The Game with Alex Hormozi - Why you shouldnt' believe the revshare or agency lie... 😡❌ | Ep 59

Episode Date: May 31, 2018

"If you don't know how to do those things, it's not a business." Today, Alex (@AlexHormozi) discusses the issues with gym marketing agencies and revenue share companies, highlighting the importance of gym owners taking ownership of their business and learning all core competencies. He emphasizes that outsourcing these competencies leads to a lack of personal growth and business success.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:(1:05) - Gurus made money but didn't know business.(3:08) - Learn competencies of running a business.(5:43) - Learn skills to take control of business.(9:11) - Own every aspect of your business.(9:54) - Outsourcing without learning leads to unsuccessful business.(10:44) - Consider owning all revenue for more profit.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition

Hey, what's going on, everyone? Happy Tuesday. Hope you guys are having an awesome, awesome day so far, and I hope you guys had a good memorial weekend. The thing that was on my mind today that I figured I would make a video for you about is, you know, RevShure Builder 5,000. And this is the awful agencies that exist out there, and the lie that most of the time they peddle to gym owners. And the reason I wanted to make a, you know, video about it,

or if this is being used as audio, an audio about it, is because it's probably the thing that bugs me the most in the entire industry. And there's two aspects to it. The first aspect is where we have agency owners and, you know, revshared dudes, guys who basically bought ClickFunnels and a Facebook marketing course and then consider themselves experts on the gym business, right? Because they're like, you're supposed to niche down, so pick a niche and they pick gyms, right? And so the reason that it bugs the crap out of me is that they feed this one lie

and they ride this lie into the sunset and they ride it so hard and they jam it down our throats. This gym owners is two things. One is that they preach to you how you're supposed to run your business, having never actually run the business, right? Having never actually owned a gym or multiple gyms, right? Or if they did, ask them how successful it was, right? Did they act like, did they have an exit?

You know what I mean? Like, just like things don't add up from a success standpoint. The reason that there's so many gurus that are out there is that they did make money with their gyms and then they start selling how to make money with a gym after they sold their gym or closed their gym. And the reality is that they never knew how to make money with the gym. And so that's kind of how they transitioned. And that's why none of them really grows because ultimately the product that they

had is shit. And the same thing happened with the gym is that the product they had wasn't good. And so it didn't grow. Right. And so they get along by selling on this premise that just simply false. Right. So that's the first thing. The second thing is the lie that you're a gym owner and so you shouldn't know

how to market or run ads for your business. That's the lot, right? And they say this. They say, listen, you should just focus on what you do in best, which is training clients, and then we'll just focus on what we do best, which is running traffic and learning the new ad platforms and Facebook's new changes, right?

Facebook, like, I've been running ads on Facebook for eight years, all right? The platform has not changed that much, right? Like, literally has not changed that much. And you know what's crazy about it is that they will say this to you, in one breath and then in the next breath, turn to the person that they pay, that they hired a week ago, that they trained for two days on how to run an ad, and then they will let that person run and manage your account, and they're paying that person 15, 20 bucks an hour, right? And so they're like, you're incapable of doing a 15 hour or an hour job because it's so

complicated, right? And they try and make it seem like it's overwhelming just to get you to not try, right? And so anyways, this bucks the crap. out of me because if it basically a, A, it's demeaning to a gym owner. B, as a business owner, what they're saying is that you don't need to own all the core competencies of running a business. Like if you don't know how to generate leads, if you don't know how to nurture leads, if you don't know how to sell, if you don't know how to fulfill and if you don't know how to retain people and ascend them to higher levels of service, they're saying, yeah, yeah, you don't need to know how to do these first two things. If you don't want to learn how to do those things,

you'll never grow as a business owner. Like, it's just a deficit in skill, and that's okay because it's just a learning process. It's a growth process. But if you're like right now, so this will probably turn some people up, but if you're the type person who's listening to this right now and is like, well, I don't want to learn that stuff, I'm like, cool, you're just not going to grow. You know what I mean? Like, your business is not going to boom.

Like, you have to learn this stuff. You have to learn how to generate increase. You have to learn how to nurture them. You have to learn how to sell. Now, that could be based on referrals. It doesn't matter, but you have to have a process around it. And so when an agency or a repure company is like, you just focus on what you do, pat on the head, little gym motor, like, you just keep training your sessions and getting

your clients great results because that's what you know how to do best. I'm like, dude, like, shut up. You know what I mean? Like, you've never run a gym. It's not that hard. You can do it. So, like, I know that you're not smarter than I am, right? Or like, literally you can Google how to run a Facebook ad on Google right now.

And you'll find up-to-date video. for free on the internet. It's not hard, right? And so it just, it bugs the crap out of me. What guys are susceptible to this. So if there's a company that is an agency, don't listen to them for how to run your gym because they never ran a gym. And second, don't, like, don't rely on them because I've never, ever seen somebody who's been with an agency for more than, like, I haven't seen someone ever stay with one for more than a year. Like, I can't even think of one, right? The typical life cycle is this. They run an advertising campaign. pain that they know is like going to do decently well. And then it works. And the second month

works a little less well. Third month, it works less. But the problem is they signed you up on a 12 month contract. Right. And then you got to get into this old dispute. And then you leave, you know, burn and pissed off. And they say, you know, burn and pissed off. And then you say, they suck. Right. But at the end of the day, like, you're going to be half to be the one who has to learn how to fish for yourself. Period. It just is what it is. Right. Because no one's going to care about your cheddar more than you will. No one's going to care about refreshing ads more than you will. all they're doing is they're just trying to manage their client load and more realistically, they're trying to sell on the front end the whole time because that's what they know how to do,

right? It's market. But they're not good on the fulfillment. They just hand it off to somebody who is like who they're paying minimum wage to run your stuff. Right. And so like if they can pay that person minimum wage, you can do the small amount of effort that it takes to learn this valuable skill for your business in order to take control of the business that you own. So, man, sorry. I'm just kidding like it just drives me up a wall.

but it's insane. Like, you have to own every core competency of the business. If you do not know how, if you're like, well, I don't want to learn that. I'm like, good luck. You know what I mean? Good luck. Like, you're just going to keep bouncing from agency to agency. And like, because none of them are really ever going to care about your results like you will, period.

It just is what it is. Like, no one will care about gym launches growth more than I will, period. It just is, right? Hey, if you're a return listener and you have not rated or reviewed the show, I want you to know that you should feel absolutely terrible about yourself and everything else in the world. I'm kidding. But it would mean the absolute word to me if you guys would go ahead and do that. You don't even have to pause the show.

You can keep listening and you can just do it with your thumb right now. It'll take you less than 60 seconds. And like I said, the only way that podcast grows through word of mouth and this is you joining hands with me and helping as many entrepreneurs as we possibly can because no one is coming to save us. It's just us. All right. So please go do that now. And let's get back to the show. And so you have to know how to do this.

And even if you were eventually to get to the point where you're like, you know what, we have 10 locations and like running traffic is a full-time thing, then you can have a. traffic manager, but you need to know what they're doing so that you could give them feedback. Right? So you'd be like, hey, this number's out of place. Like this doesn't look like, right? Like, because you have to know what you're talking about. So that's on the agency side. On the rev share side, if you're being wooed by somebody who's saying, hey, there's no money up front, then it means that they know something that you don't, which is that there's a massive opportunity that you're not exploiting. And so they're saying, because you're afraid of taking risk, I'm going to take the risk for you and take all the profit. Right. I know because I

did it. I had a redshirt company. That was what my first, the first business, like Jim launch original was a rev share company. That's what it was. The first four months in business, I had an eight-man sales team. We flew them out to gyms, and then I would collect 100% of the revenue. We'd fly them out, 21 days we'd be on site. I'd do on average 50,000 in sales per location in the first 21 days. Now, you're like, Alex, do you miss? If you did that, why did you stop? The reason we stopped is because I had to pay the payroll. So I had to pay the, the flights there and back, I had to pay for the hotels for the 21 days. I had to pay for the rental car for the 21 days.

I had to pay for the ad spend for the 21 days. And then I had to pay for the commissions on top of that for the 21 days that the guy who's out there and making $50,000 in sales. And the type of guy who's going to fly out and do that and spend 21 days away from his family ain't going to do it cheap. Right. And so we were still with all of that able to make money, right? But the thing is, like, the model I could see on the writing on the wall.

It's like, man, I don't want to have to have a 200-person sales team like this is just insane. And there was a ton of logistics behind it. And the main one, the main reason we stopped doing it is because the gym owners that we were serving, like, there was not, there was no personal growth that happened for them. So what happened is I'd have a gym owner who's unaware sitting there. And then all of a sudden we sign up 100 people at his gym. He's just not ready for that. Right. And so we had issues with the people not being able to fulfill because the thing is for me, I was like, I'm going to sign up as many people as I can because that's where my incentive was. But there are some gyms that simply could not handle it. And so it just,

It just put our incentives against one another, and I didn't like it. And so that's when we switched to, hey, you know what? I'm going to show you how to do it. But the point is there is that what I'm saying, like the rev share company, if they are doing it, it means that they know something that you don't know. It means that they're able to make so much money on your gym that they're willing to do it for that upcoming the cost. So if you're like, if you're getting pitched by that, right, then it means that you better just learn how to do it and then take all of the profit for yourself. Like, I feel like this is obvious. Like, I don't know.

Like, this feels really, really obvious to me. But it might not be. You know what I mean? It might not be. So, just to bring this full circle for anyone who's on here, you need to own every aspect of your business, all five grow function. You need to know how to generate leads. You know how to nurture leech.

You need to know how to sell. You need to know how to retain and resell slash send people. That's who need to know. If you don't know how to do those things, it's not a business. It's not a complete business. If you have the outsource pieces of it, then you, like, I don't want to say these words. but like you don't deserve to have a successful business because you're not willing to grow and learn.

they said it. I said it. Like you don't deserve to have to success with this because you are not willing to grow and learn. And then you will continue to ride the cycle

of like not knowing why your business isn't growing because you weren't growing. So that's on the like why you shouldn't use an agency side. On the refsher side, like I said,

it's an opportunity that they're exploiting that you're choosing not to exploit because you're afraid to take the risk. And the thing is that as an entrepreneur you have to take risks. It's just part of the game.

Right? But you have to make like, you have to make the logical jump that hold on. These guys were able to spend the money on the ads and generate a positive return on top of that, plus what they're giving me as my rev share and still willing to do this. I wonder if I owned all of that revenue if I would make more money.

Interesting. Something to think about. But anyways, that was just my topic for today. I hope you guys find that interesting. It was just on my mind and I felt like I needed to share. So if you're a gym owner and you haven't signed up for gym launch, there's the only two things that I think that you'd be doing other than us. So hopefully that should explain away some of the concerns you might have.

And to show you that we are invested in it, we let you start for $1,000 and keep going from that. Because frankly, most gym owners don't have the money to afford our services and that's okay. And that's why we help you make it with us. So that's why we have paid money. So anyways, lots of love, tag a friend who needs to hear this for those gym owners who are in gym lunch and have this friend who's like on the sideline. He's like, but I don't know. Just tag him in here because it's an inevitability.

You have to learn how to do it. You have to. You just have to. Like, just period. Like, you just does, like, you have to learn how you're going to learn? You know? So anyways, lots of love guys. Have an amazing Tuesday and rest of week. I hope you guys had an awesome Memorial Day weekend.

And as usual, keeping awesome. Send your friends. All right. Oh.