Welcome to my world. Alex Hormozi and I have nothing to sell you.
Do you know the difference between $1 million and $1 billion? It's a lot. If you were to compare the delta in time, a million seconds is about 11 days. However, a billion seconds is almost 32 years. Alex Hormozi, entrepreneur, author, and CEO of Acquisition.com, has a growing portfolio of companies worth upwards of $100 million. Hormozi has a remarkable story that has all the makings of a Hollywood movie. Triumph and tragedy; high stakes business failure and success; complicated family relationships; romance; and more. Hormozi says that by the age of 32, he and his wife Leila's portfolio of companies crossed $85 million per year in revenue spanning brick-and-mortar service, licensing, education, SaaS, and e-commerce. In my opinion, they are on a trajectory to hit the billion-dollar milestone sooner than most.
In his 20s, Hormozi opted to choose his own path and not the one that his successful Iranian immigrant father hoped he'd choose. Many children of immigrants might relate to this story and the subsequent consequence of the choice. Hormozi's decision led to serious conflict and years of tension -- even thoughts of suicide -- between Hormozi and his father that he had to figure out how to heal. In spite of it all, Hormozi remained true to himself and eventually, he hit major success working in the world of fitness and fitness business.
"I was a management consultant right out of college," he says. "I did space cyber intelligence for the military, which sounds much cooler than it really was. But I had a top-secret clearance. It sounded really good at dinner parties and just about only that. One day, I looked out from my balcony, and I was like, is this it? I was in my [early] 20s, and at that point I had done everything that I think I was supposed to do. I did well in school, I was president of all the clubs, graduated in three years, got the good job ... and I realized that I was living the life that my father wanted me to live."
Hormozi tells me that in his youth, everything he did in his life was in pursuit of his father's approval, and that he had never really made decisions for himself and for his own joy. Ultimately, it became clear that he didn't want to live the life that he was living. He says that for a short time he contemplated not living anymore at all, but ultimately decided that risking disappointing his father and carving his own path was a better way out, and so he took that risk.
"I left at 22, and I turned 23 two weeks after my gym opened," he says. "I had done two years [at my job], and the career path traditionally was two to four years of management consulting and then you go back to an Ivy League for your GMAT. Then from there you can do investment banking, you can do private equity, you can do some of the bigger white-collar jobs, but I didn't want more of what I had. I thought that I would have a better shot taking $200,000 in two years, which is the economic equivalent of what the degree was, and starting on my own. I figured I would learn more in the first two years with that money and maybe even have a [profitable] business by the end of that period of time."
Hormozi wasn't sure what he wanted to do, he simply knew what he didn't want to do, and so he started there, reverse-engineering his dream career. He knew that he was highly passionate about working out, and those around him were quick to remind him that it was all he talked about. Armed with this knowledge, Hormozi took a leap and moved into the world of opening gyms. At first, Hormozi's experiment with opening gyms seemed to be paying off. He opened one with little to no difficulty and the money was great.
"I opened up four more locations, so I had five total," he says. "I was already making $20,000 a month take-home. I had made so much money launching and opening gyms, that I really didn't care as much about running them afterward. I knew how to do it. I just liked the launches. They were more exciting. So I had this idea for a model where we'd fly around and just launch and fill other people's gyms. This was right around the time that I met my now wife, so I pitched her the job on our first date and asked her to quit her job."
Hormozi pitched the idea to Leila telling her that while their relationship might not work out, they could make a ton of money in business together. She was hesitant at first, but after he showed her the contracts he was ready to process from launching three gyms in five weeks, her interest was piqued, and she decided to join him.
"I asked her to help me process the contracts, and we ended up processing about $120,000 in an hour. She said, 'Is it legal?' That was her first question. I was like, 'Yeah, it's legal,' and she was like, 'Can you teach me how to do it?' And I was like, 'Yeah,' and she said, 'All right. I'm in.' And so that was when she quit her job, and then she and I started launching these gyms together. We did that for almost a year."
Unfortunately for Hormozi, running this business got complicated, and after a while the stress became too much for him.
"I was drinking half a bottle of Johnny Walker Black a night to function," he says. "Not to get drunk, but to feel back to not being stressed. I had a coach at that time who was really more of a therapist, and he said, 'Alex, your stress is literally going to kill you.'"
Hormozi and Leila eventually decided to pivot. Leila had a side business where she'd been selling digital weight-loss programs that she believed they could sell together, and Hormozi knew that his marketing expertise could help ratchet up her sales and get them into a better place financially.
With their new plan in place, Hormozi started calling all of his salespeople around the country from the gym launch and letting them know that they'd be suspending operations. One salesman in particular wasn't ready to walk away, and his desperation to stay in the game was the catalyst for a major turning point for Hormozi, Leila, and the team. He wanted to buy the sales materials from Hormozi and strike out on his own.
"He said, 'How much?' And I picked the highest number I could think of, because I wanted him to say no so I could move on with my life," Hormozi says. "I said, '$6,000,' and he was like, 'Deal.' I still remember, I looked at the phone and I was like, Holy sh*t. And then I said, 'Cool. What card do you wanna use?'"
This guy had just paid $6,000 for all of Hormozi's sale scripts and launch materials, and in that moment, Hormozi realized that the IP he had held for starting these gyms was worth a lot more than he'd ever realized, and so he started making calls. He called all the gyms that he'd help set up and asked if they'd be willing to buy his IP and sales training materials, and nearly all of them said yes. Within a month, Hormozi, Leila, and the team had made almost $500,000 in sales and they were out of debt and back in the black. Hormozi jokes that just like that, he was an overnight success.
Hormozi will be the first to admit that he was searching for guidance and a father figure early on, and that that search got him into a lot of trouble. There were many dark days, but two relationships were instrumental in pulling Hormozi out of the darkness.
The first was his relationship to Leila, whom he describes as the Charlie Munger to his Warren Buffett, but that second relationship was the one that Hormozi was building with himself. He was on a journey, and he was determined to succeed. Did he truly know himself when he started his first business? No. But was he eager to learn more about himself and figure it out? Yes.
I ask him what he thinks is the quickest road to financial freedom, and he tells me that it's all about knowing yourself and having marketable skills. You might strike out a few times, but if you know what you're doing, if you're an expert in your field, you can always find work.
"The one thing that you can always protect yourself with is skills," he says. "Skills are the only things that will always appreciate in time. If you know how to do math, you can learn how to do accounting. If you learn how to do accounting, you can learn how to do tax work. If you can learn how to do tax work, you can figure out how to do insurance work. If you figure out how to do insurance work, all of a sudden you're a CFO and you can prepare companies for sale. The skills stack on top of each other. Specialized skills are valuable independent of the currency and the economic climate. If you are good, you will always have a place to provide value because ... people want good stuff."
Here are Hormozi's 10 tips if you want to become a millionaire in 2023
- Read memoirs or autobiographies written by billionaires: "You get to see how they think," he says.
- Understand leverage versus scale: "If you chase the big things, it also makes it worth it because small goals and big goals are equally difficult," he says. "You have to expend time to achieve either of them, so you might as well make them big."
- Admit your deficiencies and work on them: "If we can admit deficiency, then we can create space to learn," he says. Hormozi says that every business is bottlenecked by the entrepreneur in one of three ways: skill deficiencies, trait deficiencies, or belief deficiencies. The key is to understand which is your weakness and spend time reflecting and then working on it.
- Passive income isn't always all it's cracked up to be. Do the boring work: Hormozi says that skill comes from repetition and feedback, and that the best way to get better at something is to do it over and over again. "I think we need to make active income cool again," he says. "Your work works on you more than you work on it. You build your character through the work that [you] do."
- Getting rich quick is a fallacy: Hormozi says that most people who have a large amount of wealth make that wealth slowly and consistently over time. This is something I've also heard Mark Cuban say, and it makes sense. Hormozi says that most people give up on their project or career path before they've given it enough time and put in enough work to see growth. He says most people start something new every few months hoping that that will be the thing that will hit. He advises you to pick one thing, one client avatar, one product or service, one channel and just keep building.
- Everything compounds: Money, skills, experience--nothing goes to waste and it all compounds over time. You might start out as a bookkeeper and then grow into an accountant and then from there continue to grow into a CFO, etc. There is always use for the things we learn. All experience is good experience. It teaches us about our skills and our goals.
- Understand your client avatar's pain points: The number one lesson you'll learn in marketing and sales is to know how to spot a prospective client's pain point. Make sure that the product or service you are offering is something they desperately need or want. Something that's a solution to a problem they're facing.
- Make sure your client avatar has purchasing power: There's nothing worthwhile about a prospective client who can't afford your product or service. Hormozi says he had a friend who tried to launch a business helping people perfect their résumés, but the main problem was they were looking for work and didn't have extra money to spend on his service. Make sure the person you're selling to can afford you, or make your product or service more affordable to them.
- Make sure your client avatar is easy to target: "If you have a hot dog stand, and you have one competitive advantage, what would you want?" he asks. "Would you want the best location? Would you want the best ingredients? Best marketing? What you want is a starving crowd." Hormozi says with the hot dog stand analogy, it doesn't matter how marginal your hot dogs might be if you're the only hot dog stand near a crowd of people who've just left a football game. You'll sell out your product. If you can't tactically target your prospective client, then what's the point?
- Make sure your industry is growing: There are many industries in our world today that are not growing or are failing. Movie theaters are losing sales to at-home theater systems and streaming services, print media is losing customers to digital media ... Make sure that the industry you're in is a growth industry. Hormozi suggests that you ride the tail wind if you can. It just makes things easier.
A final thought: I believe the world is probably full of power couples--and we have no idea what's going on behind the scenes. That is, partners who have complementary skills that make the duo better together compared with working solo. It's true that Hormozi is an absolute beast in the gym and in business. You can arguably learn more from his YouTube channel than you can in B-school. But his big heart, trusting nature, and willingness to help others made him vulnerable to betrayals. These seemingly good attributes nearly cost Hormozi his life and almost caused his business to go to zero. Enter Leila. Leila is also a force to be reckoned with, both in the gym and in sales. But she might have been playing life too small and conservatively before she met Hormozi. Want to become a millionaire in 2023? Step 1: Choose the right life partner. Step 2: Watch the full-length video master class below with Hormozi.
Underneath all of the difficulties, Hormozi had a drive to succeed and be better, and Leila was the missing ingredient to their mutual success. They are each other's guiding light, and this is what got them to $100 million-plus today. The Hormozis now spend their time investing in founder-led service-based businesses, and their goals are to help them scale and multiply their profits. Hormozi's father eventually came around, and [in his own way] apologized, and they mended the rift in their relationship. The journey was a chaotic one, but ultimately Hormozi and Leila landed exactly where they wanted to be.
More with Alex Hormozi and how to become a millionaire here: