The Game with Alex Hormozi
Building Wealth While Building A Business | Re-Air Ep 290
Wed, 15 Jan 2025
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.Wanna scale your business? Click here.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
Chapter 1: What challenges did Alex face while building Gym Launch?
When I was doing gym launch, which is when I started the original gym launch version of my company, this is after I had my chain, I would fly out to facilities and fill them up, right? And then we scaled up to a team and then we'd fly out to those facilities and scale them up. And what's interesting is
When I had my chain of gyms and I built them not to make money, I built them to build a business, right? That was kind of the mindset. I was like, I want to build a business. And so what's interesting is I continued to grow the business, but I didn't make much money. I mean, I made it enough, but I didn't make a ton of money. But I will say this, is that whenever I got into a hard spot, right?
And you may identify with this. Whenever I got into a hard place where I was like, I didn't have enough money and there was payroll coming up, I always found a way to make money, right? And like never failed. I never missed payroll. I never missed rent. You know what I mean? Like I always found a way. And the same thing happened with Gym Launch. When we were flying out, we always found a way.
And what's interesting is, When Gym Launch was growing, I got into this horrible position. And so what ended up happening was when I was selling, we'd fly out and I'd talk to the gym owners and we'd kind of help them with their business, shift everything around, et cetera.
But then as I scaled up and then I had sales guys flying out and doing the sales at these facilities, for 30 days we'd fill their gym up. And the thing is, is they didn't really have the same, you know, rapport with the gym owners. They weren't gym owners. They're like, hey, I'm here to close deals. Which is fine. That's okay. You know what I mean? It happens.
But the problem was, what would happen is, they would sell people on, you know, a challenge or a program. And the gym owners would, after they left after that, you know, we'd already fronted the cost of the marketing, the hotels, the commissions, everything, and sold all these people in their gym.
Um, some of the gym owners told all of the clients that we had sold to refund and then, and then buy it again through them. Um, which you might be thinking that sounds dishonest. And the answer is you are right. It is dishonest. And so I think in a matter of a week, I had like two gyms do that. And I think I had like a hundred or $150,000 in refunds. And mind you, like,
I think I had a total of $150,000 saved up. And so this was like everything I had. And it happened in a week. So just imagine losing everything you have in a week. It was horrible. And this is just after I had kind of come out of my barely... barely getting out of bankruptcy situation. So I'd gotten rid of the gyms. I'd started the new enterprise.
That money had disappeared because a partner had taken it out. And then I was basically left with $1,100. And I started gym launch the way this company had grown. I was able to grow it back up at $150,000 in savings. And then boom, it's all gone again, right? And so I said, I share this with you because I know what it's like to lose everything.
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Chapter 2: How did Alex manage financial difficulties during business growth?
A refund monster that was growing. And so the thing is, is that when I thought from that perspective, I ended up coming up with a solution really quickly, which is like, well, you know what? I'll just bundle all the stuff. I'll call all those gyms back up and say, hey, you remember how I put all those people in your gym? Want me to just show you how to do it?
And then you can just buy the information from me. And I did this as like, I'm getting out of the gym industry concept because we were doing well with the online thing. And what was crazy was when I thought from the perspective, and this is the entire point of this podcast, all right? When I thought from the perspective, Man, I really just need to make money. I made the money.
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 word so we can have 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 ask you to do is you can just leave a review. It'll take you 10 seconds or one type of the thumb. It would mean the absolute world to me. And more importantly, it may change the world of someone else.
And it was one of the most profound lessons that I've learned as an entrepreneur, is that most entrepreneurs don't think about it like that. And so, what I mean by that is, I'm sure there have been times, like I said earlier, that you needed to make payroll, or you needed to make rent, or you needed to buy something, and you had to go generate cash, right?
And then you, boom, you went and generated the cash. What I can tell you between the people who I've observed who are very successful, who have lots of money, and people who have businesses but don't make that much money, is that the people who are... really successful always are in that mindset. They're always trying to think about how they can make more, right, from the business.
And I'm not saying that from a selfless standpoint or anything like that. Obviously, you have to do that, provide value, you know, et cetera. Like that's a foregone conclusion in this conversation, all right? But simply making the extra effort, right? So this is like when you're, you know, if you have a business and, you know, you run a flash sale or something like that and it works well.
Well, why aren't we doing this once a quarter? Why isn't this systematized? If we know that doing this extra little promotion and we do this on a 12-week cadence, we can get four times these amount of pops and we can do this on a regular cadence, then we're going to make a lot more money.
And so it's like, think about the thing, and this is a good exercise that I do a lot, which is like, if I really needed to make money, like I had to make money, what would I do? Think about it.
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