Alex Hormozi on Scaling SMMAs (FULL INTERVIEW)
Summary
TLDRIn this insightful discussion, the speaker emphasizes the importance of talent acquisition and the challenges of scaling a business while maintaining quality. They discuss strategies for identifying and hiring 'A' players, the necessity of being specific in customer targeting, and the art of saying 'no' to ensure long-term success. The conversation delves into the intricacies of service-based businesses, the value of niching down, and the power of authenticity in standing out in a competitive market.
Takeaways
- π Building a successful business involves recognizing that no one is irreplaceable; instead, find people who can excel in different aspects of what you do.
- π The ability to judge and attract talent is crucial for business growth and will improve over time.
- π« Learning to say 'no' is essential for maintaining discipline and focusing on the right opportunities for long-term success.
- π° Avoid the trap of prioritizing short-term gains over long-term financial stability, which can lead to an operational rat race.
- π€ When scaling a business, consider productizing your services to make them accessible to a broader audience without diluting the quality.
- π οΈ Talent acquisition is about finding individuals who are as smart or smarter than you and can bring unique perspectives to your business.
- π To become irreplaceable, focus on serving a niche market deeply and mastering your craft within that specific domain.
- π€ The best way to judge talent is by how specific your directives need to be; the less direction needed, the higher the talent level.
- π― Agencies should maintain focus on the problem they are solving and the target audience to avoid diluting their service and losing strategic alignment.
- π Scaling a service-based business requires high-quality talent and a culture that attracts and retains that talent.
- π Authenticity is key to standing out in a competitive market; being genuine and true to oneself will attract the right audience and build a loyal following.
Q & A
How can a business owner effectively delegate their responsibilities to scale their operations?
-A business owner can delegate by breaking down their responsibilities into smaller parts and finding individuals who can excel in those specific areas. It's also important to develop a disciplined approach to say no to opportunities that don't align with the business's long-term goals.
What is the significance of being able to judge and attract talent when scaling a business?
-The ability to judge and attract talent is crucial for scaling a business because it ensures that the right people are in place to handle the increasing responsibilities and challenges that come with growth.
How can a service-based business maintain a competitive edge when scaling?
-A service-based business can maintain a competitive edge by focusing on the quality of their talent and the culture that attracts and retains that talent. Additionally, being very specific about the problems they solve and the customers they serve can help them stand out.
Why is it important for a business to remain disciplined in saying no to certain opportunities?
-Remaining disciplined in saying no helps a business avoid the operational rat race and the sacrifice of long-term success for short-term gains. It ensures that the business stays focused on the right customers and opportunities that align with its goals.
What is the recommended approach for finding and hiring top talent?
-The recommended approach includes looking for individuals who have demonstrated similar experiences in the past and have a proven track record of success. Offering opportunities for growth and aligning with the candidate's aspirations can also attract top talent.
How can a business ensure that its service offerings are effectively communicated to potential clients?
-By breaking down the service offerings into specific steps and explaining the value of each step, businesses can help clients understand the complexity and value of their services, thus avoiding undervaluation.
What are some common pitfalls that agency owners should avoid when trying to scale their businesses?
-Agency owners should avoid trying to be everything to everyone, maintaining focus on their niche and the specific problems they solve. Additionally, ensuring the quality of talent and fostering a culture that attracts and retains that talent is crucial.
How can a business become irreplaceable to its clients?
-A business can become irreplaceable by deeply understanding and integrating into the client's operations, offering a comprehensive solution that is difficult for the client to replicate on their own.
What is the strategy behind narrowing down the target market for a business?
-Narrowing down the target market allows a business to focus on a specific niche, becoming an expert in that area and offering unparalleled value to a defined customer base.
How can a business leverage its unique selling proposition (USP) to stand out in a competitive market?
-A business can leverage its USP by clearly communicating how it differs from competitors and the unique value it provides to its target market, thus attracting clients who are looking for those specific benefits.
What advice would you give to a PR marketing agency that feels their offer is not ROI-based?
-A PR agency should focus on targeting clients who understand the value of brand building and are not solely focused on immediate sales and leads, positioning PR as a long-term investment in brand reputation and awareness.
Outlines
π Scaling Business Operations and Talent Acquisition
The speaker discusses the challenges of scaling a business, emphasizing the importance of recognizing one's irreplaceability and the need to delegate tasks to others who can excel in specific areas. They share insights on how to extract oneself from day-to-day operations, suggesting a narrow focus and creating a system where anyone could execute tasks without needing the founder's expertise. The conversation highlights the significance of attracting and judging talent, and the discipline required to say no to opportunities that do not align with long-term goals.
π Hiring Top Talent and Avoiding Common Pitfalls
In this segment, the focus is on identifying and attracting top talent, with an emphasis on the qualities that define 'A' players. The speaker suggests that the ability to judge and attract talent improves over time and stresses the importance of maintaining discipline in selecting who to work with. They discuss strategies such as offering opportunities for career advancement to attract talent and the importance of focusing on specific problems and maintaining a high-quality team to ensure business growth and scalability.
π€ Building Irreplaceable Service Models and Client Relationships
The speaker addresses the concept of making a service model indispensable, discussing the balance between providing comprehensive services and maintaining client relationships. They talk about the importance of breaking down services into smaller, manageable components and communicating the value of each step in the process to clients. The speaker also shares thoughts on targeting larger clients to become irreplaceable and the challenges of working with small to medium-sized businesses due to their volatility and unpredictability.
πΌ Strategies for High-Value Service Delivery in Small Business Markets
This paragraph delves into strategies for delivering high-value services to small business owners, who are often price-sensitive and face financial instability. The speaker discusses the importance of defining clear problems and selecting clients carefully based on their fit with the service model. They highlight the need for discipline in saying no to clients that do not fit the criteria and the benefits of focusing on a niche market to build a successful business.
π Transitioning from Service to Consulting and Licensing Models
The speaker explores the transition from a service-based model to consulting and licensing, emphasizing the importance of documenting and productizing the service playbook. They discuss the benefits of licensing tested materials to clients, allowing them to implement successful strategies immediately. The conversation also touches on the challenges of maintaining client relationships and the importance of being authentic and disciplined in selecting clients to ensure long-term success.
π Standing Out in a Competitive Market Through Authenticity
In the final paragraph, the speaker addresses how to stand out in a competitive market, particularly in the fitness industry. They stress the importance of authenticity and the pitfalls of trying to replicate the success of others. The speaker encourages being true to oneself and leveraging unique personal interests and experiences to create a distinct brand that resonates with a specific audience. They argue that being genuine and consistent in one's offerings is key to long-term success and differentiation in the market.
Mindmap
Keywords
π‘Talent Attraction
π‘Irreplaceability
π‘Service-Based Business
π‘Productization
π‘Playbook
π‘Scaling
π‘Niche
π‘Operational Efficiency
π‘Refusal
π‘Authenticity
π‘ROI-Based Offer
Highlights
Importance of recognizing one's irreplaceability in a business and the need to delegate tasks effectively.
The necessity of finding and hiring individuals who can perform specific tasks better than oneself.
The concept of scaling a business by focusing on talent acquisition and the ability to judge and attract talent.
The challenge of scaling coaching models due to the expertise required and the risk of experts leaving.
The strategy of productizing solutions to make them accessible for implementation by anyone, regardless of their knowledge.
The value of narrowing down the focus of a business to a specific niche to increase efficiency and scalability.
The importance of maintaining discipline in saying no to opportunities that do not align with long-term business goals.
The approach to finding talent by assessing how specific one needs to be with directives and leveraging past experiences.
The benefits of offering a step-up opportunity to attract high-performing individuals from other companies.
The pitfalls of trying to be everything to everyone and the importance of focusing on a specific problem and audience.
The direct correlation between the quality of talent in a service-based business and its growth potential.
The strategy of becoming the marketing department for a company to increase value and irreplaceability.
The challenges of working with small to medium-sized businesses due to their volatility and unpredictability.
The concept of arbitrage in business through licensing tested and successful materials to multiple locations.
The importance of being authentic and leveraging unique personal interests to stand out in a crowded market.
The advice on focusing on a niche and becoming exceptionally good at it rather than trying to expand too broadly.
The discussion on the challenges of scaling a non-ROI based offer and the importance of targeting the right audience.
The emphasis on the power of saying no to protect the long-term health and success of a business.
Transcripts
and you're not going to find another you
to replace everything that you do you
can find three people who do portions of
what you do better than you and other
things that you do that you don't do
better than you what have you seen some
of the most common qualities among a
players when you hire them your best
talent is in the future what happens is
your ability to judge talent and your
ability to attract Talent will only go
up and here's the one that everyone
messes up who you pick like I said it
earlier say it again you don't
necessarily even want to work with all
chiropractors which means you need to
have discipline to say no I'm dead
serious that's why they stay poor they
can't say no and what happens is you go
for the short-term money and you
sacrifice the long-term money hey what
is up how's it going all good man all
good big fan
I appreciate it I'm a mutual fan
yes thank you very much yeah thank you
so much for supporting the book launch I
appreciate it awesome man awesome my
community loves you and that's all we
are here and I literally got like 150
questions I had to narrow it down to
five or six it was so hard
we'll do the best we can and if we get
through the six we can go to the number
seven best best so let me get started
with the first uh question that we have
as like uh so Alex how did you get
yourself out of gym gym launch
day-to-day operations and this is my
personal question because uh you
mentioned something in the uh 100
million dollar offer that to hit your
first 100K you don't need a lot you just
need an offer to sell and that's exactly
what we did uh but right now we are
hitting a bottleneck and our biggest
bottleneck is operations and I know I
want to know how exactly you got out of
gym launch operation because we have a
very similar business model for I know
service providers for web service
providers uh so we help uh you know
mostly agencies and digital Consultants
with lead generation and sales and the
way we do it is with a one-on-one
Consulting and in a group coaching
format okay so to get out of so the
reason that so coaching models in
general tend to be very difficult to
scale because the reason people come to
you is for expertise uh and so in order
to get other people to provide that
expertise then you have to create lots
of experts who then eventually walk off
and start the business on your behalf
and take your customers with them so the
there's kind of there's I would say like
there's a couple different approaches so
the first is that there's like the law
firm and the McKinsey kind of Consulting
model where they there's a track to
become a partner in the business and
then that's kind of the whole business
structure so there's a where a way to
share in the profits those businesses
aren't particularly lucrative okay don't
get me wrong they do make lots of money
but the owners of those end up having to
dilute themselves out not that there's
anything wrong with that you can make
lots of money doing it but that is that
is a a version of the model
um the other way is to productize the
basically get narrower on the solution
that you're providing and productize it
to the grace of your house possible so
that anyone could do it even if they
have no knowledge of it in terms of like
the implementation of the thing
um that is more the direction that we
went uh with Jim lodge because we had a
very specific we don't even we didn't
even work with all gyms like just to
show how narrow we were with it we
worked with only micro gym owners we
have now expanded to health clubs as
well but we still don't service a ton of
different parts of the gym industry we
only work with microgen service based
businesses and health clubs and so but
like the you know the five or six years
that I was doing it before we sold we
were only uh micro gems and so just to
show like how incredibly narrow that was
someone had to have at least 30 members
assigned lease one employee and be
running this type of model for them to
be a customer and then if they fit all
those things we could generate a lot of
Revenue using our playbooks and so that
was like I could have somebody who had
no gym industry no expertise whatsoever
and still say send this email
say these words here's 10 reportings of
people doing this exact same thing this
is the expected value and so that's like
from the delivery perspective now
operating the business overall comes
from Talent
um and being able to find people who are
just as smart or smarter than you and
people say that but like when you
actually meet somebody who's smarter
than you and then they admire an aspect
of what you've done so that they start
to work for you that's where you really
start to have the magic happen
but how exactly you find those talent
because I personally feel like I'm
irreplaceable in the company the
experience that I bring to my clients is
not something that anyone else can come
and yeah you're not good at teaching
you're not good at teaching
um and the idea of like I'm
irreplaceable is completely ego
um so you just have to get rid of that
like you have to be like I'm the most
replaceable person in the business like
in the like from an employee perspective
like you want like they want to become
Irreplaceable
the owner's perspective should be the
exact opposite which is that everything
that I do I can need someone else to do
better than me
so do you recommend like breaking down
whatever I do into smaller parts and
yeah 100 and you're not going to find
another you to replace everything that
you do
but you can find three people who do
portions of what you do better than you
and other things that you do that you
don't do better than you because they
have other lives that they've lived yeah
oh well so don't try and find one person
replace you try and find four
oh yeah that's that's a good Prospect
thank you very much for that yeah uh
what have you seen some of the most uh
you know Common qualities among a
players when you hire them like you know
what I need this person right now
because he's gonna crush it yeah your
best talent is in the future like what
happens is your ability to judge talent
and your ability to attract Talent will
only go up
right so it's it's kind of like uh so
the easiest way to judge talent in my
opinion is how specific you need to give
your directives right so if you take
this to a hypothetical extreme on the at
the at the bottom level you have
somebody who's has barely any cognitive
function and you have someone who you're
sort of like here's how you turn on a
computer here's how you open up Internet
Explorer like on this extreme of just
like very little cognitive function very
few meta skills on the other end you
just say build me a department that does
this and the person can just build or
spin up an entire entity that does a
certain thing within a larger
conglomerate right so like those are the
two kind of just like hypothetical
extremes of talent and so you can judge
someone's Talent by how specific you
have to be with the things that you're
asking them to do and a big function or
proxy for that is what experience they
have in the past that they've done
something similar to what you're asking
them to do
oh all right
I'll give you an example if I wanted to
build if I wanted to hire somebody to
build a app on sales team uh and I have
a B2B business then I'm gonna go find
somebody who's already built one or two
outbound sales teams for B2B businesses
ideally close close to who are already
in the industry that I'm in so the
likelihood that they'll succeed and know
how to do it is very high they already
have tons of trench knowledge they have
the experiences I just copy paste that
into my business and I can give you a
better deal a better culture uh to work
in than where you're at now
oh okay that makes a lot of sense
another hack to this is finding the
number two and so uh you know like in
the sales person example maybe your your
personal brand or your company's Brand's
not as big as the company that you're
trying to attract someone from so that's
where you can give someone the
opportunity to step up right so if
you're if you're the you know let's say
there's a sales director and you're the
lead sales person
um of the company now when I say lead I
mean lead in the technical sense not the
top sales person but a sales lead is
usually somebody who does a little bit
of training with the team
um also sells and give them the
opportunity like if they had a good
manager who you can't get you say well
you know what that manager is doing what
if you were that manager here right so
you can offer them a step up opportunity
because they still have enough proximity
to what it looks like when it's right
yeah it sounds like a lot of the time to
get such clients you'll probably have to
do a lot of Outreach like you mentioned
in the leads book and such you know
methods and the lead in this instance is
an employee exactly and right you know
what somebody actually asked this
question and I had to remove this
because I read that exact answer on 100
million dollar leads so phenomenal job
there thank you very much for writing
the book
um so yeah I'll read one of the
questions that one of them are an
audience member wrote
they mentioned uh what kind of pitfalls
to avoid that business owners know but
agency owners are usually unaware of
those of that leads them not to work
with an agency for example what this
person wanted to try is that you know
try to tell uh is that like what are
some of the things that agency owners
should avoid doing if they ever want to
scale a new experience
which question do you want me to answer
uh the second one okay so what things
should an agency owner avoid when
they're trying to scale yep yep that's
one of the questions that I have
I mean the same things that any business
owner would want to avoid when they're
scaling
um I think that agencies tend to fall
into the you know they they tend to fall
into the bucket of trying to be
everything to everyone so yeah
maintaining the discipline to be very
focused on what the problem that you're
solving and who you're solving it for
and I think that solves 90 of the
problems from a strategic perspective
for any small business owner including
an agency and the second piece is that
if you're in a service based business
the quality of your talent is going to
be
directly proportional to your growth
because you're you're basically selling
people fractionalized people that's what
service businesses are right you're
selling some level of training that
you're able to give and having more
efficiency than an individual business
owner would have like the the classic
you know small business owner Legion
agency that charges two thousand dollars
a month the idea is that if they were to
hire somebody full time to run these ads
it would cost them five or six thousand
dollars a month but you have
copyrighters designers and media buyers
and page designers who all work a
fraction of their time for this one
business and they can get it more
efficiently and you can still do it at
good margins right like that's
fundamentally what service businesses
are and so the quality of that talent
and the culture that you have at the
business to attract and keep that Talent
um are the kind of the key or The
crucial pieces of the success of the
model
Yeah you mentioned something in the book
where you mentioned the agency model
where you hire an agency to learn the
stuff and you internalize it and then
when you have stopped learning you
replace an agency but teaching agency
models agency businesses how to become
Irreplaceable right that's uh usually
one of the things and what we uh you
know help them with is like how do you
have stacks of offers where you don't
just handle one thing in one Department
you become the marketing department of
uh the company that you work with so in
your perspective how should one go there
should we start with one business then
upsell the next and upsell the next and
upsell the next offer or like it's tough
because then you it's it's it's more
like creating the irresistible offer
isn't necessarily about having a zillion
products it's more about explaining and
communicating the many small things that
you have to do anyways and so rather
than saying like I'm going to generate
leads for you that's like one outcome
but there's many things that have to
happen along the way you have to create
landing pages you have to write copy you
have to you have to have follow-up
sequences you have to work the leads you
have to have scheduling you have to you
know you have to split test you have to
make new creative like there's lots of
things that have to happen in order to
just get the single result and it's just
making sure that we're delineating those
things because in unbeknownst or an
ignorant uh business owner I say
ignorant in the technical sense like
they just don't know
um would have no idea what you're doing
you're like yeah just go get me leads
it's like well it's much easier said
than done and if I was doing it from an
outbound perspective I'd be like well I
have to warm up domains I have to you
know spin up different accounts I have
to split test different email openers I
have to like you have to explain all the
steps and they're like wow there's a lot
more work that goes into this now I can
I can appropriately value this price tag
that you describe to whatever the
service is so that's Piece One Piece two
about being Irreplaceable I think you
know
it's tough and the the way to like in
order to be Irreplaceable oftentimes
you'd have to go after significantly
bigger customers so like if you're an
agency for 4chan 1000 for Fortune 500
companies then a lot of times they don't
want to they have to it would be so
costly for them to spin up at scale the
level of talent that's required to do
like programmatic media buys across 100
different Platforms in different
countries right it'd be very difficult
for them so there's so much pain
associated with that that they can
immediately plug into your solution and
then they're likely that they want to
leave or do this on their own is
significantly lower right but the idea
that any service provider is going to
become truly Irreplaceable like any
business can do anything on their own
right so like you always have that and I
would prefer to put myself out of
business and do it in a way that aligns
my customers with me then have a model
that I know is is basically has a timer
for obsolescence
all right so uh and inside check is like
uh not everybody works it's Fortune 500
companies right yeah most people don't
and many people uh they might work with
you know a smaller medium businesses
they help them with that uh but I think
in those cases because these uh let's
say you become a marketing agency for
chiropractors in New York you become so
good at that in general people won't
leave you because you're just good at
that particular service
okay got it thanks a lot man for that
yeah and the thing is the small business
owners are really tough
yeah they're super tough
um because they're the problem
like they're super erratic they're super
volatile their cash flows lumpy
um they don't know where their next
paycheck's gonna come from and to to no
fault of your own they can cancel
because they just can't make payroll
that month
because there's other things that are
required right and so that's the reason
that like do you see any large SMB
agency in the U.S
oh yeah no right there's a structural
problem right the biggest agencies look
at the biggest agencies that exist
Ogilvy you have Vayner you know is up
there now
um yeah who do they service massive
companies why because the quality of the
customers are higher
and so they know that when they sign a
contract they actually stick with the
contract we all know that if you have a
small business under signs a 12-month
agreement for agency Services he's good
for three months
yeah
it's it's because even if you were the
best marketer in the world if they have
a shitty product or they don't work
leads or they have a terrible location
they have one star reviews Google
there's a number of things that are not
under your control if you have bigger
better customers then a lot of those
other things have been controlled for
because they've they've achieved a
certain level of success now it's harder
to get those customers why because
they're going to also look for an agency
that's equally qualified because they're
also smart enough to say well listen you
know you're in your mom's basement right
now and so I don't really feel like you
know giving all my lead generation over
to you and so I think the enterprising
individual who's very good at Marketing
in a specific Niche the short term solve
is like sure anybody can take on 10
agency clients that pay them you know 2
000 to you know four thousand dollars a
month or a thousand to four thousand
dollars a month for an SMB and make a
top one percent living and there's
nothing wrong with that it's just work
it's fine
yeah if you want to have a better
version of that opportunity it's
learning more skills and saying okay let
me see if I can understand the
chiropractor business even more than I
already do and see if I can combine that
with kind of some Consulting around the
business model itself and then start
seeing if I can put some of my own
Capital at risk and buying into these
businesses right like that's when you
start moving into private equity and
away from Pure Services now again like
are there like the biggest model that
I've seen for small business owners from
a marketing perspective
um was an agency that was running 300 a
month
a month price point because they had
figured out and like there's a key here
is that like those business owners are
so price sensitive that you're not it's
not whether you can sell them it's
whether you can keep them on their worst
month that's how you have to think about
it like the price isn't based on the
value that you can deliver on the best
month but how much you can keep on the
worst month because that's where the
churn comes in right and so the best
model that I saw uh was doing SEO for
small business owners and they had
completely automated every aspect of it
um it was basically just a Playbook and
I think it generated reviews and maybe a
couple phone calls a month but at a 300
a month price point if they got one or
two phone calls a month it was worth it
so the bar to get over to to ascribe
value and especially on something that I
call like a nuisance business where it's
like I know I should be maintaining my
reputation I know I should be doing some
of this stuff okay for two or three
hundred dollars a month I don't feel
guilty about not doing it because this
is all right does that make sense yeah
it totally makes sense so when uh in gym
launch we started helping small
allergens because that's again a small
business owner and you specifically
mentioned this I think in the gym launch
book where you know they struggle to
make the ends meet uh I think that's
where you went into the licensing model
where you started teaching them the
stuff because they can help themselves
and probably uh scale up with that uh
entire technique I think that's what it
is right yeah I mean that's a good
transition to a consulting or licensing
model like in the beginning it's
Consulting because you have a lot more
service because you haven't you haven't
like productized every part of it but if
you're diligent about productizing every
piece of your playbook because if you
consult enough times for the same type
of business you realize that you start
basically reverting to the same 6 7 10
12 plays and then you just you just
document them out right and then you
hand off one to somebody who says cool
you just execute Play One ux you play
two ux you play three
um and that can be from a circle space
you know relationship where you can
license the materials out right like for
us it was truly licensing because we
would generate we would test you know
ads in you know 20 markets and come up
with the best combination of copy
creative headline and landing page and
then we just license the material out to
a thousand locations and so for them the
cost of trying to figure out what the
best ad is going to be and the cost of
filming the ad hiring the talent doing
all these other things was far in excess
of just immediately having scratch off
tick tickets that were winners so they
could just immediately run the ads and
get a 10x return because we had already
tested 100 other ads that didn't get
that and so they could just take the
winners and take it to the bank and so
that was where the Arbitrage existed for
us and we could spend 50 Grand or 100
Grand testing it but no we had a
thousand gyms that were paying three
thousand dollars a month in order to
have that material because it was so
local so we could sell the same thing a
thousand times
oh yeah that's good and uh because when
we are in a Consulting model right what
happens is some clients actually do the
work and they get results and some
clients they need a lot of follow-ups
and they need a lot of accountability
from you right so uh how do you maintain
that like I'm I know I'm getting very
Nitty Gritty into this but yeah I'm good
with nitty-gritty I mean I get it
um I mean you you you talk to basically
one of the core problems of all B2B
businesses which is that you end up
taking over the person's entire business
until eventually they're like yeah if
you could just send me a check every
month and you do you run the business
that would be awesome right and so
that's why being very disciplined about
problem definition from the services
that you provide number one and here's
the one that everyone messes up who you
pick like I said it earlier say it again
like
it's not like even if you work with
chiropractors right as that example you
don't necessarily even want to work with
all chiropractors you want to work with
chiropractors like if so here's how I
mean I talk about in the book in the in
the referral section but you look at the
customers that you have right now that
are the best customers like the top 20
of the top 10 you say okay what
characteristics do these people have
that other people don't have in my
client list and that's both from the
software the hard perspective what are
the quantitative differences they have a
certain size business they're over a
certain amount a month they have a
number of locations they have a certain
amount of employees number of customers
like you just get all that data on them
and then also what was the experience
that they went through when working with
me and was it different than some of my
other customers because one of the
things that happens oftentimes is that
the first few customers you get become
really sticky and then you and then you
start scaling and then you have this
front revolving door but you still have
your core business of these people that
you had in the beginning right so why is
that because these people got more help
from you and actually got delivered more
value and then you basically tried to
scale without scaling the value that you
delivered to the original customers
right and so you were able to train them
enough that they could become
self-sufficient and then not need you as
much anymore and then that created a lot
more margin for you but it's really
saying okay I'm only trying to scale to
100 000 a month because of my ego not
because that's what the business
requires right now right so if you're at
whatever 15 000 a month and you've got
five customers and they're all like
having a great experience and you keep
signing people on they keep leaving it's
like okay well instead of me trying to
sell five this month why don't I just
sell one and do a great job and then not
lose them
and like that's the key to compounding
in a service business once you pay down
the basic pay down the inefficiencies of
them not knowing what to do yet
um and being very specific about who you
serve and who you don't like we did
personal trainers we didn't work with
facilities that weren't making a certain
amount of money we didn't work with
facilities didn't have a certain number
of customers we didn't work with
facilities that had a different model
than what we knew worked and part of it
I'll give you an example
um so like cycling Studios and like yoga
studios 100 could use our model
we didn't work with them because the
founders tended to be psychologically
different
they just didn't they just didn't they
just like their adherence was super low
because they just come from a totally
different world view than the guys who
are more Fitness weight loss
transformation focused even though at
the end of the day it's just a
membership with a back room where people
work out fundamentally the exact same
thing but mindset wise they had a very
hard time
um kind of adopting a different model
even though monetarily it totally made
sense
so I have to pick the 80 20 of the
things like which 20 of the customers
give us and then you have five times
more than 20. yes oh all right which
means you need to have discipline to say
no
I am and say like honestly like sales
calls that are genuine sales calls in a
service business really should be
ex genuinely Discovery calls
what's your business what do you have
what are your goals right now what have
you done so far tell me more about this
how many clients do you have Etc it's
like okay based on what you've told me
you are a fit for these reasons now
based on what you told me you might not
be a fit for these reasons I just want
to let you know now if something like
that changes in the future or if you can
fix this thing I could take you on or I
have a a down sell that might get you
prepared to be a customer for me later
that's a lower level of service because
the likelihood that I think that you're
gonna stick is very low
you're this is so hard to say no to this
new upcoming business because you know
they can help them but they just don't
fit your criteria
I have 13 companies I get 1800 a day
who reach out
right all right you have to say no
yeah
how did you go about like didn't it like
it feels weird to like say no because a
lot of the time I get
specifically that's why most people stay
poor they can't say no
that's why they that's why they stay
poor they can't say no and what happens
is you go for the short-term money and
you sacrifice the long-term money
long-term because then you just get in
this operational Rat Race and then you
scale up your your costs to meet the
fact that you took on all these
customers that you shouldn't have taken
on to begin with and then you have to
pay them every single month so then you
have to keep on taking out customers
that you shouldn't take it on to begin
with and you get in this vicious cycle
that you can't get out
until you downsize you take two steps
back five steps back
fix your ego and then say I'm only
working with these customers because
ethically I know that these are the ones
that have the highest likely to success
with everyone else I had mediocre
success and I can say it's their fault I
can say it's my fault it doesn't really
matter all that I know is the likelihood
that they achieve what I think they
should achieve is low period so I'm not
going to sell them
a lot but aren't you afraid that the Tam
will go smaller like of course yeah of
course but I build 100 company off of a
niche this big it doesn't like it really
you can build a niche an inch inch wide
and a mile deep
you don't need to like you don't need to
serve it like there's 30 million small
businesses you don't need to service
them you like there's there's 50 000
gyms that fit the model that we have
fifty thousand that's it that's not a
lot
yeah yeah right and so you will be
limited but the question is what is your
goal now if you want to build a 10
billion dollar company then yeah you're
gonna have to go after a bigger problem
but if you want to build a nine figure
company
you can do that almost you can do that
in almost any industry yeah like and I
think you can always do a 10 degree
shift and like good
I think you can always do a 10 degree
shift to the niche closest to it and
slightly expand the market as you go I
think that's what most people do right
and you know what I would say even that
just cut off the back part
just like pick the niche and don't
expand just get better
seriously just get better just get
better at delivering even more about
because what happens is you can get
better and better at it and then you can
take a greater and greater percentage of
the economics
because you're because you have so much
track record so much proof that you
deliver so much value so consistently
yeah makes sense
uh when it comes to let's say uh so I
got this I have a question that one of
my uh you know clients asked me yeah
five minutes maybe this is the right
time to ask so the question that they
asked around this is like I'm not able
to scale because my offer is a non-roi
offer so this is a PR marketing agency
and they say like hey we just do PR we
do press releases it's like and just
help them with Fame it doesn't really
help with leads and sales so how do I
position myself because it feels like my
offer is not an Roi based offer uh I
would say you're selling to the wrong
people
uh
all right so there's absolutely I mean
PR is a big Market you know there's lots
of people who want PR but the only types
of people who want PR are people who
understand brand and if you're trying to
make your rent every month you don't
understand brand you're trying to only
get leads and sales
oh yeah I think a person who needs leads
in sales doesn't understand Brandon a
person who has enough of these and now
they look at like how do I build my
brand they'll look for PR yeah
yep yep thanks a lot man so I think we
have time for one final questions sure
sure awesome so you mentioned that when
you started out you started with the
first five customer framework that was
awesome and then you just grew with
referrals so this question came from a
fitness consultant herself and she said
that with the competition that the
fitness Market is how do you stand out
because even if I get my first customers
and I post them there are 100 others
that have this many uh case studies and
testimonials to show
honestly it's just being authentic
very easy to say very hard to do
yeah so what happens is the you know 99
of the fitness Market just looks at what
other influencers doing and say I'll
just I'll copy that and I'll do stuff
like that but then you just do a worse
version of what somebody's already doing
right if you look at the top influencers
who are in that space they have a very
specific personality that like so
zooming all the way out fitness like
there's no secret
like there's no secret like work out
more stop eating shitty you'll look
better over a longer time Rising I think
that's what it is
so the reason then goes where do I want
to get my news from right people go to
different news outlets even though the
news technically is the same I'm not
getting into the you know misinformation
political part they're saying Jenna
people consume media from sources that
they like more and so the idea is how
can I there's going to be a subset of an
audience that is like you genuinely and
they want to get there if they could get
Fitness information from Alex but if I'm
a you know a 45 year old Indian mother
I'm probably not going to be her source
for Fitness information even if I say
The Identical stuff as another 45 year
old uh Indian mother now if that 45 year
old any mother looks at my fitness
content and tries to make content like
mine it's going to seem weird right yeah
and even if that 45 anybody looks at
another 45 video who is uh really
successful right then it's still going
to be it's gonna be one degree closer
but it's still being not them and so
most people you can stick out by
actually being yourself
and like I know it sounds trite but the
real like this is real there are so many
unique aspects of someone's life and the
things they're interested in compared to
other people that if you just lean into
those differences those unique things
that you're actually into that are weird
right Rogan's into aliens and mushrooms
and comedy and fighting who would have
told him like you should knit like you
should be Joe Rogan and you're going to
have people who like some aspects and
then the super fans will be people who
overlap on two or three of the interests
that you have
and so that's the idea is you just have
to show more of who you are and that
will create more pools of people who
relate to to you like if you pick my
brand to be like dessert working out
philosophy Business Marketing sales like
what are like what's Alex from Rosie's
brand like no strips right
sure these are all like they're all
completely disjointed things but they're
different they're people who follow me
because they only like the business
money stuff they're people found me
because they only like the philosophy
stuff they're people follow me because
they just think the desserts and cab
stuff is funny like it just depends on
what someone's going to come in for but
if you're just you then you can stick
with it for the long term and that's
what's going to build over time and make
you quote stand out because there is
only one version of you that's lived
your life so just live it publicly
absolutely absolutely it's a document
thanks a lot man I think we are at the
end of our tenure thank you very much
for being uh here and keep writing great
books
thank you and thank you so much to your
community who are watching this I
appreciate you all thank you for showing
up and supporting I hope the book I hope
I hope you make so much money from the
book um and just and crush it because at
the end of the day there's more problems
than any one person can solve it I hope
you build businesses to solve them so
thank you guys
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