Solving 6 Scaling Problems | Ep 969

Summary

Podcast Summary: The Game with Alex Hormozi – "Solving 6 Scaling Problems" | Ep 969

Date: May 12, 2026
Host: Alex Hormozi
Main Theme:
Alex answers real entrepreneurs’ questions on how to overcome the most common problems scaling service or brick and mortar businesses. This episode delivers tactical advice on leadership, hiring, pricing, and building teams across HVAC, roofing, electrical, construction, and more.

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Key Discussion Points & Insights

1. The Cost of Scaling and Personal Trade-Offs

[00:24-07:13]
Alex discusses the personal fears that often hold entrepreneurs back from the next level: comfort, distractions, and fear about losing work-life balance. He frames ambition as a matter of preference and trade-offs, not right or wrong.

• Quote:

  "We regret when we imagine the upside that we didn't get without also considering the downside that we didn't suffer to get it." — Alex [01:38]

• Insight: If you want to grow from $6M to $100M (like Thomas), you’ll have to give something up—profit, time, or distractions. Decide what matters least to you, and accept short-term discomfort for long-term goals.
• Advice: Bring in higher-level talent, even at a short-term loss, to free yourself for other pursuits. Keep investments (like real estate) truly passive and don't let them eat into operational attention.

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2. Hiring & Retaining Talent: Redundancy and Raising Prices

[07:14-12:12]
Corey, an electrical contractor, struggles when one team member is unavailable—he gets pulled back to the frontline. Alex shows that scaling requires redundant capacity and margin.

• Quote:

  "We have to fix the pricing component...raise prices by 20-40%. If you don’t meet your new service guarantees, give the profits back. But every time you do, you keep the extra." — Alex [08:30]

• Insight: Solve constraints in order: raise cash flow (via pricing) to recruit extra staff and build redundancy, then proactively market to create a larger, less dependent customer base.
• Advice: Create guarantees no one else offers (on-time, on-budget with full refund if missed) to justify higher prices and differentiate from competitors.

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3. Building the Dream Team & Delegating

[12:52-18:17]
Tanner wants to build a “dream team” and struggles to let go of tasks due to his high standards for luxury clients.

• Quote:

  "Keyman is the number one risk of every business for two reasons: No one wants to buy it, and you’ll want to kill it yourself at some point because you’re burned out." — Alex [15:16]

• Insight:
  1. Track every 15 minutes of your time; rank activities by value.
  2. Delegate the least unique/profitable tasks, making use of your high margins to recruit top talent (even with high signing bonuses or relocation).
  3. Don’t cheap out—premium work justifies premium team members.
• Advice: Go legit; avoid 1099 “contractor” gray areas for core operations. Big growth comes from shedding low-leverage tasks and focusing on relationship-building and sales.

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4. Outbound vs. Inbound Sales Team Structure

[18:18-23:40]
Trenton, a roofing business owner, is shifting from door-to-door (storm-driven) sales to retail, but team culture and cost per acquisition suffer.

• Quote:

  "Outbound and inbound are separate teams. Inbound is what you graduate to...if you’re an absolute savage at sales." — Alex [20:51]

• Insight:
  • Do not mix lead sources or sales motions—door knockers (outbound) and inbound lead closers require different skills and incentives.
  • Save inbound leads for your sales “savages” and use door knocking as a proving ground.
  • Marketing must be in-house and led by skilled leadership, not just outsourced to agencies using generic tech.
• Advice: Separate roles, refine career paths, hire a high-quality marketing leader even if it stretches your budget.

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5. Choosing and Committing to Sales Channels

[23:43-27:54]
Art’s junk removal company wants to pick the “right” sales channel but faces indecision.

• Quote:

  "I will reject the premise that one channel will ‘work’—you make it work...Pick the thing you already have a skill overlap with, then double down." — Alex [25:18]

• Insight:
  • Every channel can work—social, outbound email, networking. Double down on the one that matches your or your team’s inherent strengths and current momentum.
  • Don’t dabble; aim for saturation in one channel to $3M, then diversify.
• Advice: If networking is your strength, scale that attendance and meetings aggressively, then reinvest results into learning new channels.

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6. Opportunity Cost & When to Burn the Ships

[27:55-32:58]
Adrian balances a commercial construction company ($11M, lower margin) and a fast-growing elevator maintenance company ($3M, higher margin).

• Quote:

  "I burned things down. The opportunity cost of my time continuing to slowly wind down the thing was more than what I could make on the sale." — Alex [31:45]

• Insight:
  • Sometimes, cutting ties with your legacy business—even at a loss—frees you to accelerate the real rocket ship.
  • Don’t be swayed by sunk costs: You are the asset, and skills gained transfer.
• Advice: Consider fire-selling lower-opportunity businesses if your new venture blows it out of the water, and ignore the doubters (especially those less successful than you).

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Notable Quotes & Memorable Moments

• On making choices at the highest levels:

  "Either want less or trade more." — Alex [02:17]

• On passive vs. active investments:

  "Keep passive, passive. Keep active, active." — Alex [06:49]

• On customer complaints about price:

  "I care more about what people do than what they say. Customers will always want it cheaper, faster, with more guarantees. That will not change." — Alex [10:11]

• On why people pay for skill:

  "The best talent’s always in the future. Whatever we have today, the best people are always ahead of you, not behind you." — Alex (quoting his president Sharon) [03:20]

• On difficult business decisions:

  "Everyone told me I was crazy. No one wealthier than me ever told me that." — Alex [32:35]

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Timestamps for Key Segments

• [00:24–07:13]: Overcoming fear, distractions, and comfort to scale from $6M to $100M (Thomas)
• [07:14–12:12]: Hiring for redundancy and raising prices to scale an electrical business (Corey)
• [12:52–18:17]: Delegating tasks and premium hiring for a high-end HVAC business (Tanner)
• [18:18–23:40]: Separating inbound/outbound sales teams and leadership in marketing (Trenton, roofing)
• [23:43–27:54]: Picking and committing to a sales channel in junk removal (Art)
• [27:55–32:58]: Legacy vs. opportunity—when and why to burn down the old business (Adrian)

---

Final Takeaway

This episode is a tactical clinic on leveling up from operator to owner and from small business to scalable enterprise. Hormozi’s advice centers on:

• Embracing trade-offs,
• Ruthlessly prioritizing your time,
• Hiring the next-level team,
• Charging what you’re worth,
• And having the courage to make bold, unpopular moves when the numbers demand it.

"You are the asset. All the effort wasn't wasted—you’ll use those skills wherever you go." — Alex Hormozi [32:48]

Transcript

[A]

I've been in business for 14 years. I recently did $106 million book launch in a weekend. And our portfolio of [e-mail] is over $250 million in aggregate revenue. And a portion of that is brick and mortar chains that we own. And so in this video, I'm answering your questions about how to scale specifically a brick and mortar H vac business. And for all of those questions, I try to do my very best to make the solutions as tactical as humanly possible so that you watching from home can actually use this stuff. Enjoy.

[B]

My name is Thomas. I sell roofing and exterior remodeling. We do close to 6 million this year. I would like to be at 100 million. What's stopp? And I'll be a little bit vulnerable. I would say it's comfort, distractions and

[A]

fear and food fear. Oh, sorry. I was like, all right, good to know. Sometimes I feel that way too.

[B]

So the comfort is I have built the business. I've replaced myself in every aspect. I can work two to three hours a week and it run fine.

[A]

Okay.

[C]

Fear.

[B]

I would say the fear of losing family time, the work life, balance and the distractions are my other. I've got another business, drunk removal business. I've got real estate. I've got just all kinds of little.

[A]

What do you think you should do that you're not doing that you want me to tell you to do

[C]

so.

[B]

So I know I need to go all in again.

[A]

Okay.

[B]

And I did that the first five years that I worked out, and it worked out great. Went through Covid. I got, you know, kept the business going really well, and I worked myself out of the job, got comfortable.

[A]

Okay.

[B]

So I don't know what I'm looking for you to tell me to do.

[A]

Well, I'll say this differently. I think regrets come when we imagine the upside that we don't have without taking into account the cost that we didn't suffer. And so I think we regret when we imagine the upside that we didn't get without also considering the downside that we didn't suffer to get it. And so I think that's where a lot of regret comes from, because it's not real. So it's like maybe there's some girl that got away or some business opportunity that got away, and we just imagine this amazing thing, but not the trade off that we would have to do in order to get it. We just imagine the upside without the downside. And so I would say a couple things. So one is, I think that there are trade offs that we always have to make. And I don't think they're right or wrong, I think they're just their preference. There's no right answer to how much work life balance you want to have. It's right for you. And so said differently, if I like cookies and I'm good with that and I also want a six pack, I just prefer cookies to a six pack. It's just, that's the trade. And I think the dissatisfaction comes from wanting both and so either want less or trade more. And I think that's really what it comes down to in terms of is there a path where I can work no more than I currently am to go from 6 to 100? There probably is. It depends on how much you're willing to pay other people. And so you might have to take a short term hit in terms of profitability to bring in the level of talent that you want to expand the business on your behalf to where you want it to go. And so as long as you are the type of person, character wise that they would want to follow and believe in your vision and you can make your vision big enough that they think that their aspirations can fit within it, you can get that type of person, person. But like it's, it's 100% like you're, you're graduating right now into the who game, but there's levels of who's, you know, like I remember the first time I hired a $50,000 year employee and I was like, this is the shit, this is what I'm talking about, you know what I mean? Like I went from minimum wage labor to 50,000. I was like this, they can read, they can write, like let's go. You know what I mean? And then I hired my first six figure employee and I was like, oh, what was I talking about? Like this is what's going on. And then I hired my first 251st, 501st million first multi million dollar per year employee. And it's just levels. And so Sharon, who's our president, said this to me years ago, but I always remember it. He said the best talent's always in the future. So whatever we have today, the best people are always ahead of you, not behind you. And so I think for you, if you really do want to accomplish it without making the trade, you will make a trade. Because if you change nothing, nothing will change, right? So we have to change some component of your life. And so the question is, which thing do you value the least? Do you value having More profit or more time with your family in the short term, in the long term, you can make it up. You won't make up family time in the long term, you can't make the profit up in the long term. So if you're willing to give up short term profit, you can bring in high level talent and then they can lead the growth. In terms of the fear stuff, I mean, I would just say, like, just hold the line. If you don't, like, I'm afraid of losing time with the family, it's like, just don't. And then in terms of the real estate thing, I see real estate because I know a bunch of entrepreneurs. I have a ton of real estate. As long as you're not actively running it. That's why I'm a big fan of REITs and funds. Because if you have good partners in that stuff, they can just run it. You can make better than the market. But it doesn't change anything about what I do. Me putting in the S and P or me buying another big building changes nothing about my life. And so it's not a distraction unless you're like, if we could add a gazebo and what if we added a different roof? Because I'm a roofer and what if I combined what I'm really. And you're like, dude, stop. Just like, let the real estate be the real estate. Let the business be the business. And just keep them apart as long as you're good there. Because I think he's a distraction. Actually, let me double check on that real quick, which is when you said the distraction thing that you're afraid of. Why are you afraid of that?

[B]

I'm not afraid of it. I've got ADHD and I collect gold and silver. I buy houses, I buy buildings. I mean, it's just a little bit of the red dress.

[A]

Well, as long as it doesn't change anything about what you do, I don't care. But if it's like, no, I check this stuff all the time and it eats up my days, then yeah, I would say that it's a problem. And it's only a problem if you decide it's a problem. You might just like that stuff. It's just like, I sacrifice my goals because I enjoy this add. You know what I mean? Like, the cost of the big thing is the new stuff that you have to give up to keep it going. Thank you. I feel like I made some amens. This is great. This felt like a good meal, right? Yeah, I appreciate it, but yeah, that's like the cost of the big thing is all the new stuff you have to give up that you don't get to pursue, all the exciting things that you will no longer participate in because you want to do one thing big. Okay. And I think for me personally, I had this moment, I think a while ago, but like I had this realization of how long it takes to get good at anything. And then I thought about, oh, I only have like 30 or 40 more productive years at most. And so I'm like, I've got like four or five big seasons in me left. And so that's it. And so I don't have like unlimited shots on goal. I've got four or five big runs in me. So hopefully that helps.

[B]

I appreciate that answer because I thought you were going to say sell everything.

[A]

I mean, they're investments. I mean, I'm not going to tell you sell your investments. I would say keep passive stuff. Passive. Don't make it active. That's like incurring cost. Because if you're going to make it active, then make active money. Yeah. If you're like, I want to take my passive money and then make it cost me more time to get 5% better returns, it's like you're going to get way better returns in your active income than you're passive. And just, I would just keep active, active, Keep passive, passive.

[B]

Thank you.

[A]

Appreciate you.

[D]

My name's Corey. I'm an electrical contractor. I do 1.6 million a year. Probably keep about 650 of that. I'd like to be about 5 is kind of what I can see right now. My biggest constraint is myself. Plus hiring quality candidates.

[A]

So you can handle the volume you have right now. So you can't handle the volume you have. You could get more business, but you can't handle it.

[D]

I can handle it when the whole crew's here. And then as soon as one guy's gone, I'm back in the van.

[A]

Yeah. So you need more people.

[D]

More people.

[A]

Yeah, I got it. So we have to think about like, so this is probably a multi step thing just for everybody. Like as we're following through this is like if we have, if you have enough business, which it sounds like you do, that's not the constraint. Then it probably means we need to bump price and we bump price so that we can have the cash flow so that we can hire the extra person so that you have redundancy in the team. If Alex had to hop in, if Tim's sick, that's not going to work. We have to have two or three backups for any person who's here so that I can keep doing my job. But I can only do that if I have the cash flow to sustain multiple tims. This is where sometimes it's like a multi step solution. So it's like we have to fix the pricing component. And it's like, okay, well I feel weird charging more because other people in my market charge even less than I do and I'm a little bit above the market. Right. So then we have to think about the offer. It's like, okay, so the offer might be the issue, which is like, okay, can we make our thing faster? Can we make it more reliable or we can make it easier? Right. And can we guarantee around that? And if the answer is yes, and it's like, great, well then that's what we're going to charge our premium and bump prices by 20 to 40%, which sounds like a lot, I know, but we say, hey, if we don't meet any of these qualifications, I'll give you all my profit back. Which means that you raise the price and if for some reason you don't meet it, you go back to the exact same price you're charging now. But everyone that you do meet everything on you get all the juice. And if no one else does those kind of guarantees, which basically no one does, then you can basically say, well, the reason that they're not doing that is because they're not confident they're going to be on time and on budget. And I am. And so it's very easy for somebody else to say, hey, I'll do this job for you and maybe I'll be on time and maybe I'll be on budget. But if I have no teeth in that agreement, I'm promised that it'll be free and I'll be done tomorrow. But if I don't have to be right about it, who cares? Sure, I'll be done tomorrow. And they'll be like, oh, I guess I get your point. Like, right, I'll be done by this time and it'll be done satisfactory at this price, period. And you know that when you sign this, you get that that's it. And if for some reason something happens, we'll come back and fix it. Right. And so by doing that, you'll be able to increase the cash flow which will then allow you to go recruit the extra tech that you need so you can stay above the business and then ultimately honestly just keep advertising it so that you can keep hiring and

[D]

backfilling Okay, I can see that totally. For my service calls and stuff like that, kind of my bread and butter is I chase six or seven different heating and cooling companies around and do all their electrical work.

[A]

Cool.

[D]

So they take the lead. They. Yeah, I have a flat rate sheet for that. But the biggest thing they always complain about is price. And we're super efficient to get in, get out. But they're always complaining about the cost that we came in at.

[A]

Do they still buy from you have for six years? Yeah. I mean, I care more about what people do than what they say. Okay. Everyone would like it cheaper, right? I would like it cheaper. I would like all of you guys to get paid less. But it's. Yeah, I just. I pay very little attention to that. Okay. Like, customers will always want it cheaper. They will always want it faster. They always want to guarantee, like, these are all things. Like, that will not change.

[D]

So when I'm moving, my prices don't even. Yeah.

[A]

Be like, this is what it is. Okay. Yeah. Now to make yourself sleep better, you have six or seven guys. It's like, wouldn't it be cooler if you had, like, 60? Right. So then we go back to the top here, which is you have your way of getting customers, which is mostly chasing these six or seven heating and cooling companies around. And so it's like, what do you get? What do you do to get the heating and cooling companies?

[D]

Basically, I've worked for one for 15 years, and it's just constant.

[A]

Yeah.

[D]

And then the other ones, since I opened my business shortly after they've been with me. And so really, I have no.

[A]

You have no marketing function.

[D]

Yeah.

[A]

So you should start doing. This is what I would do if I were you. I'd start doing outreach to other heating cooling companies. Say, hey, let me quote some of these jobs for you. Like, a lot of people are just stuck with the person they're they're with. They're not happy, they're not unhappy. They're just whatever. Like, let me at least get something. It'll just keep them honest, at least. Right. And so then you can just start bringing business for yourself. And that'll just give you more leverage with all of the other kind of negotiations that you have with the existing companies. Okay. Because right now you're just dependent on them, so they have all the leverage. Well, yeah.

[D]

And then as soon as they, like, I'm missing out on work.

[A]

Yeah.

[D]

Because as soon as they say, hey, we have a job tomorrow. Yeah, I'm going. Because they're my. Yeah, they're My whales.

[A]

Right.

[D]

So it's.

[A]

So you see more whales. Okay, yeah, so we need more whales, but to get more whales we have to tweak price to get so that we can hire the manpower. Like it's usually multi step solutions because like for most businesses it's. If it were one thing, you probably would have already seen it. So it's usually second order or third order that has to change so we can reverse engineer back to the fixing the core problem. Gotcha.

[D]

Thank you.

[A]

That feel good though? Yeah. Okay, cool. Appreciate it. Real quick, I'm going to show you the exact 10 stage roadmap from 0 to 100 million plus that less than 1% of companies finish. I've now done multiple times. And so I can say with a lot of confidence that these are the stages as headcount increases that you need to get through. And I broke each of these down by eight different functions of the business. What the constraint feels like, like what are the symptoms of it when you're going through it and then what steps we actually took to graduate. And we've done this across software, physical products, service businesses, brick and mortar, all of this. And it works. And it's my gift to you. It's absolutely free. And so the link's in the description, but you just go acquisition.com roadmap. Just enter info and it'll spit it right back to you. All free.

[C]

My name's Tanner Jarrett. We're at 1.5 mil the date.

[A]

Amazing.

[C]

700 net. My big concern is how do I make the dream team like you have here? How do I get technicians on board? Sales guys? Yeah, like make it work.

[A]

So okay, what breaks when we do more?

[C]

What breaks?

[A]

Like what stops you from doing this? We're figuring out which one, like order ops. What breaks when you do that?

[C]

Biggest issue is technicians.

[A]

Okay. So tax is the. Is the issue. Okay, so what do you have? What do you make on a tech?

[C]

Anywhere from 180, 200, 300,000 a year per.

[A]

Yeah. After cost. Uh huh. Damn.

[C]

Well, this year. Yeah.

[A]

Your dentist, he's giving you a run for your money there. I'm just saying, man. All right, all right. So we got 300k for the techs. Got it. All right. And you need them local in Bozeman. Yes. Okay. And what are you doing right now to recruit techs?

[C]

Honestly, kind of just gave up lately.

[A]

Yeah, I would imagine that would make it difficult to recruit more techs. So then let me ask the next question, which is like what stops you from recruiting more techs? Not the decision. Some of you guys have probably seen that management diamond that I have, which is like people don't know that you need to do it. They don't know how to do it. They don't know when to do it by. They have something blocking them or there's a motivation issue. I'm assuming you're motivated. I'm assuming you already know that you need to do it and how to do it 100%. So. And you need to knew the when is now. So I'm guessing there's something blocking you.

[C]

My thing that's blocking me is I have to be involved. I believe in every single strong words.

[A]

Yeah.

[C]

Every single aspect of the company.

[A]

Have to. Or choose to.

[C]

Choose to. Choose to.

[A]

Just so we're, you know, staying from saying him. Okay.

[C]

And so I can't. I can't let it go.

[A]

Okay. So can't. You won't.

[C]

We have some. Okay. We have some very high end clients.

[A]

Okay.

[C]

So we work at the Yellowstone Club in Montana. Spanish Peaks. I know. Matt Damon, Jennifer Garner, Mark Zuckerberg.

[A]

I mean, you don't need a name drop.

[C]

Yeah, sorry, but you're a big deal. I'm not a big deal.

[A]

It's tiny.

[C]

Ed told me, he said anyhow, and so it's hard to let that go. You know that, that ego.

[A]

So fundamentally, I mean, Keyman is the number one risk of every business for two reasons. One, no one wants to buy it, but second, you want to kill it yourself at some point because you're like, I don't want to do it. You said you burnt yourself in the ground. Right. So what we have to do is if we look at all of the things like look at your behaviors, not your feelings around them, and say, okay, these are all the things that I do on a daily basis. Some of those things someone else can do. Now there's for sure things that are higher leverage, higher value. It might be that for you, doing the design for stuff is the highest leverage thing. I don't know. It might be. It's definitely not using your hands. I can promise you that. It might be getting the relationship and managing the relationship that might be the most valuable thing. So if we just did, if we, if we did a rank order, this is what you'd have to do is like we do a time study, which is step one. So take an Excel sheet. You can open up on your phone. Every 15 minutes you have an alarm. It'll annoy everyone. Don't worry about it. And every time it goes off, you just Write what you did in the last 15 minutes, and at the end of the week, you can look at all those activities and rank them in terms of revenue, like, which of these is the most valuable and most unique? And then when you look at the bottom half of that list, does it neatly fit into some person that either exists currently that has bandwidth or somebody that we can hire? And part of the good news that you have is that when you serve premium customers, which you do, you can charge a premium, which you do, which means that you should have excess margins. You can get premium people. And so right now, what will probably be required is that you have to lower your tolerance for mediocrity on your team. And so it might cost. So if you're gonna make $300,000 per year for a tech, it's like, would you be willing to spend $50,000 to go get another tech who's good?

[C]

100%.

[A]

Right. And so that's a combination of, like, you could try the recruiting firm thing, which is a thing, one that you probably haven't thought of, that I would strongly recommend. This will probably be the unlock for you, is run national ads and then offer a really generous relocation package. So make the 50. Basically a signing bonus. You get 25 now and 25amonth. 6.

[C]

What do you think about Instead of having W2 employees and how much they cost running 1099 service tax, you're a business.

[A]

Do they have to show up at certain times and do work specific the way you want them to do?

[C]

Yes.

[A]

Or employees. Employees, yeah. Unless they're like, they're not vendors. They work for you. If you have meetings and they have to show up, they're employees. So no, you, like, keep it W2. Keep it tuned. You want to go more legit, not less legit. Yeah, but fundamentally, if you were to spend this $50,000 to go get another tech, we just have to. Getting the tech, I don't think is gonna be that hard, honestly, if you're just willing to spend money for it, which you have the money to do it, and then the other piece is, okay, now that this person comes on, I have this big stack of stuff, how can I give them a third of it or half of it, and then all of a sudden you get those time back. And so let me ask you a different question. If you got half your time back, could you double the business 100%? Right. And so that's the game. Yeah.

[C]

Beautiful. Thank you, Alex.

[E]

My name's Trenton. We sell roofing. We're going to do about 3 million. This year we'd like to be at 10 million. My biggest constraint, or what's stopping me is that for the last eight years all of our lead gen has been

[A]

from weather from doors. Okay.

[E]

So it's been 100% door to door lead gen. And now when we're trying to knock for retail, it seems to be heavier of a weight on the team.

[A]

When you say retail, what do you mean?

[E]

So like just people on market that need a roof.

[A]

So like residential.

[E]

Residential, okay, cool. Residential, yeah.

[A]

And when you were doing door knocking before, you were knocking on residential doors. Okay, so it was the.

[E]

Well, we were getting funding from the insurance company.

[A]

Got it. Word. Okay. Yeah.

[E]

So now with me being a door to door guy, like purchasing leads and all that was like sacrilegious to me. So there's some limiting beliefs there that I started to explore. Last October. We bought leads.

[A]

I just want you to be lead curious. That's all I'm asking for.

[E]

Yeah, I'm very lead curious now. But I basically got slaughtered learning this.

[A]

Don't be acquisitionary binary. You know what I mean? Be non binary with your leads. As many as you want. Yes, yes.

[E]

No, that's what I'm trying to do here. And when we did purchase leads and

[A]

the unedited version, by the way. Go ahead.

[E]

And when we started to stack the guys calendars, there was a big culture shift where we actually saw more buy in from the guys. But then the door knocking just went.

[A]

Because it was easier.

[E]

It was way easier. But our CAC and all that was absolutely horrid.

[A]

Right.

[E]

So I was spending like $7,500 just to acquire one customer over the summer and it wasn't sustainable. So I make from a customer on average $6,500.

[A]

So that does not work.

[E]

No, it doesn't work.

[C]

Yeah.

[E]

And it was just like a lot of the marketing agencies that we worked with were like younger people. They were like using AI tools, go high level, like. So we decided that we were going to build it in house.

[A]

Okay.

[E]

So with that being said, now it comes into a leadership issue because I need somebody that knows how to market better than I do so that I can focus on training and.

[A]

Can I pause you real quick?

[E]

Yes, please.

[A]

Okay, cool. So you're at 3, you want to get to 10. You rebuilt it from storm chasing to just straight up door knocking whenever. Fine. I think it was a good idea. You had a door knocking team. You took the same sales guys, brought them on leads that you got them. They got lazy, fat and don't want to do door knocking anymore. So great. Rule number one. Outbound and inbound are separate teams.

[E]

Yes.

[A]

Inbound is what you graduate to. And so if you're an absolute savage, like you just take children's souls and just rip them out every day because you're a terrible person, but you're just unbelievable at sales. Then and only then do you get the opportunity for me to feed you leads. Because these are the most expensive leads that we have to work very, very hard for to make sure and, like, we cannot waste them on anybody who cannot close everything. And so thank you. I hope that was an amen. And so first off is the team should be separate. But you're in this mix now. You're in a little bit of a mess. And so my 2 cents would be like, take the cause I'm sure their commissions have gone down since they now are selling nothing. Basically.

[F]

Yes.

[A]

Yeah. So I would say, guys, my fuck up. I went to this thing. He told me I did this big boo boo, which is inbound and outbound. We're together, which is not how it should be. Everybody get back on the streets. You guys do that. And then for the absolute savages of you, because you can usually have far fewer people on inbound, that becomes the Christmas tree of the career path. Because on inbound, I can feed you and you can do like five sales a day. You can't do that door knocking. Right. But you can do it. If I'm feeding you leads that are already qualified, already set, already gone through a vsl, whatever in the sales motion. And then those guys can absolutely clean up. But you earn the opportunity to get that level of commissions. Now the commission structure should also be different on inbound because you have to pay for those leads. So it's a different role. They graduate to it. It's more volume, lower per, but it's more reliable. Which guys with families, things like that. If you have a bad day, you close two, and a good day, you close seven. It's different than you have a bad day, you can close.000. Right. It's much more stressful. And so guys will be happy to even give up. They'll even make the same money, but should have to be more reliable and you don't have to be in the sun.

[E]

So then we should hire for inbound sales.

[A]

Yeah. Or take one of the guys you have who's really good at it and put everybody else back on the street. So you just funnel everything to that guy because then you can iterate faster. Because you're new on this and so you never want to have too many news. Because kind of like the brick analogy I gave at the beginning, the more news there are, the more likely something's going to fuck up. And so it's like, I know this is a absolute savage salesperson. If they're closable, he'll close them or she'll close them. And so then the only variable we have is just what offer lead source am I getting and what process are going from lead to talking to them. Those are the only variables you have to play with. It's much easier to iterate on that and then get it to go faster.

[E]

Okay, okay. And then. Okay, so then I want to hire a marketing director or leader to manage that.

[A]

Outbound team goes out, inbound team becomes the one guy. You need to hire a marketer person who actually knows what they're doing. Probably pay more than you expect, but then that person will be worth it. Your entire business is sales and marketing, so you should have the core elements of the business in house. Okay, great.

[E]

Excellent.

[A]

If you need help with the sales process, we can help you.

[E]

Excellent. Thank you.

[A]

My name is Art.

[G]

We sell junk removal and demolition to commercial property managers. Currently do 1 million a year. Would love to be at 10 million a year. What's currently stopping us is knowing which sales channel to focus on. I know it's important that we pick one, capitalize on it, and I'm wondering how much time, energy or volume do I spend on one while I determine if that's going to be our channel or not and know whether to leave that one or focus on that one?

[A]

Yeah. So I'll give you two answers to that question. So before I answer it, I'm going to do the first thing though, really the second thing first. What do you do currently right now to get customers?

[G]

Right now it's been mostly referrals.

[A]

Okay. So you can't do more referrals because there's nothing for you to do besides do a good job. Okay, that's fine. If referrals is the way you're getting business, what ways have you begun or you haven't started doing sales channels yet?

[G]

So we've started to lay the framework for doing email cold outreach as well, simultaneously with LinkedIn outreach, and then also converting some of our social media efforts into a bit of outreach as well with people who are engaging. So those are some of the things

[A]

that were like manychat and then DM and then.

[G]

Yeah, yeah, more manual for now while we get the Flow going. And then also I'm in a networking bni, so that's.

[A]

I would prefer you stick with one of them and just do more in that thing. And so if the question is how do I. So the original question was how do I know which one to pick and how long to stick with it. So I think I will reject the premise which is that one of them is going to work like you will make one of them work and so you could make any of them work. And so I would take the hypothetical extreme of is there a business that acquires other businesses customers in each of those different channels in your market?

[B]

I'm not sure.

[A]

I'll bet there is. There probably are some junk removal people who do it via social media and they take it that way. Some people probably do it via LinkedIn, some people do cold outreach. All three of those are super repeatable channels that anyone could run. So all of them can work. My recommendation to you would be the one that you have the highest overlap with existing skillset between you and team. So if you and or your team have more knowledge around social media stuff, they'd be like just double down on social media. If it's. I have, you know, we're better at kind of the outbound motion, then I would say go do the outbound motion via email. And if it's like, well we want to boost these things, it's like, well, why don't we just send more emails? You know what I mean? Does that help?

[B]

Yeah, it does. Okay.

[A]

I was like, you sure? Everything else, that was an easy one. That was like a warmup.

[G]

Well, for I guess, follow up since you're taking more questions, I guess if you had to just say one irrelevant to what the team has, which one

[A]

do you have the best skill set?

[G]

To be honest, I just don't have the skill set. And I guess networking is number one. When I'm in person with people, I'm doing the best.

[A]

Okay, so hear me out then. Wild idea. So you do networking stuff and so if I said I want you to spend four hours a day to find every local community based related event with 20 people or less or 50 people or less in it that have people who are similar to your avatar, would you be able to do that?

[B]

Yes.

[A]

Okay, so why can't we do more of that?

[B]

We can do more of that.

[A]

Okay, so how many of those events do you currently go to? And I'm guessing you get customers from when you go there, right?

[G]

Yeah, they, they compound over time. We go to currently a Few a week. And then we're meeting one on one

[A]

with a lot of people we meet afterwards. Right. So I would say, all right, well then what would it take for us to go to like several a day? That would be my first kind of like risk adjusted move, because the other things you haven't done yet at all. So I was like, how do I go from 1 to 3? Just like this year I would do that because then it'll free up more cash flow. Because the issue that you have right now, especially like in the swamp that you're in right now, I would just do way more of the thing you're currently doing as my path of at least getting to 1 to 3. It's probably super profitable for you as well. And then I would invest more of those resources into learning one of the other channels. Got it. Perfect.

[G]

Thank you.

[A]

Cool. You bet.

[F]

My name's Adrian. I own a commercial construction company. Did 11 million this year, 10 last year. Read the book Built to Sell. So I started analyzing my company and I said, or I figured out that construction companies are not an easy asset to sell. That their enterprise values based off of assets or backlog of work as a commercial contractor. I thought to myself, okay, well, how am I going to do that? So we started doing public works projects, bought some heavy equipment. Now we have contracts that are for several years at the same time. With the clientele base that I had in the multifamily space, I started thinking about, okay, well if I don't want to sell this company, if it's going to be that difficult, how do I get recurring revenue? So I started an elevator company. And over the last 12 months, we did 3 million to start. And it's a racket.

[A]

Congrats. I have elevators. It's ridiculous.

[F]

We can help you. So if you were me with the two companies and the combined revenue, what would you do next in order to go from 10 to 100?

[A]

What's profit on 3 versus 11?

[F]

30% on the 3, 18% on the 11.

[A]

Okay, so you're making roughly double on the construction side. But cash flow sucks and it's a pain. And you never take the money out of the business, probably, I'm guessing. Okay, so it's a tough call because you already did it, right? You can't not have the kid. It's already out there running around.

[F]

That's what I had said.

[A]

Can't insert. It doesn't go back up. Right. Okay. So I think again, it depends on what you want to do. So I think the elevator Company totally could sell if you wanted to sell that business. I do. Are you splitting your time right now? Yes. Yeah. So it might take $800,000 in profit on the construction side to get the two or three liters that you need to do it without you. And then it would continue to exist. I do think the elevator is the better opportunity for the reasons that you're already aware of. And it probably grew significantly faster than the other one did. Oh, yeah, yeah. This isn't normally what I would say in this type of situation, but I'm just familiar with it. What timeline do you have? Like selling five, selling ten.

[F]

Definitely ten. You know, if I could do it in five.

[A]

Okay, you could sell in five. I mean, what's the growth rate on the elevator?

[F]

Well, I mean, year one. Three million.

[A]

Oh, year one. Right, right. So it's a straight up elevator. Okay, sorry.

[F]

Exactly.

[A]

Straight to the penthouse. Okay. There's the reasonable advice, which is, hey, hire the people and then let them continue to run the thing. And then I would say, like what the quote Alex advice would be, which is super unreasonable. And I only give it because this is what I did. I burned things down. And so if I can't exit it. So like, you could exit the 11 now for way less than you think it's worth. Right. I would just be willing to exit it. I had six gyms and I fire sold them in 90 days. I made in total on six what I should have made on one. And then within six months, I was doing a million a month on the next thing. And so once it was clear that this was a way better opportunity, like the orders of magnitude better, which I think you are in that situation right now. It's super niched. You've obviously got ins in terms of understanding how to work. It's already recurring. It is a racket, a legal racket, but it is. Oh, it is. If you're willing to take a step back. If you're like, I want to do this in two years. The break even point on this is two years, which is like if you got rid of the construction firm in the next 90 days and you said, I don't care what the price is, I just want all the headache back. You will grow so much faster on the elevator side. You did three while splitting your attention. If you had had full attention, you might be at 8. And so I tend to think only exclusively on opportunity cost. I don't normally give that advice because it's just so hard for people to do. But I burn things down when I am very clear that this is the next thing I'm going to do. Just because I know that the opportunity cost of the time of just continuing to wind this down or get it ready for sale, I could make more than I'm going to make on that sale in this opportunity. So let's say that a perfect exit for that business would be like $5 million or something, based on the assets and the AR that you have coming. It's like, for me to build another million dollars in recurring revenue in the elevator business, I can do that in a quarter, which equals the enterprise value of the other thing. And so as long as you can get out of your head around like. Cause everyone, if you do this, everyone will tell you that you're crazy. Everyone has told me that I was crazy every time I've done this. And that's why also, none of them are wealthier than I am. Just like, no one who was wealthier than me told me that. So as long as you're good with it and you can just stomach the fact that your wife's like, you worked so hard on this. And your dad's like, this is ridiculous. All the blood, sweat, and tears and all this stuff, and you're like, I did this so I could learn all these skills and apply it here. It was not a waste because I was the asset.

[F]

Thank you.