Transcript for:
Business Growth and Offer Strategies

You probably recognize this guy, Alex Herozi. He's known as the $100 million man, and he's probably the most popular business teacher on YouTube. So, last week I flew to Vegas and I asked Alice to teach me the things in his new book, Money Models. Ah, how to make money. Thank you. Yeah. He says that this one concept has made him more money than anything else in his career. How would we improve our business? By thinking in money models. So, let me walk you through the actual economics of this. If 10% of people buy something that's 10 times expensive, you double your revenue. So the classic upsell is you can't have X without Y, right? You can't have a burger without fries or whatever, right? It's like what? You can't have X without Y. I recorded the whole session and I want to share that with you here today. All right. If I reset your bank account and your followers, change your name and face. So I reset you to zero, how long do you think it would take you to get a million bucks in your bank account? Well, having lost everything twice, um, I'll tell you what I did. What do your haters get right? So, you got a new book. If I read this book and it's going to start a little campfire in my head, what's going to happen from money models? You will love this book if you liked offers. And so, a money model is a deliberate sequence of offers. Many businesses have more than one offer. And so it's how do we sequence those in the right way that accomplishes a financial objective. And so the financial objective for this book and what I try to go for for every business I have um is something that I've always called client finest acquisition. And so the reason that we've been able to one user pays for the next user. Yes. And a slight tweak on that. Okay. Which is um so it's 2x CAC plus COGS. Okay. So this is our this is the big thing that we want. So it's basically gross profit in 30 days. So I guess I could move this over here, but it doesn't matter. Gross profit in 30 days is uh is greater than two times CAC plus COGS. Let's just explain the terms people don't know. Gross profit, you're not talking about overheads in in this, right? So gross profit, CAC, cost of customer acquisition, COGS, what it cost you to deliver the product or service that you deliver. Yep. And what you're saying is my bar, my golden rate, my golden number I'm trying to hit is I want to take the cost to deliver the service and get the customer, double it, and in in 30 days I need to be hitting that number. That's my goal. Whether that came on the first offer or what you're saying now is the second, third, fourth thing I sell them along the way along their customer journey. It's exactly that. And can you do like a stupid tangible example? Yeah. Yeah. So the the first business I ever did this in was the gym business. And so it's a really simple example because everyone gets it too. So, when I came into the gym business, what the vast majority of businesses did is they would run uh low ticket like $21 21 days or they run a free month or free 14-day trial, whatever. That was their the the primary way of getting people in. And so, let me walk you through the actual economics of this. And so, if you have a business, let's say old way, right? Um someone comes in, let's say you pay whatever, 10 bucks a lead, uh that's your CPL, cost per lead. And, uh then you can convert, let's say you're getting, you know, 20% of these people to to start a trial. So that means that it cost you 50 bucks uh to start a trial and then one out of three of those trials which is the industry average uh convert and typically the conversion for like a boot camp or something like that is going to be about $99 a month. Right. That's that's what it costs. And so there's your CAC. Yeah. Exactly. There's the first 30 days. Exactly. And so you're you're upside down here now. Not only that, it probably took you two weeks to like between when you like got the lead before you got the trial and then 21 days. Now you're at 5 weeks. And so by the second month now you're like, "Okay, I got 99 times two." Now that doesn't even take into account that like that 99 is not all free. Like there's costs involved there. But let's just say that these guys are amazing and they're running 100%, you know, margins. And so it's like, okay, so this is going to take 60 days for this business to basically recoup the money. Now, the problem is that in the gym industry especially, many customers leave within four months. And so it's a very tough way to make a buck. And so what I kind of came in and started doing was we'd run these challenges and I' I'd spend the same amount of $10. I'd had the same You were here when you started your you did the same model initially. No, I saw people doing it. I saw people doing it. And so then it was like a three-step permutation. I I don't even want to tell the backstory, but basically figured it out, tried it out at a gym, it worked at that gym, and then I started my gym. That's basically what happened. So uh same same cost per lead. I would close the same. I get 20% uh of these businesses. So, it would cost me, let's call it 50 bucks, whatever. Um to for me though, I would off of that $50, I would sell up front and I would make 500 cuz your $500 offer was Yes. a challenge. So, you win your money back. So, if you lose x amount of weight in x amount of time, we get your money back. Now, that was the beginning of the offer. That's an attraction offer. So, it's one of the offer types I talk about in the book. And so, it's like, okay, I got $500. But we didn't stop there because what are you going to do after you have your your thing? Well, you're going to need some supplements. It's like, all right, so then we'd 48 hours later, we'd sell $200 of supplements, call it, you know, 80% gross margins, whatever. It's like, okay, so I get 160 plus plus 500. So now I'm at 660. All right, great. Now on top of that, it's like, all right, 3 weeks in, it's six week uh six week deal. I would then say, hey, I'm going to roll this towards a one-year membership. And so boom, we'd roll that over, which is another mechanism that we use. Um, and so then I get the one-year one-year member. Great. Now, at week six or between week three and week six, we'd make a second offer and say, "Hey, you're already a member. Can I just save you some money?" And they say, "Sure." And we say, "Hey, if you want, what we can do is if you just prepay for the whole year, we'll knock knock knock two months off." And so then all of a sudden, I'd get about 20% of people to prepay for the whole year, which is a $2,000 $2,000 cash up front, which if it's 20% and we add all these together, I'm getting about a,000 bucks up front in the first same period of time that these guys are getting 99 or$1.99. And so my ability to outspend them in a in an auction based uh based on attention on like Facebook or Google search or whatever was like unparalleled, right? And so because of that, I was able to uh not only outspend my competition, but because it cost me like if you're actually doing LTV to CAC on this cost me $50 to make a,000, I'm getting 20 to1 30 to1 up front. And so I was actually able to finance the opening of all my locations that way. So, I could spend $5,000 in ads and make a hundred grand back and literally paint the walls, put the lobby in, buy the equipment, and by the time I actually open the gym, because I do pre-sales for a month or whatever, um, I would actually already be cash flow positive day one without actually having to invest capital. And so, fundamentally, I will continue to tinker. And this is where I got spoiled or whatever. Maybe my belief set changed is that this was the first model I ever had. And so every business I've had since then, I was like, I know there's a way if I just keep tweaking it until eventually this thing will print. And then when that happens, you don't need the outside investors because you cash flow getting customers. And so you basically almost like every business I've had has been supply constraint because I can blow the doors off on the front end because I can acquire customers. And so like this has been the skill that's probably been the largest, you know, contributor to my material success. And like Allan went from zero to, you know, 1.7 million a month within 6 months. Gym Launch went from zero to 2.2 million a month in 20 months. Prestige Labs 0 to 0 to one one and a halfish in six. And so like each of them just very quickly just ramped because I could get customers at a profit. And when you look at the actual like where the mechanics of the money happen as soon as one customer comes in, right? One guy comes in. Now if he gives you that 2x CC plus COGS, then it's like, okay, well I've paid for him and I paid for the delivery, but he comes loaded. He's holding this guy by the throat. He comes loaded with my next customer. And so, but then this guy brings me two more. And so, basically, you keep doubling. He comes loaded. Yeah. Exactly. And so, then at that point, you literally only have to acquire, you have to have the cash or the wherewithal to acquire the first customer. And then everything after that is is financed by the by the customers. And the greater that discrepancy, the more you don't have to even put more capital into the business at all. And so, that was a very long as as fast as I could say it, that's that's the that's the that's what we hope to accomplish, the good money. All right. So, a lot of people they'll talk about how you need a million dollars and three years of experience to start a business. Nonsense. If you listen to at least one episode on this podcast, you know that is completely not true. My last company, The Hustle, we grew it to something like 17 or $18 million in revenue. I started it with like $300. My current company, Hampton, does over 10 million in revenue. Started it with actually no money, maybe $29 or something like that. Nothing. And so you don't actually need investors to start a company. You don't need a fancy business plan. But what you do need is systems that actually work. And so my old company, The Hustle, they put together five proven business models that you could start right now today with under $1,000. These are models that if you do it correctly, it can make money this week. You can get it right now. You can scan the QR code or click the link in the description. Now, back to the show. I want to break down a couple of things in here just to because I can first of all this is great you know in I come from Silicon Valley in Silicon Valley uh virality rules all yeah and and they they you know the early growth hackers in fact there's a book called the viral loop the guy my mentor the guy who who kind of plucked me when I got to Silicon Valley he's featured in that book because early on he was like scraping hotmail and he realized wait I have no marketing budget but one user can get me the next user through this thing called the K factor and you measure the K factor it becomes like this how Facebook and other other businesses grew you've created a version of the K factor for um nontech uh businesses that are not going to grow virally but you can grow you can finance the next customer through through the existing customers. I want to point out a couple of important things. So the first one was this is what this is kind of book one. So this is you know your $100 million offers book. Yep. And I would a key difference here for any entrepreneur is that you're able to charge $500 when this guy's probably honestly struggling to even charge $99 a month. I drove by a place here that was like $5 entry offer uh the Las Vegas Fitness Club or whatever because you were not selling a me a gym membership which is a cost to the customer. You were selling a transformation promise. Y right. So you're selling customer transformation the happy ending. So first of all what what are you actually selling? That was a key thing. The second was you were then upselling upsell one of your money model. Yep. And you had a good insight here in um the preview your team sent me which was basically that you want to sell when the customer pain is highest. Can you talk about that? Yeah, I I'd love talking about this. Um so basically I think so many people businesses etc get they think about that what especially services because 78% of businesses are they think about they have a term that they deliver for a customer and they typically want to renew when they're about to stop getting paid which is typically the absolute worst time to try and renew. It's like an ex-boyfriend. Hey back in town. It's like oh I guess I'm on month 11 of my annual trial. No. Exactly. And so there's there's basically five five times that you that you want to sell um uh sell a customer. So number one, I'm just going to move this. Okay. Number one is uh immediately, right? So that's like in the same conversation. Um the second one is after basically some sort of activation point. Next you have your halfway just because like you're like why halfway? Because it's halfway and that's why it works. We're humans at halfway. Yeah. Yeah. You have your last chance at the end and then you have milestone which is which can happen kind of anywhere in here but basically they have something occur so this is something they do this is something that happens. So the action item for a company here is map this for yourself. Yeah. But if you're like okay well which of the five do I do? You want to sell the point of greatest deprivation not the point of greatest value. Sometimes the point of greatest value and the point of greatest deprivation occur at the same time. Not always though. So, I'll give you my simple example, which is like if I go to the best steakhouse in the world and I have a steak and I'm like, "This is amazing." And the waiter comes back and says, "Hey, would you like another steak?" I'd be like, "I'm I'm good." And they're like, "What? You didn't like the steak?" And I'm like, "No, the steak was great." They're like, "Why don't you get another steak?" I was like, "I'm good." They're like, "Well, if you if you like the steak, you'd get more steak." And the thing is is that so many businesses are trying to sell and upsell that way. And they're like, "My customers suck. They're so cheap." It's like, "No." So at that point I might have a I might have deprivation around something that's sweeter and lighter and that might be the right time to offer dessert, right? Versus more of that other thing. Now um the deprivation occurs at the same time as value creation when the first loop of value that gets created creates the next problem. So if I help you get leads and you get leads then you're like holy [ __ ] I'm overwhelmed. If I say hey would you like me to help you work those leads? then it's a very natural upsell where greatest value and greatest deprivation happen at the same time. If you are a business that doesn't have that type of I'll just I'll just speak broadly. If that doesn't occur in your business or on a short enough timeline, then that you you don't want to sell at that time, right? And so that's basically what we we strive for. And that's why I've always been of the belief like when someone comes in with red hot pain, that's when you sell, not when you offer your trial, right? And so for uh let's take you can use the gym. We can use a different business if that maybe maybe that'd be nice if you can. What would you either, you know, either this or a money model. Uh, you know, you can either walk through a money model or you can walk through this for another business. Let's do another example. Sure. Let's say you have a an SEO agency, whatever. So, if you we actually we can use one of my real businesses. Okay. So, we have this business somewhere.com. We basically help you find talent that is overseas. So, we help businesses where you're like, I really want a developer, but I'm not trying to pay. Did you invest in that, too? Yeah. Okay. Got it. I thought it was. Okay. Got it. Yeah. So, we we own this business somewhere.com. So for example, I got my assistant through this. Uh, you know, I'll hire developers, graphic designers, data analysts, whatever you need. There's talent is everywhere in the world. Hard to find. They put boots on the ground in different locations. So South Africa, Philippines, and they have hundreds of recruiters in each of those areas to find who's the best 1% in each of those locations to come work for you this year, right? Great business, great margins. Love it. Uh, happy owner. Yeah, exactly. Okay, so now what's the problem? So today, the way our money model works Mhm. is customer basically listens to Sean's podcast. We'll just do this. Uh or they follow Nick on Twitter. Yeah. So we get leads from one place. Exactly. Not not exactly fully, but that's a a bulk of it. and they come in, they book a call and on that call we try to sell them um a contingency based thing which says if we find someone pay us um a fraction of their salary. you know, they're so low salary typically because you're getting talent from different regions of the world, that will come out to let's say, you know, maybe 6K per customer. And what we do is that happens and then we stop and we go fishing again for the next one. Yeah. Okay. Help us with our money model. How would you if I took if I read this book and I want to go help Nick improve this business? Yeah. Um, how would we improve our business by thinking in money models? Yeah. So the question would be like do we need so if I'm looking at this right you have attraction offers so it's like do we have a big demand issue or do we have an LTV issue which might be upsells do we have a conversion issue which might be downells all of the above everything can be improved or do we have a continuity thing right and so there are different structures that lend themselves more to one versus the other type of type of problem right that we're trying to solve and so like for an attraction offer if you're you know what? Let's get a shitload more, you know, phone calls in the door. I would say, hey, I just got this uh absolute savage. And I would put like this is the dude. All right. This guy is a [ __ ] god. Whatever. Now, who here wants him? And I would say the the business that uh like we're going to do a raffle and everybody who who submits to win this guy, now obviously you got to be ethical and loyal, but assuming that you're not a [ __ ] idiot, right? Uh this is this is the guy that you're going to get and you have to be a business that's like this in order to qualify. Cool. So they're going to enter their information in order to get in the raffle. So they get this guy. Now you're going to say we will pay for this guy for a year as our as the deal as the big giveaway. Not only is he amazing, we'll also pay for him for a year. And so that makes a huge you'll get a gigantic amount of demand, but what's beautiful about it is that the demand is for your most expensive or ideal product. And so then at that point the person like every single other person who opts in is a qualified lead who say you know we can't give you Carlos but we can give you so and so and you uh we'll give you a partial scholarship we'll give you a partial win whatever and you knock whatever off 10% 20% off and then you roll that right into the continuity. So that would be an example of an attraction offer that you could attach to that existing thing from an upsell downell perspective it would be like and there's five different ones that's just one that I pulled out. That's a giveaway giveaway. Yeah. Yeah. And so like the just for everyone's just listening, the the the weight loss version that I had was something called win your money back, which is a different was a different mechanism, right? And so there's there's five different ones that I think that work exceptionally well for bringing people in. Depends on the type of business. And so for yours, there's bikes go away free. There's a bunch of different versions, but like think this makes the most sense. Cool. We'll use a giveaway. All right. So then upsells and downells. So um with down so I'll I'll start from downsells. So you can have feature downsells, you can have free trials, you can have payment plans. Now, for your particular business, payment plans doesn't probably that doesn't really make sense cuz it's a continuity thing anyways. And so, it's like, okay, we have free trials, which you kind of have with contingency. So, it's like that part's that risk is kind of um averted. But from a downell perspective, they might think, okay, well, I can't afford six. Now, that's a business decision more than anything. I like to think of feature downells. So, I can get you somebody who's maybe not as PhD level, whatever, but we can do it for 3K a month, and that person might give you more opportunities to say yes. That would be the downell component. From the upsell perspective, there's there's four different upsell structures that I like. The classic upsell is you can't have X without Y, right? Which is like you can't have f you can't have a Coke without fries, you can't have a burger without fries or whatever, right? It's like what? You can't have X without Y. And so it's like you don't want to buy this big, you know, this big framed art without insurance. Yep. Right. So there's always a you can't have X without Y. And so uh the so for here because they said yes, naturally you should say yes to this next thing. Exactly. In order to make your first decision an even more sound. And this is why the whole deprivation thing that I was saying earlier is so important where like right now supplements in your case because some people are like well I don't want to sell them something else. It's like well you just created this new problem that they weren't aware of which you will now make them aware of which is oh sometimes these guys flake out whatever. And so we have insurance that we can offer for for this type of thing. So me just shooting from the hip here. Um I was I'm running through the easy one here in this situation is payroll. So great. They a lot of companies are not set up to pay people all around the world. we can manage that for you and we'll do it for you for 500 bucks a month. We'll take care of this because you're going to you're going to build out a remote team here all around the world. You don't want to be doing compliance and payroll and foreign exchange tax reporting. We take care of all that for you for we have we have an accounts team that does that. Perfect. And so that would be the natural upsell that you do you tack on. And so some people and I I'll just make this point a lot of business owners will will think well why don't I just include that in the main offer. So, I'll just say in my experience, it's a lot of times as as bad as this may sound, it's easier to get the second yes after you get the first yes. And so, like it's like, well, maybe if I included that, they'd buy it at $6 $7,000 a month. It's like, yeah, but you might also just raise your price to $7,000 a month and then do it again, right? And then still have it. And so, cuz I mean, the amount of gyms were like, you know what, I'm going to I'm going to take the challenge system and then just include the supplements. I was like, or you could just do it the way that I've already tried a hundred times. Like, believe me, if I could sell more up front, I would. it works better this way. And I had this whole psychology around it which is like you have these different wallets in my mind. I it doesn't work this way. But like it's like um my grandmother used to say this thing like I would go there and probably like your family like overfeed she'd have she'd have enough food for 10 people when I go and see her on my own and I would just she would stuff me to the gills. And one time I went there with my dad and she she and I have different languages so she's tough to talk to. But she said something under her breath after she walked away after I was like dying and he cracked up. I was like what did she say? And uh he said well you said you were fool. and she said, "Well, your your your main stomach's full, but your dessert stomach is empty." Yeah. And so, it's the same idea here where it's like, "Well, their person wallet has been spent, but their their tax avoidance operation pain, what a pain in ass isn't." And that one's still full, so we can still tap that one. And so, if we're if we're drawing this, it's like, okay, so we've got payroll as our upsell. Cool. And you'll know your services better than I do. Um, but it's like, okay, so we have one or two things that we can include in the upsells. Um, but the mechanism of doing it is part of uh like part of the money models book. And so the X without Y um the way that we'd probably present it. So each of that whole section is a lot more on the scripting of it. Okay. So it's like hey what a lot of people do is uh they do this. Do you want anything else do you? And so when you say that everyone says yes by saying no and by that it's like you get 80 90% take rates on the upsell rather than saying hey do you want it's a it's a it's a binary it's a different question right now they have to consider a purchase. And so all of them have like tiny little little repositionings that work really well. But that I think would make sense. Like you'd say that's that's the classic upsell. There's rollover upsells. There's uh which is one of my favorites. There's anchor upsells. Um which anchor upsell would be like let's say uh you're like, "Okay, if you want uh Nick will go find the person for I'm just making it up." Right? And he'll do it uh for $15,000 upfront and you know $10,000 a month now. At that point they're like [ __ ] It's like that's a lot. like or if you're good with the exact same work being done by someone that Nick trained, we can do it for onethird the price. And it's like, oh yeah, that's fine. And so the key part is that you anchored them to the anchor is is part of it, but there's also like um what you want to anchor. And so the way I learned this was actually at a Salt Lake City uh suit place. So I go in, a friend of mine sets up a private suit appointment with me. Now I'm not balling. I have like $10,000 in my name. So I was like, he's like, "You got to have a boss suit if you want people to take you seriously." This is many years ago. Obviously, I've really listened to this advice. Um, and so I go in there and the guy's like, "All right, I'll get you." And he asked me, "What do you want?" I said, "A boss suit." And so I'm 23 or 24, something like that. And so he puts this suit on me and he was like, "What do you think?" I was like, "Oh, I look awesome." And then I uh I looked at the tag and it was 16 grand. And I was like I I think I turned white, right? And I was like, "Oh." And I think he saw me like just like freak out. He's like, "Hey." He's like, "Do you care about the brand?" And I was like, "No, not at all." And he was like, "I got you." And so he The thing is is that he had his lineup already picked for me and he just pulled the second one, put it on me. He's like, "What are you thinking?" And I didn't even look in the mirror. I just looked straight at the tag and it was two grand. And I was like, "Thank God." I was like, "Okay, I can like my friend's not going to be embarrassed that he sends this poor, you know, his muggle, his non-match folks over peasant." And so anyways, I ended up checking out. Then he was like, "Well, you want you can't have this without that." He's like, "Well, you want to make sure that you have the little pocket thing and you want the socks, whatever." So, I ended up leaving for 2500 bucks. And I remember after I left, I was like, I spent five times more than I had budgeted for this thing. And I realized I was like, "Oh, but the key part wasn't just that there was something expensive." Number one is that you actually have to sell it. As in, cuz sometimes people put anchors, but they don't really like commit to the anchor. If you just say it and then immediately like don't even acknowledge it. Then it's just like this is this thing we put in the sales process. I don't know why it's there. That's dumb. You have to commit to it. Because the thing is is 10% of the time you have a whale and they'll [ __ ] buy it. You're like, "Holy shit." But the other 90% of the time, the key is that the thing that differentiates the anchor from the core offer is a very negligible thing. And so for me, the brand didn't matter. Or like he might be like, "Do you care what kind of wool this is?" I'd be like, "I don't care." Now, somebody might. And the reality is they probably don't actually. They just always buy the most expensive thing. Like Ila just always asks, "What's the most expensive thing?" And then she just buys it. That's how she rolls, right? She just always wants the best [ __ ] you know, whatever. But the thing is, you want to have a model that allows for that. And if 10% of people buy something that's 10 times expensive, you double your revenue. So, it's still worth it. And that that's why the anchor should be super [ __ ] high. And so, that's an example of a different type. But this one uh is a is a classic upsell, which would be positioned the way I said, which is a no-based a no-based. Yes, we covered the downell with a feature downell. And then continuity. Now, you already have a continuity business, so there's no real point to like saying how do we how do we do that? But one of the like there's a different mechanisms that I use in that on that side, but one of my favorites is like something called a wave fee. So, this works really well with expensive stuff. So, we would say, "Hey, um, for us to go find this person, it's uh it's 10 grand upfront. Uh, or I can wave it if you commit to a year." And so, you just wave the fee, but you get the commitment. And you and the thing is it's like, "Oh, if you're not sure, then just pay the 10. You get monthto month. No sweat." And so, with that also, you say, and we would stack it. So, we'd be like, "Okay, we're going to wave the fee. you commit to a year and if for some reason it doesn't work out with Carlos, we'll get you we'll get you another Carlos within 90 days or whatever. No, no cost. And so then it's like the in so you you decrease cost and you decrease risk with the continuity and commitment and we create artificial pain in the moment. Now what happens if they're like hey 6 months in I want to cancel. It's like no worries just pay the fee right that I waved for the commitment. So it actually creates a very simple contract which is like you just got to pay that on the way out the door. So it also increases stick. So that's like it has like three prongs to it that makes it but it's very easy to understand and very elegant. And so that's one of the continuity mechanisms that I use. And so when I'm looking at a business I'm running through the different mechanisms that we do like okay we're having issues we're having a lot of friction here right now I'm guessing because you're selling continuity on the front end is probably not a huge deal right or but maybe churn is I don't know but here it's like okay which part of this process needs to get lubricated. is that we need to lubricate people coming in the door and that's where we'd use a raffle or giveaway or sweep stakes or something on the front end or it's like you know I like the thing is is there's signing for six but we need them at 10. It's like okay well then we need to put more lubrication here or you know what we're getting all these unqualif like 80% of the leads that are coming in are unqualified. We make the business decision we still we want to sell to these people. Okay, we have a gross product uh a gross margin product that's sufficient uh that still makes sense. We still have 80% gross margins on this inferior product. Okay, how do we present it? And that's where the down cell would actually become really key. Um so I had a business that I um close friend of mine had and what we did was for the downell uh he we basically this super high ticket thing that we were selling. He's a a PhD for health stuff and he does all this like really weird health stuff for people. I'll just I'll just if you have a problem he's the last person you go to and then he fixes it. That's his whole thing. Okay. And so um what we did though is we created a downell that re-upsold people and so they'd they'd get sticker shock and he would say no worries. um if you want I can do it for you know $2,000 less um but I just won't include a guarantee and so then people are like I kind of want the guarantee and then they'd re upsell themselves right and so the guarantee is worth that 2,000 to me which actually gets to show you so then there there's becomes the art and I talk about this in the book of how much do I decrease price versus how much do I decrease value and so the play between those two uh if you if the more you study the customer the more you understand which components they value the most and so typically when I'll create a a downell structure, I'm going to think, okay, the first downell I'm going to give is actually to re-upsell the main thing. Now, if they really can't because they they clearly said no, even though it's a big a big issue, then I say the next one I'm going to do is going to be a tiny thing with a large decrease in price, right? And so the first one it's like small decrease, big drop in value. You know what? I'd rather have the main thing. The next one though, I'm going to have a bigger drop in price with a smaller change in value. At that point, price is actually the thing that's stopping, right? And so then then it's basically how do I ethically lower my price without saying I'm selling different things to different people. That way I can change the terms rather than saying because I I never discount but I will change terms like oh no they got something different than you which is why they pay less. If you want I can give you that. That's fine but you just won't get what they're you're getting now. And so that's so that's a little bit of a brief overview in terms of how I think through creating these but you can see right now like if you were to do just even like a raffle once a quarter it's like that would probably feed all your leads for the next whatever. Yeah. And I think one of the best parts about this is every business has some version of this, right? This is a different way of looking at a funnel. Yeah. Um but the cool part what you what I think you're doing with your books is you're basically taking the parts of the funnel. Yeah. Offer getting leads through the door, being able to actually sell the first sell the first thing to them, sell and how do you string together things to maximize the value you're getting for every that hardearned lead that you already, you know, paid for and busted your ass for. Yeah. And um one of the things I like about this is that you've basically codified a lot of what the best people do, but they do it in their business, then they get rich and then they sort of relax, right? Like I don't need to go back. I don't need to even label what each of these things were, but you've sort of looked at it and said, "Okay, let's call that an attraction offer. What are five examples of those that I've seen?" And then then you're on the lookout for them. You see it in this business and that business, and you start to put it together. So I think that's very very valuable even as a uh a structured way of brainstorming because I think most people in their business most most founders will understand yeah I got to I I want to get more demand and I want to make more money per customer but these vague wishes and I think the the key is to sort of not be most people. I have this like rant about most people. I'm like you know we try to fit in. That's our nature. Yeah. But it's like most people in America are overweight or obese. Most people don't like their job. Most people get divorced. Most people don't have enough money to, you know, to pay for an emergency procedure. You don't want to be most people, yet you want to fit in. It doesn't really make sense. And so, I'd love to understand from you where you see a lot of entrepreneurs. Yeah. When it comes to money models, what do you see is like what are your most peoples that you're seeing that if we just drew kind of like here's how most people are doing this and if you just made these sort of one or two tweaks, you're now not in the most people bucket anymore. you're operating in a different way. Your business is gonna have a higher chance of success or be worth more. I would say not enough entrepreneurs are students of business and they're students of the thing. And so I'll I'll give an example. So like I will never claim to know more about remote work business or HVAC or plumbing or whatever, but like people fly out here not for that, but because I'm very good understanding of the variables that create money. And so it's like, okay, how can we arrange these variables and then we will fit like you said the payroll thing. I was like, okay, great. You have a thing. I'm not going to be the one who immediately knows that, but I'll be like, there's a slot here that we're missing, right? And so, one is they're not big enough students at business. Uh, number two is a lot of times it's like, well, this is what everyone else does to your point of and so like, well, I'll give you an example. I had a guy who did um guard services, right? And so they they staff like buildings like this, right, with with guards. And so, uh, he had huge cash flow issues because he paper thin margins, but it's super sticky. People stay forever. Um, and it's very commoditized in terms of competing for bids. And so, you know, after talking for, you know, extended period of time, I was like, okay, well, why don't we just say that people pay quarter at a time and pay upfront. It's just, oh, yeah. And he's like, well, no one does that. And I was like, so let me give you the best overcome in the world. Someone's going to ask you and they're say, well, everyone else listens it. You're like, we've just always done it this way. That's all you have to say back. That's all you have to say. We just it's all it's how we've always done it, right? And as crazy as that is, that is still the number one overate excuse. Yeah. is still the number one overcome. Like when I used to ask for credit cards on the phone for someone to show up for, you know, personal training or trial or something like most places do not do that, but they'd be like, "Why do you need my car?" Like, "That's just how we've always done it." And then they're like, "Oh, okay." And so there's all this, like, it's so funny how some of these little lines just make huge differences in your life. You like weaponize the um the the the the uselessness of of most processes. It's like we're all so used to processes policies that are stupid that we're just like, "Oh, it's one of those. Got it." From management. And they're like, "Oh, yeah, [ __ ] Yeah, got it in." And so um so one is but like when I I had to spend probably 30 minutes with him to just like just get him to just be okay with asking for the money getting paid quarterly number one and getting paid before you do service rather than after you do service. And so I mean everyone throws around the word first principles but it's like very few people actually think from first principles like what prevents us from doing this? And I think that's that's like this is the constraint cash flow then like what are all the things we can do? Can we change payment terms, which is the first thing you're going to do if you have cash flow issues? Can we push our stuff out net30 always? Like, how can we change this this cash flow balance in our business? What's the money model of acquisition.com? So, this is really interesting. So, it's so hard for me because what I have to write about is not the rules that I have to live by. And so, my favorite movie in the world is uh is The Matrix, like many people's. Um, but there's the line in the Matrix when Neo's looking at Morpheus and he says, "So, you're telling me that I'll I can dodge bullets?" And he says, "I'm telling you that when you're ready, you won't have to." And so all of the things that I write about, like even like selling tactics and things like that, they assume you have no brand. And so, like, when you have a brand, you have so much demand and so little supply that you can set your own terms. I can have zero attraction offer and make the the absolute worst offer in the I don't have to make a grand slam offer at all because I might say I don't want to deliver much at all. I will promise zero. I will guarantee nothing and like but because then that'll still give me less operational constraints on the back end. And so at the end of the day like the reason I have the the two parts of my logo are this is a lever and this is supply and demand. And to me those are the two biggest the two biggest forces in business. And so like if you have I always thought it was a whale's tailact. Yeah. Yeah. Um, but like those are the two strongest forces in business. And so all of these things are to help lubricate or create or channel demand when you have little. When you have an ocean of demand, it's hard to lose. And so the model that we have is very different. It's almost like a ward away model of like we, you know, we invite entrepreneurs out here who we think are interesting. Uh, we look at the business and then we say, "Hey, change these things. Call us in a year." Um, and that's that's basically what we did. We took our diligence process that we were doing for multiple years. And I was like, what h the the the catalyst for it was that we had we getting all these thank you emails. So all these founders come in from my content or whatever and they'd be like, you know, they took we my deal team took six calls with them and was like at the end was like, listen, these two metrics suck. Do these things, see how it works for a year. Give us a call. And they were like, this was the most valuable process I've ever gone through. And then I was thinking like that cost me a lot of money, right? And so I was like, what if I just charged for diligence functionally and then I got then I could actually staff it better and all these other things. And so that's functionally what we do from the advisory practice that then feeds the deal side. So you have the content which creates the brand. Yep. What you did is you turned your cost into whether it's a profit center or break even, I don't know, but you know something like this. This is your workshops. What did you call it? You called it something else just now. Advisory practice. Advisory. Okay. So there's your advisory. Yeah. And you you say, "Okay, pay us five grand, come over here." Yeah. But then you do have an upsell here to like more advisory like Yeah. So we just do. So basically from there it's this is how we basically how we see value creation. And so we say like this is our framework for creating value. If you like this, happy to help you. If you're like this is cool, I'll go do this. Awesome. Uh but the the consulting side's true consulting. It's it's one thing like they come we identify the constraint. We say, "Okay, okay, well, we're going to go look at comps. We're going to look at the different ad strategies of people who are bigger. We're going to say, "This is the funnel and this is the offer that we think you should do." And we say, "This is all you have to do. When you do that, call us." And so, it's it's 100% from uh point to point. It's not like a ongoing thing. It's literally onetime consulting. Um, and that's the quote that's the quote upsell. And then at the bottom here, you have the equity side. Yeah. Where you're like great, the private equity side, right? You're going to buy the businesses that and the venture arm now which we do a lot of and venture. Okay. Gotcha. Um interesting. When you started how much of this was figured out as you go for 100% of it uh grandmaster plan visionary. Well there turtleneck. Some things were master Yeah. Right. Yeah. Some things I would say the the big goals for master plan the all of this mechanics was absolutely like figured out as you go. like the books and how they've all been structured has been a five plus year plan and you'll you'll see what what I do at the launch and and why. Um it's going to be awesome but uh it will it will it will all be revealed. Um but like the mechanics of like the prices and like how we do that like that was very much born from like I am currently spending money on this team. We have way more demand than we have supply. Maybe if I can generate more revenue here I can staff it better. I can get more luck surface here because I can look at more of these deals because you've probably seen this like some companies look terrible on paper and then you meet them and you're like, "Oh, these guys are awesome." And so we had to do so many like I mean we we'd probably talk to 1% of the papers that we that would come in and I was like I know we're missing stuff, right? And so that was that was basically the thesis behind this. I mean I think it was brilliant. I was like wait a minute. So he's basically gets paid for people to come and open up the kimono. They get value too otherwise they wouldn't be doing it. These are not dummies. These are business owners. they should be making good decisions. But I was like, "Wow, that's a Yeah, the median size is is 4 million." So it's not like they're not small business. It's median. So like there's plenty of like tons of good businesses every every every time we have a workshop. Top one's usually between 30 and 100, you know, and there's plenty in the eight like every single I don't think we've ever had one that doesn't have multiple eight figure companies. I want to play a game with you. Do we have the uh the game here? Oh, what is what is the game? So the game was this. Okay. So, so this is going to be a game that we're calling make it or take it. All right. So, you're going to have to shoot. I I know I know you're not big hole. We're going to have to get up for this. Yeah. Okay. So, you're going to take a shot. We're going to see how far back we're going to get here, but I think we'll set that as the benchmark here. Okay. You make it, you're off the hook. Okay. You miss it, you have to take it with one of the tough questions that we spin the bottle. I was like, I really like Alex. And I was like, uh, what do people want? So I asked people, what do you want episode? The guy puts out a ton of content. Yeah. You know, I'm not just going here to get you. Like, yeah, let's do something new. Let's do something fun. And so they were like, ask him some tough questions. So I said, okay, let me think of some tough questions, but let's make it fun. How we do this? All right. So first shot, uh, go for it. And then you get miss it. Do I ask you the question? If you make it, yeah, you can ask me the question. That's fair. Or I burn the question. Uh, so it's up to you. So this is the question I have. Okay. What's the question? Perfect. So the question is what do your haters get right? What do my haters get right? Meaning all you know you get criticism as anyone does but sometimes there's you know some criticism is fair or there's uh components of it that's fair. So what do the haters get right? Steroids is one you know he's just you know he's here for the money. I would say from like the the philosophical angle, you know, I say there are people who are like uh you know the say that like Alex is a life and I'm like well yeah I'm pretty open about that too, you know. So it's like they will use a fact as an insult and I'll be like I agree, right? So that's I think that qualifies. I think that's one, right? Like intending it as a hater comment. Yeah. But you're like yes and I agree. I agree. Yeah. And if you if only you knew and I'm open with that. Yeah. No, cuz if you ask like I'm here seven days a week like I work all the days until I cannot work and then I take a day and then I continue to work again and I I work 12 hours most days. I'm usually here 5 to 5 um for six and so is that a temporary thing? Are you like I'm in an era of my life where that's what I want to do or you're like that's who I want to be. It doesn't feel this doesn't feel like a push like if I if I when I'm pushing I work third shift which is I work 18. If I do that for an extended period of time, that starts to grade at me. But like twelves is like that doesn't Yeah. Like five to five. Five to I'm like I still feel like I've got plenty of time to like chill out and do whatever. So let's do another question. Yeah. Okay. Yeah. Make it or take it. All right. Next question. All right. What do I got? I love it. Uh all right. If I reset your bank account and your followers, change your name and face. So I reset you to zero. Basically drop you in another drop you in another life another country. How long do you think it would take you to get rich again? And what what's rich? Rich would be let's say for the name of this podcast, my first million to make a million bucks. Get a million bucks in your bank account a year. Uh and what would be the approach? So you're you're back to to nameless faceless Alex. Alex Alex. Yeah. Well, having lost everything twice. Um I'll tell you what I did. Uh which was I find a local business that's typically a service that I think um I can sell for a lot of money. Um and they're typically undercharging. And so I will say, "Hey, how cheaply will you let me sell?" Basically, if I if I send you a 100 customers, how cheaply would you do it? Would you charge me to do that? And so, I get an agreement on price from them and then I sell for whatever the hell I brought you volume. What's the lowest you could deliver the service for that volume? Yeah. And so, let's say it's a back cracker. Let's a chiropractor, whatever. And I say, "Okay, um, how much will you crack back at the absolute cheapest?" And he says 25 bucks a session. I say, "Okay, cool. So, I can sell packages of 10 for 250 and you're cool with it." And he says, "Yes." So, I'm going to go and sell packages for three grand, right? and I'm going to make the spread and it's because I know how to sell. I know how to get leads, right? And so, I mean, this is what I did. I mean, obviously I did it in the gym space, but that's that's what I did when I lost everything. I just went to gyms and said, "Hey, um, but for them, I could I negotiated zero." So, like, you already have all your cost bases. I'll just add you customers and then after the first month. Exactly. So, I would I would take the first the 500 bucks. I'd say like, I get to keep that. And then after six weeks, you convert them. The memberships are all yours. So, zero CAC for you. I take all the risk. I do all the work. Right. And that's and like I would I did about 100 grand every 21 days doing that. Is there a better or worse type of service business that you'd go for? Like knowing what you know now like maybe I sold a gym. I for sure do healthare. Healthare. Oh my god. Yeah. Healthcare means what? White lab coat. Anything any service in healthare like pseudo I call it pseudo medical. Okay. So that's where like I mean that's why I like teeth whitening. That's we have a chain of 28 28 stores. Like I love pseudo medical stuff. So uh laser you know laser laser skin stuff, laser hair removal. uh you know the the chemical peels um I love all that stuff like the the beauty medical like intersection you you can just sell your eyes out it's amazing what's the why you love it because of the demand because it's huge supply demand uh inequality so there's if you see if you look at the stats there it's insane like the amount of demand of like boomers and all the stuff who like want to stay young and the supply side on it is so low and the reason I know this is cuz every single med spa that walks in these doors is killing it and I talked to the founder And I'm like, "Whoa." And I'm like, "So, how do you market?" They're like, "We just kind of like open up. We just we just announced that we're there. We have a website." Yeah. No. They're like, "Yeah, we have a phone number. People just kind of come in." I was like, "They don't know. That's not That's not how it works. That's not how most that's how crazy the supply demand difference is." And they don't think about pricing. They They think about nothing. They just And they make, you know, 40%. They have no idea. And so that's why I would give That's like a heat signal for you. Yeah. That's Yeah, 100%. When I when I see a lot of people who don't know what they're doing, all making money, I'm like, "Okay, there's something there that's good." Um, and so that's what I would do because that's what I did do, right? All right, you're up. All right, let me get Wait, wait, let me get another question here that I want to do because I got a couple. Yeah, because it's like if you need to make a 100 grand to a million bucks, you can do that. Like if you just if you know how to generate leads locally and sell, you just get a service business that agrees to take customers for a price and then you just sell as much as you can. All right, go ahead. Maybe you want me to burn it or you can ask. What are we doing? Uh, what did you get most wrong in the past three years? Okay, I'll tell you this. I started with a bit of a portfolio approach. So, I kind of had this thing where I was like, I don't want to operate, but these guys are operating well. I can add a bunch of value, similar to what you guys do, private equity, whatever. And I took minority stakes in several companies that have done well. But basically, when they do well and I add value, I just sit there wondering why the hell don't I own more of this company? And I realized that I could have made more and really simplified my life with one great business. Like it doesn't take many great businesses to get to the next levels of wealth. You know, business can be worth 100 million, 500 million. Like they can get very big. And so I would have been better served doing less. And I got it wrong. I thought that I was being I thought I was playing the game at a bit of a higher level. Uh when in actuality, if I just kept it simple, picked one of those businesses or built one one great business, I could have done better than I did spreading my focus uh with less work. I made the same mistake. All right. Yeah. We did we did 24 deals in 24 months and then we consolidated down to five. Yeah. Like you it's it's I mean it's 8020. You're like wow that was dumb. Power law applies basically all rule. It's still rules. Yeah. All right. Let's do the next one. All right. All right. Now I've got Now I've got my my move the benchmark. You just ask it. Whatever. All right. I was going to ask you this one's funny. Should entrepreneurs should successful entrepreneurs get a prenup? Um should's tough as a as a frame if it's your kid? It's my kid. Uh well, if they're my kid, then they're going to have my money. So, yeah, I'd say yeah, get it. I mean, um for me, I I asked Leila. Basically, it's like when you you want to you want to have a prenup in the when you have somebody who doesn't want to sign a prenup. Like that's like that's the only that's the only way I can say it. Yeah, it's actually so like um Leila and I um I thought I was like rich when I met Ila, which I wasn't, but like I thought I was rich. Um and I said, "Will you sign a prenup?" And she was like, "Sure." Like I don't care. I don't want your [ __ ] And so we were on the way to the courthouse to get it the notorized or whatever. And in a dramatic flare, I uh tore I tore it I tore it and threw it out the window. Um because I like it was so not a thing. She was like, "I don't want your [ __ ] Like it's fine." And I believed her and like we've built everything together. So um but I think that is very risky advice. And so I would say the vast majority of people should ab like should strongly consider it. Romantic. I like it. All right. Here we go. I'm going to give you one Okay, I like this question, so I'll do this one. Oh, perfect. Bumped in and out. I know this is an easy one. This is actually not that tough of a question. Um, if you could only follow three people on X, meaning if you had to slim your content diet down, that's a really good bodybuilder mode where it's like chicken and broccoli or whatever, who's your chicken and broccoli of your content diet, people you genuinely you genuinely value what they're putting out there on uh I think maybe Twitter is one of your big platforms on X. It is. I mean, Elon would be one. Um, so I have two more two more people to to to use. Oh. Um, you know, it's weird. I'm actually I totally like use Twitter like a like I just like let it serve me whatever, right? And so I just like love all the threads. Yeah. I just like kind of like just let it feed me whatever. Um I'm trying to think about the other accounts that I would be like, "Oh, I would I'd miss them if I didn't see them." Right. It's actually hard. It feels like a Who are yours? Who are two of yours? Um, Naval would be one. Okay, Naval is a good one. Um, you know, the others I mean I would cheat and be like the news aggregator. So, it's like, oh, at least I get all that, but I wouldn't actually pick that. Um, you know how who I actually think puts really good content? Anker from Carrie. Okay. Yeah, I actually like his stuff a lot. Interesting. Yeah, I like his stuff. That probably my second one. Just very tactical, very Oh, you know what? I love George Mac stuff. Yep. George Mack. Although I' I'd cheat. I'd be like, "Just text me the thing. Just do George." No, George is really good. I actually really like Georgia's stuff. Yeah. Now, as I'm thinking about it, it's like Seah puts good stuff out. Um, obviously Williamson puts good stuff out. So, like, now that I'm I'm thinking through it's like I have like this blank, but no, I like I think George George just has some of the most unique takes and I think that's why I like his stuff a lot. Yeah. All right. Well, thank you for playing. Make it or take it. He took the tough questions. Hot hands. Hard questions. Yeah. The the three, you know, the biggest errors, man. That's a because it's like which ones cost me the most and then which ones did I miss the opportunity the most. So it's like I have it's like I it because like just based on the like I I I thought I've really beat myself up on this. I have missed more $100 million net gains and multiple hundred million dollar net gains than I have made, right? Which makes me really angry. Um but then I thought about it. I was like you always say no to more deals than you say yes to. So, you're always going to miss you're literally going to miss more winners than you have, right? But like, but like every I could tell you all like it's like I say their names before I go to sleep at night. Like I like one of them Stark. Yeah. And some of them I'm like I should like this one was in the like I there's no like there was a gym franchise like buddy of mine. I've known him for years. He's been in the business for 30 years. He finally went on his own to start a franchise. Um and then I I was like we need to do the business this way. And he's like I just I just want to run a fr cuz I was like dude let's just privately own a mall. it's a great model. And I was like, I'll fund the whole expansion. And he's like, I've already sold 40 units. Like I, you know, I want to flip back and and so I ended up like not doing the deal. And he'll exit for probably 120 million. Um, and this is in three years. And I I was going to it was for 50% of the company. And I was just like, he was a friend. It was fitness for I was like, there's I should not have missed this deal. You know what I mean? Uh there was a content creator that I that I love and have followed for more than 10 years. Um talked to them. You know, we had a uh we were going to get a 33% stake in the company. And from the time that I we said no to the deal, I'd say 24 months later, they're now probably $150 million company. And it's just like I have a I have like four or five of these ones that I'm just like I should like that was like that one. I said no because I knew the amount that he he slash they wanted from me was going to be more than I wanted to commit to. Like I could they it was like I think they saw it as like an aqua hire and I was like I'm not going to like I will do this but I'm not going to dive in. I had a moment like this in Silicon Valley. I was Yeah. I thought I was saying my big miss. Yeah. I was like I forget which one it was. Maybe it's like comm or something. I was buddy with Alex and you know he was like raising a probably like a four or$5 million valuation. It's now two billion. Right. So, so I could have easily written a check into com disregarding the fact that at the time I had no money, was not angel invested. Like there's many reasons I missed that in addition to just not thinking it was going to be a winner. Um, but besides that, I I was telling some story about one of these one of these misses and I thought I was like sounding cool cuz I missed it and literally I just got big dogged by this guy at Silicon Valley who was just like he's like, "Okay, welcome to Silicon Valley." He's like, "What are you talking about? Everybody anybody has Yeah. baskets of these. Are you kidding me? You want to start? Like I could How much time you got? Facebook number one Uber first and second round. Exactly. It's like oh I wrote the check. I misid the date. You know how many different versions of this? And he but he said something smart, you know. He was first he was like shut up. Basically he's like shut up. You think this is like a really cool unique story. Yeah. Not only is this not cool and unique, it's actually just a standard cost of entry if you're going to play this game. So like what are you talking about? But the second thing he said was he's like, "I think you're taking the wrong lesson from this cuz I was focusing so much on what I missed out on what the root cause analysis of why didn't I do this?" Oh, okay. And I've actually since then changed this where it's like actually a lot of these misses were like deals I liked, I wanted to do, they wanted to do it. We just didn't chase. There was kind of followup. Yeah. Enough to like make sure a transaction goes through cuz doing a deal takes a sprint at the end. And we actually like operationalized a bunch of those once we once we got over ourselves and the the kind of weird ego of missing. Uh you know life got a lot better for us. But I had to I had to learn that the hard way. But that's that was probably a big one. I um and then a lot of my big misses have been like strategic mess ups. Like one of the big like one of the biggest errors I ever made at gym launch was I started Allen the software company, right? And I should have built a CRM for gyms and that was like I had the right idea. I just What did Allen do if it wasn't? It just it worked leads because the biggest pain point they had was working leads. CRM wasn't a painoint from a monetization perspective. If I had put them all on the platform then I would have had all their metrics. I would have been control revenue. There's so many things I would have been able to do. So use the pain to get them into like the sticky forever product 100%. And so like that was like that was probably a $300 million mess. And so like that sucks. Like I've that that's probably like my biggest strategic miss I've made where I'm like I literally allocated capital to build technology and I built the wrong one, right? Like but I didn't know. I mean, I was 27. You know, on the other side of the coin, what are the biggest hits that have happened post the gym launch and whatever? This building. So, this was like an unexpected like, wow, this was way way more alpha than I would have would have. What do you mean by that? Like the literally the real estate value or you mean the serendipity? No, the fact. So, I bought this building before we did any like it was just like I just wanted a place to have a gym. So, like I was like, I'm going to I'm going to buy a big building. And um Leila was like, "We don't like we're all remote and we have like you know with the on on the just the pure holdco I think at the time we had like 15 employees just on the investment side and I was like and so and so anyways I was like I really want this building because it was the it was old UFC building. It's kind of cool. Um I was like I will figure out a way that it will pay for itself, right? And so the only reason the advisory practice got stood up was because I was like well we have this space. So I was like, let's just I'll make a post to see if anyone wants to come out. And then that's what sprung. It's like there's huge demand for that in person versus remote stuff. And so then it was like great. So we meet all these businesses and we generate cash flow. So it's like both things. But like this for sure like that whole thing would not have happened if we didn't have a building. Like zero chance. I wouldn't have done it cuz I it was just like I have the space. Let's try. I just would never have taken that leap, right? So that was probably a huge like didn't guess it was going to be a win-win. That's probably like the biggest the biggest one that's like that. Plus, I mean, you've got like, you know, Michael and a bunch of other guys who are here all the time now, which I think it was very tempting and very easy to be fully remote. Yeah. And I think remote works. Remote works. But in like the business Olympics, the people who are serious about it, they're going to be together. They're going to be colllocated. Uh, you know, like I paid Diego, I was like, "Move across the country. I'll pay you more. Just live." And like the rule is here's a five minute radius from like, you know, where I live. Yeah. pick a place, you know, that that's the only rule of coming out here because there's, you know, you can't really replace that. Oh, totally. We're 80. So, now we're 80% in person and so I think we're at like 90ish employees, something like that. Um, and so the only thing that we allow as uh remote is infrastructure. So, HR, well, actually HR is here. So, like, but uh finance uh can be remote. Uh certain tech roles can be remote. Um legal can be remote. This has actually become my favorite podcast question. I don't know if you have a good answer to this because I think you're so locked in and focused on what you do, but just what are you what are you like really interested in lately? Like what are you very obsessed with lately that's not your core day-to-day work? Meaning not like a hobby, but just like I'm kind of fascinated by this or just I keep reading about this or I keep wanting to meet people in this doing this thing. What what's that thing? I only have two and they will not be well one's the tright answer which is like I'm reading up on AI just like you are and I spend a ton of hours looking into it. Um the other thing is completely unsurprising is that I'm actually really into gym equipment. Like I I like my Instagram is gym equipment. It's gym equipment. Are we talking like novelty gym equipment or what do we like like kind of like I get all these like your neck cracker machine. It's like commercial like giant industrial. Yeah. Yeah. like like the stuff that you see at gyms like and why are you so interested that what's what's get me interested in it. Well, if you like if you train hard like you start to notice that like some some machines are better than others and like why are they better and then you start looking at like force curves for like okay where does the you know where's the tension the highest and then it's like does it correspond with where hypertrophy is maxed out for like the range of motion for the muscle and like just the like what's the feel of the of the equipment and the range of motion and the adjustability and and like what like what kind of bearings are they like you can get you can go like pretty far into this. Yeah. Um, and so I'll say this. There's a there's this a new thing that came out. It's called the Volultra. I'm not sponsored. Um, by Beyond Power. And I think that I think in I think 10 or 15 years gym equipment will look very different and it has not changed for a very long time. And it's because uh basically magnetic resistance hasn't wasn't a thing and now it is. And so like a vulture for example is it's like a brick. It's literally the size of a brick. It's this big. It can get to 200 pounds of resistance, right? But not only that, you can do single pound increments, which is amazing for strength work because like most people the like side note for anybody, a lot of reasons you get stuck at a at a at a machine or on dumbbells is because the percentage jump is too big. Like girls with dumbbells, it's like the worst. They go from 20 to 25 pounds for a girl, it's a 20% jump in in in in weight. And so they just can't make the jump. They just get stuck. Whereas like the perfect gym would have literally a 100 dumbbells that are one pound, two pound, three pound, four pound all the way up. And then you can make those progressions much easier. So anyways, it goes single pound increments. You can also change the eccentrics. So you can have it be way harder on the way in versus the way out. Uh the next thing is you can change the curve. So you can make it like uh really hard at the front. So for any kind of pulling movement, you want heavier here because you're stronger here, lighter here. On the flip side, if you're doing pushing movements, you want to be lighter here, you know, heavier here. Um and you do that by just telling it the movement. You can change the curve. you can even manually change the curve. Uh, and so because of that, this is the European company by the way. I don't know. I I somebody sent me this. They were like, cuz I was buying the do the Bowlex like adjustable like two dumbbells, but you can do all these weights. And he's like, if you really want to get it, get these. And I probably New Bell. Okay, maybe that was the one. That's probably what it is. But yeah, the the best ones right now are the Rep/Pepin adjustables. They go to 120 and they're all metal. There's no plastic. It was I mean, like I can talk equipment. Um, but that is probably my uh but I I'll circle I'll close the loop on the on the vulture thing. The reason that I think it's so interesting is that like all the selectorized pieces you see stacks of weight, right? You put a pin in it and there's the stack. Those they take up so much room because you have to have room. You have to balance the the piece of equipment from when people are moving it. Um, and the stack takes up a huge amount of space and from a shipping perspective, it's so expensive to ship 400 lb plus the machine, right? And so it takes more square footage, it's more expensive, it has smaller increments, you can't change the strength curve. There's all these reasons. And so they f like the tech is finally there where I think that there will be a next generation of machines where they will only have the electronic. Yeah, exactly. And you just literally plug it into the wall and the thing is the square footage will be smaller, the actual machines will be cheaper because this is Voltra's Gen One. As soon like in five generations, it'll be $200. Right now it's 2,000 for the brick, but it'll be cheaper than weight. As soon as it's cheaper than than mass-based iron physics. Yeah. As soon as it's cheaper than mass based iron, there's there's basically no point to having mass based resistance. So I I get very excited about that stuff because I think it's going to be really cool for gyms because I I mean I obviously come from that space, but the amount of things that you can now be able to do as a gym owner, now I don't own a gym right now. I do own a gym. It's just not commercial. Um, there's so many more things you can do with customers that like your ability to do like true hypertrophy training in a large group setting when you have that type of resistance, it's safer, you can't get hurt on it. Like there's all these things that are beneficial for it. So, I think that that's my that's my 10-year call that people aren't expecting. Uh, I think it'll I think a huge amount will be magnetic. It could be cheaper for gym owners. They don't break as often, incremental, all the reasons I said, and it's less space. Dude, that was a sick answer. That was the one I was like, I don't even know if I'm going to ask him, but I feel like he's feel like he's going to tell me like, I really like writing this book. And I'm like, okay, well, great. That gym equipment. Have you seen my gym? No, I haven't. I'll show you. Okay. Yeah, that's cool. Yeah, you you'll see it and be like, oh, who said you're geeking out on AI? Anything like what's it? You're using it a ton. What do you use it for? Yeah, I use it a lot. Um, I use it. I mean, I feel I I would just say I'm ashamed. I use it all the time and I am ashamed at I'm my use cases. I know I should be using it better, which I think many people feel that way, but I feel like at all levels, everyone feels like they should be using it more. But um yeah, there should be a word for like AI guilt. Yeah, I have this like overwhelming sense of AI guilt. Yeah, I think Elon has AI guilt. You know what I mean? So, uh I would say like I'm the the most interested part that I'm in for like where I'm focused on AI is actually um phones because obviously I come from the sales background and so that use case like I want phone call what do you mean by phone? customer supports like right now we have uh we have fully implemented um AI support and it's crushing it's doing so it's like it's amazing so right now over 90% of all tickets are being resolved entirely with AI which is I mean you have e-commerce multiple right like it's so it's amazing and like the like I'm getting I'm getting these thank you emails like you guys rock like this was two minute response like you guys are on it and like the whole thing's AI right and so I'm like that it's obviously the textbased side is there, but like it's weird because the if you let you do like Grock 4, I'm sure you got the upgrade or whatever. The voice keeps getting better. It's so like I Gro's the one I use for voice. Um, so it's the only one that I do voice stuff with. I do all the other stuff with the other ones. Um, but I'm like why? Like it's so close like the latency is so close that I just I that's the use case that I'm waiting to crack. Like we've been working on one for a year now and the latency but it's it's still like it's it's like not it's not good enough that I'd be like I want to waste money on you know leads for it to call but it's like maybe it's 6 months but that's the one that's the one that I have my most finger like on the pulse. Yeah that's great. Um yeah dude I hired an AI tutor like basically every week because I'm like it t it's a full-time job to keep up with cases etc. So I said I'm gonna sit down. I was like I'm pay $500 an hour. What you're going to do is you're going to come with a list of like blow my mind point.1 blow my mind point 2 but I get to drive. Yeah. Right. Cuz like you you set it all up but then like I get to be caveman. This is how I learn everything. Just so you know like Yeah. This how I learned how to run Facebook ads. I picked I said 15 an hour and I said just explain to me how you're doing this and then I'll learn it. That's how I learned it. Literally coaches are like coaches for adults is like I don't know why there's maybe an embarrassment factor or like a lack of imagination or creativity. Um I think it's just like massively underrated. Highest ROI money. Also like the difference it's just like engineering right like they had like 10x engineers there like average coach a good coach and like the best coaches is these orders of magnitude jumps in how good they are. So the other thing people do get wrong is they just take the first coach that they have versus like be really promiscuous and like you know go date around and like go find a coach that will just like rock your world because whether it's fitness or food or what I have like probably six or seven coaches like in rotation right now in my life for AI or in general. I have AI. No, just general like I have a I have a I got my food girlfriend. She calls me every morning, helps me think about like, okay, how am I going to eat today? Yeah. Uh and helping me like uproot all my bad habits through that. Uh I have my personal trainer who does like a very specific like functional training thing that I I I like and I I do. I got a basketball coach. People like, "Are you going you're not going to the NBA? What are you doing?" It's like, "Well, I love playing basketball. I decided like being better at basketball is not sucking Yeah. Like this is more fun. It's like I can go do cardio or I can have like an NBA trainer train me. It's way better than just doing cardio and you know so why am I why would I not do that? So I just have a bunch. But like it's it's become to the point where it's like comical. It's like I'm just like looking for an excuse like no but what other coaches can I add to my piano teachers everything. I'm such an advocate of this. Um for anyone who if we're still even rolling but um they've all left. Yeah, they all left. Yeah. No, but like um I think the some of the highest ROI money you can spend is oneonone tutoring. like just like like every time I really need to learn something what you said like I just like I will pay you a huge amount of money to just sit with me which by the way is the killer AI use case right so like that's going to be the thing where once we get it I forget what it's called have you heard like the bloom two sigma thing basically there's this long-term studies people want to fix education so rich people fund like how do we do it and then they go do the research and they're basically like the number one way to get like an actual two sigma which is like standard deviation jump in outcome is one-on-one tutoring problem is doesn't scale so they wrote it off. So for the last 30 years, we've just been like, well, we know the thing that works, doesn't really scale, doesn't, you know, can't be affordable. So we'll try all these other things, but it's like, hey, wait a minute. That's now that's now viable. And so let's see what happens. You know, are you in Austin? No, I'm in Bay Area. Alpha School Joe. Yeah. So I talked to I talked to Joe about Alpha School and um I mean the the stuff they're doing is wild. But the issues that they're encountering has nothing to do with education. Yeah. has everything to do with policy, right? Such a pain. But it's like, okay, two hours a day, we're moving at twice the speed. So that's that's so 1/4 the time, twice the speed. They're moving at eight times the speed of a normal school and their scores are top 98 percentile. So it's like eight times the speed and the quality metrics there. And then the other six hours of the days, the kid just learns whatever they like. They code apps, they do public speaking, they do budgeting, they learn all these other life skills. And it's like, God, did you hear did you see that clip by um Alexander um Wang? Hopefully I didn't scale scale guy. Yeah. Yeah. Which clip was it? Well, he's like, I don't want my I don't want a kid until until it's until it's native. And I was like, man, that was one of the more insane statements I've ever heard in in a good like that's the good weird of Silicon Valley is you run into very batshit insane stuff with a straight face and then you're like, wait, am I insane or is he insane? I can't tell. He's he's probably right, but he's crazy. way more context which is what scares it's like when you have one of those it's like well you have to know like if we have the same information you might be crazy by my standards but if I assume that you are intelligent and can make good decisions then it means you know something I don't know and so that's what that's what frightens me from the AI or you have different values but yeah yeah exactly but like Peter Thiel had a great one of the great Peter Tal like sort of insights was when he was went around he was like university is a bubble and he was basically saying like you have to look at university as a bundle education great Sure. 10%. Yeah. You know, babysitting, uh, you know, you know, maturation, maturation of 18 to 22 year olds is what what's there? Social, there's a insurance policy for parents where you're like, I don't know, just go to college cuz you're like, that's what I needed to do for you. And there's like a filtering thing which is like, well, we trust that Harvard filters you, so we Yeah, we'll just trust their filtering process. So like college does all these different jobs. And his take was basically like if you want to disrupt it, you don't just disrupt the whole thing. you have to unbundle the bundle and figure out what to do. And so like I feel like this is just such a common business thing which is like oh healthcare sucks or this sucks. It's like yeah it sucks cool but until you've realized that that thing is actually a bundle uh you really have no shot at like upending it in any way right you got to take one part of that bundle and just 10x that and figure out a way where the other stuff doesn't apply to you because you didn't promise that. And if you could do all that, like it works, you know? Yeah. Like, you know, the way I think about what you do is you're a teacher on YouTube, which is not a surprise to you, but like people think of YouTube as like either a social media, okay, maybe another it's just it's content, it's entertainment, right? But like, dude, I got little kids. Miss Rachel is the best preschool teacher in the world. She has 34 million preschool students who watch her on her app. Great. Like that she is the best teacher. Therefore, she should get this huge outsized number of students. Totally. And like Khan Academy was a great teacher. There's you're a great business teacher. Like I literally look at YouTube like it's a high school. There's just classes to offer. Like I can go to David Shenna and get the history of entrepreneurship. That's a an elective I decide to take. Totally. And like you're basically like business 101 or business whatever, you know, business fundamentals. Um and it's like great. I can go take business fundamentals with my professor, you know, herozi. And like I think when you start to look at YouTube as also a bundle of music and entertainment and education, then you start to think about how I might use it differently than the average person, right? cuz like both you and I probably wish we started on YouTube 10 years earlier. Yeah. Uh and it was the people who saw YouTube as more than what others saw it that actually got that advantage. Yeah. No, I think that's really good. Yeah. I think the it reminds me of the quote that I like a lot which is technology um democratizes consumption and consolidates production. And so it's like which means if you're the best in the world, you get to do it for everybody, right? And so yeah, I actually I think about that a lot when we talk about our channel, which is like how do we how do we just make this the best business content, you know, possible? Um, and that's I mean that's the whole goal. It's like if we just keep doing that then we'll be okay. I think you're doing a pretty damn good job of it. I appreciate it. The hard part is is uh I'm curious how you do this cuz at one point in time I think I even talked about this on the podcast. I was like I think he's great and smart but then the problem with YouTube because the goddamn views are public. Yeah. Is they gave you an outer scorecard to use that may not be the one you want. Right. And it was like I remember once I looked at your channel and it was like if you're broke do this. if you don't have enough money for Chipotle, do this. I was like, dude, he's just going to attract broke people. That's the opposite of what he kind of like wants, you know, or like it's easy to optimize because guess what? There's more broke people who are more desperate that are on YouTube with a bunch of time to kill. You're going to get 2 million views on the broke guy video, but like I'm never going to click that and you probably want some people like me clicking some of your content. Totally. And so, like, I think that's the challenge with YouTube overall is like if you take their metrics Yeah. as your metrics, you might have a big problem. It's 100%. It's uh so yeah, it's it's a thousand% a problem. Um and we it's like we just we put as many controls in place as we can and it's still tough. And so right now here's where it gets like let's let's peel a layer back. Yeah. So where it gets really interesting is that if I make six videos, this is our actual cadence. Five of them I want to be business first, business deep, whatever we want to call it. And then one out of six I say I'm okay to just like make it wide, brutally honest truth about whatever. Right? that one video will get more views than the other five together. And so then how much does that actually weight the brand? So even if I actually think about my production versus consumption, right? So if I actually put my inputs like I might have a 50% philosophy brand and 50% or you know motivation whatever you want to call it right like mindset etc. and then 50% businessy e but in terms of my production it's 90% of my time is business. It just like doesn't get the reach. And so it's actually one of the things that frustrates me in some ways because like if I like if I get stopped on the street I'm always curious like what was the you know what was the thing and so but like business owners for me cuz like I see the people walk in the door and you have to be at a certain level to walk in the door anyways is like they are more more listening and reading uh in general and like we have the we have a whole series we do called cash cows which is kind of like what we did with the hormonia hotline but I have them in person and then I do the whole the whole thing and it's like an hour and those ones right now average like 150,000 maybe 200,000 views per video but like a brutally honest million like it's just like I could do like we could we could do right now and like I know what like I know exactly what we're going to say and but the but when I ask who here likes those who shows up they're like please keep making those and so I have I keep asking them just because I need the reinforcement of course no because you need an inner scorecard I need something the outer scorecard is only going to tell you one thing so you have to like instrument like an antenna yourself to get the signal that you're actually looking for in a way that's not necessarily biased, but if I don't put up an antenna, there is no generic antenna for this, you know, like also a little a little tiny thing um that maybe may maybe helpful useful, but um we actually just this quarter switched our metric. So, we used views as basically the way that I did it before was like we will make content about these topics and then as long as they're within these topics, then we'll maximize views. So, that's the that's the constraint and then maximize within that constraint. We have now switched to subscriber count uh subscriber growth even though subscribers matter zero right it's just yeah it doesn't matter for distribution but it's a great loyalty exactly it's a quality score of like I thought this was valuable enough that so now I can still do the same constraints on um on the content but then use the subscriber because that gives us the because subscriber still has baked into it some element of reach but if you if I make a brutally honest video I'm not going to get the same amount of subscribers I am as like 13 years of business advice like one of my best videos ever That's but hardcore business. Yeah. So anyway, just something that we've switched to just this quarter. I um I have I can't figure So I I I basically figured out what do I want which I can't measure. So first was what do I want? I was basically like I created a like you know you know in popularity they have the Q score. Okay. So I basically was like give me the zcore. What's the zcore? The zcore for me is a trust score. So I was like, "All right, probably should have been a T-core think about it." But it was the Zcore, which is basically I realized that all content, what you actually want is number of people reached times the quality of the person reached. Sure. Times the depth of their trust in you. Sure. And basically that's the equation you ultimately care about. So like you can reach a lot of people on TikTok, but if they're just like, you know, if they're not the people you're trying to do to attract. Yeah. Yeah. Exactly. You know, it's you have to discount factor because you're not your second variable is not very good. And then the third which is like how much do they actually trust you? Not like they watch that piece of content or they like that thing or they hate watched it and you're like yeah I got views but like actually they're like this guy's an idiot or like you know I hate this guy right? So that's that's what I wish existed now that's never going to exist. So I had to back channel it and basically a shame metric. So I said if uh if I make a thing do I want to go put it in my favorite group chats. me myself being like, I made this, guys. There's a lot of [ __ ] I make that can get that's popular that I would be I would cringe putting it there. Yeah. Because they'd be like, bro, what the [ __ ] is this? We don't we don't need this or care about this. Like, what is this for? Why did you put this here? Versus other things like I did this one thing that went nowhere vir virally. I did this like I spent like two months just studying the process of creativity. Yeah. I really realized with AI is like productivity values going down and creativity values going up. So, I was like, how do the most creative people in the world work? I've studied Elon and all those guys, but I actually have no idea how, you know, and all these other guys how they operate. So, I studied that. I put it together and I put it out there again went nowhere kaput. But I've like internalized these lessons deeply, so it was still a win. But that was the one where if I put it in my group chats, yeah, my most successful peers were actually like, dude, this is actually sick. Like, I actually have I didn't know this. I took this. I needed this, blah, blah, blah. So, I've had to use basically like my own cringe factor of like, do I want to put this in there or would I feel like kind of stupid doing that? Would I would I feel like I need to soften it with some context and some excuses uh to put it in? Yeah, that's um I think I mean I think what you hit on is like such a painful part of of creating content is that the entire the reinforcement system leads you away from the actual business goal. I mean if you if you do this for business which I do like it leads you away from your business goal which makes it very you just have to have a lot of discipline of like this is the stuff I'm going to make and it will underperform and that is okay and it gets harder when you when you get when you know how to make the stuff that really hits from a views and all that stuff perspective the more you know. Yeah. Yeah. I mean but you know I mean this has been it's probably one of the largest focal points that we have uh as for our brand and I I feel like it's an accordion. It's like, you know, if we we do just hardcore hardcore business content. Um, and then we'll be like, "All right, let's let's make a little bit of personality stuff. Let's show a little bit." And then it's like, "Oh, that did great." And we're like, "Yeah." Then we're like, "Oh, [ __ ] We're way too wide." And then like, so I think we just kind of oscillate. One thing I wish you did more of, just my personal request, was uh, you did something is like a short or something. I don't know who made this. Somebody in this room might have made this, but it was like you were just talking about your the gear you wear. You're talking about your shoes, right? And I bought those shorts and and so yeah. Yeah, you called it your Darwin outfit. You're like, I can wear this in the rain and in the pool and then I can get out of the pool, go to a restaurant. It works. I can go for a hike tomorrow. And um you know, I think that's great because first of all, it first of all, it didn't feel like I'm trying to be the Kardashian. So, it didn't feel like you were trying to show me something. It was just like, oh, you want to know like something I do in my life? Here's something I do in my life. Yeah. Um what I thought was interesting about that was a it was a good find. You'd actually put real like your own nerdiness into like doing something for your own lifestyle. So, it was like it meant something. Uh but B every time I wear those shoes I think of you and there's something to physical anchors in a digital world that like actually matters. I'm a huge believer in that side note like hugely. So I think this is like a little sauce there and I think the other part of it was um I so my I like made a a mission for the year like a masogi for the year and like I thought it was like it should have been about you know business or like getting in great shape or whatever but when it was like oh I know what I want to do I I was like I want to learn to jam out on the piano. I was like, and so I just made that my mission and I took it like incredibly seriously and like had a great time doing it. And so just yesterday I just turn on I just turned on a live stream on Twitter. I was like I think they have this feature. I just live stream myself doing like a piano practice. Not even like a performance. I was just like [ __ ] around like trying to learn these songs. I'm not good. I've been doing it six months. Dude, I got so many DMs from like again the same thing like the people who I don't want to send my content to cuz I'm like you're a billionaire. What are you how to get rich, you know, from a guy 10 times less rich than you. But I got them being like dude I've been wanting to practice. I love I love how you made time for this. Is that what did you which one did you get? What room is that? Who's that teacher? How'd you find her? Do you think a teacher is better than the apps? And I got so many of those that was like there's something to the lifestyle content when it's really like I could talk about gym equipment for example. Like you can probably see that I like I'll light up when I talk about it. Exactly. It if it if it genuinely lights you up and it shows it's like for other successful people who I don't like I've read all the books now. I don't really need a lot of like how to grow my business. I'm actually pretty good at that. Sure. And so like one cool way I thought your lifestyle stuff worked was it attracted me to that where I probably wouldn't watch like 10 of the other videos but that one I was like kind of interested in from a different angle and I think you you kind of turned the spigot off on that I noticed. Uh but like my personal request is give me 10% of that back. Yeah. So this is the the dichotomy that has to be managed which is the the the thumbrint of the creator in my opinion should be the representation of their current life which means it can change right and so it's like I spend maybe it's like 10% of my time is fitnessoriented and so like maybe 10% of my content should be fitness oriented and then probably 80% of my time is businessoriented then maybe 10% of my time is philosophical and maybe five and this is now 105 but uh is is relationship whatever right and so it's like that that's my mix and maybe in a different season it'll change And so the content should be I was think was like should be glass. It should be like when someone meets me it's exactly as they expected. The only thing that [ __ ] that whole thing up is the algorithm. Yeah. Because I can absolutely make that that that thumbrint. It's just that this one will get 10 times the views. And so then if you're trying to manage the mosaic of your brand with all the little all the little shorts as tiny little squares. It's just that you can't control how big the square is in the middle of the [ __ ] face that you're trying to build. So that makes sense. But that's what I'm saying. Like those that thing about your shoes didn't get a lot of views, but it made an imprint on me. And I would say like I would carry more weight than like say a thousand random views. Tim Ferris said this once. He's like, "Do I want 10,000 random people selected at random somewhere in the world to like my stuff or half of Davos to be like to really respect what I do?" He's like, "One's a big number, one's big, one's big value, right? Like which one do I want?" I think there's something similar there. And also like you know you were talking about like they have different wallets or different stomachs. Totally. Yeah. It's like I only have a certain wallet or stomach for like educational business content. Me reminding myself I need to do more at work, right? But I actually have other wallet share to give you. Interesting. On another area, my fitness wallet share. You could get some of that. You could get some of my outfit wallet share or my relationship wallet share as an entrepreneur dealing with, you know, busy relationships, right? Like, so think of it maybe with your own analogy. Yeah. No, I really like that. That's a I mean, it's always I we need to be reminded more than we need to be taught. Yeah, I'm with it, dude. All right, we should we should cut. Appreciate you. Thanks for Thanks for having Thanks, dudes. [Music]