The Game with Alex Hormozi - What I did after I lost everything to make $100k | Ep 268

Episode Date: January 19, 2021

It’s all about the skills. Today, Alex (@AlexHormozi) shares with us the decisions and mindset that helped him get out of having nothing to earning millions, his strategy with sales and leads, and how the skill of acquisition came in very handy.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:(2:47) - Developing versatile skills helps in any situation, even after loss.(4:51) - Useful skills give hope after financial loss.(7:10) - Knowing business and value propositions enables success.(8:33) - Alex shares his sales process and how he found luck.(10:33) - Learning skills brings peace of mind money can't provide. Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

I ended up making $100,000 in my bank account within the next, I want to say six weeks. That was in my bank account after having nothing. Welcome to the game where we 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 we have learned along the way. I hope you enjoy and subscribe. What's going on, everyone? Welcome to podcast. I have a sweet episode for you today.

I'm going to tell you about how I started from zero after I lost everything and rebuilt it. So the kind of the motivation for this is I was on a panel last. week and the question for the whole panel was what would you do if you lost everything all your money all your contacts all your reputation and the only thing you had left from your skills what would you do to build a business that made 5,000 each month and so this is really cool because you got to see a lot of different successful entrepreneurs talk about how they do it and many of them just talked about what they actually did which i thought was pretty cool and so um the reason that i think this is so like this hits home for me obviously is that i've actually

gone through it and most entrepreneurs will cycle, right? The entrepreneurial journey is one of cycles, right? You make a lot and then sometimes you lose and then something you make more. Typically, you want to go up and down upwards, but sometimes you lose it, right? And there's definitely some investors that only invest in entrepreneurs you've already done a cycle or done or cycle twice because they understand that that entrepreneur doesn't believe they're unbeatable, right? And so as one quick foreshadowed to the store pregnant to the nitty grave exactly what I did. I ended up making $100,000

in my bank count within the next I want to say six weeks. That was in my bank account after having nothing. Which I'll tell you that story in a second. But when my Layla and I's fathers are both from Iran and both of them flood during the revolution and both

of them, their families had houses and land and things like that. And the government just said, that's not yours anymore. That's ours. And so they just took everything that was our families and my dad was able to get here with a thousand dollars right and with that he was able to rebuild his life and the reason that he used so hard on that is that he had skills he was medically trained right as a physician but he had nothing except for his skills but the skills is all he needed which is why they say once you like the first really is the hardest

because if you lose it you know how to make it again and it's the skills and the experiences and the beliefs that allow us to recreate the same successes much faster because we know what to do, right? And so that's why he was always so big on education in general, on formal education, because that's how he got educated in. I ended up just being big in education, which is huge, that's why I make these videos, because I hope that somebody, you know, it gets value from it. But the reason I think skills are so important is that your plan B, like what happens if you lose everything changes as your skillset improves, right? So before I had this skill set, when I decided to start my gym, my plan B in my head was I will drive, like if everything fails and I lost everything at that time, I was going to drive Uber 12 hours a day and I would strip at night, which is, you know, some people have moral issues with that. I do not. I think you do what you got to do. And so for that, I knew that I would make probably that $200,000 a year if I just did that, right? And so,

Then as I started to have my gym, I started learning more skills and learned how to sell. And so then my plane B, instead of being Uber A and chirping, it leveled up, right? Now my absolute zero is I can go to a cartelorship and make between, you know, $200,000 and $400,000 a year and not have to take what those off, right? And so that gives me almost a top 1% income just from knowing how to sell, right? So that's probably what I would do if I had to like at that time, given that skill set, that's what I would have done, right? And so the thing is, is that I develop more skills than just sales. And so I also learned how to generate leads, work leads, make offers, and then present those offers to prospects and then sell a higher ticket.

So that was kind of the next stack of skills. And that at the time of when I lost everything is what I did. And so this is probably what I would say, like my third level of plan B. At this point in my life, if I lost everything, I, I might. do that. If I lost everything and I had no reputation, then that's probably what I would do is exactly what I did the last time. All right. So I'll tell you what I did. So at this point, I had sold five of my gyms. I'd shut one of them down. I felt kind of good about myself. And so I felt kind of like a good entrepreneur. And I'll say, all right, I'm going to take all this money

and go on black in this new venture. Right. And then of course, you can already guess based on how I started the story. The venture did not go the way you were supposed to. And just like that, I lost everything. And the only thing I had left was $1,200 in all my accounts put together. And I was like, this is horrible. And it felt like I just lost four years of all the work I'd put in. Literally, it was just gone. The reality was I hadn't lost everything because I sell the skills, right?

And so what I did with the skills is I said, okay, well, I already know how to generate leads, and I don't have to work leads. I know how to sell and I'm going to make offers. I don't sell a ticket. I'm going to just do that for local businesses, right? And so I reached out to a little business. It was like, hey, you want more clients? Some people like, yeah, sure.

And so what I said was, I'd like to get you clients. And you might be wondering, well, what offer, you know, how did you get them to say yes if they didn't know who you were? I said, don't pay me anything, right? Don't pay me anything. I'll go get my own leads. I'll work the leads. As long as you have like a, you know, a hat and a t-shirt that I'll sit on your front desk and I'll sell them for you. Right?

And my deal, when I did this, because I had $1,200, I was able to say don't pay anything. Now, if I truly had $0, like zero, I would have to do something that I could sell my time for to get $100. From there, then I would get a phone. And then from the phone, I would then search on Google for local businesses. And then that is what I, like, that's how I would get that first from zero to 100, right? Real quick, guys, you guys already know that I don't run any ads on this and I don't sell

anything. And so the only ask that I can ever have of you guys is that you help me spread the words so we can out more entrepreneurs, make more money, feed their families, make better products, and have better experiences for their employees and customers. And the only way we do that is if you can rate and review and share this podcast. So the single thing that I asked you do is you can just leave a review. It'll take 10 seconds or one type of the thumb. It would mean the absolute world to me. And more importantly, it may change the world for someone else. But I had $1,200 and I knew that what I was going to do was going to work because I'd done it so many times. Right. And so I told the, I did a gym obviously because I knew that space, but you could do this in any business that you frequented.

So if you have anyone in your family who knows, you know, is a mechanic or somebody who's a chiropractor, someone who's a dentist or someone who's a whatever, right, a hairstylist. It doesn't matter. As long as you have some idea of how that business works and what the value propositions are, you could do this entire process if you had the skill set, right? Which is why I talk about these skills all the time, because it literally saved my life, right? And so that's why I'm passionate about this stuff. So boom, I reached out. They said, yes. My offer was, don't pay me anything.

And my deal was, I'm going to sell an upfront package. I will keep all of the profit after I recover my time of my ad spend, right? You will fulfill. So that's your cost. Right. But then after that, the customer life cycle is yours. Now, that works specifically for Jim because there's lifetime value beyond an initial package, right? if I was working with someone that had like, if I were doing roof fixing, right, and I was selling big roofing jobs, then I would probably do some sort of split like I would take, you know, after I recovered my ads, but I would get maybe 30% of the gross profit or half the gross profit of the deal, right?

And the other thing is if I had truly no money after getting that $100, I'd probably just ask them to cover the ad spend and say that after they got paid back first, then we'd split it. So if you have a little bit of money, I'm talking like $1,000, you can make the deal way more in your favor. But if you truly had nothing, then I would ask the first guy to cover the ad spend. And then I would do the marketing. We'd split the profit after the ad spend. And then the second guy, I'd now have money and say, don't pay anything. I'll cover the ad spend. Because if you can take on more of the risk, you can take on more than reward.

All right. And so you might be wondering, like, how could I go ahead and do this if I only had $1,200? How could I make a huge campaign? So I'll walk you through it in a lot. of happening, right? So I started spending $100 a day, right, on ads. Now, that $100 a day at the time would get me about 20 leads. Now, 20 leads, I would typically close four people at $500. So I would spend $100 and I'd end up making $2,000, right? That is exactly what happened. And then from that $100, from this $2,000, you can subtract $100 for day two, and I would have $1,900 left, right?

And then day two, the same thing would happen, and that was pretty much the game. Now, in the first one that I did this with, because this is literally what I did, I think I did $34,000 in 14 days at my first kind of gym that I did this at. The second gym I did it at, I didn't do that well. I think I was only like something was really weird about it. I ended up doing like 11,000 in 10 days or 14, I think it might have been 14 days. It was two weeks for the second one. It just, it was a hard market for a variety of reasons.

But then the third one, I ended up doing $121,000 in sales. And I did that in 20 days, all right? And that was awesome. And then after that I did another 120,000 at the next one and so forth. And so as soon as I started working, I hired six sales guys. And I said, let's do six gyms every single month. But this is how I went from zero. And at the end of this period of time, I had $100,000 in my bank account in about six weeks.

That was my profit. That was literally what I had in my banking out after doing this after losing everything. And so the reason I'm so big on learning the skills is that it gives you a peace of mind that money can't. Because money can get taking, governments can get overthrown. And I say this not as an alarmist, but because like both Layla and I's fathers have gone through this, right? It seems like something like that wouldn't happen here, and I can understand that. But for me, it's happened in direct connection to me. And so skill acquisition is the only thing that can protect us because they cannot take our skills, right?

They can't, like, no one can take that from you. You can make a bad decision, sure. You can make a hundred bad decisions, but you still have the skills. And so just as a quick recap, I reached out to local businesses. I made an irresistible offer. I generated the leads. I worked the leads. I sold the people.

And I was able to collect the money up front. And if I didn't have any money, I would ask them to cover it the first time. I would pay them back and then I would split the profit with them. And so it's funny because a lot of people wouldn't be able to do this because they're just not willing to do the amount of work that's required here. Like when I did this, I was working about 80 hours. a week. Actually, it might have been working more than that. I worked 12 hours a day, probably six and a half days a week when I was doing this. It's because I just lost everything. And so I needed this to work. And so I don't know, maybe you're in a place where you're like,

I need this to work. And so maybe thinking about it from that perspective might be useful. But anyways, this is how I made my, how after I lost everything, I had $100,000 in my bank account within, you know, two months. And it was by having this skill set of acquisition. So I hope. I hope that was valid before you. I hope that was neat and interesting. And I can't wait to see you next video. Love, bye.