The Game with Alex Hormozi - The 5 Stages of Niche Hopping... | Ep 220

Episode Date: July 17, 2020

You have to pick one which you can win at. You can’t win with all. Today, Alex (@AlexHormozi) talks about one of the common mistakes new entrepreneurs make: niche hopping, discusses the 5 stages that the entrepreneur will go through, and why picking just one is way better than spreading yourself too thin. Note: there is no shortcut, you have to put in the work.Welcome 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 on his path from $100M to $1B in net worth.Timestamps:(1:16) - Alex's failed attempt at owning multiple businesses for more money.(3:08) - 5 stages of Niche Hopping: optimism, pessimism, despair, perseverance, achievement.(6:54) - Confronting head problems is key to achieving eight-figure goals.(9:05) - Winning requires sticking through tough times when others give up.(10:59) - Gym Launch's success through continuous testing and improvement.(13:54) - Focusing on one niche, persevering through challenges for mastery.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

And I'm saying this, and if this affects you, I'm purposely doing it this way because I'm not going to help you unless we break some beliefs. All right. And that's what has to happen. Welcome to the Jim Secrets podcast where you talk about how to get more customers, how to make more per customer and how to keep them longer. And the many failures and lessons that we have learned along the way. I hope you enjoy and subscribe. What's going on? Everyone, happy Wednesday.

Hope you guys are having a smashing mid of week. I saw a bunch of sales coming through, so good on that. I want to tell you a story that will hopefully break some of your beliefs in, I think will be one of the reasons that you, like, if you can internalize this story, this may be the way that you get to eight figures or seven figures, if that is your goal. When I started in the information marketing agency world, Layla and I were dating. At that time, I had six gyms that I was, that I owned. I had gym launch, which was a done for you sales and marketing system where we'd fly out and launch other people's gyms. And I had a dentist agency where I would generate leads for dentists. And I had a chiropractic agency where I generated leads for chiropractors.

And guess what? I made no money. The reason I made no money is because I could not focus on anything. And so what happened there was I developed an initial set of skills, sales and marketing, and then immediately saw this whole new world of opportunity that was in front of me. But what I had not developed yet was the character trait to associate with the skill, which was discipline and focus. And because of that, my lack of character, I was not able to reap the rewards or the fruits

of the skill set that I had acquired. And so what ended up happening was probably one of the hardest year and a half. of my life. All right? I ended up having, I sold five of the six gyms. I'd shut one of them down. A partner stole all the money from the sale of those gyms. I had the gym launch that started happening, was working, and then all of a sudden we had chargebacks from one of the gyms that I shut down, which then wiped that account clean again. All right. The dentist that I sold did not get results because I did not have a system for them put together. I just generated leads on a sheet and just told them on calls what they needed to do and they didn't do it, obviously.

And so I had two dentists that had paid me $10,000 each. I had chiropractors that had paid me $10,000. And all that was left is that all of the money that I'd used that I'd gotten from that was literally just to pay my bills and eat and do whatever. All right. And the issue was that I had no focus. As soon as I see an entrepreneur that comes into my world and they say I have a couple of companies, I immediately know that they are a noop, that they are a noop.

And some of you may be hearing this right now and be like, well, I have a couple of companies. Cool. You're probably a new. All right. It's very unlikely that you have the ability at this point to have multiple entities. All right. Like I'm telling you this right now. And so the issue is there are five stages that you go through when you are a new.

All right? And I'm saying this. And if this affects you, I'm purposely doing it this way because I'm not going to help you unless unless we break some beliefs. All right. And that's what has to happen. And for some reason, fuck it. I'll just make another sheet.

All right. Here's the five stages. You've got one. You got a little up. You got a down. And then you go up higher at the end. All right. One in the beginning is called uninformed optimism.

That means you are optimistic about something that's going to happen. You're excited about the opportunity that's in front of you because you see with your skill set, you imagine how much money you could make. And you start doing this math in your head and you put it on Excel. and you get excel rich and you sell yourself and you talk to your partner and you talk to your parents and you talk to your friends and all you do is get excited right and your dopamine starts frying you know oh my god this is going to be amazing to make so much money right then what happens you get into it and then you go to here right and right here is called informed pessimism you now know that it's not

as good as you thought because now you have more information you find out that just like every other niche there's going to be issues there's going to be constraints there's going to be problems right because guess what? They all have problems. And then you go to here. This is called the Valley of Despair. This is where you're in the thick of it. You can't figure it out or like you're figuring out. There's tons of hair all over it. And so what do you do? You jump to the next niche and you start all over again. And you do the dance. You say uninformed optimism, informed pessimism, valley of despair. And you never make it past step three. Step three is. where you have to go through the shit, right? And the only way to get through the shit is to focus.

When you keep going into new niches, you never put your roots deep enough to learn the game, right? There's a reason it's not Cairo launch, you know, dental launch and, you know, PT launch and whatever launch, right? There's a reason that we chose not to do that because you can have a $100 million dollar dental agency. You can have a hundred million dollar chiro agency. You can't have a hundred million dollar PT agency. What you probably can't have is three of them. And so you have to ask yourself, what is the reason that I think I need to do more niches? What's the reason? Is it because I think that's going to make me more money? No. Why? Why would it make you more money? Because wouldn't it be easier to just get more of the customers you already have and can demonstrate results for? Right. And so the next

two steps of this are now informed optimism is step four what that means is at this point you've gone through the shit and you've figured out the solution right and it's starting to work and he's starting to get into a rhythm and then all the way up here at number five is achievement all right and that is where you realize the potential of this new opportunity most people never make it past here ever And depending on the entrepreneur, they can continue to repeat this cycle for years, years. And they cannot figure it out. It's like the guy that you know who continues to date the same girl, identical, different chick every time, but it's the same chick. Right.

And they keep going and they keep doing the same mistake over again. They fall in love. They get really excited. And they actually realize they have a relationship and they bail. Right. And they do the same thing over and again. They never get to the part where they can achieve the potential of the relationship. It's the same thing in business.

And until you learn the skill, you will never get to eight figures. I'm telling you this right now. It has everything to do what's going on in your head. You have to go through the shit and you have to figure out the stuff that they aren't figuring out. Every problem that you encounter, instead of running away from it, which is exactly what niche hopping is, exactly what new opportunity hopping is, you have to confront it. You have to face it head on and you have to figure it out. out, right? If they can't sell over the phone, you have to figure it out. You have to make a better script. You have to make a better training. You have to do daily calls with them. You have to have your

team train their team. You have to think, how many ways can I solve this problem? If they're not making enough money, it's because you did not create a mousetrap that was valuable enough for them to extract value from. And whose fault is that? It's yours, right? Real quick, guys, if you can think about how you found this podcast, somebody probably tweeted it, told you about it, shared it on Instagram or something like that. The only way this grows is through word of mouth. And so I don't run ads. I don't do sponsorships.

I don't sell anything. My only ask is that you continue to pay it forward to whoever showed you or however you found out about this podcast that you do the exact same thing. So if it was a review, if it was a post, if you do that, it would mean the world to me and you'll throw some good karma out there for another entrepreneur. And so just like I'm putting this out there because the number one thing I'm seeing right now and if you guys were on my presentation yesterday, the third framework that I introduced was the niche duplication framework, which is how you can repeat this in as many niches as possible.

And I put that in there because I know who I'm talking to, right? In their minds, an experienced mind, they think, oh, my God, if I made $10,000 in one niche, I could do $10,000 in another niche because they don't even have the belief yet that you can make a million dollars a month in a niche. You can make $10 million a month in a niche, right? You just have to have that belief. All right. And so getting to another niche, tell me what problem it solves to double your operational

issues double the types and number of problems that you have to solve in real time tell me how that's going to make your life easier explain it to me making argument to me right because if the question is i don't you know my my niche is super saturated welcome to the fucking world right it's all saturated 100% of it saturated right and the only way to win is to be better and the way to be better is to stick through the shit it's to go through the third step where everyone bails right and on the other side of that is where all of the green grasses. The green grass is not on the other niche. It's not on the other side of the fence. It's not in the new opportunity. It's going through the manure and digging down and then letting it grow, right? You got to work the field. That's how it works. All right. And I'm telling you

this because I lived it. All right. I had six gyms, one done for you agency, and then I had three niches I was serving. It was impossible. Same guy. All right? Six months later, I cut everything out just said, I'm going all in on gyms. And why did I do that? Because my wife was like, if you don't pick something, she's like, I'm not going to be with you. And I was like, fuck, all right? And so maybe some of you need someone. Maybe you don't have a company who's going to do that.

Maybe she has no idea, whatever, right? And so hopefully this can just be a voice to you from your past, all right? Because I feel like as I'm talking to some of you guys, I just feel like I'm talking to myself, right? And so I don't want you to make this mistake. And some of you will keep going around this merry ground over and over and over and over again. And you will not beat the level until you learn how to unlock the boss, right? And to put him on his ass. And the way to put him on his ass is not to do more different things is to do more of the same thing.

It's to get better. And every entrepreneur wants something that's new. The marketplace wants new, but the business world wants better. And that's how you win, right? There's no shortcut. And so you have to put in the work. You have to run beta tests, right? You got to say, okay, we're going to try this new script.

We're going to take four of our facilities and have them test this new script out. You're going to make a little training for them, present it, get them to give you stats every day and focus on it. And then what happens? If it improves, great, roll it out to everyone. If it doesn't improve, learn from it, try something else. Right? And like, the reason gym launch grew it away it was is because every single step of the process we

tested and tested and tested. Right. Even in this online model that we've been pushing. right now, right? We have, we've already changed and tweaked and improved each part of that process. Like, it wasn't like, all right, let's do chiropractors. You know what? Jim's, gyms aren't working, right? Jims aren't working. Let's do chiropractice. No, right? We just stick through the shit. And so I say this with like a lot of love and I'm trying to say this because some of you guys, I feel like I could be a big brother to. Like, I feel like I want to give you like a nougie sometime.

But I'm saying this with love because I need you to get through this. I need you get through. this like creepy best in phase of new entrepreneurship of i want to do everything you got to pick one you can win at any of them but you can't win at all of them and that's that's the reason right so many of you have so much skill right you guys are so good at promoting you're so good at selling right so we guys are great marketers you just have to use that and channel it into one channel otherwise you're spread too thin and that's why you feel like you're working all day and you're putting out fires all day and you can't move forward right if imagine right now all you had to do is get to one person to be successful and then all you do is duplicate that one person and just clone them

and do it again and do it again and do it again and do it again and I'll tell you like right now we're learning on the agency side how to make you guys successful one of the mistakes that I made early on like with Alan right now is that in the beginning a lot of the messaging that I have when I talk to you guys was that Allen is a platform that you can run your agency on and make more money in reality Alan is Alan is a platform that supports the business model that I'm telling you right It's more switch to my model and you will make more. We just so happen to use Alan to extract the value. It is a piece,

but the model is the thing that's going to make you the money, right? That's the game. And so some of you are not following instructions. You're half in, you're half in, you're half out. You're like, I want to do half of things one way

and half things another way. It's not going to work, right? It's like the girl who's trying to lose weight and she's like, well, I'm going to do keto on Monday, Wednesday, Friday. I'm going to do high-carb, you know, Tuesday, Thursday, Saturday. You can't mix shit. Doesn't work that way.

Right? Got to follow the sequence. The guys who are doing the best are just following the play, right? Or following the play. Some of you guys got to swallow your fucking egos, right? You're not hot shit, myself included, right? But I'm saying like, I don't know how, like, and I'm, I'm, just so you guys know, well, I'll leave it there. I'm going to reach out to a couple of you guys.

But you have to just, ugh. So I want you guys to win. And I don't want you to make the same mistakes I did. And I want you to level up. And the way to level up is not by doing more things. it's by doing the same thing better. And it's not sexy. And that's the character trait you have to develop

to get to the next level. So anyways, I hope that made sense for some of you guys. And if maybe it made sense for one of you, hopefully it made sense for one of you guys. And hopefully that's a turning point that you can just say, you know what? I'm not going to do six niches. I'm going to pick one and I'm going to get really good at.

And that's what I'm doing. When it gets hard, I'm going to stick with it because I know that every other person who's gone and tried this niche gets to this point and bails. And that's why they can't move forward. They all do a mediocre job and then try and spread themselves too thin. But I'm not going to do that.

I'm going to be better than them because I'm going to win and I'm going to get through this piece because what it took to get you to hear, which is learning how to sell and promote, is not the thing that's going to get you to there, which is learning to be disciplined with your focus, with your attention. All right. So anyways, I hope that made sense. If you guys could do me a favor and like this so that everybody sees it in the group, then Facebook will know that it's important, which it is. So I just wanted to throw that out there.

make sure that you don't stop at step three get all the way up to realizing your potential and stop leaving the value of despair and jumping to another opportunity where it says uninformed optimism you just think it's great because you don't know it well enough just like every new girl you start dating you think this one's not going to be crazy but you find out they're always right it's the same thing with your lines all right everyone's crazy you just got to dig through the shit and then you find the diamonds all right lots of guys hope you guys are having a good week and i mean it seems like the sales numbers are doing great p s The reason we use ClickFunnels in our business isn't yours, right? Or using funnels in general, not ClickFunnels specifically. ClickFunnels in general is because lead quality is higher and they make more money. And so if you make your clients more money, you will make more money too. All the guys who are doing the best with all their numbers are using funnels. Just FYI. All right.

Catch you guys soon. Oh, make sure they keep their available because otherwise nothing will work.