How a $100M CEO would go about starting from broke!

About Alex Hormozi

Alex Hormozi is an American entrepreneur. He started as a management consultant in the public sector then left that career to pursue a career in fitness starting his first gym at age 23. He scaled his small gym chain from 0 to 6 locations in three years. Over the next two years, he and his wife started flying around the country turning gyms around.

Their large success, however, came from packaging and licensing his boutique gym model to 5000+ gyms around the world. They then started a supplement and software company to support that base of gyms. They sold a 66% stake in the company in 2021 at $46.2M to American Pacific Group. They then started Acquisition.com as a holding company for their private investments. The private equity firm focuses on making minority investments into cash flow positive growing founder owned businesses. They then scale those businesses. As of 2023, their portfolio of 16 companies generates $200,000,000 per year and growing.

The couple now has shifted their mission to making real business education available to everyone.

They fulfill this by making content across social media and publishing books and free courses for entrepreneurs.

I recently found a video where he talks about what he would do if he was broke and starting from nada today.

Here it is:

TL: dw ( Too Long, Didn't Watch)

Here is the cheat sheet:

Alex is discussing a message he received from someone who is "dead broke" and wants to know what to do.

Alex discusses the importance of having skills, as they cannot be taken away. Alex then shares his observation that wealthy people surround themselves with other wealthy people and have a lower desire to spend money.

Your Network is Your Nett-Worth

Alex then presents a scenario where if a person has $50,000 to invest and compares that to buying a house with a mortgage payment to finding a business to invest in.

Mr. Hormozi advises speaking to brokers for business investment opportunities but also mentions the possibility of negotiating a deal.

SO BUY NOT BUILD

Want a bullet-point review of the video?

1. Alex received a message from someone who is broke and wants to know what to do.
2. Alex has lost everything in the past but was able to collect $110,000 in the next 30 days by using their skills.
3. Alex mentions that skills cannot be taken away by anyone or the government.
4. Alex noticed that people with more money around them spend less money.
5. Alex provides two scenarios for investing $50,000: buying a house or acquiring a business.
6. Buying a house requires a down payment and a mortgage payment every month.
7. An alternative scenario is to look into buying a business in the area instead of a house.
8. Alex advises contacting brokers to get an idea of businesses in the area but also mentions negotiating a deal if buying from a broker.
9. Alex then mentions a deal they made where they bought a business for less than the asking price.
10. Alex stresses the importance of being knowledgeable about the business industry.
11. Alex mentions that they have bought businesses in different industries and they have all been successful.
12. Alex stresses the importance of taking action and not being afraid to fail.
13. Alex mentions that success is not guaranteed but taking action is important.

Conceptually this video is correct but there are much better ways to structure a deal, I am told.

Be cautious about overloading a company with debt, and don’t forget that the SBA will likely require you to personally guarantee that loan and post your other assets as collateral.

More on this to come.

But as you have read this far here is a BONUS LESSON and FACT

This entire blog was written for me

by CHATGPT - (??)

WHY

Cos Leverage is the tool to greatness and there are only Four C's Of Leverage that you need to add to your business to make more monies:

1. Collaboration (other people's time)

Hire smart people.

Get them to give their time to your cause.

Big things are done together. See: Pyramids.

2. Capital (other people's money)

Cash allows us to grow faster than what would be supported by a business's cash flow.

And in many cases, allows ideas that require scale to work, possible.

See: Funds.

3. Code (use a machine's time)

Code is just a machine's labor that you pay for once.

and you can charge for it forever.

It's leverage because it has virtually no incremental cost of use/production.

See: Software.

4. Content (other people's attention)

Capture people's attention through media.

More attention = more leverage.

One video can be seen by 1 person or 1M people for the same cost.

But you can charge for it every time. That's leverage.

See: MR BEAST

P.S If you need to make the $50 000 to start, here is my cheat sheet

You have to sell something to someone, that's it like literally, that's the most important thing I have ever learned.

Then its:

One Avatar ( he should never have made a sequel)

One Product

One Channel

that's it!

So you have one way of getting customers you sell one thing to one specific type of person that is all you need to do to!

Need More?

Sell one product to one avatar on one channel in a consistent manner so you start having predictive metrics on how you can acquire customers so it's either, " I spend this amount of money on advertising to get this many calls to get booked and then from that many calls I get this many sales etc.

If it's outbound then send this many emails or make this many calls or this many texts and then it's how many reply backs etc.

If you're running organic - it's that I need to have this many podcasts that create this many posts that I have to make across these different channels with a call to action that drives people towards this page and for every thousand visitors on this page I get this many opt-ins so I can then make this many calls to make his many sales.

These are only a few ways you can get customers:

OutReach, Affiliates, Referrals, Paid Advertising, Word of Mouth, and Content.

Pick one Avatar - One Channel and One Product as soon as you can

And start predicting how many inputs it takes to get an output - that will help you get to your goal.

NOW GO GET YOUR GOAL!