Next Level Pros - #87: Leila Hormozi reveals how her companies do over $200M in revenue

Episode Date: March 25, 2024

Welcome to a new episode of The Founder podcast. In this episode, I have with me Leila Hormozi, co-founder of Acquisition.com, to dive into the secrets of successful business scaling, the power of organic and paid marketing, and the future of business education. Leila's insights from her journey in building and scaling businesses offer a blend of strategic wisdom and practical advice. Whether you're a budding entrepreneur or an established business owner, Leila's experiences and forward-thinking approach provide invaluable lessons on navigating the complexities of modern business. Join us for a conversation filled with actionable strategies, personal anecdotes, and a glimpse into the future of entrepreneurship. Highlights: “A big red flag is when companies aren't willing to invest in talent... it's undeniable the impact that investing in good people has on the success and growth of a business."     “The businesses that have paid plus organic have a significantly lower cost of acquisition and a significantly higher lifetime value of customers... It's about creating your ideal customer through your content." "Our mission is to make real business education available to everybody... it's about changing the industry and making a mark through education." Timestamps: 00:00- The Value of Investing in Talent 01:21- Shift in Marketing Strategies 04:20- The Impact of Organic Content on Business Growth 06:51- Choosing the Right Platform for Organic Marketing 08:12- The Role of LinkedIn and Facebook in B2B Marketing 10:10- Creating Engaging Content Across Platforms 13:00- Operational Excellence and Team Analysis 17:22- Competitiveness and Work-Life Balance 24:26- Personal Insights and Alex Hormozi's Character 36:12- Vision and Mission for the Future of Acquisition.com Live Links:  Join my community - Founder Acceleration ⁠https://www.founderacceleration.com ⁠ Apply for our next Mastermind:h⁠ttps://www.thefoundermastermind.com⁠  Golf with Chris h⁠ttps://www.golfwithchris.com⁠  Watch my latest Podcast Apple- ⁠https://podcasts.apple.com/us/podcast/the-founder-podcast/id1687030281S⁠ Spotify- ⁠https://open.spotify.com/show/1e0cL2vI1JAtQrojSOA7D2⁠ YouTube - @thefounderspodcast

A lot of people aren't willing to invest in talent to grow their companies. And so I'll give you an example. I had this company that we were looking at a couple of weeks ago, and I said, what's your highest paid employee? And then he said, oh, my guy that runs the whole thing, you know, $65,000 a year. $65,000? I shit you not. This is the highest paid person?

Oh my goodness. Yeah. And so I was just like, big red flag right there. Like, one, you're not willing to invest in talent. Two, the fact that you think that that is like a high paid job is frightening to me. And three, who's running the company. Yo, yo, yo, yo. Welcome to another episode of the founder podcast today. I am joined with miss is miss is Layla or Mosey. Layla is the founder of Acquisition.com, the founder of a gyms. She's done gym launch. She's done all kinds of different things. You guys probably seen her all over social media. You

may have seen her husband a little bit. Alex, he tends to be out there in the wild all over the time. He's literally all over, but I'm super excited to spend some time today with you, Ms. Layla. How are you doing today? Good. I appreciate the introduction. So yeah, excited to dive in. Good to have you. So 2024, what are some things that you are seeing right now in business that most people are struggling with and could fix with just a couple little tweaks? I would say that one of the biggest things that we've noticed, especially like in our portfolio and probably businesses that we're looking at at this point, is the shift in marketing.

So if you look at, for example, I'll give you a story. So we had a business and when we took that business on, I want to say they were at about like 10 million in top line. And they said that all of their traffic was coming from essentially Facebook and Instagram paid ads, right? And so about a year and a half into our investment, all of a sudden the cost of marketing started getting really high, and they were not getting as many leads. And so we're looking at the business saying, like, what's going on?

And we were dissecting all of the different marketing funnels and looking at, like, the ads and the copy and all this stuff, and we're looking at the product, and we're like, what has changed? And what we actually dove into was that something that we didn't know that the founder had been doing, that they stopped doing, because they didn't know how important it was. So the founder, in his free time, when he was just kind of having fun,

and this is before he sold a lot of the business to us, he actually would make YouTube content. And so up until about, I want to say it was three months before this issue that they were having with marketing, he was constantly producing content on YouTube, just for fun, but it was related to the business. And he was also the face of the business. And we tracked using a few different softwares basically to see if the buyers in the past, so the people that we had had

over the last one to two years, where they were coming from. And we found out that something like 95% of buyers had watched his YouTube videos before they booked a call. Oh, wow. So they're organic content. Correct. So it used to be like, I think a lot of people talk about like there's paid. And I think for a while it was like, you could just do paid, run some bullshit ads and get a ton of customers. And I think even now it's like people think, well, I can outmarket, I still don't need to have organic. But what we've started to find, and I've seen it in the pattern all of the businesses, is that the businesses that have paid plus organic

have a significantly lower cost of acquisition and a significantly higher lifetime value of customers. So if you look at the businesses in our portfolio that have the longest or the highest lifetime value, I really think that it has to do with the experience that they have on the way in, because it's like they're conditioned already to be good customers. And so we've seen that one, it lowers marketing costs, it gets you more leads, and then on the back end, it increases your lifetime value. And so I thought that was really interesting because it's this trend that I continue to see

where people are saying, hey, should I be making organic content? Should I be doing brand? And I'm like, I don't think it matters if it's you making it, if it's your company making it or what, but it's undeniable the evidence that it will make your company better if your company or you produces some kind of organic content to pair with the paid. The thing is that what a lot of, I will say, like really large marketers when it comes to organic content and brand know is that sometimes that alone is not enough. So I've actually seen that it's the combination of the two because a lot of the time what happens is that, and I'll just put it this way, like the best portfolio companies are not applying on our website.

The best portfolio companies answer when we call. They respond when we DM them. Right. You see what I'm saying? And so it's like our brand gets us out there so that they answer when we knock on the door. Yeah, absolutely. And that's what I'm seeing for the coming years. It's like you've got to have both if you really want to compete in the market.

And I would even say for myself as a consumer, right? Like if I'm scrolling through Instagram and I see an ad from somebody that I see their organic stuff all the time, I'm more likely to pay attention to that particular ad because I've already seen their stuff. And so then which increases my likelihood to buy and everything else. I think it answers the question like somebody sees an ad of somebody pop up or of a business. And the question that everyone's asking now because it's so crowded is, why should I listen to you? And the organic content gives them that, why should I listen to you? What it doesn't always give is a clear correlation to buying.

And so it's like, I think you've got to, yeah, you've got to have both. You've got to be able to like put yourself out there, let them get to know you and then also make the ask. Yeah, no, that makes a whole lot of sense. So would you say this is industry-specific or agnostic of an industry? It should apply to every type of business out there. Honestly, I see it in B2B.

I see it in D2C. I think that the trend started more in B2B to have both. But what I'm seeing now is that specifically the business I'm referencing was the D2C business. And so for them, even when you're thinking like, oh, I think I can just like, you know, I think people used to think like, oh, I can just sell eyelashes online. I can sell, you know, makeup.

I can sell razors, deodorant, whatever, right? And it used to just be kind of a play on e-commerce and like throw some shit up on Amazon. Not seeing that anymore. Yeah, not seeing it work well. The only thing I'm seeing work well on both sides, and I think the D to C is a little slower, but I think that if people leaned into it more,

they would probably grow a lot faster, is just combining the two. And I think it's just something that's, at this point it feels undeniable, but I think the piece that's missing is that it's not just getting more customers. It is creating a better experience for those customers, and it's almost like you're creating your ideal customer

by conditioning them through your content rather than getting someone in and then having to set all these expectations of what your product is or isn't and what your company is all about. Does that make sense? Yeah, yeah. No, that makes a lot of sense.

So what platform, if you had to choose one organic platform, what would you focus on right now in 2024? And then maybe what is one that is lesser known that could be a good supplement to that? Lesser known, I'm not sure that I would have a good answer for. But I would say from a B2B standpoint, LinkedIn and Facebook. So Facebook right now is killing it. How do you mean?

It's just picking back up. I think that it's because a lot of eyeballs left and so the opportunity is much bigger. And so we started going hard on Facebook again and we've noticed like a huge return for that. Now I think it does depend like if you're trying to sell something, what's your target market specifically for two businesses that we have in the portfolio that have people over the age of 45 Facebook crushes to put organic content and paid I would say that plus LinkedIn. I think LinkedIn there's still a huge opportunity Like I would literally think I pay like point zero five percent to LinkedIn and like I'm still in the top hundred creators on all

The different lists, you know what I mean? And so it's just like I think that just just take your shit That's on another platform and post it on there for now Even if you can't just do completely organic to LinkedIn, because I certainly don't. I would say I suck at LinkedIn. I log in like once a month. It is so terrible. And I know that's something I need.

It's interesting, though, because, I mean, depending on what you do, like three companies that we end up going into diligence with messaged me on LinkedIn. Like they reached out to me there. And so I was like, that's really interesting because I don't get that on Instagram. Or if people messaged me on Instagram, it's not always the best ones. And I didn't get it on Facebook. It was LinkedIn.

Yeah, interesting. I would say for the latter, if I were a D2C company, I think, I mean, I just still think Instagram, people are saying is hard right now. I don't know. My Instagram is growing. But I think it is harder than it used to be.

I think for a lot of D2C, TikTok makes a lot of sense. Especially like if you're looking at just like consumer products in general, I think that the way to display them on TikTok, it just, it feels like that's the platform for that at this point. Right. It's interesting. Like you say Facebook. Facebook has like so many different ways to create organic content. There's lives, there's posts, there's stories, there's long form. I mean, literally all, all kinds of different things in there. Is that like, what, what would you say is like, what are you using? Real stories?

Honestly, we're just posting, we're taking everything from all the other platforms and we're just posting it all on there and just seeing what works. There's not a huge strategy to it. I think that most people overcomplicate it. I look at all of our content, people are like, oh, you've got content all over. I'm like, oh my God, I'm so embarrassed of it

because none of it's like, because I'm not a full-time content maker, you know what I mean? I don't do that. And so it's like, I don't have time to tailor everything for every platform. Our team does the best they can with the contingencies we put in place.

Cuz I'm like, hey, don't make up my words. I only want stuff I've written. I only want stuff I've said. So that makes it very limiting. And you can't necessarily tailor to a platform. I think people just gotta try and see what works. I think for the most part, the platform that you like the most and that you, like Alex, he's a writer all day.

So Alex crushes Twitter, He crushes written form. He murders me any day on anything like that. He just will always, anything. I don't think I could ever outperform him on any of those because he's an author. And he writes for seven hours a day. So is he the one actually typing it out or is he writing something big and sending it off the team and cutting it up? No, he tweets all his own tweets. And he puts them on his own HootSuite even.

I tweet my own now, but I barely do it. I'm like, oh, shit, I haven't looked at that in a week. I'm also like, I don't spend a lot of time writing. So most of my communication is one-to-one contact, and it's in person. And so for me, it's like I know that I typically now do better on video because my communications to my team and on a daily basis are mostly done on video. So I think it's just like you're, think about what you do every day.

That's why I tell people, I'm like, what do you do every day? You're probably good at a platform where like that can be replicated. So if you're talking to people all day, every day, that's probably what you're going to be good at in terms of being on video. If you're writing all day, every day, cause you're, I don't know, a blogger, that's probably try Twitter or something. You know what I mean? Right. And what would you say like some of the actual best practices are, are you, are you batching all your content together? Are you like setting aside or are

you just consistently doing all day every day? So I pay very little time to my content. I made a commitment that we literally just got off a meeting of actually, which is for 2024, I have one day per week only content. Like this is one of those days, like I've been doing content all day. Because I feel like what has happened in the last year, the first year, I think we had just sold the businesses and Acquisition.com was newer. I had more free time. So it felt like on a daily basis, I had more time to be creative, to think of content, et cetera. And then last year, everything started growing really fast and I just would cancel all my content shit all the time.

And so I said for this year, like, no excuses. I'm just going to go hard on everything, business and content. And I basically what I have now is I clear one day and we're planning them a month out where it's like every minute is planned. I get in the morning hair and makeup, which I'm sure you would have to do as well, and then go straight into like probably six to seven different content things, whether it's filming shorts, skits, LinkedIn posts, Twitter posts, whatever it is.

We're just trying to batch everything in that day because I've just realized there's like a lot of days that like I say I had to do a live stream and I would literally get off a call where someone's like very upset and crying. And I was like, get into a live stream and answer answer questions or it's like I'm on a call with like a lawyer and we're going through a lawsuit and I'm like now I've got to get on a call and encourage people and I'm like this sucks you know yeah it's like you could switch it but I don't like feeling fake I'd rather I tell my team now like I am doing content today please don't tell me any bad news I love it just tell me at the end of the day I love it there's too many times that

I've walked in and they've been like are you good I'm like fuck I don't tell me any bad news. And then just tell me at the end of the day. I love it. There's too many times that I've walked in and they've been like, are you good? I'm like, fuck, I don't want to talk about it. Like we got a lawsuit this morning or like something like that. It's like almost cursed now. So. Yeah. So, I mean, obviously stuff like this, where you have an interviewer being asked questions, it's pretty easy to produce content. How are you coming up with your ideas when it's just like, I got to come up with five hours worth of content where I'm not being asked questions? Is it team providing that? Is it AI generated? And like, where are you gathering the questions or the topics to be able to go and

produce this type of content? You know, I think because my full-time thing is running the acquisition.com, it is not ideal at all. So, you know, even today we have what we say is like content ideation meetings. That's the only time I'm thinking about content ideas. And essentially what we talk about is like the team comes with like, here's our ideas for YouTube. Here's our idea for shorts.

Here's our ideas that we think you should be doing these walk-in talks. We think we should be doing a get ready with me. We think you should, and then they present them and I say like, yes, no, maybe iterate it here. And then we kind of run with it. But the thing is, is they brought to me today, they were like, your top performing videos are all the ones that you scripted yourself.

So they were like, can we like block the time in these days that you could even script those? And so I did not do it in a way that's ideal. If I were the primary face of acquisition.com which I'm trying to be a more prominent face but I'm not trying to be I would say the primary I would probably take more time to do that like Alex has most of his day until usually like three o'clock where he's writing making content and I think that that gives you a lot more creativity a lot more time to reflect on the lessons that you have. Something we joke about is like,

he'll be like, oh, I don't know, I don't have a tweet right now. And I'm like, I have so many in my head, but like, I don't have the art of turning it into a tweet. I have all these things in my head of like, I've had a million things happen this week that I think are lessons or mistakes that I've learned through.

And I'm just not as good at articulating them. So it's still learning. It's not perfect. So you brought up something interesting. You're focusing on creating more content. Obviously, Alex is out there creating a lot of content, right? I'd say for like the vast majority of people, if they think about acquisition.com, it would be Alex first and then probably you. One, what is the overall strategy? Like I know a lot of times brands are like, okay, we should only have one. Is it to have two type of heads that are equal in content? So that would be the first question.

If you want to answer that, and I have a follow-up one to that. Yeah, I think my goal has always been this. I just want to reflect externally what it's like internally. And Alex is on the same boat as me, which is like, we just want an accurate reflection of what we actually do, what our team actually works on.

A lot of people come, they're like, well, you guys are like marketing, right? And I'm like, oh my God. Like, yes, there's marketing and sales, but like there's so much more to what we do with businesses than that. Most of our team is not that, right? And so I just want to put enough content out there

from myself and you'll see like this year, we're gonna put a lot of our team out there so that people actually understand like holistically what acquisition.com does, not what Alex does. And so that's really the goals. I just want acquisition.com to have its own brand that stands on its own.

And I think that it needs, brand is just associations. And so acquisition.com needs to have associations not just with Alex. He is part of Acquisition.com, right? But with also Layla and with also all these teammates who bring all of this to the table. So that's the way I see it. And I think Alex also has other things that he's doing, like school now. And so he's going to be associating with other things.

So I see it as like a gradual, he associates with more things outside of acquisition.com, more people from within acquisition.com start to associate with acquisition.com, and then they start to be a little bit more of like separate entities, more really just like accurately depicted, honestly. Like it's just that right now people are like, is Alex gonna come in and fix my business?

I'm like, what? Like, no, you know, like that's not at all what's about to happen. And so I think I just want an accurate depiction of what we actually do. I love it. I love it. So you bring up kind of something interesting with this whole thing, creating the holistic. So knowing you personally and having spent some time with you, I know you're very competitive, right? Yes, I do. I do think you're competitive and you're just as outspoken as Alex. How over the over the years of like Alex kind of taking more of the fame, like how do you how do you handle that? Are you OK with that? Are you are you are you

fine being in the shadows? I'd love to know more of that. Yeah, yeah. It's you know, I have to say it's so funny, though. I've never had anybody say i'm competitive really i'm super competitive with myself though yeah i i i see that i've been around it i know you are like an attack dog which which is awesome i prefer to be the secret weapon uh but yeah i think honestly I have no, like, weird feelings about it. Like, no, I really don't. I, if anything, what's really cool about it is that, one, we talk very openly about these things. You know what I mean? And I've just kind of accepted also, like, he is so practiced and so good and so articulate in so many ways and so inspirational with so many people.

There's just a lot of skills I have to acquire to get to do that. And I really get a lot of gratification from actually like just running the team. And so it's like, I kind of say at the end of the day, I'm like, listen, I really just care about what my team thinks of me because they know me better than anybody. It's like people can say what they want online, but like that's where I get my reinforcement from. And I think the second piece to it is that I get to learn from him. So there's a lot of things that I do that he gets to learn from me. There's a lot of things that he does that I get to learn from him.

And so I honestly just have always looked at it that way, which is like, we can just make each other better. And I think he used to always say this in the beginning, but he's like, there's two of us. We can just transfer skills to each other. And so it makes us, I would say like a formidable competitor. I have never, yeah, I don't know.

I've never had any odd feelings about it. I think, I mean, I am probably like the instructor in the back, like also helping make his life in a way so he can make more content and be more famous. So it's like I want him to win. I like helping him do that, you know. And so. Yeah, I think you guys have really mastered the yin and yang, right? Like he's the marketing sales. You're the operations and team behind the scenes.

But it's interesting because a lot of times people that are behind the scenes, operations and team aren't a very good face. And I think you still present in a very good way from a marketing standpoint and those type of things. Well, it is interesting, too, because I actually run our marketing and sales. And I think a lot of people don't know that either. You know what I mean? But I don't talk about it because he's so much better at talking about it. Why the fuck would I? I could be like, oh, I did these things.

But one, he knows it to such a degree. But it's also like, well, who would logically know it to the second best degree? I would, because I read every damn book. I talk about everything with him. He tells me all his ideas. So I know it all very well. I wouldn't say that I'm passionate about it. You know what I mean? I love leading the marketing and sales teams. I love helping them. I love directing them. But that's because I lead all of those teams. Now, Alex comes in and he absolutely consults with the teams and coaches people and helps in, you know, like, hey, read this part of my book, do this here, or I'll have like a plan put together with the team. And I'm like, what do you think of this? And he's like, look at that

right there. And I'm like, oh, fuck. Okay, you're right. So like, he's absolutely better at it. But I think that one piece that I actually realized is like, people actually probably don't even know that I even have that skill because they just. Well, I mean, I know you have the skill just because you are actively involved in your own personal brand and those type of things. But I would say I'm a little surprised that you run all the sales and marketing. And so obviously you're a little bit misunderstood in that aspect from a public standpoint. What would you say are like other ways that you're misunderstood and people would be surprised to know about you? You know, it's interesting.

I don't like know what people say about me because I just don't pay attention. Yeah? Yeah, no, I really don't. That's good. What is the hardest thing about being Layla or Mosey? And I know you got a positive outtake on pretty much everything, but there's got to be some difficulties. Oh, yeah, everyone has something, right?

I'm just, I'm like really trying to think that's an interesting question. I've never been asked it before. That's what I'm looking for. Competing priorities. How do you mean? I actually just think, I had this epiphany probably like two years ago when it came to like being in business, right? Because I started making business content and I started seeing like a lot of people

shit on me were more men. I was like, why are men shitting on me? You know what I mean? Like I thought it would be women being like, bitch, whatever. Like you're annoying. Well, I think we are all like feel challenged because you're awesome at business, right? And I think traditionally it's the men that dominate the face. And so there's probably a little bit of friction there.

Like who's this, you know? Totally. And I think competing priorities in this. the face and so there's probably a little bit of friction there like who's this you know totally and I think competing priorities in this and I realize this uh this is even to a greater degree with women who have children I think is that and this is going to sound ridiculous but I'm just I just say this is like somebody else's gonna say like me winning in business wouldn't matter if I didn't have a good marriage and was ugly and fat. I have multiple priorities, which is like, if I'm winning in business but I don't feel like I'm winning in how I present myself, how I show up, my health, all those things, or I'm winning in my marriage, I don't give a shit.

And I think that at the end of the day, if I look at like the measure of success of a man, I think that you can't afford a lot of them, at least. More that I've met can just solely focus on business. And it's like, they're not really thinking about, because like the measure of a man's success in society is often money. Right. And there's a lot of ugly successful guys. Yes. And they got a hot pick, right? But if you look at women um i don't think that many women would say i'd rather be a billionaire and be fat and ugly i just don't think so and so for me it's interesting because i've had this like thought in my mind um i'm like you know it's i'm okay with that and i'm willing to say like the you know it's like even like okay I have hair and makeup for an hour Alex doesn't do that so what's that an hour that he can do or any other guy out there

can do they can put it into their business and I try to just take meetings while I do my hair and makeup I fucking do um but I have those competing priorities which is like I want to have a great marriage and I also want I care what I look like and any woman that says that they don't I don't know we ain't the same but i uh i think that having those competing priorities and also i think that's probably the more difficult part is like i won't sacrifice my marriage or myself and my health and my fitness for business i also also won't sacrifice the other, vice versa. And so it's like, I have multiple things. And I think if and when we have children, that factors in as well, which is like, I wouldn't just say, fuck everything. And I think I probably come off more one track minded because I'm not talking about all of those things. I don't necessarily

feel like, I don't want to be like a marriage and beauty and all that channel. That's just like not my thing, but it's absolutely a part of my life. And so I think that I'm trying to learn how to play the game of business while also balancing those priorities, which I think is something I would say a decent amount of women experience. I'm just trying to figure out how to do ands, not ors. Yeah, yeah. You know what I'm saying? I love it. I love it.

Thanks for opening up about that. So while we're on the personal vein, what is something about Alex? You know, Alex is out there, right? Like, I mean, literally his whole life is documented, right? Whether it's on tweets or Instagram reels and he takes hot takes on everything, right? What would be something about Alex that most of us would be surprised to know? It's like I have two things that come to mind. Share them both. I would say the first one is that it's like so random, but I think it's just like with his character. But like, Alex can't have an animal because he'll just love it too much like he just like when we had this little cat I got it for myself and oh my god he became buddies with that little

cat and I was like oh my god the cat doesn't even like me anymore the cat likes Alex and I've just noticed like he just absolutely loves animals but that's why he doesn't want to have one he's like I don't want to be distracted by it right which I think is interesting just in terms of like what people think of him which I think kind of goes along with the second which is like I think is interesting just in terms of like what people think of him which I think kind of goes along with the second which is like I think people probably see us publicly and they're like wow you know he's so intense like good I've had women that couldn't be married to someone like I'm like you think he acts like that to me you know what I mean like we act like that in private

like he's one of the most generous kind-hearted like if like if not, he's the most generous, kind-hearted person I've ever met. And I just don't think, I think a lot of people won't get that privilege to see that unless they gain his trust. Can you give us some examples? I mean, the reason that he writes the books and makes the content is

because he genuinely wants to help people. He kills himself over those books and making the content. Like he loses sleep, he doesn't eat, like he will forget to take care of himself because he genuinely, it's not about the money. It's about like genuinely being able to get a message out there. And he's like, there's a kid

who's like gonna save up all their money from like this part-time job. And they've got like nothing going for them to read this book. And I think he's like very romantic about that kind of stuff. And I think, I don't think as many people know that as I wish

they did. Right. Does that make sense? Yeah, no, it's, it's, it's very impressive. So I've interviewed tons of entrepreneurs, know a lot of people who've written books and read some of their books. Reading Alex's book, I think it's like so awesome because I hear his voice while reading. And I could, I could see where like he chuckles or, you know, like his jokes is like, you know, dry humor in certain aspects. So I'm like, holy crap, like this is 100% Alex. This isn't a ghostwriter. This isn't anybody else's idea. And I think that is a pretty remarkable.

Yeah. I just think sometimes it's like seeing content on the internet. Like people have to forget like we're like sitting here like animals in a cage with like lights all over us like we're not going to be like our most open vulnerable selves every time it takes practice and i also don't think i think i probably try really hard to focus on that but that's also because i think uh that's just been like an intention of mine i think yeah i just don't think a lot of people know that about him or would guess it or would believe it if he even said it. Right.

And that's fine. Yeah. So shifting gears, we talked a lot, you know, sales, marketing, content creation. What would be some main operational issues that like you guys go and acquire a business or invest in a business or consult for equity or whatever it may be? What are some of the first two or three things that you look at operationally and what are some changes that you make there?

I mean, the first thing that we look at because it can absolutely deter us from any initiative that we have is just the team. And it's not even, it would be a couple of different things, which is I look at pay of everybody on the team and I look at tenure of everybody on the team. I'm trying to understand a couple of things, which is like, do we have anybody

who is a true leader on this team besides the founder or CEO? Because a lot of times people say, especially during a deal process, they're like, listen, the whole business is automated. Like I could leave tomorrow and it would still run. And I'm like, but what happens if you die in six months? And then they're like, I'm like,

does it grow or does it decline? And then they're like, really think about it. They're like, probably declines. I'm like, okay, well then you have key man risk. So I think that's the first one is just looking at the people involved in it because, dude, I can't even tell you the amount of times that there's been an insane fucking business with like some crazy way to acquire customers. And like they've completely

exposed some kind of arbitrage in the market. They've hit blue ocean, whatever it is. And like they just have a fucked up team. And like they it's not even like they find a way to fuck up that opportunity. Like they find a way to lose. And it's played out like damn near every time that we've avoided one of those investments that we get a call like a year later or two years later and they're like, damn, like we really need help now. The business is taking a turn. And I'm like, what happened? They're like, oh, you know, Jeff, he ended up. And I was like, yeah, I remember Jeff. Seemed like a fishy fella. You know what I mean? Like it's like it's just the people on the team. And I think a lot of people

and I know you know this is important, but it's like they just's just the people on the team. And I think a lot of people, and I know you know this is important, but it's like they just grow at all costs and disregard culture. They disregard people. They disregard values. And it shows up. And it might not show up now, but it's easy to win for two or three years.

It is easy to do that. It's not easy to win for five or seven or 10. And I think that a lot of people get really, it's like they just think their shit doesn't stink because they're in year three or they're year four and like nothing bad has happened yet, but all the leading indicators are there that something's about to happen

because there's not a good culture, there's no good engagement, they're not saying good things about the CEO. And I'm like, those are all leading indicators that something bad is about to happen. And I don't know if you've read Jim Collins' book, but he talks about like most companies die from the inside out, not the outside in.

Most of them implode themselves. And so we look a lot at like team and infrastructure to make sure like, does their internal strategy reflect the external strategy? And I think they're equally important. So that's the first piece. I'd say the second piece- So you talked, with that first piece,

you talked about pay. What is it that you're looking at regarding pay? Oh, well, one, are people compensated fairly? Are they compensated methodically? Like does everyone's compensation match with, could you, if everyone knew each other's compensation in the company, would you have a logical argument as to why you pay each person each, like what they're paid?

And I always go by that for myself because people do find out and people talk. And so I want them to always, I want to always be able to say like, this is why, and we have a formula for how we do it. So that's the first piece. The second piece is that a lot of people aren't willing to invest in talent to grow their companies. And so I'll give you an example.

I had this company that we were looking at a couple of weeks ago. And I said, what's your highest paid employee? And then he said, oh, my guy that runs the whole thing, you know, $65,000 a year. $65,000 a year. $65,000. I shit you not. I was like. Did you know, so in the state of Washington, if you have 50 employees or more, the minimum salary that's an exempt salary is $68,000.

Good thing he's not there. Oh, my gosh. This is the highest paid person. Oh my goodness. Yeah. And so I was just like big red flag right there. Like one, you're not willing to invest in talent. Two, the fact that you think that that is like a high paid job is frightening to me.

And three, who's running the company? You know? And so then you dive in and then I'm like, oh, this guy is an individual contributor, but he like happens to like build your CRM. So you call him a COO. You know what I mean? It's just like, and so that's dive in and then I'm like, oh, this guy is an individual contributor, but he like happens to like build your CRM. So you call him a COO, you know what I mean? It's just like, and so that's just a big piece of it is also understanding if we were to invest in that company, I mean, a huge piece is also,

have they, do they have a talent deficit? Are we gonna have to right size how much they're paying people, the kind of people in there, because we know that maybe that can stay as is and possibly not die for a year or two, but it's definitely not going to grow. So it's like a lot of people are like, my margins are insane. I'm like, right, because you're running everything with like a bunch of like doers who

you pay nothing. Zero management teams. Yeah. And so that's a big red flag for me. Let me think of the second thing. So actually, I'll tell you this. We run background checks and sentiment reports on the founders, right? So a huge piece of our process is there's business fit and then there's founder fit. And I run a lot of the founder fit piece. And for part of that, we look at like what the sentiment report is. They basically pull all public records of this person as well as like a summary of their social media and what's found on there as well as like a summary of their social media and what's found on there, as well as like background checks. And it's just been really interesting because some of what will come up in companies

that we end up not investing in is just, if it wasn't their first company, this has been an interesting pattern. It's like some huge blow up in their past company with their co-founders. And that is a big red flag to me as well, because we have had, for example, deals that don't work out where we partner with a founder,

but I don't think that it would constitute a public blow up where we're screaming and tweeting about one another. And if you're doing that, I don't wanna be your partner. So I would say lack of discipline when it comes to speaking your mind is definitely like there's some founders that are just like running rampant on social media. And I just look at that and I don't think like I don't give a fuck what your opinion is about anything.

I don't care. Politics, marriage, like nothing. But I'm like, OK, well, what good talent is going to want to work for you? That's all I'm thinking. Because I'm thinking the best people out there wanna work for somebody with high character. And if you're acting that way online, it's gonna be really hard to get people to wanna work for you. Right.

So. So if you were to describe the perfect founder, you talked about character. What are some other characteristics that you were like, that's a home run, that's somebody I wanna invest in? We say competitive greatness. What that looks like is, I'm asking these people, I'm like, that's a home run, that's somebody I want to invest in? We say competitive greatness. What that looks like is I'm asking these people, I'm like, what's your goal with the business? And I have nothing wrong with if people want to make a shit ton of money,

they want to sell their business, right? We've both done that. But it's the ones who say that that tend not to actually be able to do it. It's the ones who say, they're like, I want to change the industry. I want to make a mark here. I want to build something amazing. I want to build something that outlasts me. It's people that are motivated by something bigger than the money.

Mission driven. Mission driven. 100%. And so I think that's a huge piece of it because the amount of times I've asked somebody and I'm like, what's the big goal? They're like, 30 million. And I'm like, I'm so not excited at all. Like, that was just like, it's like, yeah. So I would say that's a huge piece, competitive greatness.

The second piece, and I would say the more important one for me is unimpeachable character. You know, are they somebody that we would be proud to associate with both in the business and outside of the business? And I think a lot of people can show up to their business and put on a face and act like a professional and then go get drunk and end up at God knows where at 3 a.m. when they've got a wife at home. I don't want to fuck with that because at the end of the day,

the amount of times that seeps into business and it shows up and people don't want to work for you when you're like that. At least not good people, you know, and the good people leave. And so looking for unimpeachable character, you know, people that would take a loss in business to maintain respect for themselves. That's really what it is. Right, right. So what would you say, obviously, you've had exits and you've had a lot of success. I mean, you're what, 32, 33? 31, right. So what would you say, obviously you've had exits and you've had a lot of success. I mean, you're what, 32, 33?

31, yeah. My goodness, that's still so young. Congratulations, that's awesome. And here I am turning 40 next month and I just think I'm young, but I'm not. And I miss my 20s. So what pushes and motivates you? What is your mission right now? And, uh, and where does it go? Yeah, it's interesting because I have some weird beliefs about motivation, but like, I don't really, I don't even like the word. Um, I think that I just have been

very reinforced for what we're doing. I get so much reinforcement from business. I have community within my team. I have feedback in terms of people saying good things, partners having success. So it's almost like if I stopped, there'd be so much emptiness in my life. I also get to work with my spouse on the business. I have family now that's in my business. You know, so it's like I derive so much meaning from the business.

It provides me with so much positive reinforcement. I just want to keep doing it and want to keep doing more of it. Is there a big goal that drives you? Is there an end game? I mean, in terms of like my vision for acquisition.com, we always say that the vision is the same thing, which is like we want to make business education available to everybody in every way, shape, or form

that we can, like real business education, not bullshit, you know, never run a business before, blah, blah, blah. And so for me, I mean, that's a huge step to that is getting this building. And eventually I'd like to have an entire campus because the new division of acquisition comm that we're rolling out is really like so for the past Two and a half years now almost three. I Mean right now because we've taken even a different approach to our portfolio

You know, we have ten businesses, you businesses after all these years. And I think a lot of people are like, oh my gosh, wouldn't they have more because all these people want to work with them? But it doesn't make sense to work with certain size businesses. It's like it only makes sense that, and when we take on a business, we want to go really deep with it. We want to have a large impact. We want to make sure it's a really big win for them and us. And there's a lot of requirements for that. So like right now, only wanna take on two businesses this year. While 34,000 people that apply on our website don't qualify and meet our standards, right?

And so we've been thinking like, there's all our free content, all our books, and that's where we always say, hey, go look at that. But what I've wanted to do for some time, and it's always been the vision of actcoach.com, it's like this little triangle, which is like the top is the portfolio, bottom is the free content there's this middle and we've been like what do what's there and i really think that the next step is in person

i want to say training uh workshop types and so not events but like um the vision eventually is it's like acquisition.com has almost like a school. Yeah. Right. I love it. And that's the first step is basically this year hiring the team for it and rolling it out. And I think we just did our first workshop two weeks ago, I want to say. And it was like it was very affirming because it was just like it was cool you know

because I think helping the few companies we do very deeply is incredibly satisfying but there's something about affecting more people like we do through the content but even to a greater degree and it's like it's the middle and so I'm really excited about that because I think I can see it like the eventuality of like this campus that we have where we have our portfolio companies in one building and they're all working out of there and we're able to have all of them network together and then work with our portfolio team. And then we've got, you know, multiple workshop centers

where we have our workshop team workshopping with all these other businesses that aren't big enough yet, but like hopefully one day they could be and then we have like our content team which is basically producing content of leila alex acquisition.com and then all the other companies that we support because the idea is that eventually with all the companies we want a majority of we produce content for all of them because then it provides opportunity for our team too um and that's that's really what we want to do i think it's really if you go to the bigger of we produce content for all of them because then it provides opportunity for our team too. And that's really what we want to do. I think it's really, if you go to the bigger,

like the one that I don't like to talk about yet, it's really like I would love an acquisition.com school. Yeah, I love that. But I wouldn't call it a school also because it's negative associations. No, I think it's a pretty awesome vision to really, I mean change change the world through education right through like real education because you and i both know there are so many gurus out there i mean young kids that went to some sort of course or something and like oh i should coach people

now it's like oh like weeding through that crap on the internet is so i wish i were more empathetic to it but i'm not very uh i love the vision i love i love the time that you uh spent with us uh today leila um what would you say so obviously you guys have produced some pretty awesome resources right you got the a couple books you got the podcast or whatnot where would you would you say that your most valuable content that's available outlined? Is it the books? Is it the podcast? Where would you send some of the viewers to go gather some more info? I would say go to acquisition.com and go to our free courses. You just go acquisition.com, free course. And that's where we put all of our, we make courses based on all the books and the things that we know in acquisition.com. We put them for free up there. Second, as I would say, you can go to my podcast, which is just build

Layla Hormozy. And I think that's probably the easiest way to consume my content. I love it. Love it. And then of course, available on all the major platforms, social media, whatnot. What, so obviously the school is coming down the line or whatnot. What are maybe some things that you guys are working on right now that behind the scenes that you're pretty excited about? I mean, honestly, that's probably the biggest one that I'm focused on. I think the second to that is Alex is really going hard with this company school, which we see a lot of benefits for acquisition.com in helping our mission through theirs because they actually almost have a like identical mission to ours which is a huge reason why we like it um so he has a lot of stuff going on with that um and in terms of his next book coming up we're preparing for that about

i can't i don't think i'm supposed to say it when it's coming. As soon? We're all excited about it. Yeah. I mean, I would say in this upcoming 2024, it's something that will be happening. All right. All right. You heard it here first. Let's go. We have no idea when it is, but sometime. Maybe I don't know either. That's exciting. Thank you so much for your time today, Layla. You shared some valuable gems. Appreciate you so much. Until next time!