The Game with Alex Hormozi - A Tactical Guide to Make (And Keep) Your First $100,000 | Ep 727

Episode Date: August 7, 2024

"You have to check out your ego. Your ego's gone for this. You don't care about what other people think." In this episode, Alex (@AlexHormozi) explains a step by step process to make and keep your first $100,000, if that's a goal you're striving for in your current seasonWelcome to The Game w/Alex Hormozi, hosted by entrepreneur, founder, investor, author, public speaker, and content creator Alex Hormozi. On this podcast you’ll hear how to get more customers, make more profit per customer, how to keep them longer, and the many failures and lessons Alex has learned and will learn on his path from $100M to $1B in net worth.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

If you have less than $100,000 in savings and you would like to have $100,000 or more in savings, these are the things that I would recommend doing. And that means that you have to check out your ego. Your ego is gone for this. You don't care what other people think because they're not going to be there in 10 years. Because you have a whole new group of friends that are way fucking better and cooler. So one, stop eating out. Discount groceries only.

That's if you're super poor. If, here's my caveat, if you know how to make money, you already have a base level of skills, then eating Chipotle and whatever, whatever. you can door-dash it in so that you can keep working, the moment I realized I can make $500 every 30 minutes by selling, I was like, oh, I'm never buying, I'm never cooking food or grocery shopping ever again. Anything that was less than $500 an hour was now immediately outsourced, right? But this advice is for people who are super broke, okay? So if you don't have the skill set yet at all and you're struggling to just get things going, then you need

to be completely on the defensive so that you can have enough money so that you can start taking bets. Because the only way that you're going to get ahead is that you have to make bets on education. You got to make bets on opportunities. You got big bets on inventory. You got make bets on software. You want to start a Shopify score. You want to start a school community. You want to start something. It's still going to cost some money. Right? You might have to buy a camera. You have to buy some software that helps you edit videos. Like there's some expenses. All right? And so having a big stockpile allows you to be patient. The more money you have, the longer you out you can think because you don't have to worry about tomorrow. You know that next month.

and the month after, and the month after taking care of, because even if you made no money, you've got enough. That's how you can start thinking long term. People are like, think long term, think long term. But unless, if you have payroll and you've got, or you've got rent or you've got groceries to pay, you can't think long term because you're in survival mode. And so I'm trying to get survival to be as low as humanly possible

for you so that you could get into Thrive mode, but it's all relative. If you make $40,000 a month and spend $40,000 a month, you're going to mean the same survival mode. But if you make $40,000 a month and spend $4, you're going to have every month, you make $10. months worth of income. And so in two months, you've got 20 months saved up. You're good. And

then you can get super aggressive with that other 36 and start really betting to double down. All right. So here's the very broke five, six things that you can do to immediately spend way less. One, stop eating out, discount groceries only. Two, stop buying new clothes, go to Goodwill only. Three, only attend free friend events. All right. So think of what I just said. Think about all the events that friends will tell you to come to. Weddings, bachelor parties, birthdays, just nights out because it's thirsty Thursday, whatever. Only attend free friend events. And if they don't support your goals, they're not your friends.

Think about that. If I said, hey, I've got this goal and I said, hey, there's this human being and he wants to get you to not have the goal. Would you describe them as a friend or an enemy? Think about it. Some of the people in your life that you call friends are actually your enemies. You just don't know it. Now, four, take the rest of the time that you have to, A, apply to jobs that make more than your current job. B, pick up side hustle work.

C, learn skills that you can trade for a higher hourly rate than you currently do. When I say trade, I mean, you make more per hour than what your current skills pay you. All right. And then five, find the hardest worker in the room when you enter that new job or that new place and then double their level of input. So if they knock on 100 doors, you knock on 200. They make 100 dials, you make 200 dials, right? When I had Jacob, my young neighbor, I gave him this exact advice.

And he was expected to on his team do $100 a day. He did between 300 and 400. And so guess what? He got better faster. And then once you follow all of those steps, this is what you need to do next. Wait, 36 months. And this is what I mean by patient with your outputs, impatient with your inputs. And the crazy thing is that you can show.

change your life in one decision. I can get drunk, driving a car, and change my life forever. Right? I can happen like that. But it can happen just like that the other way. It's just that the outcome's delayed. That's the only difference. You can change your life today in this moment by making these decisions and your life path will have veered. You will have changed direction. Your tree of life will move. It's just that it takes time for that new direction to bear fruit. Whereas you can poison the fruit in a second. You can kill a tree real fast. You just can't grow one real fast, but it doesn't mean that if a seed's planted and you're watering it, it's not growing. It just takes a second to get above the surface. I think you can solve a lot of male problems

by getting in shape and making money. You'll still have problems. They'll just be smaller, and you'll have more resources to handle them. So let's talk about the making money part first. Fundamentally, in order to make money, you have to provide value to someone, either an employer or customers. But either way, you have utility, which you exchange for money. And so by making that a goal, then it means that you're going to increase your own usefulness. And so somebody who is more useful, all of a sudden develops other ancillary skills around that utility that they can use in other parts of their lives. If you're good at sales, guess what you can do when you're talking to girls? You can use the same conversational skill set. If you're trying to negotiate a purchase

for a car or a house or whatever, like those skills generalize, they transfer across domains. And so a lot of people think it's like, well, when would I ever be a salesperson or when would I ever be outbound? Like, it doesn't matter. It's not about that thing. The thing is, it's like real life skills actually do generalize. Like, this isn't elementary school or middle school when you're learning calculus or algebra or whatever in thinking like, what am I going to use this in real life? One, it is real life right now. Two, these skills do get used across domains of all of my friends who are since millionaires and billionaires to a person.

They started in what I would consider a high volume sales environment. So that's either door knocking, cold calling, or some sort of in-person business where they had many, many, many conversations with strangers on a daily basis. And I think there's, and I'm talking not like a month or six months. I'm talking like three, five years where no one knew their name. They were just some faceless representative that stood there at the door, saw a people sold memberships, sold insurance, sold solar, sold whatever. And the thing is, is like, skill development happens through volume and feedback loops. So it's the number of repetitions

you have times the amount of improvement between repetitions. Brute forcing the amount of volume definitely will help if you can give yourself feedback. I've seen people say, hey, I've actually made 100 pieces of content. Now this is like 1% of people because most people do nothing. But of the 1% of people who say, okay, I post it every day for a year, the thing is, is they didn't do the most important part, which is you don't just like make a video and post it and just every day like, hey, make a video post it, make a video post it. You have to look at what you did and what you could do better. Fundamentally, that is the cornerstone of feedback. And so you look at the top 10 videos you made over the last month and you say, okay, how do I do more of that and how do I do less of the bottom 10%? And you just pick one thing that you did well there and you try and do it in every video going forward.

and that develops a checklist of things to do so that you develop a skill. And so speaking from my own experience, the first sales conversation ever had, first off, I had zero sales training. No one was like, hey, this is the script, this is how you go over. They're like, hey, here's a new lady, go sign her up. And so I was like, okay. And I didn't even know this was a sale. I didn't know the term sales.

He said, go sign her up, and I said, okay. And so I walked over and she was like, hey, you know, I want to know. know more about the gym and I said, well, what do you want to know? And she was like, well, I mean, like, how much is it? And I was like, oh, it's, uh, whatever, 150 bucks a month. And she was like, okay. And I was like, you want to sign up? And she said, I left my credit card at home. And I was like, okay. And she was like, I'll be back with the credit card. And I was like, cool. And so I walked out and it was like two minutes, right? And I walked out and the owner, Sam was there with a few of other gym owners. He had bought a few gym owners in. So it was like three or four gym owners

there. And he was like, damn. He was like, that was fast. And I was like, yeah. He's like, you closed her? And I was like, yeah. And he was like, with a credit card. And I was like, oh, no, she's, she's going to go get it and she'll be back. And they just looked at each other and then looked back at me and then just started laughing at me, uncontrollably, like couldn't breathe at how dumb what I had just said was. And the thing is, is I had no experience. And I, and I tell that story because so many people assume that like I walked out of the womb closing deals. You know what I mean? Like, hey, nurse, what do you do it later? You know what I mean? Like, but it wasn't like that, right? Like, I didn't know. I didn't even know the term.

And so, you know, over time, I just started developing like, okay, well, what do you do? And I watched other people sell. I was like, okay, they start with asking them why someone's there, ask them about their goals, asking things that they've done the past, they didn't work. I said like, okay, that seems to work okay. And then when they ask them to buy, then if they don't want to say yes, they ask them more questions rather than just saying, okay. And so I started to develop at least an understanding

of the framework of how sales occurred. But I still wasn't good, right? And so then I went through that rocky cutscene period where this is where I'm very grateful for this, is that Facebook ads is when I started running them in 2013 were super cheap. And so it actually gave me so many repetitions. Because not only was I taking 15 to,

20 consults a day in person. I was also working leads. And so I'm talking to strangers over the phone to set the appointments. And so all I got was just names on a list. And I would call them, set the appointment. Like, who's this again? You know, all of that.

And then, and by the way, if you are local, you just say the name, pause with a question mark at the beginning. You're like, John? And then they'll be like, yeah. You're like, this is Alex. I would pause. And they'd be like, they're like, who the fuck is Alex?

I'd be like, from Facebook. You signed up for a blah, blah, blah, blah. our thing? Yeah, I'm just calling to make sure that you're not a crazy person with the internet, and neither am I. I was like, we're actually on the corner of X and Yth. I was like right next to the 7-Eleven. They're like, yeah, yeah, I'm like, okay, cool.

I just wanted to see what time you want to come by. I was like, we have the sweetest facility in the world. Not really, but it's at least pretty decent for this area, but we have five out of five coolness. And they were just laughing. They'd be like, I can make it at six. And I'm like, six works. I was like, do you want a picture of me or just of the address?

And they're like, just the address. I'm like, all right, sounds good. I'll text it to you and I'll see you later today. So that kind of like, notice like half giggles between each word. Like it's showing that you're a positive tone person, high energy. Someone's like, man, this guy seems cool or this gal seems cool. Right? And so they're more likely to show up.

They're more likely. Now, if I maintain that tone, if they give me an objection, I can pivot really easily. If I'm like neutral or like, hi, I saw that you signed up on the internet for our thing. Would you like to come in? They're like, well, tell me more about it. Like, well, you have no room for messing up. And so I always tried to have more rapport and bring a lot of energy. And the thing is, if you've seen any of my content, I'm not naturally like a high

energy person. I will continue to work, which is different than being like up here. And so I developed a lot of things to try and keep myself energized. And so I had a small trampoline that I would bounce on before and between every sales appointment. It sounds ridiculous, but if you, I'm telling it, it's like a hundred bucks. If you buy one of those little trampolines and you bounce either between sales calls or between people, like I'd have people coming in as I was still bouncing.

And I'd be like, I know this is ridiculous. I was like, but try and be in a bad mood on a trampoline. You can't do it. You can't do it. You can't do it. And I challenge you too. You can be in a bad mood. If you try to jump around, like you feel like such a child, it's ridiculous.

But what would happen is like I would also get a little bit exercise. My blood would keep moving. But it's also just like mentally. literally bouncing, gave me a lot of energy for these appointments. And so I say this because I developed all of these things over time. And so if you're starting out, you're not going to be good. That's why you're new. You have no experience.

But there's a difference between, there's a story that, shoot, I can't remember where it is, but there was a foreign kid who had never seen a banana before. And so the adult gave the kid a banana. And so the banana, so the kid took the banana and then bit right into it with the skin and everything. And another child was like, you're such an idiot. And then the adult yelled at that child and said, no, he just doesn't know any better. And there's a very big difference between being dumb and being experienced. Right now you just don't have reps.

And so you're going to make a lot of mistakes like biting into the banana, like for just letting someone walk away, assuming it's a close, and they say that they're just going to come back and call you with their credit card, right? by the way, that never happens. Very rarely. But instead, you want to just peel that banana. You want to bite into the banana, a bite into the orange, all of those mistakes as quickly as possible and not judge yourself for making the mistake

and see the mistake as part of the process of being like, that didn't work, that didn't work. And if I develop enough of these doesn't works, then you just kind of walk the minefield, and you get to where you're trying to go. And people are like, wow, you're so good at this. And you're like, oh, no, no. I actually just know all the things not

say in a sale and then they end up buying. I just avoid all that and then they buy. And to be clear, I think I have a similar piece of advice but for very different reasons of telling young men in general or men to work harder. And it's not because I think it's some sort of beating your chest, I'm on alpha, whatever thing. It's just that for me, the point of my life is to become the best version of me. And in order to do that, I need to learn because there's huge discrepancy between where I am and where I want to go. And the discrepancy is is going to get filled with skills, which means that I need to do repetitions to acquire failures that I can learn from to get better from. And if I can do more of that in a shorter

period of time, I will learn more skills, and by definition, I will shrink the distance between myself and my ideal self. And so that is pretty much the only thought process I have around this. And I also believe that you need to be patient with outputs and impatient with inputs. So let me unpack that. Patience in general is figuring out what to do in the meantime. So when someone says, hey, be patient. What they just mean is figure out something else to do in the meantime. And so if I'm telling you to be patient with outputs, it means that you basically just have to figure out something else to do in the meantime while you wait for outputs to occur. Because you can't output. You can't, money doesn't appear. You have to do something.

and then money happens, right? But the doing something part is the thing that you can control. The money happening is the part that you don't control. That comes afterwards. It's an outcome, right? And so when I say patient with outputs, that's the first part.

The second part is impatient with inputs. And so if being patient is figuring out what to do in the meantime, inpatient is doing the thing in the meantime, right? And so it's the opposite of that. It's the thing you do in the meantime. And so if you wanna be impatient with the input, the input is the thing.

That's the action you do. And so by delineating that, if you hear yourself thinking, man, why hasn't this happened yet? You're talking about outputs. And that means great. If I think that thought, I need to do more of this input. Right. And so use your input, your action, you're doing this, the thing you use your hands for as your coping mechanism for your impatience with outputs.

I want to say that one more time. Whenever you have that feeling that things should be happening faster, use action as your coping mechanism. I used to write this down a lot and say it, which was action alleviates anxiety. And so when I would have this anxiety about the future of like, why haven't I made it yet? Why are these other people doing better than me? Like is this not going to work? What if I'm on the wrong path?

Action alleviates anxiety. The only thing I could control with that I was, is that I would work, is that I would get better. And the key point there was that it wasn't just working for work's sake, it was working with the intention to improve. And so you want to do repetitions because by doing things more times you get better at them, typically just by accident. But if you were deliberate about the point of doing this, when I started working at a gym going from a white collar job, it wasn't because I wanted to become a trainer for the rest

of my life. It was because I wanted to learn the skills. And then I knew that once I learned those skills, if I owned a gym, then I would know how to do the training part as well, and that would be good for me. And so then when I was a gym owner, and when I started and started working at a gym, I wanted to own a big chain of gyms. That was my whole goal to start with. I wasn't getting into this for one.

Like, I never had the goal of owning just one gym. And so even when I started that gym, the whole point, and I worked all the time because I thought of all the things that I didn't know how to do yet. And so it wasn't about great I've made it. I own a gym. It was like, I'm so deprived of where I want to be. I have to fill this gap as fast as I possibly can. And so that's why I spent so much time on this and got feedback from as many human beings as I possibly could who were ahead of me.

So I want to say this clearly. Once I started my gym, one, I paid for a mastermind for gym owners before owning a gym. And I did that because I figured, well, why would I start a gym until I learn all the stuff that you guys did wrong? I was like, I'll just learn from all y'all's mistakes. It sounds like a great deal for me. It almost felt unfair. I was like, yeah, okay. He said, don't start at one of those locations.

He said, have good storefront. He said, make sure that you have good parking. I was, ooh, these are all good, you know, good things. They were like, don't go too big. I was like, okay, that's good. And they're like, make sure your rents under this per foot. I was like, all right, make sure I got that. Right?

And so I took all these notes in that I would have just made huge mistakes on the upfront. Now, once I did start my gym, what a lot of people don't know is that every weekend, I would either be on phone calls or I'd be driving out to other gym owners. And thankfully, because I was so young when I started my business, they were just like, they felt bad for me. And so they would just sit there and I'd be like, hey, why do you do that? Hey, why do you do that? Hey, why do you do that?

And it was like, you know, they'd be like, God, you're such a pain in the ass. But I just wanted to learn, right? But I was always like willing to help them with anything they had. You know what I mean? I was like, let me show you the stuff that's working well for me. And I would always just share it. And the thing is, is I would go there and they would say they did something and I'd be like, huh, that's weird.

That's different than the other guy. And I like that way better. It didn't mean I'd take everything as fact, but I got a lot of ideas from that. And then I would use them. And if they didn't work, I would just toss them out. And if they did, I kept it. And that's how I quickly iterated the gym model to become much better than a lot of people's models,

despite me being younger. Because I was able to leverage everyone else's experience as fast as I could and jam it into my own. And so I think the people who move faster than life learn faster. And the only way you learn is by changing your behavior with the same conditions, which means that if a person walks in, I say, this is my six-point script.

a person who's identical walks in right afterwards. If I've learned something, that script changes. I mean, same condition, new behavior. And so if you keep doing the exact same thing every single day, then you may not be learning. And it's a key point. It's good to work hard, but it's good to work hard and smart, which means that the work you do gets better because you tweak things.

And so if you're not documenting the process that you have, and I'm not saying you're making content about it, but literally looking back at game footage, looking at the calls you did, looking at the content you did, I do this today. People ask me like, what are the masterminds you're into? What are the courses you learn from? I have now broken apart the learning process that I have that works best for me because I see the biggest gains in improvement haven't come from advice for me for the most part.

They came from looking at data, which was, let me look at the last 2,000 ads I made. Let me look at the top 50. Let me look at what these ones have in common. Let me look at what they don't look like compared to the bottom 50. Okay, these ones have these characteristics. These don't. I'll do more of this less of that. And then I do another 100 ads and I look at the top 10 again. I say, what do these ones have that these ones don't? And I do that for sales calls. I do that for content. I do that for meetings. I do that for businesses in general when he starts zooming out. And so that process of do a lot of volume, then look at the outcomes that were good, look at the activities that led to those outcomes that are positive, do more of those activities, look at the bottom

percentages, look at the things that led to not having that happen, and do less of those. And if you're younger, and this is specific for everyone who's listening to this video, if you're probably sub 30, sub 28, maybe, right? If you're in your 20s or less, you can probably get away with this, which is that people ahead of you are more willing, believe it or not, to feel like they have status. So you can give them status by saying be a mentor. And the thing is a lot of young guys have a lot of ego, right? Because you're trying to prove yourself, trying to be a man, whatever. The thing is, is that if you humble yourself, It's not like there's some fucking massive scoreboard where it's like, who humbled themselves

to whom across the whole U.S. It doesn't exist. It's just within one dynamic. And so if you go and say, hey, I don't know anything. I'm happy to learn. If you do that, then a lot of people are like, oh, well, he humbled himself. Well, yeah, I'm happy to teach you. And the thing is they'll give you advice that's worth thousands of dollars, years of your life

for free if you just say, you're better than I am at this. But the thing is, is that the end of the day, none of it matters, but. Scoreboard would be the thing that matters in business, right? And so the only thing that precedes the scoreboard is your learning. I've spent ego points. I've spent dollars. I've spent time. I've spent social capital.

I spent every resource that I had to get more learning faster. Because fundamentally, the only thing, and I think this is probably one of the biggest gifts my father gave me, is believing that I am the asset I am investing in. And the cool thing is that you are the permanent hold, right? You can't sell you. Like you're you until you die. And so this is the one asset you've got because you compound, skills compound. When you get really good at sales and really get at finance, guess what?

You can raise a billion dollars because you know how the finance world works and you know how the sales world works. Right? If you know how to code and market, then guess what? You can build software and sell it to gazillions of people because you have the product and the acquisition. Like, skills stack disproportionately. If you only know one, you might not be able to make a tenth as much as if you know two. Now, obviously, those are big bucket of terms that have many, many, many skills underneath of them. But fundamentally, when you think about it that way, you become a weapon.

So let's tackle the second part. I said, you can solve a lot of male problems by getting in shape and making money. And so let's talk about the getting in shape side. So you can avoid tons of problems in life by doing one thing, going to bed on time. And so instead of setting alarms to wake up, set alarms to go to sleep on time. It's hard to wake up late when you go to bed at nine. And so the thing is that that one simple behavior actually can eliminate a lot of the things that derail men, especially young men.

And so Charlie Munger talks about this a lot, which is like, all I'd want to do is find out where I'm going to die and never go there. The whole point is he thought so much more about avoiding stupidity than trying to be intelligent. It's kind of like the stupidities are very easy to identify. intelligence is hard. But if you avoid all stupidity, you just become intelligent by default. And so if you define intelligence the way I do, which is rate of learning, so how quickly you pick things up, that is intelligence, if you can avoid all of these things that make you look like an idiot, right, then you become more intelligent. And so let's talk about this from the getting in shape

perspective. Show me a situation where you have two groups of men, one group of men that is really out of shape and fat. And another group of men that's really in shape that are going to outperform one another, and this is generalized. You have to take random sampling of the population, a bunch of in shape guys, a bunch of overweight guys, who's going to do better at any task over and over again? If we pick 10 tasks that are completely different, the in-shape guys are going to do better than the out-of-shape guys, period. They're going to have more energy. They're going to be more focused. If it's anything interrelated, like interrelations-based, like those guys are going to close higher percentages. If you're better looking, you will close more.

If you're better looking, you get paid more. If you're better looking, you get more promoted. If you're better looking, you do better in content. Period. Fight me. And so the thing is, if you have this one thing that affects every way that people see you, and the only thing you have to do is control what you put into your mouth, then don't you think it's worth developing that most basic skill of discipline at this point in your life?

Because the thing is, is that you want to get in shape young. Because if you're not in shape, guess whose fault that is? So, get in shape now. Thing is, is it cost time, not money. And right now, you've got time and not money. And time only becomes more expensive as you age. So buy it now while time costs you the least and you have the fewest responsibilities.

It'll help you no matter what life path you choose.