From Sleeping on Gym Floors to $100M with Alex Hormozi

**Sam Parr** (0:00)
All right, there's this amazing book called Getting Everything You Can Out Of All You've Got. I read it a few years ago and it changed my life.
And the reason I loved it was because it basically talks about how to get and make more money using things that you already have.
Coincidentally, today's podcast is brought to you by Business Made Simple. It's a podcast by Donald Miller, who I'm gonna tell you about in a second, but he has this amazing episode that's all related to this book and the things that I learned in this book. It's called How To Make Money With What You Already Have. It's an incredible episode. It talks about all the stuff that I learned in this book. The host is Donald Miller. I didn't know who Donald Miller was up until recently, but over the last 12 months, this is totally by coincidence. It was all separate people. They said, you have to check out Donald Miller. He's amazing. So I'm happy that he's part of HubSpot's podcast network. You can check it out, Business Made Simple Podcast. It's where he coaches you on how to build your business like an airplane, where the cockpit is your leadership, the body is your overhead, the right engine is your marketing, the left engine is your sales.
You have to check it out. This guy's amazing. It's called Business Made Simple with Donald Miller.

**Alex Hormozi** (1:01)
I have come to accept that I love working and I don't need to judge myself for that or take in other people's judgment on how much I should quote do. Like this is my life and this is what I like doing.

**Sam Parr** (1:21)
Because I never heard of you before, and I was like, A, this guy's popping up all over my YouTube all of a sudden. What the hell is going on? And B, he's saying that this gym, I don't know, I called it a course, which actually is incorrect.

**Alex Hormozi** (1:33)
I love reading. If there's one thing that I could make, just for the, almost for the audience's sake, because we're much closer to what a franchise would be.
And overall, in the very beginning, that was what the big decision was, am I gonna go the franchise route? Because I had six working locations, I was 26 years old.
And they worked. And that's when I meant to was like, you should stop owning all these gyms, you need to license the model out. And so that was when I transitioned from B to C to B to B. What you might not know is that for two years, I actually, because I wasn't confident, I was like, I know it works in my six markets, I was like, but does it work in all of these markets? So my wife and I actually did 32 gym turnarounds in the next two years. So we'd fly out in person, fix their pricing, change how they did their layout, change their self-care.

**Sam Parr** (2:17)
It's just like a consultant, like a management consultant for a gym.

**Alex Hormozi** (2:20)
It's exactly that. And then from there, we figured out, we cleaned it up to just like completely dial it in.
And then I would love to say there's some stroke of brilliance of like, and then in my master plan, I decided to start licensing.
That was not what happened. We ended up doing these launches and the flaw of the business model was that I didn't control the fulfillment. So we would go in, we would charge nothing. It's pure performance. We'd fly in and I would charge 100% of the upfront cash collected that we would do while we were there. So we averaged about $100,000 in cash collected in 21 days and that's what we would average per gym that we'd come into.

**Sam Parr** (2:58)
So that means each gym is making an incremental 100 grand a month from your insights.

**Alex Hormozi** (3:03)
If I were launching eight gyms in one month, we would make $800,000.

**Sam Parr** (3:06)
We've got it. Oh, and this was when the model before you were like, doing gym launches.

**Alex Hormozi** (3:12)
And so what ended up happening though was like, and it started scaling really quick. I was like, this is the game. Like this is what I need to be doing. This is awesome. And they didn't have to spend money on ads. They did literally nothing. They gave me a place to go market and sell is basically what happened. And so what happens, we would dip out. And then all these customers that we sold would then be fulfilled by a facility that was struggling because that's what they called us. So they typically had pretty poor product and I didn't have the bandwidth to stay there for six weeks on top of that and retrain trainers and show them how to set up. Like I didn't have the time to do it because we were marketing selling most times we were there. And so anyways, we would fly out and then what happened in an unfortunate percentage, they basically were like, hey, you signed up and paid this guy $500, I would give you the same thing for $200, refund with him and just sign up and I'll do everything through me.