Introduction
Alex Hormozi, an entrepreneur who has sold nine companies, including one for $46.2 million, shares 13 years of business wisdom. From pricing strategies to advertising, customer acquisition, and team management, Hormozi’s insights are a goldmine for entrepreneurs. In this blog, we’ll break down his top 20 lessons.
1. Premium offer pricing
Hormozi emphasizes the importance of having an extremely expensive offer on your menu, even if you don’t expect to sell it. This “anchor” makes your core offer seem more affordable. For example, a weight loss business added a six times higher priced option, and surprisingly, it outsold the core offer, tripling profits overnight.
Key Takeaway: Use premium pricing to make your main offer more attractive and don’t fear raising prices.
Read more in he’s book called $100M Offers: How To Make Offers So Good People Feel Stupid and $100M Leads: How to Get Strangers To Want To Buy Your Stuff
2. Advertise more
Hormozi shares a story about launching his book, where even after massive advertising, only one person recognized him. He stresses that most people won’t remember your ads, so repetition is key.
Key Takeaway: Don’t worry about over advertising. Your audience needs constant reminders, not just one-time exposure.
3. Focus on advertising
Until you hit $100,000/month, your primary focus should be on advertising. Without enough customers, you can’t iterate and improve your product.
Key Takeaway: Prioritize customer acquisition early on to gather feedback and refine your offering.
4. One Channel, One Avatar, One Product
Hormozi advises focusing on one customer avatar, one product, and one advertising channel until you hit $1 million/year. This narrow focus allows you to perfect your approach before expanding.
Key Takeaway: Avoid spreading yourself too thin. Master one thing before diversifying.
5. Start for free
Hormozi recommends starting with free offers to build testimonials and proof. This approach not only builds trust but also helps you refine your product before charging.
Key Takeaway: Use free offers to gather testimonials and referrals, which will help you sell later.
6. Proof promise
Instead of making grand promises, focus on showcasing proof. Recent, visual, and high volume proof (like testimonials and case studies) is more compelling than any promise.
Key Takeaway: Let your results speak louder than your claims.
7. Raise prices strategically
Hormozi shares how doubling prices led to a 35% drop in conversions but tripled profits. He advises testing price increases and being prepared for initial resistance.
Key Takeaway: Don’t fear raising prices. Higher prices can lead to higher profits, even with fewer customers.
8. Talk to customers
Your customers hold the answers to most of your business problems. Whether it’s low conversions or product issues, talking to customers provides invaluable insights.
Key Takeaway: Regularly engage with customers to understand their needs and improve your product.
9. Do more of what’s working
Before trying something new, maximize what’s already working. Hormozi suggests scaling proven strategies before exploring new avenues.
Key Takeaway: Double down on what’s already generating results.
Focus on the end result (the “vacation”) rather than the process (the “flight”).
10. Running a business is stressful
Hormozi reminds entrepreneurs that stress is part of the journey, whether you’re growing, stagnating, or declining. Accept it as a fact of business life.
Key Takeaway: Embrace stress as a natural part of entrepreneurship.
11. Customers billing
Customers judge your value based on their most recent experience. By billing less frequently (e.g. annually instead of monthly), you give yourself more time to deliver value.
Key Takeaway: Consider longer billing cycles to reduce churn and increase customer satisfaction.
12. Monetize under used resources
Hormozi encourages entrepreneurs to monetize under used resources. These opportunities can create additional revenue streams with minimal effort.
Key Takeaway: Look for ways to repurpose existing resources for extra income.
13. Prepare your sales team
Provide your sales team with content that addresses common customer concerns. This empowers them to close deals more effectively.
Key Takeaway: Equip your team with tools to overcome objections and close sales.
14. Sales and advertising
Hormozi recommends merging sales and advertising under one leader to ensure alignment and efficiency.
Key Takeaway: Break down silos between sales and marketing for better results.
15. Business leaders
Every business needs three key leaders: one for acquisition, one for delivery, and one for operations. These roles ensure the business runs smoothly and scales effectively.
Key Takeaway: Build a strong leadership team to handle growth.
16. Promote employees
Hormozi advises promoting employees based on their standards and performance, not just how long they’ve been with the company.
Key Takeaway: Reward excellence, not longevity.
17. Hire people
When hiring, look for candidates who will elevate your team’s average performance.
Key Takeaway: Only hire people who make your team stronger.
18. Employee underperformance
If an employee isn’t performing, it’s usually due to one of five reasons: lack of clarity, training, motivation, resources, or timing.
Key Takeaway: Identify and address the root cause of underperformance.
19. Tackling problems
The hardest part of entrepreneurship is tackling problems you don’t know how to solve. Hormozi encourages persistence and learning through trial and error.
Key Takeaway: Don’t shy away from challenges. Embrace the unknown and keep pushing forward.
Conclusion
Alex Hormozi’s lessons are a masterclass in entrepreneurship. Whether you’re just starting or scaling a multi million dollar business, these insights can help you navigate challenges and achieve success. Remember, the key to growth is persistence, adaptability, and a relentless focus on delivering value.
By implementing these strategies, you’ll be well on your way to building a business that not only survives but thrives.
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