The Game with Alex Hormozi
6 Levels Of The Money Ladder And How They Effect Your Business | Ep 856
24 Mar 2025
Wanna scale your business? Click here.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 and will learn on his path from $100M to $1B in net worth.Follow Alex Hormozi’s Socials:LinkedIn | Instagram | Facebook | YouTube | Twitter | Acquisition Mentioned in this episode:Get access to the free $100M Scaling Roadmap at www.acquisition.com/roadmap
Full Episode
The wealth or money ladder. There's six levels to this and I'm going to break it down. This fundamentally changed how I saw, how I priced my payment terms and fundamentally how I saw money flowing through a business. Welcome back to the game. I have an old concept that has reemerged. This is something that I thought a lot about in the year that Layla and I were selling Gym Launch.
And it's basically just how the flow of money is prioritized. And so I think if there were like a wealth principle or like a woo-woo idea that I have ever subscribed to, this would be it. I don't really know what would make it woo-woo, but wealth principle certainly has that ring. But it's actually that there's some mechanics behind how money flows within the economy.
And the privileges that certain types of businesses or agreements set in motion cause a disproportionate amount of money to stick to those entities that follow this structure. And so I see this more as a continuum than I do a specific rule. And I'll break it down. But it's basically the relationship between payment and work.
There are kind of six varying degrees along this continuum that I've kind of identified. I have noticed that as I have become wealthier, I've moved up kind of the continuum here towards the ultimate extreme. Let me take this out of the theoretical and put it into the actual or real life.
So at the lowest end of this continuum, you would have somebody who works now, takes on tremendous personal risk and gets paid later. All right. Now, normally you'd think, oh, wait, isn't that, you know, the results of like, isn't that, you know, delayed gratification? Well, not when it comes to the flow of money within an economy. And so I'll kind of explain.
And so what's the word for somebody who falls into this category of rules? Well, the answer is an employee, right? They will front, you know, two weeks of work, sometimes a month of work. They'll work up front and then they'll get paid later. Right. And that's a pretty standard agreement that's existed for a very long time.
As I walk up this ladder, think about both of those variables, the payment and the work, and you'll see how they shift. And obviously the goal or the ideal is to go as high up the ladder as you can. And so the level above that would be an independent contractor. So this is somebody who functions like an employee. They do work and they get paid.
But sometimes the nature of the payment and the timing of that payment can be altered. And so, you know, a common setup might be half now, half later. Right. And so you can see how how this works. So they get paid half now. They work and then they complete work and they get paid the other half. And so it's a little bit more smoothed out. compared to the employee situation.
Now, that would be the second lowest on our rung of wealth. Ah, the plot thickens. And so what are these remaining tiles above this? So above that, I would consider the in-demand professional. And so what happens in this situation? So this would be a specialist of some sort, or you go to a heart surgeon, or you just go to a doctor in general, whatever. You pay first. And then they do services.
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