From Broke At 26 To $100 Million Net Worth By 31 (Alex Hormozi Interview)

1. 0:00 – 8:55

   Explaining Alex's business

   1. AHAlex Hormozi0:00

      I have come to accept that I love working, and I don't need to judge myself for that or, or take in other people's judgment on how much I should, quote, do. Like, this is my life and this is what I like doing.

   2. SPSam Parr0:19

      Because I'd never heard of you before, and I was like, A, this guy is popping up all over my YouTube all of a sudden. What the hell is going on? And B, he's saying that this gym... I don't know. I, I called it a course, which actually is incorrect.

   3. AHAlex Hormozi0:31

      Yes. I was-

   4. SPSam Parr0:31

      So I would love for you to-

   5. AHAlex Hormozi0:32

      I was like, there's one, if there's like one thing that I could make, just for the, almost for the audience's sake, 'cause like we're, we were much closer to what a franchise would be. Um, and overall, in the very beginning, that was what the big decision was. Like, am I gonna go the franchise route? 'Cause I had six working locations. I was 26 years old, and they, you know, they worked. And that's when a mentor was like, "You should stop owning all these gyms. You need to license the model out." And so that was when I kinda transitioned from B2C to B2B. Um, what you might not know is that for two years I actually, 'cause I wasn't confident, I was like, I know it works in my six markets. I was like, but does it work in all of these markets? So my wife and I actually did 32 gym turnarounds in the next two years. So we'd fly out in person, fix their pricing, change how they did their layout, change their sales process.

   6. SPSam Parr1:14

      Just like a consultant, like, like a management consultant for a gym.

   7. AHAlex Hormozi1:17

      100... It's exactly that. And then, um, from there we, you know, we figured out, we cleaned it up to just, like, completely dial it in. Um, and then it, I would love to say it was some stroke of brilliance of like, and then in my master plan, I decided to start licensing. Um, that was not what happened. Uh, we ended up doing these launches, and the flaw of the business model was that I didn't control the fulfillment. So we would go in, we would charge nothing. It was pure performance. We'd fly in, and I would charge 100% of the upfront cash collected, uh, that we would do while we were there. So we averaged about $100,000 in cash collected in 21 days, and that's what we would average per gym that we'd come into. And-

   8. SPSam Parr1:56

      So that means each gym is making an incremental 100 grand a month from your insights?

   9. AHAlex Hormozi2:00

      So I, if I were launching eight gyms in one month, we would make $800,000. We would.

   10. SPSam Parr2:04

       Got it.

   11. AHAlex Hormozi2:05

       Right?

   12. SPSam Parr2:05

       Oh, that... And this was when the model before-

   13. AHAlex Hormozi2:07

       Yeah

   14. SPSam Parr2:07

       ... you were, like-

   15. AHAlex Hormozi2:08

       Exactly

   16. SPSam Parr2:08

       ... go, doing gym launch.

   17. AHAlex Hormozi2:09

       And s- and so what ended up happening though was, like... And it started scaling really quick. I was like, "Fuck, this is, this is the game." Like, this is what I need to be doing. This is awesome. And they didn't have to spend money on ads. They, like, they did literally nothing. They gave me a place to go market and sell, is basically what happened. And so what happened is we would dip out, and then all these customers that we sold would then be fulfilled by a facility that was struggling, because that's why they called us. So they typically had pretty poor product, and I didn't have the bandwidth to stay there for six weeks on top of that and retrain trainers and show them how to set up cl- like, I didn't have the time to do it, 'cause we were marketing and selling most times we were there. And so anyways, we would fly out, and then what happened in un- an unfortunate percentage, they basically were like, "Hey, you signed up and paid this guy $500. I would give you the same thing for $200. Refund with him and just sign up, and I'll do everything through me."

   18. SPSam Parr2:57

       [laughs]

   19. AHAlex Hormozi2:59

       And so within a matter of months, I had, uh, like, $150,000 in refunds between, like, three facilities, 'cause they talked to each other, and then I was like, "Fuck."

   20. SPSam Parr3:06

       Yeah.

   21. AHAlex Hormozi3:07

       And I already incurred the cost of the marketing, the flight, the sales guy, the hotel-

   22. SPSam Parr3:10

       What was-

   23. AHAlex Hormozi3:11

       ... the rental car, everything.

   24. SPSam Parr3:12

       What was the name of this gym franch- this, this-

   25. AHAlex Hormozi3:14

       It was Gym Launch

   26. SPSam Parr3:15

       ... turnaround business?

   27. AHAlex Hormozi3:15

       It was Gym Launch.

   28. SPSam Parr3:16

       Okay.

   29. AHAlex Hormozi3:16

       But I'll tell you this, the original concept was Gym Rescue. Um-

   30. SPSam Parr3:20

       Yeah
2. 8:55 – 27:55

   Alex's background and how he got his start

   1. SPShaan Puri8:55

      I only barely know the story, but the story is you open up a couple gyms yourself. So you open up a gym-

   2. AHAlex Hormozi9:00

      I did

   3. SPShaan Puri9:00

      ... and you get to six locations.

   4. AHAlex Hormozi9:02

      Yeah.

   5. SPShaan Puri9:03

      You're sleeping on the gym floor, which is always... You know, any business I do, I'm just gonna sleep in a garage w- at least one night so I can say that.

   6. AHAlex Hormozi9:09

      [laughs]

   7. SPShaan Puri9:09

      But, uh, but, but, you know, you know, may- maybe you did the real deal where you, [laughs] you actually had to sleep there. I don't know. So you-

   8. AHAlex Hormozi9:14

      Nine, nine months

   9. SPShaan Puri9:15

      ... nine months. All right, so you're sleeping on the gym floor for nine months. Uh, you end up getting six locations off of cash flow, so you know, you're not like, you know, getting a bunch of investors to come in or whatever.

   10. AHAlex Hormozi9:23

       Mm.

   11. SPShaan Puri9:24

       And somehow, some way, you stumble into this like, I don't know, like a mastermind or a retreat by Russell Brunson-

   12. AHAlex Hormozi9:29

       Mm-hmm

   13. SPShaan Puri9:30

       ... the, the... Or I don't know if he hosts it or he was-

   14. AHAlex Hormozi9:31

       Yeah

   15. SPShaan Puri9:31

       ... just there, um, who's the ClickFunnels guy.

   16. AHAlex Hormozi9:34

       Mm-hmm.

   17. SPShaan Puri9:34

       How did you even get to that event? And then I wanna ask you a couple questions about it.

   18. AHAlex Hormozi9:37

       Yeah, so for, for avoidance of doubt, I had two partners that after I had my successful gym, uh, one was the ex-COO of Broadcom, [laughs] number two at Broadcom, $10 billion company. Um, and the other guy had 22 tanning salons. And so the Broadcom guy brought in the tanning salon guy and was like, "Hey, let's scale this thing." And I was like, "Awesome." Long story short, the partnership didn't work out. Um, and so I ended up opening the next f- three on my own. Um, and I opened up two more with them, and then I ended up buying out, uh, both of them over time. So just for-

   19. SPSam Parr10:13

       Did you have a job before this? 'Cause-

   20. AHAlex Hormozi10:14

       No

   21. SPSam Parr10:14

       ... uh, you're only 29, 30?

   22. AHAlex Hormozi10:16

       I'm 32. Um-

   23. SPSam Parr10:17

       32

   24. AHAlex Hormozi10:17

       ... I was a management consultant, uh, before that. So I quit my management consulting job-

   25. SPSam Parr10:21

       Got it. Makes sense

   26. AHAlex Hormozi10:22

       ... and then, and then started this. Um, the question that you asked though originally was?

   27. SPShaan Puri10:26

       So h- how did you end up at this thing where, uh, it's at this m- hangout or this mastermind-

   28. AHAlex Hormozi10:31

       Right

   29. SPShaan Puri10:31

       ... or this meeting where you, where you realize, "I'm in the wrong business. I shouldn't be running gyms. I should be teaching other people how to run j- run their gyms."

   30. AHAlex Hormozi10:37

       Yeah.
3. 27:55 – 32:30

   Starting a supplement business

   1. AHAlex Hormozi27:55

      Prestige Labs, in December of, in December of '18.

   2. SPSam Parr28:03

      And you're basically selling supplements to your clients.

   3. AHAlex Hormozi28:07

      Well, s- through the clients. So they never actually purchased from us directly. What we did was we created a drop shipping model, because the number one issue that small business owners have is cash flow. So I said... What we did was we sent out retail kits that had 130 bottles and they were empty. So the retail kit was, like, 100 bucks, and they could stock their whole wall because all consumer research shows that, like, the more stocked the wall is, the more likely they are to purchase, and they would only have one sampler of all of them out. And then we sent them a kiosk with a, with an Amazon, uh, uh, k- uh, Fire on it, right, that was preloaded with their affiliate link. So someone would try it-

   4. SPSam Parr28:39

      Oh my God

   5. AHAlex Hormozi28:40

      ... they'd love it, and they would make the purchase right there. And we'd say, "Hey, this is so much better 'cause now it'll go straight to your doorstep. You don't need to take it home with you. And better yet, you won't miss a month because it'll automatically ship to you." So we gave the gyms a second recurring revenue stream through the supplements. So when someone walks in, what I was telling you earlier, like, sell, sell them service, then we sell them product. We'd sell two EFTs, so that's the gym word for electronic fund transfer, so recurring revenue. So we'd sell them a service recurring, and then we'd sell them a product recurring so that we'd have two different streams that would come in. The nice thing with the product recurring is that there was no, there was no operational drag for the gym. They don't have to do anything. They just have to make the one sale one time, and they're gonna make 80 bucks a month from that point going forward, pure profit for them, like, just straight to the bottom line. And so what... You know, interestingly, uh, [laughs] a lot of gyms made more money selling the supplements than they did on their service 'cause the service is low margin, but the, the product was, like, almost all margin for them. And we paid really aggressively, so we paid 40%, um, commission to them 'cause they were paying for the cost of acquisition and doing the sale. So I said, "You know, you guys should get disproportionately rewarded." And the first month we launched that, uh, so we beta launched in December, and then January of 2019 is when it kind of officially launched, and the first month we did 1.7 million. And so, um, 'cause I figured, I was like, "Okay, if we've got, you know, 800 active gyms, if each of those guys sells..." And it was actually under my projections 'cause I was like, "We're gonna be, you know, so wealthy." I was like, "If all of these guys just sell $5,000 a month," [laughs] I was like, "We'll do a million a week." Um, it didn't work out that way. But, uh, we ended up doing that year 37, but my licensing business came down, and I think it went to, like, 20-ish, and then the supplement company did, like, 17. And part of the reason, the oopsie that I did was two big oopsies. Number one was I started a second active company when I already had one, which to me I think was a mistake, uh, given the skill set I had at the time. And then the second, uh, oopsie was that because I thought a potential acquirer would want lower churn, which is true, um, I lowered the price. And so I thought that if I lowered the price, that would get more people to stick. And so I cut my top line price by 25% and saw absolutely no change and just lost 25% of my-

   6. SPSam Parr30:50

      What, what, what was it, and what did you reduce it to?

   7. AHAlex Hormozi30:53

      It went from, uh, the... It went from $800 a week, which was the licensing, uh, on the back end, to $600 a week

   8. SPSam Parr31:00

      What's 800 a week times 52? I don't even know.

   9. AHAlex Hormozi31:03

      Yeah.

   10. SPSam Parr31:03

       Like, what's the annual cost?

   11. AHAlex Hormozi31:04

       42.

   12. SPSam Parr31:05

       What is it?

   13. AHAlex Hormozi31:05

       42,000.

   14. SPSam Parr31:06

       So it costs 42 grand to be, uh, a part of your-

   15. AHAlex Hormozi31:09

       Yeah, the Legacy

   16. SPSam Parr31:09

       ... w- what, what do you call it? Part of your-

   17. AHAlex Hormozi31:11

       Gym Lords.

   18. SPSam Parr31:12

       Not core. Yeah, but what do you... What's, like, the noun that you use to describe this? Uh, like, your, your-

   19. AHAlex Hormozi31:17

       The program was called Legacy. The people were called Gym Lords. And so we would sell the launch as a front-end program, and then they would go into the continuity, which was Legacy. So if you're, if you're f- if you're f- if you're following along from home, for anyone in the podcast, I copied the exact same model. So I sold a six-week defined end program for a lot of money, and then I down sold the continuity because 16,000 for 16 weeks is 1,000 a week. And so I said, "Now you're gonna get more for less for $800 a week. You're gonna get what you had before, plus all this other stuff for less money than you were currently paying." And they're like, "What a deal." At the gym, I'd said, "Hey, it's $100 a week, $600, and if you stay, we're gonna drop you from 250 a month to $200 a month, 'cause we'll take your $600 and we'll spread it over, uh, 12 months. We'll go $50 a month in credit. And so then you get to 199 a month." And so it was front end to liquidate the cost of acquisition so that I wouldn't need outside capital to acquire customers, and then the back end, I would down sell the upsells so that we could keep the continuity and make it-

   20. SPSam Parr32:10

       Which is all, like, the most classic internet marketing shit.

   21. AHAlex Hormozi32:13

       Sure.

   22. SPSam Parr32:13

       Which, like, a lot of, like, tech startup stuff, they don't do this, and they're fools for not doing it.

   23. SPShaan Puri32:17

       Yeah, in, in tech startups, we do the opposite typically. So we say, "Hey, uh, we wanna get you in. We wanna make... You don't know us. We don't know you. Let's make the cost of c- of trying so low, so f- free, free trial. Don't even put a credit card on file."

4. 32:30 – 46:30

   How to get big commitments up front

   1. SPShaan Puri32:30

      And they try to g- put the bar as low as possible. You did the exact opposite. You said, "Okay, I'm gonna put actually more friction up front. I'm gonna ask for $500-"

   2. AHAlex Hormozi32:38

      Sure

   3. SPShaan Puri32:38

      ... or $16,000, a huge number up front, and then over time I'm gonna actually be selling you on more value for less cost. Why do you think that works or, uh, why do you think that worked for you to, to charge, have such a big kind of commit up front when, you know, that's usually when people are, you know, hesitant?

   4. AHAlex Hormozi32:56

      I think there's a couple pieces. Um, one is most software companies have funding. Not all, but a lot of them have funding. I did not have that, and so I could not afford to be in the negative and incur co- I didn't, I couldn't have a burn rate. Burn rate was Alex's bank account. So that wasn't gonna work for me. From a psychological and behavioral standpoint, it always made sense to me to sell s- someone when they're the most excited. So you're the most excited day one, before you've gone to your first workout, because once you get your first workout, you're like, "Shit, this is gonna be work." So-

   5. SPShaan Puri33:28

      [laughs]

   6. AHAlex Hormozi33:28

      ... and I'm gonna have to start dieting and not eating the stuff I want. Sell them when they're excited about the bikini and not about the TSA and the airplane they have to go through to get to Maui, right? And so I followed that. And then the reason that we decrease cost over time is because it's my belief that information decreases in value over time. And so, uh, the longer someone has it and exposure to it, the less valuable it is, you know, marginally. And so we try to accommodate that with the pricing. And since our, our gross margins were still basically 100%, it still made sense for us.

   7. SPShaan Puri33:59

      So let me try something. This might be a bust. We can go back to the gym stuff if this is a bust, but let me try something. You've said a couple things that I thought were really interesting nuggets. I wanna kinda rapid fire just say s- I'm gonna just quote you-

   8. AHAlex Hormozi34:11

      [laughs]

   9. SPShaan Puri34:11

      ... and I want you to riff on it-

   10. AHAlex Hormozi34:13

       Okay

   11. SPShaan Puri34:13

       ... for as long as you feel like doing, and then we can switch to the next one. All right?

   12. AHAlex Hormozi34:16

       Okay.

   13. SPShaan Puri34:16

       So I'm gonna take one of yours. Um, [laughs] let's, uh, let's start with this one. Passive income is overrated. We seek freedom, but what we really want is options for engaging activities. What does that mean, and, uh, w- how'd you come to that realization?

   14. AHAlex Hormozi34:29

       Yeah. So 2021, uh, we sold three companies. So we were... Like, I didn't... It was... Interestingly, my CFO was the one who was really engaged in those activities, and, like, I was not, so I pretty much, like, took a really passive seat in 2021, uh, 'cause I didn't wanna really go start hardcore on, on scaling acquisition.com, um, until that was done. And so I was bored out of my mind.

   15. SPSam Parr34:51

       Wh- which, which three companies?

   16. AHAlex Hormozi34:52

       Al- so Alan, Prestige Labs, and Gym Launch.

   17. SPSam Parr34:55

       Okay.

   18. AHAlex Hormozi34:55

       So those are my three majority holdings. Right now I have all minority holdings, so between 20 and 33% are the holdings that we target for acquisition. Um, and so I had this, I don't wanna say existential crisis, but more like I'm bored out of my mind. I thought this is what I was always optimizing towards, which was, you know, quote, freedom, which is like you're always, you're always outsourcing all of your activities and buying your time back, and then you have all your time back and you have nothing to do, and I was like, "This sucks." And I look back on the times when I was building each of those companies with lots of nostalgia, and I was like, "Man, that was, like, some of the happiest times of my life." And so now that I'm in this position, I'm getting back into the game and, and, like, right now we're heavily recruiting. Like, we're two days a week we're just doing interviews, uh, to build a core team out. And, um, I honestly am, I'm, I'm happy as fuck doing this. Uh, and so it's like, but the difference between this time and last time is that I have the option to do it that I'm choosing rather than, uh... 'Cause if I didn't have this business, I wouldn't have the option to work. So I had to create the option for myself. And so it was like, for me, the shift was going from freedom to optionality, at least for as I had to understand the word.

   19. SPShaan Puri36:00

       Right. First you start, you, you do what you have to do to pay for life. Then you take that money, you buy back your time, but then you need to spend your time on the thing you want. That's the s- the same deal.

   20. SPSam Parr36:08

       And, and acquisition.com is basically you're buying other... You're gonna buy businesses and deploy your model.

   21. AHAlex Hormozi36:14

       Yeah.

   22. SPSam Parr36:14

       What are you, what are you doing?

   23. AHAlex Hormozi36:15

       100%. Yeah, so we buy an interest in, we buy a minority interest in the business, um, and we deploy the model. I mean, that's, that's what we do.

   24. SPShaan Puri36:21

       I'm sorry. The, the business is somebody who's doing, like, what you did for gyms, they're doing it for legal or hair salons-

   25. AHAlex Hormozi36:27

       Yeah

   26. SPShaan Puri36:27

       ... or something else?

   27. SPSam Parr36:28

       Or photographers.

   28. AHAlex Hormozi36:29

       Yeah.

   29. SPSam Parr36:29

       That's your latest, right?

   30. AHAlex Hormozi36:30

       Yeah, yeah. That was the, that was the fourth company. That one we still, yeah, we have a 20% interest in that company. Um-
5. 46:30 – 53:45

   Alex's 5 AM to 4 PM schedule

   1. SPSam Parr46:30

      not the ri- right word, but like neurotic maybe is a better word, um, where it's like, uh, you're, you're, there's something that's deep-rooted inside of you that's kind of m- it's not like you wanna do something necessarily. It feels like you're, it's more compulsive, um, or obsessed. You're obsessed about stuff, which I am as well. Um, w- where if that's true, what's that rooted in? What are you trying to get done?

   2. AHAlex Hormozi46:55

      So I think originally the drive was from just crippling insecurity and needing approval, right? Um, and then I think from like a behavioral conditioning standpoint, I got immediate feedback that was positive, and then I was conditioned to continue those actions. Now, uh, I continue to do them without the original catalyst that got them going to begin with. So I don't, I don't think I suffer, you know, from the insecurities as much as I used to. I'd say I'm probably 30% better than I was at the beginning, and it might just be because I have this massive big pile of money that I can use as an emotional crutch to why I'm not a piece of shit. Um-

   3. SPSam Parr47:32

      That, that would help

   4. AHAlex Hormozi47:33

      ... I'm just being... Like, I mean, and if it were all to disappear-

   5. SPSam Parr47:35

      Yeah

   6. AHAlex Hormozi47:35

      ... I'd find out how much actual growth I had or if I just compensated by circumstance and, you know, compensate for deficiency. I don't know.

   7. SPShaan Puri47:42

      You can send it to me and we'll, we'll find out. We'll see.

   8. AHAlex Hormozi47:45

      I, yeah [laughs]

   9. SPShaan Puri47:45

      Let's run the experiment. [laughs]

   10. AHAlex Hormozi47:47

       I like... So there's the compulsion, and like this last year I pretty much took off. Like, I did not work that much. Um, and so I saw the difference and like I have, I have come to accept that I love working, and I don't need to judge myself for that or, or take in other people's judgment on how much I should, quote, "do." Like, this is my life and this is what I like doing, and their ideals that they've arbitrarily made up as what they define as balance are irrelevant to me.

   11. SPShaan Puri48:19

       W- you said you took last year off. What'd you do? What'd you get up to?

   12. AHAlex Hormozi48:23

       We went out to dinner every single night to a five-star restaurant for, for seven straight months. We went to... I mean, we, we, we moved to Vegas temporarily. Um, we traveled a lot. Uh, went to Cabo, went to Scottsdale, went to Sedona, went to Flagstaff. Um, traveled all over. Um, went out, did, did stuff. Um, felt, felt honestly pretty empty. Like, you can only eat so many times. Like, there's just not a lot to do. Um-

   13. SPSam Parr48:49

       It feels good having that rest though. I mean, when I sold my company, which was, uh, a year ago last week, the first six, six months I was like, "I need to decompress."

   14. AHAlex Hormozi48:57

       You just-

   15. SPSam Parr48:57

       It felt good to have a... And then, and then I was like... And I'm in that phase now where I'm like, "All right, now I'm ready for war again." You, you can't... Like, I, I f- like you can't be in the trenches, I think. Like, or rather you need breaks from tr- from being in the, from being at war.

   16. AHAlex Hormozi49:10

       I think, and, and maybe even phrasing it... I'm just throwing this out there. Like, phrasing it as instead of a, like a break as a shift in how you're thinking, 'cause like it's really like it's going from dirt to clouds, but I still think it's high leverage ... activity, you know what I mean? Or f- like output. It's just a different type of output.

   17. SPShaan Puri49:27

       You, you said something on one of your videos that, um, you're one of the only other people that I have heard say this phrase, I use it a lot, which is, "Yeah, I had a season..." Like, "Or this season I'm doing this," or, "I had a season where I was really just focusing on X." And that's been like a game changer for me. My, my personal trainer and kinda coach, he's like my mindset coach plus trainer, he does this all the time where he's like, he's like, "I'm, I'm in a season right now where I'm, I'm just..." Uh, he'll be like, "You know, I'm, I'm practicing not waiting." And then he's like, he comes up with these little themes or he'll be like, "Right now I'm in a season where I'm gonna eat whatever I want." And it's kind of like in the entrepreneurial world, it's like time boxing. It's like, all right, I'm gonna give myself two hours to get this shit, shit done, or I'm gonna launch in the next two weeks no matter what, right? Like, we- t- I've used time boxing for productivity, and now this seasons thing, it makes every like decision you're making less heavy of a commit because you're like, "It's okay."

   18. SPSam Parr50:17

       Yeah, 'cause there's, there's an end.

   19. SPShaan Puri50:17

       Yeah, there's, there's beginnings and ends, and this season is gonna feel a little different, just like winter feels different than summer. That's how I use it. Do you, do you use it like that? I just noticed you said that phrase.

   20. AHAlex Hormozi50:28

       100%, yeah. And maybe it's a fitness thing, I have no idea. Um, I, I've, yeah. I, I have no ownership over it [laughs] .

   21. SPShaan Puri50:34

       Right. Yeah, it's like Burpees seasons.

   22. AHAlex Hormozi50:35

       I, I use it as a tactic.

   23. SPShaan Puri50:36

       [laughs]

   24. AHAlex Hormozi50:36

       Yeah. I mean, I, I think about it in terms of entrepreneurial seasons. Um, and I, at least for me, mine have been like five-year chunks, and so this is gonna be my fourth season. Um, and they've roughly been about the same length, so I think that it probably takes me like three-ish years to like really see something through, and then two years to figure out how I'm gonna transition from that thing [laughs] or realize or mon- you know, whatever. Um, that's what I... It's kind of like a PE cycle almost.

   25. SPSam Parr51:04

       How much of your look do you think is a lot for your succe- uh, accounts for your success? Because your face are on a lot of ads, and on your YouTube videos it's like you looking jacked. You've got this, in a lot of videos you've got this badass handlebar mustache. For the p- people listening, not watching, you look, I don't know what your n- what your b- heritage is, but you've got like cool jet black hair. You look like a, I don't know, you look like a, like a, like a, like an Italian lumberjack.

   26. SPShaan Puri51:30

       [laughs]

   27. AHAlex Hormozi51:30

       Persian.

   28. SPSam Parr51:30

       Like, I don't know what it is.

   29. AHAlex Hormozi51:31

       Or Persian. Persian.

   30. SPSam Parr51:32

       [laughs] Persian. All right, there it is.
6. 53:45 – 58:30

   How Alex got jacked

   1. AHAlex Hormozi53:45

      I mean, you know, he's, you know, got a perfect SAT score when he was 14. Like very, very bright. Um, but also stupid strong. Like when I met him we were in our 20s and he was pulling 800. Like stupid strong and natural. And so anyways, he was like, "I read this research paper, what if we had you lift six times a day but for like 10 minutes each time?" And I was like, "Cool." And I lived at the gym, so I was like, "Sure, whatever." So I set a timer, and every 45 minutes I would go and do one set on three exercises, then I'd go back to work. Which side note, is actually an amazing productivity hack, because like I had this nice, uh, timing, uh, like cadence, and I got this nice like boost from my nervous system every 45 minutes to like wake back up. And so I did that, and that's when I, I gained just a tremendous amount of weight. Um, but coupled that with another thing that he had done research on, which was like a pure carbohydrate diet, um, with no fat. And so basically the efficiency of fat conversion to fat that's stored is almost 100%. The efficiency of carbohydrate storage into fat is lower. Um, and so if you don't have... 'Cause you're gonna have a calorie surplus. And so to give yourself a smaller percentage of that surplus that gets stored as fat, you would want 100% of the surplus to be carbohy- carbohydrates. And so the idea was like if I had, you know, 200 grams of protein and like 800 grams of carbs and basically zero fat besides the

   2. SPSam Parr55:08

      Yeah, I saw what you were eating. It looked like it'd be awesome for a day-

   3. AHAlex Hormozi55:11

      It w- it was horrible

   4. SPSam Parr55:12

      ... and then horrible after that.

   5. AHAlex Hormozi55:13

      Horrible. And anybody who's like, "It didn't work," I'm like, "Just try eating that." Now, the big caveat to this is like I have what I, you know, I think I have elite genetics. I think, like, uh, Dr. Cashy, who's my closest friend, he's a biochemist, he's a national str- strongman, he's like, "You have potato chip genetics." He's like, "You shouldn't give advice to people." He's like, "You can just like drink Coca-Cola and work out, and like you'll have a six-pack." So like I had that- Plus I was doing everything maxed out, like as I possibly could. And like it was not sustainable. Like my knees were shot, my elbows felt like shit. Like by the end I was sleeping terribly because I was, I was bordering on over-training. Um, but I put a ton of weight on and I put a ton of strength to all my main lifts. And, uh, from there what I did was I dialed back the total volume, but I kept the split, not to get into too f- fitness stuff, but instead of doing, uh, seven sets of every exercise every day, um, I just dialed it down to like five. And then-

   6. SPSam Parr56:06

      Well, I was reading that article while I was listening to your videos and I was like, "Oh man, this guy carries this shit over to everything. I understand." Like it was super precise, very like... Well, obvious- look, I think what's interesting about you is you don't have a s- uh, or maybe you do, but you've overcome it, uh, a self-limiting belief that a lot of people have and you're like, "Well, of course this is gonna work. You're gonna do this, you're gonna do this, you're gonna do this, you're gonna do this, and it's gonna be hard, but that's, the outcome is gonna be blank." And it w- and, and y- here's the plan, attack. And you took that same process to business. Yeah, I could, I could hear it in your voice when you're talking about business and fitness, and that's why I thought it was cool.

   7. AHAlex Hormozi56:40

      Thanks.

   8. SPShaan Puri56:40

      [laughs] Let's do like, uh, one thing. You, one of my favorite things from you is, uh, these little TikToks or shorts I see ab- where you're giving like a sales tip or a little sales trick or whatever. And, um, I would love for you, I think most people probably, you know, most people who are listening to this just, you know, the bell curve of people listening to this probably have spent, you know, zero time trying to improve their sales and have not seen some of these things. So I wanna give them the opportunity where they don't gotta go click and find this random TikTok that I'm talking about in the ocean of TikTok. I want to, uh, role play a little bit. Um, give us kind of like, um, give us an example of normal, like here's the default way people are doing something, and then here's the rephrase or the reframe that has better results. Um, I would love to, to give g- two minutes of learning sales from Alex.

   9. AHAlex Hormozi57:32

      Sure. And just as a quick caveat, to complete the loop from like 40 minutes ago, you said like what was the book or training or whatever that... So it's my belief if you look at Belfort, you look at Bradley, you look at Grant Cardone, some of the big sales trainers that are out there, almost all of them invariably have the same story which is I started selling and was the best guy on the team by a fucking mile, and then I tried to figure out what I was doing. And so I do think that some people naturally, based on their childhood, their upbringings, their whatever, are just have a higher proclivity for selling, which carries over-

   10. SPSam Parr58:04

       Yeah, just the gift of gab and, and, and empathy.

   11. AHAlex Hormozi58:06

       Yeah. And I, I think it carries over into how you recruit for selling too because we've built a lot of sales teams and I actually have a very short allowing for people to fail at sales cycle, probably much shorter than most people, and it's just because I've never had a killer salesperson who didn't do pretty well the first week. And so for me, we, you know, we turn through those quickly, but as a result of that, the team is just killers, and they know that. So it's, I, I like this quote from,

7. 58:30 – 1:11:32

   Sales advice

   1. AHAlex Hormozi58:30

      from Grant Cardone, but he says, you know, "My sales team's a dangerous place to work."

   2. SPShaan Puri58:33

      [laughs]

   3. AHAlex Hormozi58:33

      And, um, I, I love that. So in terms of, uh, sales stuff, I think that, I think people don't know how... People are really freaked out about the idea of selling, right? And so I think the first reframe is like you're not selling, you're helping someone make a decision that's gonna help themselves. And the, the, the f- the front part of that is that, uh, I do think that the number one predictor of good sales is conviction. And so fundamentally, you have one person who should believe in something, another person who does not believe it yet, and trust is the thing that transfers that conviction. So if fundamentally there's the two things you need, you need trust and you need conviction. Most times salespeople don't have 100% trust. I'm sorry, 100% conviction. And so the also the idea of conviction as a binary is false. So it's not like I believe it or I don't believe it, it w- it's to what extent do I believe it, right? And so that's why like in terms of if I wanna improve a sales team, I can do the drills, which we do, and that's like blocking and tackling. But the thing that really juices a sales team is hearing the testimonials of the people that they sold last week and what they're doing today, and how their lives have changed. And so I noticed this because on my sales teams when we were in person, whenever I did weigh out day, which is when everyone finished their challenges and everybody was crying and so excited, I tried to stack as many sales appointments as I could while people were weighing out. And during those days, we closed like 100% 'cause people were like, "Dude, how can you not think this works? It's right there." And so the thing is, is like you can either trick yourself into having the right tone or you can train yourself. And I think that it's much easier to trick yourself into it by just simply believing. Because if you talk, if you truly believe in the product, you will talk about it differently. And so in terms of an understanding of selling, if you need to have conviction, you need to have trust, trust is gonna come from expertise and some level of rapport, right? And so, um, I think that overarchingly to help someone sell, we just have to ask the right questions to get someone to come to the conclusion on their own. And so most sales conversations follow more or less the same framework if you know what you're doing. Otherwise, people are just chasing their tail and trying to chase a prospect to an outcome that the prospect doesn't know how... Like we've had this conversation 100 times. They have only had it once. We should be the one knowing how this conversation's supposed to go, right? We should also come in with a massive advantage to how to have this conversation go the way we want it to 'cause we do it all fucking day, right? [laughs] And so, you know, big, big front-end pieces is like why are they there? What's the problem? What have they done so far? Understanding where they failed. Seeing why our product is different from the things that they failed. Asking for permission to explain about the product. Explaining the product not in any way based on features, but only based on the experiences that they will have as a result of it, and using analogies to explain those experiences, right? Um, and then, and then having a close, uh, at the end, which the, the TikTok I think that you, you referenced is like a no base close. And I think a lot of natural salespeople do this anyways. Like if I want something, I'm not gonna be like, "Hey, can you do this for me?" I'm like, "Hey, would you mind?" And they say, "No." They don't, "I don't mind," right? Like this natural communication dynamics that most people who naturally know how to persuade people or at least influence do that on their own. This is just retroactively looking at it and saying, "What did I do diff- like why is this different?" And, um- In terms of, like, overcoming, 'cause people are afraid of confrontation, right? That's what they're afraid of. And so I believe that you can sell without ever having confrontation, and you can do that with what I like to call childlike curiosity. And so if someone says, um, "Well, my husband's not gonna approve that." I'm like, "Why wouldn't he? Like, what do you... Like, huh, that's so interesting. Tell me more about that." Rather than like, "All right. Let's... Like, your husband's an asshole." Like, that's not gonna work because in arguments no one wins, right? And so you'd be like, "Why, why would he think that? 'Cause, 'cause I would think that he wants what's best for you, right?" "Yeah, he wants what's best for me." "Does he know you're struggling with this right now?" "Well, I mean, yeah, he knows I'm struggling with it." "Okay, so he wants what's best for you, he knows you're struggling with it, so why do you think he would be opposed to solving something that, that you're currently struggling with? The... Just so I understand, would he be happier if you continue to struggle?" "Well, no." It's like, "Well, great. Then would you be opposed to moving forward today?" And that way... And hey, if you go home to your husband and you make a joke and it lights the scenario, then you close it, right? And so it's, I think childlike curiosity is the immediate that you have to train because people get defensive. So that is one thing that, like, fighters talk about when they're in the ring. Like, in the beginning you breathe in too much, right? I don't know if you... Like, if you've been in, like, sparring and stuff. Like, you breathe in, you breathe too much, you hyperventilate. And so the guys who've done it enough, they slow down their breathing because when they get, things get intense they can slow it down. And so I think sales is a lot the same way, where you're like, your adrenaline kicks in, you start breathing faster, it's fight or flight, so you gotta be able to slow it down and be like, "Huh, that's crazy. I wouldn't have thought that. Okay, tell me more about that." And like, now you're interested. And then they don't feel like you're combating them. They feel like you genuinely are interested and want to help them, which is what you should be doing because you should be selling them-

   4. SPSam Parr1:03:29

      Dude

   5. AHAlex Hormozi1:03:29

      ... only if it makes sense.

   6. SPSam Parr1:03:32

      You're exhausting. [laughs] You are full of, like, interesting insights, and, like, just like you're, you just, you're, you, you just have s- you have a, you know a lot of shit. And, like, you've clearly packaged this in really easy to understand ways. It's almost exhausting listening, 'cause it's like every... It's like when you read a really good historical book or something, it's like every sentence is packed with a fact.

   7. SPShaan Puri1:03:52

      Yeah.

   8. SPSam Parr1:03:52

      And it's like, oh my gosh, like, I, 'cause I gotta-

   9. SPShaan Puri1:03:54

      Like when you started-

   10. SPSam Parr1:03:55

       ... you gotta pay attention the whole time

   11. SPShaan Puri1:03:55

       ... what I didn't know what the hell he was talking about, I was like, "Exhausting. This is awesome." Uh, but then, uh, now I know-

   12. AHAlex Hormozi1:03:59

       [laughs]

   13. SPShaan Puri1:03:59

       ... 'cause there's this book-

   14. AHAlex Hormozi1:04:00

       Thanks, Shaan

   15. SPShaan Puri1:04:00

       ... there's this book I'm reading right now that's like, like one of the best books I've ever read. Literally the first 10 pages have more insight than any book I've ever read, and I'm only on page 30 because I'm like, I'm like rationing this, not to, like, not 'cause I don't, I think I'm gonna run out. It's like I can only... It's like I can only have my mind blown so many times per minute, and so I gotta like chill out-

   16. SPSam Parr1:04:21

       That's what I'm saying

   17. SPShaan Puri1:04:21

       ... with this book right now. And I'm reading 10 pages at a time, then I hand it to my, my trainer and he reads 10 pages just so I have a two-day break, and then we bring it back. That's our book club right now. And I think it's more like that, like what you, what you just said, which is how many lessons were there to learn, right? So there's like, there's the lesson of like, you know, guy goes from sleeping on the gym floor to, you know, like hustling, but then realizing I'm hustling 100%, or I'm, I'm hustling level 10 at a level two opportunity. Okay, how did he recognize that? Wait, what a... And then people gotta ask themselves, "What level is my opportunity that I'm at right now?" And you had that formula of like number of units sold times gross profit per unit times, like, you know, uh, supply-demand dynamics of the market.

   18. AHAlex Hormozi1:04:59

       Oh, yeah. That's what I'm saying, man.

   19. SPShaan Puri1:05:00

       It's like that one nugget alone is enough-

   20. SPSam Parr1:05:01

       He's got all these things

   21. SPShaan Puri1:05:02

       ... for you to put down the podcast and go fucking reassess your life. All right. Then we go to the next, [laughs] next page, so it's like the part where you're like, "Yeah, we charge $500 up front, and then we have this continuity thing where we would actually say, 'Hey, great, congrats. You've made awesome progress. We're actually gonna offer you more for less because we want our LTV to go longer, and, uh, we know that that reduces churn,' blah, blah, blah." And I'm gonna do that because the best time to sell to somebody is when they're most excited. Boom. Nugget two. Go rethink your sales and pricing strategy. You're probably doing it backwards. Or you, you know, you're not maximizing the opportunity 'cause you just sold to 'em once, you never figured out how to do, sell the backend. Then three is, you know, like you've had five in this session, and that, that's my explanation of Sam's, Sam's weird compliment. Sam is the king of backended compliments.

   22. SPSam Parr1:05:44

       Yes.

   23. SPShaan Puri1:05:44

       He'll be like, "You're like a, you're like the weirdest looking handsome dude I've ever seen." And you're like, the guy, or, you know, the guest doesn't know what to do.

   24. SPSam Parr1:05:50

       [laughs]

   25. SPShaan Puri1:05:50

       They get frozen by the, uh, the backended compliment. It's so good.

   26. SPSam Parr1:05:54

       Well, I bet, I bet your dear friends, when you're with your, your non-work buds, buds, are they just like, "Dude, Alex, chill. I don't care. Let's just like make a fart joke."

   27. AHAlex Hormozi1:06:02

       [laughs] I don't have any non, uh, entrepreneur friends, honestly.

   28. SPSam Parr1:06:08

       So you're always able to kinda shoot the shit with them, I guess, a little bit. And that's how I am mostly with my friends.

   29. AHAlex Hormozi1:06:12

       Yeah.

   30. SPSam Parr1:06:13

       But every once in a while I'm like, I'm like, "I, I got... I can't talk money-related stuff at, today." Like I, I do, I d- I, I purposely have to take breaks sometimes.

Episode duration: 1:11:32