Podcast Summary: The Game with Alex Hormozi – "Our Billion Dollar Strategy For Acquisition.com | Ep 805"

Release Date: December 14, 2024

In Episode 805 of "The Game with Alex Hormozi," host Alex Hormozi delves deep into the strategic roadmap propelling Acquisition.com toward a billion-dollar valuation. Drawing from his extensive experience as an entrepreneur, investor, and author, Hormozi outlines the multifaceted strategies, challenges, and future plans that form the backbone of Acquisition.com's ambitious growth trajectory.

1. Invitation to the Scaling Workshop

[00:01]

Hormozi opens the episode by extending an exclusive invitation to a scaling workshop at Acquisition.com's Las Vegas headquarters. Targeted at million-plus-dollar business owners, the workshop aims to personalize strategies to elevate their businesses. Highlighting the workshop's exclusivity, he mentions, "We turn down about 65 to 75% of applicants that apply on a weekly basis" ([00:45]).

2. Vision for Acquisition.com’s Growth

[02:10]

Transitioning to the core topic, Hormozi shares his vision of scaling Acquisition.com into a multi-billion dollar entity. Reflecting on his podcast's inception in July 2017, he emphasizes the importance of documenting his entrepreneurial journey: "The podcast, more than any other source of information, has kind of my documented thoughts along the way" ([03:25]).

He outlines his 2024 strategic plans, making a bold decision to publicly reveal these strategies—a rarity among companies aiming for confidentiality during growth phases.

3. The Acquisition Flywheel Strategy

[04:50]

At the heart of Acquisition.com's growth strategy lies the Acquisition Flywheel, a self-propelling loop designed to foster continuous growth and brand reinforcement. Hormozi breaks down the flywheel as follows:

• Inputs – Media Production: Recognizing that attention is the first critical component, he states, "If you have no attention, no one knows you exist" ([05:15]). This involves creating diverse content—books, emails, podcasts—to attract business owners.

• Attracting Business Owners: Quality media leads to increased visibility, drawing like-minded business owners interested in partnerships.

• Executing Deals: Engaging with select business owners allows Acquisition.com to acquire companies at fair valuations.

• Performance and Liquidity Events: Successfully acquired companies outperform the market, leading to liquidity events such as acquisitions or public offerings. These success stories, in turn, bolster Acquisition.com's brand credibility, feeding back into the media input of the flywheel.

Hormozi admits, "This is kind of the flywheel... this is the strategy" ([06:45]), signaling transparency in sharing the company's growth mechanics.

4. Role of Content and Team Dynamics

[08:30]

Addressing the parallel strategies within the company, Hormozi discusses his collaborator, Layla, whose content strategy differs due to her day-to-day responsibilities. He notes that Layla's follower base predominantly consists of executives—key individuals essential for scaling acquired companies: "A huge percentage of people who follow Layla are people who are executives... exactly who we need to attract" ([09:10]).

5. Identifying and Addressing Strategic Flaws

[10:50]

Hormozi candidly examines potential flaws in his billion-dollar strategy:

• Time Consumption: Growth is inherently time-intensive. Hormozi laments, "It takes time to attract companies, it takes time to do deals, it takes time for a deal to grow" ([11:20]).

• Minority Positions in Deals: Acquisition.com often holds around 40% ownership in acquired companies due to founders' preferences, which complicates control and influence: "Our average position is right around 40%" ([12:05]).

• Confidentiality Constraints: Operating under NDAs to protect founders' brands means limited public showcasing of acquisition successes, hindering brand reinforcement: "Unless I'm associating publicly with a brand like Skool... the rest of our deals, we're under NDA" ([13:30]).

Hormozi emphasizes integrity over short-term gains: "I will always act in the best interest of the businesses, even if it hurts me publicly" ([14:15]).

6. Reputation Management and Long-Term Focus

[15:00]

Drawing parallels with Warren Buffett's investment philosophy, Hormozi discusses managing Acquisition.com's reputation: "In the short term, it's a lot... But the only thing that has sticking power is what is accomplished, what actually happens long term" ([16:40]). He underscores the importance of building lasting value over fleeting internet popularity.

7. Introduction of ACQ Ventures

[18:25]

Expanding Acquisition.com's investment portfolio, Hormozi introduces ACQ Ventures, with Zach Choi as Managing Director. Unlike traditional private equity firms, ACQ Ventures operates without limited partners, relying solely on internal capital derived from previous sales and distributions: "We don't have LPs... it's just Leylandized money that we got from jimlaunch first" ([19:00]).

He outlines the bifurcation between ACQ Ventures and traditional private equity:

• ACQ Ventures: Focuses on smaller, venture-style investments with lower ownership percentages and lighter operational involvement. This approach accommodates a higher volume of deals, catering to founders seeking capital for aggressive growth without full exits.

• Traditional Private Equity: Engages in larger, more concentrated bets with significant ownership stakes and hands-on operational involvement.

Hormozi reveals, "In December we'll have done our first three deals in ACQ Ventures and you'll be like, wow, three deals" ([20:15]), highlighting the initiative's early momentum.

8. Strategic Investment Approach

[21:40]

Hormozi elaborates on Acquisition.com's investment philosophy, balancing between volume-driven venture investments and concentrated private equity deals. He explains the inherent trade-offs:

• Venture Checks: Higher risk per deal but lower aggregate risk through increased deal volume. Suited for founders desiring growth capital without substantial ownership dilution.

• Private Equity: Lower risk per deal with larger ownership stakes, enabling a more hands-on approach to scaling businesses.

By diversifying into ACQ Ventures, Acquisition.com aims to capture opportunities across different investment spectrums, optimizing growth and portfolio resilience.

9. Final Insights and Future Outlook

[23:30]

Concluding the episode, Hormozi reflects on the purpose behind his podcast: "I wanted to document my thinking process from zero all the way to a billion" ([24:00]). He envisions the podcast as a transparent chronicle akin to a CEO’s vlog, offering invaluable insights into building a billion-dollar enterprise.

He also promotes his authored books, urging listeners to engage with his written work for deeper insights: "If you listen to this podcast and haven't read either of the books, read them... They are the best, most concentrated value that I've created" ([25:15]).

Looking ahead, Hormozi expresses excitement for 2025, anticipating significant milestones and continued growth: "Book three is my cookbook for making money, and I'm so excited for you guys to have it... 2025. It's gonna be a big year" ([26:50]).

He wraps up with gratitude towards his audience, reinforcing his commitment to transparency and value-sharing.

Notable Quotes:

• "We turn down about 65 to 75% of applicants that apply on a weekly basis." — Alex Hormozi ([00:45])

• "The podcast... has kind of my documented thoughts along the way." — Alex Hormozi ([03:25])

• "If you have no attention, no one knows you exist." — Alex Hormozi ([05:15])

• "Our average position is right around 40%." — Alex Hormozi ([12:05])

• "I will always act in the best interest of the businesses, even if it hurts me publicly." — Alex Hormozi ([14:15])

• "Book three is my cookbook for making money." — Alex Hormozi ([25:15])

Conclusion

Episode 805 offers a comprehensive look into Acquisition.com's strategic endeavors to achieve and sustain billion-dollar growth. Through transparent discussions on media strategy, investment philosophies, operational challenges, and future initiatives like ACQ Ventures, Alex Hormozi provides listeners with actionable insights and a behind-the-scenes perspective on scaling a modern conglomerate. Whether you're an entrepreneur, investor, or business enthusiast, this episode serves as a masterclass in strategic growth and long-term value creation.