Alex Hormozi on Why Most Entrepreneurs Never Reach the Next Level!

Key Takeaway

Audit your calendar today and protect your highest-cognitive-energy window for the work that creates future leverage—not rituals, inboxes, or routine meetings. Compress the time between waking and starting meaningful work, then use that block to identify your business’s current constraint: demand, conversion, or delivery. Instead of adding more tasks or AI tools, remove low-value initiatives and make one targeted bet that relieves the real bottleneck.

Episode Overview

Ed Mylett talks with entrepreneur Alex Hormozi about building sustained entrepreneurial capacity through unconditional effort, focused resource allocation, and calculated risk-taking. Hormozi explains why routines should be optional rather than crutches, why many businesses stall at $1–3 million, and how pattern recognition turns repeated failures into an ability to assemble businesses faster.

Full Transcript

Transcript of Alex Hormozi on Why Most Entrepreneurs Never Reach the Next Level! from The Ed Mylett Show. Auto-generated from episode audio; may contain minor errors.

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I wish I spent more time with. I think he's one of the great American entrepreneurs. Actually, worldwide entrepreneurs. I told him this privately in a conversation, I don't know, about six, eight weeks ago. I think he's the best in the world at teaching people how to be better business people and better marketers. I think he's number one in the world. And I say that as somebody who does it myself. So I have a great deal of admiration for him. Most importantly, his brain is huge, but his heart is bigger.

That's the one thing I think most people online would not know about this young man. He's got a heart of gold. He's a kind person. He's a humble person. And he still is curious and still wants to learn. He still actually asks for advice from time to time. And so you're going to get his advice today on the Ed Milet Show with the great Alex Armosi. Welcome back. Thank you for having me. And my only goal in this podcast is to live up to that introduction.

You'll do great. So you've got a lot going on in your life. Congratulations on the potential, the soon-coming fatherhood for you. Yeah. Has it changed you at all? Just the thought of it, just knowing it's coming? I'd say the thought has changed my life maybe in two ways. One is that I'm actively really trying to get ahead on education for my son and thinking what inroads do I need to do so that I can set him up education-wise because I don't like the system, obviously. I'd say that's one.

I'd say two is that I feel like I've had a little bit of a shift in terms of up to this point, I've just only had, I would say I have had reverence for the game, and that is why I continue to play it. But I've had a weird shift where I was like, oh, I guess I am going to leave this to someone because until this point, it was just I'm going to write it to charity in one check and let it go to like the Acumen Fund or some of these really good institutions that know how to deploy capital in a charitable way because I was just like, this was just chips to play the game.

But so that's, I would say those are the two things that have changed in terms of like what new weights are weighting my decision-making? Those are those two. I'm more likely to respond to a student outreach, you know, like something student-related. But beyond that, in terms of my like internal stuff, I'm here to support Layla and I expect the emotionality of it will probably come when he's born. Yeah, but I know, you and I have had enough conversations. I think it's more than that with you.

I think it's changed your overall look on everything. I mean, you've asked me a few questions in different ways. But you appear to, at least to me, it seems to have almost, I don't know, broadened your perspective, made it bigger. In what way? Like if we're using my terminology, because I think it's important. You have a lot of young people that follow your content. You have a lot of people that follow your content. But a lot of them are guys like me when I was coming up, guys like you when you're coming up, and they're not at this stage of their life yet.

I wonder, knowing what you know now about you're going to be a dad, would it have changed anything you were doing or thinking prior? Layla and I are really serious about having kids when I was 28. And we were like really going to do it. And then we were like, you know what, let's not. But there was like, you know, a few-month period where we were like, let's do this. And I think that we could have like, again, I can't replay life, but like I think me doing it at that point when I was 28 and she was 25 might have been, like that would have been good.

It probably would have been easier to have more kids. Because I think Layla and I are very all or nothing. And so as soon as we found out that she was pregnant with our son, we were like, well, I guess we're going to have a lot more than one, or at least that's the goal. So it's either like none or have a soccer team. And we have settled on Edward. That is his name, right? One of the great names. I've got to tell you, when he told me about the blessing, I think you would agree.

I was almost as excited as if my own son, and the reason is, I just want to tell you, and then we'll get into content that everybody wants. I've long thought you'd be a great father. And I told you that. I told you that before this happened. So I'm just really happy for you. I just want you to know that. And I'll just say that for people who, I mean, everyone who listens to this already knows you, but like Ed's even better in private than he is on these podcasts.

And it's one of the rare gifts. I think I had someone ask me like, hey, what are the people of all the people that you've met that were, you know, different in person versus their content? And I was like, Ed, for sure. And they were like, oh, and I was like, no, he's just way better. Oh, thank you. And yeah, it's just like, there are very few people that I, that I like if I was like having something that was kind of complex, like you have this very great depth of understanding from both, like you have the business acumen, you have this great balance of humility without having any judgment.

And I think that's super rare. Thank you. So do you, by the way, it's what I admire about you. We both at our stages are important people to know. We're both still curious. We still both want to learn. You're the smartest guy in the room most of the time, but you don't ever act like it. And that's one of the things that I really love about you. You've made me think about my own content. So I want to go into some stuff. I want to ask you about some stuff.

You've challenged my own thinking. So I was probably one of the early on way back in the day, morning routine, evening routine, guys, creating structure. I probably made it sound as if I was a little bit more dialed in than I really was on in a given day. You know, content can come across that way. But you've sort of taken a different perspective on it. And frankly, you've persuaded me you're probably more right than I was. And so I've actually not really gone back to the old way that I teach this stuff.

Meaning, I think there's a lot of things that are ritualistic we do that are just time fillers now that are wasting time. So share with the audience kind of your view on morning routines and what really matters to get a day started and a business going. I basically see the time that you wake up, after any period of sleep, even if you take a nap, right afterwards is where your processing power is going to be the best. And so the morning typically is where you're going to have the best thinking.

If you can use the morning, ideally. Some people can't get the time, fine, you can do late at night, it's okay. But because of that, my goal is to compress the time from when I wake up to when I begin working as fast to as little as possible. And so for me, it's basically wake up, stimulate, caffeine, nicotine 8, protein 8, creatine 8, do all my stuff, and then just basically go right into it. I think some people having maybe a 10 minute meditation or something like that because it calms their emotionality to attack the thing, that's fine.

I think anything much longer than that. For example, I love training. But when I'm trying to be my most productive, I train at the end of the day. You do? Yeah. Because my brain is exhausted but my body is still fresh. But if I train the way I want to train, which is 2 hours, I'm using the first 2 hours of my day on training. If I'm not in a go-go season, which happens plenty, I'll train first. Because I'll use all my juice there. But I'm definitely more fatigued because I train pretty hard.

Yeah, I'm assuming. Let's talk about this for a minute. I think it's a little bit of, and debate this with me a little bit. One, my routines were too long. You're right. It was an hour and a half or 2 hours of stuff to just get going. Frankly, as I step away from it, I don't even believe any of that in real life. You don't have to be perfectly prepared to do anything. In fact, you're never going to be. Some people, you don't think it's more like know thyself?

The most successful high performers I know know their peak cognitive time of the day. Are you saying that you think for everybody it's their morning? Because for me, I'm with you. I'm probably best, not 5 a.m. morning, but I'm probably best, my best meeting should be taken, hardest meeting should be taken between 9 and noon for me. The base is 10 a.m. meeting. Yeah, that. But do you think that it's more, if you're giving advice to somebody, it's become self-aware of when your cognitive peak is?

Yeah, I think there's the population versus n equals 1. I think population-wise, most people in there, the freshest is after they wake up. Now, I'm not saying you get shook out of bed now writing an essay. That's not what I'm saying. But 30 an hour, once your cortisol comes up and you're alert, usually at that point, you're freshest. Now, n equals 1, everyone's different. And so if you had a scatter plot of humans, it's like in general, that is where it is going to be. If you don't know where to start, where you can be more productive, start in the morning.

If you're like, I for sure am a night owl, then be a night owl. I have no dog in this fight. Right, agreed. I think the only thing that I would say that I am adamant about that I would, what sword would I actually fall on is that I would never want my routine to become a crutch in that if I didn't have it, it would make me less capable. And so it has to be something that I can win without it. But if it's there, it's additive.

So it's a preference, not a requirement. And so I think one of my favorite lines in Invictus, which is like this weird movie with Morgan Freeman, he's talking to Matt Damon, who's the lead South African player. They have some exchange, and he says, you know, I wish we could have played better this year, but we weren't 100%. And Morgan Freeman, who's supposed to be Nelson Mandela, says, no one's ever 100%. And it was this really great exchange that I've always thought a lot about, which is like a lot of champions and winners win despite imperfect conditions, not in the pursuit or effort of creating perfect conditions.

I want to talk about that. By the way, into something ironic, my drive over here with my Uber guy, I can't say why, but I had a release engagement with Morgan Freeman. I spent the last 40 minutes driving over here talking about Morgan Freeman of all human beings, and now you bring up that name in the interview. I want to talk about effort and conditions. Here's the thing I think that you have. I want you to discuss this with everybody. I think for most people effort is conditional.

Like when I'm working with athletes, you know, I'll go to these college football teams or these professional teams, and if the guy's starting, and he's first string, and it's, you know, 10 to 7 in the fourth quarter, you're getting 100% max effort from that person. But if he's second or third string in practice on Thursday, he knows he's not going to play in the game, or it's 21 to nothing, effort changes for most people based on conditions. And I think someone like yourself who's had long-term success, you've made effort unconditional, meaning regardless of the conditions, winning, losing, pregnant, not pregnant, an exit, a deal that falls apart, effort is not based on conditions or even how the people around you are behaving.

Do you believe that that's a key? A thousand percent. Yeah. For two reasons, and I think the second you'll appreciate more. So I'll actually start with that one. If you were somebody who starts to win, right, so this is maybe only talking to the 10% or 5% of people who are listening to this, you can't make your effort conditional on winning anymore because winning the bar is too low. Because starting to outcompete other people who aren't as prepared, who didn't realize how much effort you were going to put in ahead of time, you actually end up sacrificing your potential in just trying to beat them rather than saying like, and this is why I love Andy's, Andy Frisella's 100 to 0, that leave no doubt.

So it's like we have to only be playing against ourselves, especially once you get past a certain level. What a great point. And so I'll say that as like thing one. I'd say the second part is that I think I had a year off when we sold the company and going through that whole process, and it was one of the most miserable of my life. And I derived from that period this concept or this mantra of work is the goal. And it was the idea that a lot of times even hear the coaches say, hey, work super hard, the score takes care of itself.

But even adding on the score takes care of itself still makes the score the objective or the goal. If we could just say work as hard as you can, period. And I would judge you by how hard you worked relative to how hard you could work. And what's difficult about that is that the only person who actually knows how hard you can work is you. And so that is both gratifying and also terrifying because you can win in the world's eyes and still lose in your own if you use that as your metric.

Yes. Wow. Very good. What was interesting about the – so we did this book launch in August of last year. I heard you made a little money on that. It worked out. You made $100 million. So the whole idea was – the record was Prince Harry's record, which was 1.4 million copies sold in 24 hours, which is roughly like $43 million in 24 hours. And so we ended up breaking the record within the first three hours or something like that. That's crazy. But we still had 21 more hours.

And so this is the 100 to 0 concept of like, well, we're not going to stop now. Let's run up the score. And I think my team was even surprised when I took a water break seven, eight hours in. And they were like, okay, so what are we going to do now? I was like, we're going to keep going. And I had almost no celebration. Yes. But part of it was because I was like, I'm not going to waste this. We put all of this time, we gathered all of this attention, and we're going to deliver as much value as we possibly can during this period of time.

And then we're going to go for 100. So it wasn't even like, don't beat it. Yes. Put a whole new marker for what you think is possible. And we had done the math, or I had done the math prior to, which is why the $100 million launch was the idea. But it was like, I think we can do this. And so that becomes the standard rather than the world standard of just winning. You know, first of all, this is why I love talking to you because you make me think.

But I want to stay on this just for a second. First off, we've unpacked two gigantic lessons. One is how to prepare for your day and when to take your best meetings and to be self-aware. The second one is this idea of unconditional effort. But when you're saying something, are you like this too? I have actually not really celebrated, nor have I enjoyed, what I think the world would think are really normal, big life events, like the day of an exit or like the day you had the $100 million day.

Yet on the other hand, I've had massive personal celebrations on days where I have no pun intended, but like maxed out. out my potential possible effort in a given day. Meaning almost, this is really counterintuitive for most people, but so important, because this isn't on social media, it's not on most podcasts. I don't think I've mentally the last year played like a results game, even though I am outcome-focused. I am much more process and or effort-focused, and I celebrate to the extent that I'm capable of doing that.

The max effort day is not the actual result day. And by the way, my celebrations are pretty weak and suck, too. We both have had this. We both have this, privately, right? But share your thoughts on that. When I looked back on that year, where I was like, what are the happiest days of my life? Because when you have your monetary itch scratched, you're like, okay, well, what am I doing, what are the rest of my innings for? I had this great piece of advice from a mentor who told me, after I had this particularly good weekend, and I was in a good mood, and she said, you're in a good mood, and I said, yeah, you know, I've had a couple good days, and she said, I'm pretty sure the secret to life is to stream as many days in a row like that as you can.

And it was one of those very tactical pieces of advice that I've actually taken with me forever, which is, so when I looked back on my whole year, I was like, okay, what were the top 10 days of this year? And I started thinking through them, and I had this written on my wall, which is, there's like two things written on my wall, three, that are my constant reminders. One is focus is subtraction. The second is my good day formula, which is work out with people you like, eat with people you like, and write something.

And so if I can do those things, because when I looked back at my days, when I did those three things, those are my best days. And so I was like, how can I do that as much as I possibly can and organize my day to do that? But that last one, which I would say is not on that list, but is probably the result of the list, is to have nothing in the tank. It's like when I've earned my shower, when I feel like I have nothing left to give, and I would say that like, if you think of a day as a microcosm of your life, it's like I would like to end this life, being like, I left it all on the field.

Emptied the tank completely. I left it all on the field. There was no one who's like, he could have done more. It's like a motherfucker just squeezed from places we didn't know existed. That's what I would like every day to be. And of course, it's an ideal. It's not something I hit every day, but I strive to. So do I. It's funny, because you reach levels of capacity and talent or what people think are skill, at least me, through doing that. So ironically, then people look at you and think, man, this guy's so skilled as an entrepreneur, or what a great speech maker.

But it's actually happened through emptying the tank all of these days. How do you navigate, because if we're not careful, you and I fall into this trap of the people that you also hear on social media that you and I privately discuss sometimes too. Like, I can't believe, with no offense, why someone's listening to this person if they've actually never produced anything. But I've also, I also don't want to fall into this, you'd call it like bro culture, hustle culture notion of like the funny clip of me saying I work a million hours a day and I can change time and caveman lived a million years ago, or whatever.

Was a little misspeaking there. However, what I don't want to sound like is like that there's no meaning in other things, and that rest is not also okay. So I just want to give you a forum so that people don't think that of you also. Like, what are your philosophies about rest or recuperation or reflection? Because for me, a lot of times these big efforts I make, a lot of the growth actually happens in reflecting on what took place and what I learned from it. And you do do that more than most people know.

Totally. So tactically, if you were to look at my calendar, my five days out of seven have almost nothing on it. I do one day, I do a half day of meetings on one day, and then I do one filming day a week, so today was my filming day. And then if you include the weekends, those two days, I have three during the week and then two weekend days that are almost always completely empty. Interesting, okay. And so that is how I work most effectively. And it's because I think that two weeks ago, I could not know what was going to be most important today.

But today, I will be able to do that. And so I have faith that I can pull things together. Like, I put together this deal on a Sunday, once after like, yeah, I'm sure you've had one of these days where somebody calls you and you're like, oh, I think I can put this together. And it was six straight hours of calls, and we ended up putting almost a $400 million stock deal together. But it was just like, but if I had had appointments all day, I would have missed that and that wouldn't have happened.

So there's just huge value to that. So that's like thing one in terms of organizing time and trying to create space, and that's just how I function. The second is, I think it's extending the time horizon in terms of what we're thinking about output. So if you, whenever you shrink the time horizon, then it always creates a false narrative of extremism. And so for example, if I said, if you're gonna die tomorrow, you change your behavior a lot today. But if I say you're gonna die in a week, you change it for sure a lot, but it would be slightly different.

If I said you're gonna die in a month, it would still be different. Die in a year, it's for sure gonna be different. And then beyond that, it's too far for human consciousness in reality. And so as a result, it's like, we have to think, how do I maximize my output over a year or two years or five years or 10 years? And so if we take, let's say even a 10 year horizon, then for sure we need to rest. Because it's like if I worked out every hour of every day, you're not gonna get stronger, you're just gonna break down your muscles too much and you're just gonna look terrible and be exhausted and overtrained, right?

There obviously has to be some recuperation that exists. And so it's about maximizing output of unit of time total. But if I only had 24 hours, then yeah, take as many stimulants as you can because you only have 24 hours to work. But that's not how the world works. You have, and for the games that we're trying to play, decade plus, it's like not only that, you actually have to be aligned from a meaning and purpose perspective because we assume that we're going to win to a certain degree.

So it's like we have to find ways to make it worth it and also not sacrifice the other reinforcers that we have in our life, like family, wife, kids, whatever. And so I think it's navigating, how do I have the highest output over the longest period of time, which allows for a much more, I'll call it balanced with quotes approach. But it still comes into seasons. And I think again, when we think in this longer term, how you work in your 20s is gonna look very different than how you work in your 40s.

I agree. So would you say that that schedule you're running now with those open days, you more almost had to adjust to your current circumstance, but if it was startup Alex or Mosey in the gym, you're probably. Oh, all day. My startup schedule, I'll tell you what it was, because I still remember it. So basically I take my, I did, hold on. But I did split it into thirds, kind of like you did. And so I bake it into, I would do all my innovation stuff first, because that's when I was freshest.

So I would work until like from four to 10-ish. So I got six-ish hours. And then at that point, I'd have customers and the fires of the day would happen. I would spend the middle of the day on promotion and sales. So I basically do marketing and meeting with sales, customers to try and sell them our stuff. And then the back end of the day was all the admin stuff. So that was billing and finance and fixing broken equipment and all that stuff. But I slept at the gym.

But it was basically, if you think about it from a pure big perspective, you've got attraction, you've got conversion, you've got delivery. That's kind of like how you're breaking down the business. And I just would say that that has to happen throughout the day, but you have to take some block every day, at least for me, that's working on it rather than in it. How do I build the assets that can replicate a trainer, replicate the front desk girl, replicate the sales process, whatever. But yeah, that was 12 hours a day, six days a week.

I've been able to do 12 hours a day, six days a week, taking one day off as like, I can do that for a very, very long time. I'm also not saying that's right for everyone, but I can do that. But I have to say, and by the way, I'm not saying that's right for everyone either, but that's exactly what I did. That's exactly what Andy did. The three of us have in common. You slept in the gym, he slept in the store, and I slept in the office.

I'm not saying you gotta sleep in your building either. But, and the idea of this time thing, poorly chosen words in some of these clips, but you're really compressing time, meaning you're trying to do things that most people think take two hours in 30 minutes, if you can. Not all meetings need to be an hour. And that's why having a day broken up matters. Now, this episode is sponsored by Rowe. A lot of people assume GLP-1's cost a fortune, and that assumption keeps them from even looking into treatment.

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I want you to help me understand your view on it, okay? And it's this. I think most entrepreneurs, I am, as a human, I have become a control freak, meaning I try to control about, you're better at this than me of separating from tasks and trusting people you have to handle things. I'm still not great at that. I think I'd be. Because you're so good. Well, thank you. I think, though, I think potentially I'd have been a wealthier man had I given a little bit more autonomy to people.

I think I squeezed them a little bit when I was younger. But because I am a control freak, so it's this interesting dance I've had my entire career, and even to this day, of I'm a control freak, yet I know the key to my progression, my growth, my expansion as a person and as an entrepreneur is my capacity to deal with uncertainty simultaneously. So how do you navigate that, wanting to control an outcome, yet I want you to discuss the concept of your ability to be out of control, theoretically, and deal with a massive amount of uncertainty more than most people think they can handle?

So I think there's two parts to this, at least that I think of immediately. So the first is one of my favorite, and I think underrated quotes as an entrepreneur from Jack Dorsey. He said, perfect all the details, limit the number of details. And so I think that is, in a sentence, so elegant for, I think it's, I actually am a control freak at the thing that I think has the absolute greatest point of leverage in the business. And so I keep that flexibility in my schedule so that I can go full in and attack, three levels down, seven levels down in the company, and be like, okay, what are we doing here?

Show me the text that we're sending for this very particular campaign, and then I can scoop back out and then go somewhere else. So I would say that from the maniacal control, I think Elon's been an example of like he kind of has, he's delegated everything and also nothing, but I think his perspective is, he's always attacking the rate limiter, that's the verb that he uses, I use constraint, but whatever, it's the same idea. Like there's a bottleneck somewhere, there always is one, and I think your ability to identify where the bottleneck is is in some way predicated on your ability to recognize patterns and your skills as an entrepreneur.

But if we think about entrepreneurship in general as our, we are allocators of resources, and so we have limited resource, extremely limited when you compare it to the resources of the world, time, money, energy, the limited attention of the team. We have this tiny little reservoir of resources, and all we have to do is we have to just continue to get higher returns than everyone else does on this tiny bit of resources, just for the most part, why the second thing on my wall is focus subtraction, is how do I subtract, what can I cut away, what can I prune from this tree in order to keep it growing?

Because left unchecked, everything becomes weeds, everything becomes cancerous, everything overgrows because people want to take on more stuff, and I think that success of entrepreneurship has three traits that are completely anti-human. It's something I've been thinking a lot about recently, which is one, we like new shit. Sorry, you don't cut us here. We like new stuff. Number two, we like stuff now. And number three, we want things easy, and low energy. And it is the exact opposite of what it takes to be successful as an entrepreneur, because instead of wanting new stuff, you have to be willing to do the old stuff for a long time.

Over and over and over. And instead of, so it's basically focus, one thing, patience for a long time, and then frustration tolerance, which is that if at first you don't succeed, you try again. And if at first you don't succeed a hundred times, you try again, which is why I love the one more mantra. And so if you have those three things together, if I were to say, I have this entrepreneur in front of me, he's actually a dum-dum, but once he starts a task, he has a really hard time abandoning it, and he has an unlimited time horizon in terms of how he's thinking about doing this, and he wants to do this for the rest of his life.

He's keeping all of his assets in there. He's never going to sell it, and we knew that to be true. And motherfucker cannot fail, because every time he does, he just gets better. It's hard to beat that guy. Those are the guys I bet on, the people I bet on. And what's interesting, and you've seen this too, is that almost all of those things have to do with behavior patterns, and very little to do with intelligence. And so when I think about that, your business isn't scaling off for lack of information, but for lack of character.

And I think when you think about it that way, it's like, wow, when I'm presented in these conditions, I make the wrong decisions, because I've been reinforced for doing new things too much. And so when I try to adapt that for my own, to loop back to the original question of the maniacal control, I think a lot of the control is actually in trying to get the team to do less, and do fewer, rather. And I think that's where a lot of my, call it exertion, I think it should feel better when I come in, because I can tell them what not to do.

Right, I know exactly what you mean. I think that's a terrible idea. Yeah, I do think the this idea that you say you said it twice, and I'm it's what I do when I coach people So I'm wondering what you want you elaborate on it. I think great entrepreneurs have pattern recognition Even people we've already discussed here today. They're mutual friends of ours. They're really good at seeing patterns I'm pretty good at seeing human behavioral patterns right, but just step away from that How important do you think if you were coaching an entrepreneur is it to?

To get them to see both patterns in the business world patterns in the economy Trends that's a pattern recognition to me and also human behavioral patterns at the same time If I did if I had to have them pick one I would rather have them be amazing at human behavior patterns because if you can do that you can print I think I think humans are how you unlock everything despite the world of AI and all the things that we talked about because humans unlock everything like So you might find this I think you might actually I was I was really excited to talk to you about this specific so this is perfect I I'm gonna guess and I don't want to go out on a limb here But I'm gonna guess you're not spending 12 hours a day by coding.

Yeah, I'm not No, it's really interesting is that you probably need more money than the vast majority of people by a very large margin last year Mm-hmm, just to put it out there, right? And so when I was thinking about you specifically and I was like, how do I reconcile this apparent? Contradiction with We're so cooked AI is Etc with the fact that a lot of the people that I know that are extremely wealthy Are not necessarily a I'm asking themselves Mm-hmm And so it got me thinking around the concept of leverage which was one of my two favorite topics in the world supply and demand And leverage, okay And so I think one of the big misconceptions that entrepreneurs are having right now is that AI is somehow the only form of leverage But it does not erase the other forms of leverage that are also multiplicative so for example if I make a decision that we say we're not going to do this gigantic initiative the amount of time that I get back from my Company is larger than us trying to AI max that initiative.

That was incorrect. What a good point, right? If we think about it from a boiling down to brass tacks perspective Well, we're going there's so many entrepreneurs right now that are using AI to do dumb things very fast Because they have more capacity they are choosing to take on more and as a result are less focused than they were before and if we look at the output of Their business they are not making more money. They're only spending more money on tokens. And so very good Alex Very good And so when we think about the different the different types of leverage, it's like this is leverage We can run this one conversation billions people can watch it, you know, obviously software has you know, different types of leverage, but Picking one good person has tremendous leverage.

So to the idea of like, okay Well, it's not a I'm axing but do we think that AI that Ed can find somebody correct? I'm a correct Probably and do we think that Ed has? leverage in other ways that would attract or Incentivize that person to want to do their special gift within this larger business because it was designed well earlier on Yes, and so these technologies come but the game has remained unchanged There's just another tool of leverage that exists now to be clear It's an amazing tool and we use the hell out of it as you but it's understanding where it fits in the toy box Yeah, because we still have to make the right call and as of right now I still sucks at making decisions at least from the ones that I look at because you can pretty much Make it say yes or no, right based on how you prompt it And so that is something that I've given a lot.

That's a really good point Maybe one of the best points I've heard on a podcast in probably 10 years It's a really good point because it's exactly what's happening It's actually become almost burdensome for people that are doing nominal tasks adding more to their plate. That's really really good In fact, that's one of the clips I'm going to use from the show So, you know those pieces in your closet that you find yourself wearing like on repeat all the time that sweater that kind of just Goes with everything or these perfect pair of pants Those are the pieces that make getting dressed easy and that's what quince does best quince focuses on high-quality Wardrobe staples with premium materials like a hundred percent mongolian cashmere organic cotton The styles are timeless versatile and designed to become the dependable pieces you reach for every day It's what I'm wearing right now they give you the softness and quality you'd expect from a luxury brand without the price tag quince also makes premium pants fitted tees and Polos and breathable active wear quality basics designed to work with your wardrobe and hold up to everyday wear I love their cotton tees I'm wearing one now and I get a ton of compliments when I wear them on the podcast and when I speak so find your Next fall favorites at quince download the quince app for app exclusive offers or go to quince Quince.com slash ed for free shipping on your order in 365 day returns now available in Canada and the UK too That's quince.com slash ed So, you know I've been trying to take my health in my morning routine to the next level and I used to do a whole bunch of different Stuff tons of different supplements and then I found all-in-one in a drink with im8 I made is the way to simplify your supplement routine.

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That's code ed 10 at im8 health.com Slash ed 10 these statements have not been evaluated by the Food and Drug Administration This product is not intended to diagnose treat cure prevent any disease I don't hear you talk a lot and maybe I've just missed it, but you know, I'm a huge fan and follower and friend I don't hear you talk about in terms of yourself as a leader In other words, I almost feel like sometimes you look at business as an operator and correct me if I'm wrong Okay, but what are you like as a leader of a company?

Like that's not a lot of the content that I've seen you discuss So, how do you view like leadership because it's a it's a overcooked concept and topic, right? But you're very technical Very strategic very tactical, but if I worked for you or with you and someone asked me his philosophies on leadership Or what type of a leader he is what he even does he see himself as a quote-unquote leader? And what is what does that mean to you? So a couple things so one Laila had just finished her book on leadership and you know I've got to edit and you know and help out and so I have a ton of concepts from that book But I think I've I've deferred to Laila for for most things and you know Laila well and Laila will never get the credit that she deserves for the Unbelievable But Laila is the internal leader of the business and I would say that I am the external leader of the business and that Is more or less how we've managed our our working relationship.

I have One direct report, which is my father-in-law. So virtually I have no direct reports in the business, which allows me to have The schedule that I do and we've just found that that has worked really well for us. I would say to if there are 12 core activities of leadership Mm-hmm The first one Which the others are all predicated on is that we have to define what good looks like Okay in behavioral and observable terms. And so The second step of leadership and I won't go through all of them I'll let for Laila do her thing, but the second one is that we have to model what good looks like And so there's a famous story of Gandhi where a mother comes to him and says hey Can you get my kid to stop eating sugar and he says yes, but come back in 30 days And so she comes back in 30 days.

She brings the kid to him. He says stop eating sugar She's like, why did that take 30 days? And he was like, well, I was eating sugar when you asked me the first time And so he had to quit sugar for the 30 days to make it and so it's a great little story But I think that's like leadership is caught not taught, right? And it is of course taught but it's taught through modeling and it's taught through right flag, right? And so Where I fit in this leadership paradigm is that I believe that I'd number one.

I hold the standard. Yeah One of the things that I get feedback from from the team because I see the service that people who at least work in my Vicinity more so than work directly for me. Is that they're like, you know, I've watched the content I've been you know I've been seeing everything for all these years But like it was only when I came to the office and realized that Alex was literally always here I'm at 4 3rd in the morning every single day six days a week That I was basically very difficult to witness consistency unless you are also consistent He's yeah, like you cannot witness consistency right and so I would say that that I say holding defining the standard and then modeling the standard is where the majority of my my work from A leadership perspective is I think the rest of the leaders in the company do a lot of the other stuff Mm-hmm, and then I'd say that I am more of a strategic decision maker They on Then true true operators.

I think it would it would it would take away credit from the people who are actually doing the stuff Is there a void of any type of? Emotional leadership in your businesses. No, that's She provides it and I think and this is something that I would say like what is what's taking up my time right now is Managing the transition of her becoming a mother and just completely stepping away from the business, which is our intention Okay. Yeah, so she's she's completely gonna gonna check out For an extended period and so I'm I'm reoriented because the business works with the the dichotomy Yeah between the unit.

Yes. Yes, and when she's not there, I'm softer and And when I'm not there, she's a little tougher and it's it's we've had this dance That's worked really well And I'm gonna have to relearn that and I'm gonna probably crack some shells and mess up a little bit But that's something that I'm really I'm really watching you, you know how much I've always Appreciated you and admired you you've grown a lot the last few years when we talk on the phone, but we haven't done this and You're at a different level and one of the reasons is is you're you're willing to take on more and more risk still and I want You to talk about this.

I've never heard this before only you and I'm like gosh darn it. He's right I wish he wasn't right, but it's this sort of like the law of the universe People look at me or you but I'll just speak from my own perspective and I'll let you comment on yours and They do sort of go like we're recording this now in the middle of I've been giving speeches and doing business meetings here today And I've got another one tomorrow, which is a Saturday and you're cranking you'll be in here and I'm blah blah blah And they're like the old when's enough's enough and all that other stuff and I'm like, I really don't feel like I'm working but having said that my capacity Has expanded over the years to the extent where I feel like I have to take on more almost in order to remain challenged but also to live up to the blessings and and honor the Perspective nuances wisdom and skills I've developed theoretically, right?

So this thing you discussed lately about risk and capacity and ability and the correlation between the two Do you know what I'm talking about? Okay. I heard you say something recently where you said My ability to take on risk is almost connected to the fact that I'm better and better in an order to continue to grow and Expand I have to take on more risk. So I never even heard this before so Well what so I've I don't read it so I don't want to pretend like I read all day or something like that But there are moments where I do punctuated reading and I think my favorite type of reading is autobiographies of ultra-rich people Because usually especially at the end of their career They don't care at all about being politically correct and they actually tell you what finally tell you And so it was really interesting that I found between Paul Getty Who was the richest man in the world for like 30 years?

Rockefeller and Elon Musk And just take these guys objectively don't whether you like their whatever you can appreciate that. They are wealthy Right What I found is this very recurring theme is that they had multiple moments of call it like local maximums Where they then looked around and said I'm pushing all my chips back into the middle of the table again yeah, and so I kind of see it like and in some ways as much like it is necessary for The to take a bigger swing to get a bigger payoff, but it's almost more necessary to keep the game interesting Yes, and so like if and we're in Vegas So I'll just make it a Vegas theme if you were playing $10 hands and let's say at some point you get good enough to Give this gigantic stack of chips at some point.

You have to up the ante. Otherwise, you just don't care anymore Yes, and so a billionaire playing $10 hands. It's like he literally loses money playing a $10. Oh, it's so good. And so One of the things that I think is a little bit of a mindset shift, which I don't like using the term but like we behave differently in different scenario is that Your risk tolerance has to concurrently increase with the size of opportunity that you want to pursue And it's of course in the beginning you don't need to take a There's lots of risk and also no risk because you don't need to put money down you can start a business for it for almost Nothing, but if you want to start SpaceX You need to put money There is something like there and the thing is this capital in some ways becomes a gigantic mode Because other people are not willing to risk it and so you start develop more sophisticated frameworks for understanding risk and reward Which is that like not only will I take my expertise in my track record in my network?

But I also take a hundred million dollars and put that on the line Because that's how I can get to 10 billion. Okay, I want to just jump in here I don't even think you know how big this could be a book you do Okay, even though I know it's not the time but how big this is and by the way listening to you on this How many people do you and I meet that have gone from zero to a little bit and then they're stuck and they're so frustrated Like I just I can't get past 400 grand a year I'm at a million a year or whatever it is And what what's interesting is what happens when you have nothing and then you get a little bit you become very risk-adverse And you don't know that potentially the key for you to become unstuck is actually to take on more risk And that's the stimulus to go to the next level Do you know how big of a deal this is what you're talking about because it's the thing most people stall at a hundred or two Gooses right when they stall it's because you're still in the same risk tolerance category You were before and you've mastered your domain to some extent Okay, so I've given a huge amount of thought to this So there's this bullets because we see entrepreneurs every single week that come through There's a bolus of entrepreneurs between 1 and 3 million dollars and for whatever reason there's this swamp there I think there's a couple of factors So number one is that usually between 1 and 3 million dollars in revenue?

You've actually made enough money to satisfy personal needs You can pretty much go to every dinner go to every hotel take the vacations and like you're good to go and to be fair Nothing wrong with that. However, if you want more right if you do then You have to change the way you play. And so what's very interesting is that, we call this the swamp at Acquisition.com. It's one to three, maybe one to five million, it's right there. And the reason it's the swamp is that it takes more risk to get out of the swamp than to get into it.

Oh boy, so true. So true. And so it takes some risk to quit the job to whatever, but when you start, your first zero to a million for most business, especially service, which is 80% of the US, it's you and maybe some helpers, but it's almost all margin because it's just you working really hard. In that one to three, maybe one to five range, you have to make some decisions of like, okay, I can't service any more customers. My time is becoming my biggest constraint. And then there's the question of, am I going to bring help on?

Am I going to get a vendor that's going to be a legit vendor that's going to cost real money? And I think there's one, there's the emotions of like, well, I'm already comfortable. So we're sacrificing something that I know I need to achieve all my personal goals to get money that I don't need in the future, which is a big, it's a big, like, it doesn't necessarily mean it's rational to do this, to be really clear. It isn't rational, but if you decide, yes, I want to do this, here's the math behind the second layer of difficulty, which is, let's say it's a $2 million business, 20% margins.

If you have 20% margins in the business at this point, you got $400,000 to play with. All right. Now you're going to leave maybe a hundred grand in the account because you want to like have some safety, so maybe 300 grand. If you, let's say need somebody who's going to run client success or be a, let's say your first real leader in the business, a director level, not just a manager, you're probably looking at high ones, maybe mid twos, you know, as a small business owner.

So that means that on this one hire or maybe a vendor, you're going to risk half or more of your profit on one bet. And because most people are unwilling to do this, and arguably logically, they stay stuck. And so there's these points where you have to increase your bet size. You have to be able to go from spending a thousand dollars a day on ads to $10,000 a day on ads. If you're willing to spend, go from like, I'm only going to spend a thousand dollars on indeed to recruit these people to say, I'm going to pay ahead $135,000 cause I think I really need this role and it's specialized, but if I have it, it unlocks this huge amount of capacity.

And so one of the, so I'll give you a couple of tactical things for the audience. There's a couple of tricks to getting a business through that without using as much to get them into that like five to 10 range million a year so that then they have more cashflow so they feel more comfortable in the bet. So I can only resolve one of the two risks, but it's still there, which is that you have to increase the leverage on one or multiple of the three elements of the business.

So we have to increase leverage of demand. So it's like, how can we create some sort of content wheel within the business so that when customers come in, they make us content that we can then use to get more customers and you service customers every single day and then boom, we have more leverage demand. The second kind of wheel of this is the leverage conversion. And so whether you're selling, you're like, basically there's three ways to scale the sales. Either you have a big, big sales team, you sell one to many, or what I prefer, which is you create order takers.

And so my combination of solution is how do I sell one to many and preload the customers with as much information as humanly possible so that my salespeople only have to make six inch putts rather than drive and chip and then wedge and then go all the way. And so by doing that, it's much easier to recruit somebody and just say, I just need you to make, drop the ball six inches from the hole and make this. You can train that person up in a week.

Whereas if they have to be a coach, a therapist, a product expert, a teacher to a customer, and then also a relationship manager, it's so hard to find them. And if they already do come preloaded with all those skills, they're way too expensive. And so we have to have leverage conversion. And then the third process is leverage delivery. Now I think one of the big misconceptions on delivery for service businesses is that whatever way you started, that got you to one or three million in terms of your service delivery.

You say, well, this has worked so far. And I am a big advocate of doing more of a work, don't get me wrong. But there are some tweaks that you can make in your agreements of what you plan to deliver to a customer that dramatically expand the leverage that you have in the business to deliver without in any way really changing how likely they are to buy. And so for example, if we said, we have support that is via phone call at any time, you could say, we're going to do email, we're going to do chat.

And all of a sudden that increases leverage on the supply side. We could say, hey, instead of having scheduled calls, we're going to do it asynchronously. And then that allows you to batch all the work together. You can review all of the accounts, let's say your marketing agency, you could do them all at once and you can do them in 11 minutes rather than having a 30 minute call and wasting it. So it's like, great, that might triple the leverage. We can change whether components of the service are done live or done recorded.

We can change whether it's in person or it's done remotely. We can change the delivery ratio so that it's instead of one-on-one, it's one-on-small group or one-on-one to many. And so there's a number of these levers that we can do on the delivery side that if we at each of these points, if we expand a little bit of leverage on the demand, expand a little bit of leverage on the conversion, so we give people a couple of videos with some proof before they talk to a salesperson, all of a sudden the sales take less time and there's fewer of them.

And so all of a sudden my utilization per sales rep doubles or triples. And so I don't need to hire the extra rep, I can still double or triple the business if that's the constraint. And so in each of those situations, usually one, two, or all three of those things, depending on where you're at, is where you need to employ. Notice none of them were AI because you can still make good decisions and increase leverage of the business, not necessarily using AI. And to be fair, I'm a big AI advocate, but I'm also an even more common sense advocate.

Alex, that's so good. When I coach, and even when I've watched your content, it is funny though. Because by the way, those of you that feel stuck or know someone that's stuck, send them the podcast today because this is probably why you're stuck. It's the risk aversion. You don't, you're looking at all these other mechanisms. It's the risk aversion. But what's really funny about it is I'll even watch it on your stuff and when I coach too, I'm like, well no, you're going to have to hire that 250 person or you're going to have to triple your ad spend.

And you watch their face when you say it. And they're immediately going, uh-huh. And they're immediately in their mind trying to process, is there any other way I can get out of doing this? Now, you've given a couple great hooks here that mitigate some of that risk. But you watch, the reason this is so important is the tendency at this stage, even when given the counsel, is to try to find a way out of that room and not have to take it. And if you're going to get to that next level, you're going to feel unstuck.

And here I am, an older guy, 55 years old. And it is, I think, the key as to why I'm still pretty fresh and in the hunt and going and excited and not stuck is I've, and by the way, I think you would agree, it's a muscle you also build over time. Your first risk you take to start a business does not require the muscle because you're moving from nothing. It requires a muscle over time to continue to throw, like you said Musk earlier, whatever you think of the guy.

Are you kidding me? The amount of risk this dude's willing to take on over and over and over again. That's why he's been compensated more than anyone. That's right. Adequately compensated for the risk he's willing to take. What about, we don't have much more time, but this is so good. We need to agree we're going to do this at least once a year. And I need to expand the format of the show when you're on to like two hours. We can roll late and then we can do a second half.

That would be really good. That's fine with me. That would be really good. I, there's a lot holding someone back. I'll do a second half and I'll release it on my channel if you want. Okay, I love that. Whatever you want. There's a lot holding someone back from this risk aversion at any stage. And I don't know that I've been very good at getting somebody to sort of deal with it. Now what I used to say, and then I want to have your version of it because yours is frankly I think better.

I used to go, you know this like boogeyman, when I was a little kid I thought there was a boogeyman. And my dad, when he would come back from his drinking binges, I'd be up. But I created this boogeyman and my dad would literally have to come in my room when I was a little boy and open the closet and go, Eddie, look in here. There's no boogeyman in the closet. And I had this great fear, but if he would open it and show me, all of a sudden a lot of my fear was reduced.

And as an entrepreneur, a lot of these fears you have, they're real things, but even if you lost that investment you made, even if the business crumbled, the boogeyman's probably not quite as bad as you think it is. You can come back, right? You teach people that have fears to actually put it down, right? Can you talk about this? Because I think this is a great tactic to get above or be self-aware of your fears or their limitations. So it's my position that emotions exist in the vague, not the specific, meaning fear exists in the vague.

Because basically we abstract things to death because we're evolutionary beings and we don't want to die, okay? But we think if this does not work, I will fail, I will go bankrupt, my wife will leave me and I will die. I'll have no friends. I'll be shot and I'll die, right? But when you actually define out, no, no, let's sit in it because we're so afraid to look at what would happen that even the fear of looking gets people to not crystallize it. And it's like, listen, the first thing you can do is prepare for failure at least.

But in preparing for failure, you decrease the likelihood that it happens because you actually know what happens next. And so when I started the gym, I had to write down my plan B, which for me was, well, I didn't have any real skills. I was in shape and I had time. And so I said, I'll drive Uber and I'll strip. And if that was, if I fail, I'll drive Uber 12 hours a day and I'll strip at night and I'll be able to like in a year probably make $250,000 and I'll, and I'll do it again.

You know, like I'll start back. But the goal was to get back into it again. And so one is like, when you really play out your failure story, maybe you're sleeping on like you will only lose status in the eyes of people around you who are not taking the risk that you're taking, right? And so true. And you don't want their lives. So why would I care about their opinions? And we just have to expand the time horizon because like, not to sound trite here, but like failure and success are on the exact same road.

It's just the failures and earlier exit. And so one is a requisite for the other. But the thing is, is that thinking about success leads you to failure. Failure leads you to success. And so failure is closer to success than thinking about successes, which is ironic. So the idea is like, like one of my favorite things to tell sales guys, especially, especially in the cold calling outbound side is like, let's get some nose today, right? If we can make the failure a success, a mile mark, how many knows we collect today, right?

It stops having this emotional charge because we're saying, wait, we're not making no mean something we're saying we're making no mean something good. And so if we know that, um, the, the failure that we're going to have is going to teach us something like the $250,000 pet that we're talking about with this operator, right? This person who's incredibly in fear, how do we get them out of that, out of that fear is that if you don't see another way and maybe that maybe you put all the levers that we just talked about and, and still there's no other way you have to take the risk, then you take the risk and, and you know, and you do that knowingly because what you are building is the thing that we were talking about earlier, which is pattern recognition.

So let me tell you the story of how entrepreneurship really works, which is if you've ever played a video game, you played in the first time you play the game, you get to a level, it's hard. You got to beat the boss. There's a sword under the stone, whatever. Right? And then you get to the next level and you trial and error, you get it. Now, if you go back and play that game again, it's a straight line. How fast? Now the character itself can't play faster because it's, it's controlled by the same algorithm to do a game.

But how does it take you a 10th of the time to get three, four, five levels deep? Because you know exactly what to do. Why? Because you recognize the patterns. And so if you've ever had multiple businesses, which a lot of people are entrepreneurs, like by the way, you know, spoiler alert, you're going to have more than one business and you're getting into it and you have this fear that this will be the perfect one. The second business you start almost always grows faster than the first business you start because you go through, you blow through all the bosses you had on the first one and then you get stuck at the same point and then you move as slow as you can, which is trial and error again.

It's, you get into the slog again. And so the, the failure that you're experiencing is, is create, is the creation of pattern recognition. And so I remember for me just to give an analogy that might make sense for people. The first time you hire a sales manager or even the first time you hire a sales person, right? You go through, you hire one person and the most expensive hire is a salesperson, your first salesperson because you're losing, that person doesn't close, you lose all the business.

I mean, it's horrible, right? But you have to make the bet at some point. And so you hire them and maybe that person doesn't work out. Okay. So we hire another one. Maybe that person doesn't work out. Now, eventually you will hire one and it will work out. And then at that point you're like, Oh, I know what this looks like now. Pattern recognition. And so when the next one's you're like, I need to get them to look as similar to this as I possibly can.

And then all of a sudden your failure, it starts dropping and going down and down and down. And then you're like, Oh, what if I train harder? And then all of a sudden you start increasing your percentages. But the same thing happens when you're like, Oh, now I need a sales manager and you repeat that process. And so I think a lot of what the call it the better entrepreneurs in the world versus the, the non, the, the lower entrepreneurs is that it's just every single role in the business.

You have to know what good looks like and you have to fail at each one of them until eventually you find the one that works. And then that forever becomes your pattern of this is, and to be clear, there's different ways to run sales teams, but I know this way works and I know this type of person works for the way I like to run sales. And so that then when you, like when you create the next business and this is, I use different verbiage for it, which is at a certain point you don't build businesses anymore.

You assemble them. Wow. You're so right. Right. You're so right. I had to change my language because I was like, I'm not really building this business. I'm just putting the, we're just assembling. We're putting all the pieces. I know this is going to work. Also, which one of the advantages that you don't, that we don't talk about as much because it's only applies to a small percentage of people is that the longer you do business and if you, if you do business well and you do right by people, you develop this network, this Rolodex.

And if I'm going to start a new thing or Ed's going to start a new thing, it's like, I got 10 people I can call who are like, oh, you're doing something. I'm in man. Let's go. And failure was one of the reasons you've actually built all of these relationships, this in this a human capital that you've actually developed. And then you can deploy that capital and I wonder if that has more leverage. That's what you said earlier about AI and me not having to do that.

I've actually got so many other resources at this stage of my life that I can deploy AI or get access to it without having to fiddle with it myself because of these relationships. You have the benefits of AI. You're at the benefits of it. This is so good. I want to do, I want to finish on one thought. And by the way, I'm just going to finish in the middle because there's so many things we could cover. But this idea of pattern recognition, it's not talked a lot about and the video game analogy is perfect.

So it's going to give you a little runway to answer two things at once. Okay. Pattern recognition has given me, if we're giving the video game analogy and the reps that I've had in business, some of them were successes, some of them were failures. But what's happened is about this idea of assembling a business is the absolute truest thing you'll ever hear, by the way. At some point, once you kind of understand the mechanics and the mechanisms of putting these things together, it's an assemblance rather than is it of a building.

He's completely right. He and I actually talked privately about doing a type of business together. And I just know that if we did it together, it would be successful because between the two of us on that human Rolodex and what we know, we would just assemble the parts. Here's the thing that pattern recognition has given me over time that a new entrepreneur needs to give themselves some grace to develop. And that is that now as I'm building businesses, there are days where I react. There certainly are.

There are just things that happen. I spend some of my time reacting. When I was a young entrepreneur, I spent most of my time reacting. Now that I have pattern recognition, human pattern recognition, and also just trends, I anticipate more often than I respond and react. So I want you to talk about anticipation as a skill. Like the thing you and I have talked about with banking, let's just be honest, right? So the anticipation... and then inside the answer to that final question, what do you anticipate about the world of business the next two to five years with AI as a factor in it?

So why does anticipation matter and what do you anticipate? That's a really hard question. So I think anticipation matters a lot from an entrepreneur perspective because it reverts back to the people who get the best returns on their resources. So why would anticipation even be important? Well, it means that if I allocate resources to a new thing, let's say it's that their new platform emerges for social media and I'm one of the first people on it because I anticipate that it's going to grow because it has all the stuff that looks right.

If I'm a first mover in that situation, then the minimal amount of resources that I deploy towards that, I'm gonna get a way higher return. And then when people are laggards or later, they're gonna have to deploy more resources to get even less out. And so anticipation is another form of leverage. And if we just define leverage, I know we're late on defining it, but it's just getting more for what you put in, high leverage at least, low leverage would be the opposite. And so if we're trying to deploy as much leverage as we can, getting the call right allows us to get more for what we put in.

And so the anticipation I think is, a lot of it is, call it macro pattern recognition. So I'll tell you something that I heard, I wanna say 12 years ago or something, I heard a Gary V clip. And he said one of the biggest regrets he had was that when he was printing money on Google PPC or AdWords for the wine business, that he didn't spend more. Talk about the risk thing. At that point, now he's a way better, bigger entrepreneur now, and he has way higher risk tolerance.

But at that point, spending 10,000, 20,000, 50,000 a day, whatever it was, was a lot of money. And I remember hearing that clip right in the early gym launch days. And we were printing on Facebook and meta ads, and these were new-ish ads. And I was like, well, I don't wanna make that mistake. And so we're like, how do we spend more? And so that became the question, is what would it take for us to spend more, rather than, I'm not sure if I wanna spend more.

What would it take? Which is one of my favorite questions in the world to ask. It assumes the success, then you work backwards. The second thing was, what is it gonna look like in an age of AI? I will give an unsexy but accurate answer of what I'm actually doing. I like Basis's frame a lot on this, which is the future is very uncertain. And one thing that is true is that we are notoriously bad at predicting it. And so he prefers to ask himself, what things do I know will not change?

And so he's made all of those gigantic bets in the business based on the few things that he knows will not change. And so he says, I believe in the future, people will want cheaper prices still. I believe in the future, customers prefer more selection to less selection. I believe that customers will in the future prefer things to get them faster rather than slower. And so there are bets that you can make in the business based on human behavior that we know will be true. Do I think that in the future humans will eat food?

Yes. Do I think that they will need shelter? Yes. And so the bets that we're making in the business, I would say, and this one thing about risk, which I think is important is entirely personal because I get the question a lot. I'm sure you do too. One, when do I push and when do I pivot? Right. And the second question is, how much do I take out of the business to save for a rainy day versus double down? And both of those are unanswerable questions because they're entirely personal.

Ask Elon, he'll say put it all on the line. If you have a wife and kids and you don't wanna do that, which I respect, don't do that. And so those are dials for you. But back to the point, I'll just share what I'm doing, is that I take chips off the table and put them into these places that I think are boring that will still be here. So we have lots of real estate and things like that. But the big investments that I make in the business on call it big swings, I think have been predicated for at least me on making sure that my oxygen mask is there for me and my family.

People are different, Elon doesn't need that. Maybe he does, he's already so rich. He knows enough friends that he's never actually gonna start. But I think that what has served me very well was that I very aggressively lived cheap when I was younger so that I could save what I believe to be a nest egg. And that nest egg has changed in terms of what the size of it has been. But always having one allowed me to take gigantic swings and do things like the school deal or do things like the book launch or do things like some of the other things that we're talking about.

And be okay because the worst case scenario is that my life doesn't change at all. Me too. Identical, exact same thing. This is my favorite interview we've done. My favorite interview. Can I do one more a little bit? Please. So one thing in terms of the specificity of risk. So we talked about what would it actually look like. One of the things that's been even more micro for me is what changes about my day? And so this is both upside and downside. So if I'm considering like, hey, should I take on this investment or should I do this anything?

The question I ask is what will this change about my day? Do I have to now do something that I don't wanna do? Do I have to stop doing stuff that I do want to do? And most decisions don't actually affect my day, which then means that it's actually not, there's no real stakes here. It's all made up. It's literally just, it's in the air. Now, every once in a while, there are some things that when I actually run it through that filter, for example, if your wife's pissed at you, that is going to change my day or week or month far more than just about any negative business consequence will.

Honestly, just about more. And so it actually has helped me truly redefine priorities in a way that's actually much more tactically relevant to how I experience life. Wow. I'm glad you added that. That's probably best for me of the entire conversation. Because a lot of the risk that I have in my mind is made up, yet the risk I most fear is that it would alter my day and then I would have to do things I don't wanna do anymore or actually stop doing the things that I do wanna do.

What a great formula. Turns out you're pretty smart. I'm real proud of you. You know what I mean? And I'm grateful that you're in my life and I'll always be here for you. And I love Layla too. And you're really important in the world. I just want you to know. I meant what I said in the beginning. There's a lot of people that are really good at this business stuff. You're on a level that is yours. So continue to expand because your capacity is even greater than this.

Proud of you. Great job today. All right, everybody. I don't have to tell you to do this one. Share this episode. You'll know where to find Alex. He's everywhere. And max out your life. God bless you. This is The Ed Myron Show. Booking.com is the easiest way from a day surrounded by noise to a stay surrounded by nature. That's nice. Go on, book it. It's easy. Booking.com. Booking. Yeah. It's football season and you can now get almost anything you need for game day delivered with Uber Eats.

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