

  • Hormozi shares his approach to hiring, which involves a willingness to undergo discomfort to find the right candidate.
  • He no longer settles for candidates who are just "good enough."
  • The "long term perspective" in hiring is crucial for Hormozi, as it leads to better talent acquisition and growth within the business.

"And so this is kind of the long term perspective, is I'm willing to wait a longer period of time in discomfort in order to interview 25 people, rather than five to get the right person."

The quote reflects Hormozi's strategy of prioritizing quality over convenience in hiring, even if it means a more extended, uncomfortable process to secure the best talent.

Knowledge Accumulation and Business Scaling

  • Hormozi discusses the concept that a business's potential is limited by the collective knowledge of its employees.
  • He points out the limitation of the business growing only to the capacity of the owner's knowledge if the owner is the most knowledgeable about all roles.
  • To scale a business, bringing in people smarter and more skilled than the owner is necessary.
  • The discussion emphasizes the importance of relinquishing control for business growth and the inherent trade-off between control and freedom.

"And so if you want to have a business that quote runs without you, then it means it does not need you, which means that it needs other people, which means that you have relinquished control to those people."

This quote captures the essence of scaling a business by hiring people who can operate independently of the owner, thus allowing the business to function without the owner's constant involvement.

Relationship Dynamics in Personal and Professional Life

  • Hormozi draws parallels between hiring practices and personal relationships.
  • He cautions against settling for "good enough for now" in both hiring and dating.
  • The analogy of buying a temporary couch that becomes permanent illustrates the danger of complacency in relationships.
  • Hormozi advocates for a deliberate approach to relationships, taking time to add and being swift to remove when necessary.

"So we need to be usually much slower on the adding and much faster on the removal, which is the concept of higher fast. Sorry, higher slow, fire fast."

The quote emphasizes the principle of being cautious and thoughtful when bringing new people into one's life, whether in a business or personal context, and being decisive in ending relationships that are not beneficial.

Reflection on Dating and Long-Term Compatibility

  • Hormozi reflects on his dating experiences and the importance of considering long-term compatibility.
  • He shares his strategy of quickly determining the potential for marriage on first dates.
  • Hormozi's approach to dating is informed by his desire not to waste time with someone he cannot envision a future with.

"And I would really only go on as many dates as was necessary to rule out the person as, no, I don't think I would marry them."

This quote reveals Hormozi's practical approach to dating, where he focuses on quickly assessing the long-term potential of a relationship to avoid investing time in a non-viable partner.

Trade-offs Between Fear, Regret, Comfort, and Fulfillment

  • Alex Hormozi discusses the trade-offs between fear, regret, comfort, and fulfillment.
  • He notes that fear is associated with short-term pain, while regret is linked to long-term pain.
  • Comfort is seen as a short-term gain, and fulfillment is considered a long-term gain.
  • The goal is to trade short-term discomfort (fear) for long-term benefits (fulfillment), rather than seeking immediate comfort.
  • This concept is applicable to various aspects of life, including business and personal relationships.

"Fear is short term pain, regret is long term pain. Comfort is short term gain. Fulfillment is long term gain. And so the idea is we want to trade fear for fulfillment."

This quote encapsulates the essence of the trade-off concept, emphasizing the importance of enduring short-term challenges for the sake of long-term satisfaction and success.

The Importance of Long-Term Thinking in Relationships

  • Alex Hormozi emphasizes the importance of evaluating relationships based on their long-term impact.
  • He suggests that one should consider whether relationships will make them better or worse over time.
  • The metaphor of pruning a tree to promote growth is used to describe the need to end relationships that do not align with long-term goals.
  • Being less tolerant of negative influences and willing to endure short-term suffering for long-term benefits is highlighted.

"I think if you can make that simple shift in terms of the relationships you have with friends and mates, it will serve you in the long run."

This quote suggests that reevaluating relationships with a focus on long-term outcomes can lead to a more fulfilling life.

Sustainable Health and Fitness Strategies

  • Alex Hormozi shares insights on sustainable health practices based on his experience in the fitness industry.
  • He argues that dietary and workout routines should be sustainable over a decade, not just for a short period.
  • The focus should be on consistent, compoundable actions that one can maintain indefinitely.
  • He cautions against adopting health strategies that require giving up enjoyable aspects of life, as they are not sustainable.

"If you can't eat this way for a decade, there's no point in doing it for a day."

This quote highlights the importance of adopting a long-term perspective on diet and exercise, implying that sustainable habits are key to lasting health benefits.

Perspective on Exercise and Life Extension

  • Alex Hormozi discusses the trade-off between time spent exercising and life extension benefits.
  • He questions whether the time investment in intensive workouts is justified by the potential increase in life span.
  • Hormozi suggests that simple activities like walking, taking aspirin, and not smoking can provide significant life extension benefits without the excessive time commitment.
  • The focus should be on enjoying the process and choosing activities that one can continue over the long term.

"If you do those three things, you'll get all of the benefits of life extension."

This quote points out that simple, less time-consuming health practices can be as effective as more intensive exercise routines for extending one's life.

Long-Term Strategy in Business and Personal Growth

  • Alex Hormozi advocates for setting long-term goals and strategies in business and personal development.
  • He stresses the importance of patience and the willingness to invest time to become proficient at something.
  • Hormozi criticizes short-term thinking and the unrealistic expectation of rapid success.
  • He suggests adopting a mindset where waiting and persistent effort lead to winning in the long run.

"I'd rather play games where if I wait, I win."

This quote reflects Alex Hormozi's philosophy of preferring endeavors that reward patience and long-term commitment over immediate results.

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