Your Business Is NOT What You Think It Is

Summary

• Most businesses are stuck because they're working on the wrong things.

• What got you to a certain level won't get you to the next; you have to solve harder problems.

• In the gym business, I realized it's about sales and marketing, not just fitness and results.

• Low-cost gyms still have high churn rates, proving marketing's importance over pricing.

• My supplement business taught me that it's about brand, media, and distribution, not just the product.

• When I started my software company, I learned that the product must deliver on promises, not just marketing and sales.

• Outsourcing development can be risky without technical proficiency on your team.

• Businesses like cleaning aren't about marketing and sales but about recruiting reliable talent.

• In consulting, law, or professional services, it's all about recruiting, training, and retaining top talent.

• Investing has taught me to say no more often and focus on fewer high-impact deals for better returns.

• Talk to people in a new market to learn the real hard parts of their business.

• Analyze if the foundational assumptions of your business are true before deciding to push or pivot.

• For Consumer Packaged Goods, focus on how many people repurchase the product.

• If something works easily and makes money, go hard on it; if it’s hard and unprofitable, go easy.

• Real estate development is scalable; property development can be scaled by adding more resources.

• Businesses can reach a billion dollars with the right time and effort.

• Focus on solving big, hairy problems and stick with it, rather than getting distracted by easier, seemingly better opportunities.

• Evaluate business problems from a first principles perspective to decide if you should push or pivot.

• Be wary of recurring pitfalls like jumping from one business to the next instead of solving deeper issues in your current one.

• Embrace trial and error as a necessary part of business growth and learning.

Video

How To Take Action

I would suggest starting by really understanding the business you are in. Many businesses get stuck because they focus on the wrong things. So, first, identify the core problem you're solving and make sure it's the right one.

Low-cost, high-value steps you can take:

1. Analyze Your Current Focus:

   • Look at your business and ask, “What’s the real problem I’m solving?” Make sure it’s aligned with what drives revenue. For instance, in a gym business, it might be more about sales and marketing than fitness results.

2. Talk to Experts:

   • If you’re considering entering a new market, talk to people already in that market. Ask them about the hardest parts of their business to get a realistic picture.

3. Simplify and Specialize:

   • Take a good look at your processes and strip them down to the basics. For example, if you are running a cleaning service, focus on recruiting and retaining reliable talent instead of expending resources on marketing strategies.

4. Evaluate Foundational Assumptions:

   • Before deciding to push or pivot, ensure your business assumptions are correct. If something’s not working, validate if the core assumption is true.

5. Capitalize on Low-Hanging Fruit:

   • If something you’re doing is working well and making money easily, then push hard on it. For example, if a particular marketing strategy is effective, double down on it.

6. Embrace and Learn from Trial and Error:

   • Don’t be afraid to try new strategies and learn from the failures. Each failure is a step toward understanding what works.

7. Recruiting and Training:

   • For businesses that rely on talent (like consulting or cleaning services), focus heavily on recruiting, training, and retaining top talent. Develop a solid training program to ensure consistency and quality.

Key Lessons:

• Remember, what got you to your current level won’t get you to the next. You need to solve harder problems to grow.
• Don’t get blindsided by seemingly better opportunities. The biggest opportunity is likely the one you're already facing.
• Ensure your product or service delivers on its promises effectively. Otherwise, even the best marketing won’t save it.

By focusing on these core areas and implementing these low-cost, high-value strategies, you can move toward sustained growth and success.

Quotes

"The vast majority of businesses are stuck because they're working on the wrong stuff"

– Alex Hormozi

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"The biggest opportunity is the one that's in front of you"

– Alex Hormozi

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"What got you from 0 to a million or 1 to 10 million isn't what's going to get you from 10 to 30"

– Alex Hormozi

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"Every business has a big hairy problem"

– Alex Hormozi

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"There's a much harder problem in front of you that you have to confront"

– Alex Hormozi