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Language: en
you can drink and do drugs and watch
porn if you still do this that's all
that matters I want to do the formula
and then live my life how I want to live
each of us gets to make a daily choice
to play the victim or play the game and
if you're gonna play the game I suggest
you play to win and like all games life
has a set of physics there are things
that work and things that don't work
your job is to experiment until you find
the vein of Effectiveness to that end I
bring you Alex hormozzi the man with a
proven system for identifying
destructive habits and turning success
into a repeatable process
you are ridiculously good at writing
instruction manuals for how to make
money
literally you are singular in that way
but if people think poorly or they do
dumb things they're never going to make
progress so what advice do you have for
people that are wasting time on things
like porn social media or even just a
friend group that is going nowhere fast
if you it's my belief that if you could
control every one of the variables
externally to an organism you can
control Its Behavior
so one of my favorite quotes from BF
Skinner who is a behavior psychologist
from way back in the day was uh the old
saying is you can lead a horse to water
but you can't make a drink he said well
if you bleed it out enough and you
starve it and you leave it in the sun
and you put the water right in front of
its mouth he's like I can invaritably
guarantee that I can make a drink
and so if you were to think about
yourself as that horse then it's like
okay well what is the equivalent of the
the bloodletting the dehydration the
starving that you can put yourself into
get the behavior you want so starving
has a negative connotation but we can
also starve out
the negative things in your life like
you can starve the alcohol you can
starve the porn you can starve the
friends and I think the easiest way to
do that is to get out of the environment
you're in because like I'm sure you
heard about the I think this was in
atomic habits
um in Vietnam
I think it was like 10 of troops or
something we're taking heroin
um when they were there in the 70s they
thought there was going to be this
massive problem when they came back to
the States but when they came back to
the States almost no one continued the
heroin habit and so going from Vietnam
we were doing heroin to the U.S what
you're not doing taking heroin how to
had a 90 success rate whereas the
inverse is true of recovery centers in
the United States today people go there
and 90 of them relapse when they go back
home and so the difference is that
people were doing heroin in a different
environment and then they changed their
environment and then they never went
back to the environment that they did
heroin in and so it's like if you have
these behaviors that have cues from the
people the surroundings the colleagues
family whatever I think even if you
can't afford to move out of the state
like almost anybody can move across town
even 30 minutes away to just make it a
little bit more inconvenient for your
drug dealer for your bars that you know
for the friends to say you know hey
we're doing fantasy whatever on Friday
and it's like I can't make it right you
just make it inconvenient to do all the
things that you don't want to do and
make it more convenient to do the things
that you do and you'll do more of them
all right so the interesting thing for
me about the Vietnam heroin thing which
I've heard before is and this relates to
why I think people might be struggling
now is there's an underlying thing
that's happening that the the heroine or
the porn or the social media or whatever
is trying to mask and cope with
what what is that today like we have
things amazing things could not be
better yeah but you've got people doing
things to numb themselves out to what's
that thing they're afraid to face
I think it's their perceived judgment
their perception of other people's
Judgment of their failures that haven't
existed yet
and so when you're when you think about
constructing a mindset that is going to
allow somebody to be successful like
when I think about your blueprints
if you had to prep somebody to be ready
to deal with that blueprint what are
some of the either core beliefs or
habits that you would get them in the
routine of doing so that they could
actually deploy the things that you
teach
I think some of the things that I'll say
might sound repetitive to some folks but
I'm a big believer in a lot of the stoic
virtues
um and a lot of that just comes down to
having your opinion of yourself
be all that is required
and so
um
it's like it's like living for the
future version of yourself and letting
that person be your ultimate judge and
no one else's voice and I think that
obviously it takes practice for social
creatures we learn how to behave from
other people and their judgment of our
behavior when we're kids and then we
have to unlearn it as we're adults
because we find out that the people who
are giving us feedback actually have no
idea what they're doing
so but like it's super ingrained in us
and I think it just it's a long process
but like how do I prepare someone for
that
foreign
it's like everything is removing the
limitation right it's like I want to get
to here and so getting there is usually
straightforward it's the obstacles that
are all the things that people put in
their own way so it's like what are
because the obstacle might be have a
different name for every person and and
then trying to pull apart like why is
this thing like why am I putting weight
on this thing because
you had a strong drive when you were
growing up right and you wanted to get
into Film School you had this thing like
I don't know what that snap point is for
me I just like my fear of disapproval
from you know my dad was my big was my
big driver and so that was the thing
that could get me to quit whatever it
was you know what I mean to do the one
thing that mattered more
and I think that's at least for me that
was
I don't know how to find that for
someone
you said something in one of the
interviews that you were doing leading
up to your book launch that really hit
me and that was um you rewrote the book
something like 19 times and when you got
to a point one time you're like look
they're gonna be able to get this and
the guy we were working with said look
there's a guy in Iran and he has one
goat yeah and he's gonna sleep with a
copy of this book under his pillow yeah
do it for him yeah and that somehow
sparked you yeah so my question is given
your response to that given everybody
needs that thing are there some people
that are Beyond reach
no
I don't think I mean unless you have
like mental disability I mean like I
think that barring biology right
um no I don't think so I think I think
I'm a big behavioral person which is
like anything can be trained
um even like ah man he has such a great
personality it's like what is
personality well personality is probably
170 individual skills and so if one of
them is when someone walks in the room
you stand up
I can train that if it means that like
when someone's talking I need you to nod
your head like this when the other
person talks I can train that and if we
just had to make a checklist it's just
because it's hard to describe doesn't
mean it's that's impossible to teach
that's interesting okay so the the spark
the thing that causes somebody to
finally get into it
um can be translated into a set of
behaviors totally and then if you get
the set of behaviors then you're going
to be in a position to go right right so
um what are some of the behaviors that
people are doing now that you think are
destructive and what do we replace them
with
a lot of it is inaction
right like it's I'd love to say like all
these people are failing and this is the
thing that would fix it it's like most
people just don't take action to begin
with and so I think a lot of it's
between their ears
um to your point which is why I talk a
lot about fear of failure
um being being the actual enemy rather
than failure itself and really even like
even the idea that people are like I'm
afraid of failing no one's afraid of
failing people are afraid of other
people's judgment about their failure if
you could fail in private no one would
know like when you play video games and
you lose the level you're not
embarrassed
right like interesting so I've heard you
say that before yeah and I've always
agreed yeah but I do think that there is
something that will chip away at
somebody it so it comes down to what do
you build your self-esteem around this
was the big breakthrough in my life was
the day that I realized I got to choose
what I built my self-esteem around and I
had been building my self-esteem around
being smart and so I was constantly
putting myself in a position where I
could prove to myself and others that I
was smart I began to realize we are both
the shout and the Echo and I wish it
weren't so I wish we weren't the Echo
and what I mean by that is you're what
you do but you're also what other people
say about what you do and as a just
unimaginably social creature it is baked
so deeply into our DNA right I don't
think there's any escaping that so you
come into whether it's playing video
games or trying to build a business or
whatever
with a lifetime of being both the shout
and the echo yeah so you have a sense of
who you are you've mapped your
self-esteem and now if part of your
self-esteem is I'm good at this thing
yeah after a while like you're way
happier to fail in private because
nobody sees you so there's no new Echo
reinforcing what an you are but
I don't think you have unlimited
failures on your side before you go
maybe I'm really not good at this thing
and if your self-esteem is about being
good at that thing then it really will
begin to erode you do you have uh
assuming I'm right about that do you
have a thing that you encourage people
to build their self-esteem around to
avoid the kind of traps that will make
them afraid of failure
I think it would be around the traits
which can be evidenced by the things you
do which I think is probably where you
made your shift unless there's me
assuming here but um like it's not about
being intelligent about being like hard
working right it's like if you if you
build your identity around that trait
then you can always do more of it like
you always work harder you can always do
X put extra reps in ETC
um
and I think yeah people build build that
trait as their as their identity and
where they get their self-esteem from
then it becomes a self-reinforcing cycle
but they're the ones who are in control
of it rather than the outcome and so
that way it's like all of the variables
of your identity and your
self-confidence are under your control
which I think is cool
which is very cool so have you
identified the trait Smorgasbord that
people have at their ready to be
thoughtful about so for instance being
smart would be a trait being honorable
being honest being hard working
um what should people be building their
self-esteem or what traits is there one
is there a magic handful
I think the ability to delay
gratification
and from a behavioral perspective it's
being able to continue to act on a
longer extinguished curve which is like
if I knock on a door so if I knock on a
door and nothing happens how many more
times do I knock on the door before
someone opens so like if you if you if
you fire someone and they're like wait I
I want my job right you can you can
measure what someone's curve on how many
times they will try again on something
before they move on and give up right
and so the longer you can make that
curve on someone the more likely they
will hit the jackpot which then extends
how many more times they'll go the next
time which is basically how addiction
works too but you can also use the same
concept for good things so number one is
being able to delay gratification
um the second one is uh I think it's
it's
vision of what you actually want to do
is like where do you want to go because
you can have somebody who works really
hard at building a restaurant like one
single store and you work really hard at
building uh an app that's going to
change the world the amount of hours and
effort that go into building an amazing
restaurant and that are probably about
the same the amount of impact is
disproportionate on something that can
go to gazillions of people so I think
you have to have some level of vision
um and that comes from the people that
you're around
the third one is
is having some level of drive and I
think that you can have either pool or
or away from Drive pick which one or
whichever one you've got more of I would
say start with that one and I think it
does shift over time because many
entrepreneurs have away from Drive in
the beginning we're afraid of failing
we're afraid of not being enough
you know we hate being poor whatever
your thing is
um a lot of times especially I get a lot
of DMS about this it's like I'm trying
to find my passion I'm trying to find my
purpose my thing and um I don't think
you find it I think you make it how do
you know if you're going to like
anything without trying it you don't and
most people hate things that they suck
at and how do you stop sucking at stuff
you you do stuff that you suck at a lot
until you suck less until you're
eventually good and so it's like so you
so you're not going to be passionate
about anything that you suck at which
means that it's a fallacy of thinking
I have a hypothesis that haunts me and
that hypothesis Is For Real partly
because it applies to me uh that
hypothesis is that people have a very
hard time holding sophisticated ideas in
their head part of what I think makes
you so amazing and PS I would like to
say that almost a year ago I said within
the next five years you'll be one of the
biggest uh names in social media and I
think you crushed the timeline Just
monstrously You Killed the predictions
hey there it is uh just really really um
crazy but people really have
um just such a a difficult time holding
sophisticated ideas in their head the
thing that makes you as amazing is that
you are able to hold sophisticated ideas
in your head and simplify them so that
people can understand and they can
deploy them and actually use them but
the inability to hold the sophisticated
idea in their head is going to create a
tremendous amount of problems so when I
think about okay you're going to have to
to pick something for your identity
that's going to allow you to face
failure to go into that Loop you know to
be able to tear yourself down and not
have your desire to push forward
extinguished you already have to be able
to conceptualize that idea that you're
going to be fighting against your
neurochemistry so you're going to knock
on that door it is going to be brutal
it's it's going to feel so bad like
death and you then have to do mental
Jujitsu to translate that into ah but I
build my self-esteem around being the
person that can have this long
extinguisher that I can knock on a
thousand doors when anybody else can
only knock on Two And
I worry God is my big fear that I do
think some people are Beyond reach I
think that is my big fear
and I do impact theory is predicated on
the idea that as long as somebody meets
minimum requirements that they're going
to be able to do it but
press on this point because I'm deeply
optimistic and so Lord knows I hope that
you convince me
but the more I do this game the more I
realize that people get trapped in
things like
um I'm trying to find my passion yeah
and that the emotion of nothing feeling
real yeah is and and what you have to do
to build a connection between I choose
to make this my passion and how you make
that emotionally resonant is so
sophisticated that most people won't be
able to pull it off yeah
you talk about stacking Pennies on the
evidence
what evidence do you have
for all of us that it anybody really can
turn
a lack of belief into simple rudimentary
Behavioral
things that they do to get those wins
yeah
so
I'll make a statement and then I'll I'll
answer that which is um
I think like confidence without evidence
is delusion and so the idea that you
aren't confident if you don't feel
confident right now is okay because the
question is what are you trying to be
confident about like confidence as a
word right if we can Define terms is uh
you're the own percent how
the percentage likelihood that you have
that what you think will happen or will
happen right like in statistics like
what is our confidence score on this
metric right and so the same thing
applies to a person what is our
confidence that when Johnny says he will
do this it will happen and so we have
our own confidence metric for ourselves
which is a percentage likely that we
will do what we say we're going to do
and so the way that you can increase
that confidence is to have more evidence
that you've done things when you said
you would do them in the past and so I
think it's about looking retrospectively
and thinking you know what story can I
tell around this data that would give me
more evidence that I actually do have
some of these trades that I didn't think
about and I'll give you a funny little
clip on this so when I was selling
weight loss memberships way back in the
day I remember a common thing that would
come in uh would you know a lady would
come sit down and say you know um I
haven't worked out in seven years and I
know I need to be going to the gym and I
would say that's amazing and they would
just be shocked what do you mean I'm
like you're so consistent
I was like so you already have the trade
of consistency we just have to flip it I
was like it's way harder to learn to be
consistent then I was like if you were
just yoyoing back and forth all the time
I was like it might be way harder I was
like but you actually stick with what
you what you said and they were like
never thought about it like that and so
it's just like and I say that a little
bit tongue-in-cheek but to the same
degree it was really just a reframe for
these people and whether or not you know
people want to take that and run with it
in whatever Direction though like for me
I just wanted this person to believe
they could do it and so I think to the
same degree it's like well if every day
you didn't make 100 reach outs right or
you didn't make the piece of content
that you wanted to but up until that
point you've always like been able to
like make a cup of coffee and like sit
down at the computer rather than uh
going to the arcade you know
figuratively or you know playing video
games or going live video games as much
to you Alex no going to the arcade boys
and girls back in the 1980s yeah and so
and so it's counting the win sometimes
of losses that didn't happen which is
like what could have gone worse which is
also a stock frame but it's like what
could I have done to mess this day up
more than I did it's like well I could
have I mean I could have taken five
shots when I woke up I didn't do that
it's like okay check great I okay I
haven't I haven't started my day with
drinking uh have I started my day with
drugs no how many days in a row have I
not started my days with drugs you know
drugs and drinking it's like
know a whole year it's like okay well
like let's just basically chunk down a
level and then you see all of a sudden
you like peel back the onion and you're
like oh I have tons of evidence that I
can be consistent on things I just need
to add another thing on top of those
behaviors that I already have proven
that I can do and so now when I make
this prediction of my confidence that I
can do this
like you just take one step at a time
and I think that the the big meta skills
um come from those what we call virtues
but virtues are just behaviors which can
be trained
virtues are behaviors that can be
trained it's really interesting man I I
very much like the way that you look at
the world and I think I've tried to um
articulate a similar idea and the way
that I approached it was it doesn't
matter if you think negatively and
um act well you'll still get the success
out of acting well if you act poorly but
think positively you'll go nowhere and
this is why it drives me crazy when
people's advices look in the mirror and
say that you love yourself and all that
it won't work and at the end of the day
success really is just it's doing the
right things
um another killer so
I I do look out at the world right now
and I see where
Building Products that squeeze our
dopamine has created amazing products
the iPhone is incredible and I'm very
glad that it exists but I also see it
having a very negative impact on a lot
of people that simply uh pull the
dopamine lever and for people that
aren't familiar with there was a
behavioral study done in mice or rats
and if you let one you're putting the
mouse in a cage so you're already as an
artificially limited environment but if
you let it tap the lever for cocaine
yeah it will tap it until it dies yeah
now the fascinating thing about cocaine
is that it's dopamine it's the
basically the potential for for reward
more than the reward itself and so I
think that
we have a lot of products that do
incredibly well because they're all
about squeezing that dopamine release
and therefore for people to do what
you're talking about like if let's just
embrace the frame for the rest of this
conversation and I hope the rest of my
life that truly nobody is beyond this
barring you know some um a mental
problem that makes it impossible for
them to move forward so that you really
just have to find those behaviors so if
you understand that the world right now
is designed to get you to be watching
pornography to be playing on social
media to play mindless video games I
will say as somebody making video games
I'm well aware there there's usefulness
and then there's is waste
um
but understanding all of that that the
world is set up against you then you
have to have a technique that's going to
allow you to get into these habits that
are going to be effective now one thing
that was absolutely transformative in my
life was of rules to just a an absolute
binary and so um this this will be a hot
take that will piss some people off but
I've always said I do not understand how
people get addicted to drugs because if
you just have a rule in your life that
says obviously I will exclude pain
management right if you just have a rule
in your life that says I don't let's
take drinking I don't drink more than
twice a week period so if you've taken a
drink for the third time in the week
you've violated your rule you know that
you're out of bounds you need to
immediately correct course
do you leverage rules or things binary
things so that you know like I give
myself 10 minutes to get out of bed
that's like my big rule do you have
anything like that that allows you to I
probably live the exact opposite way
you can reboot your life your health
even your career anything you want all
you need is discipline I can teach you
the tactics that I learned while growing
a billion dollar business that will
allow you to see your goals through
whether you want better health stronger
relationships a more successful career
any of that is possible with the mindset
and business programs in Impact Theory
University join the thousands of
students who have already accomplished
amazing things tap now for a free trial
and get started today not as a contrary
point just um I I hate rules all rules
and so um how do you stay on the right
behaviors
I I do the things that have rewarded me
in the past
I mean that genuinely like when I wake
up earlier better things have happened
for me when I do more work before I have
my meetings better things have happened
for me when I eat a certain way I look
the way that I want and better things
happen for me and so
um I just I I Buck against rules really
hard and I don't know why that is but uh
like the moment someone's like you can't
have chocolate or you can't smoke or you
can't whatever I'm like why not I'll do
it and then still win at the thing to
prove that that's not the point which is
why like I get I get annoyed with a lot
of the Superstition around uh routine
and what I mean by that is like
you know we've got I mean I remember
there was a guy message me he's like
dude I'm doing my my morning routine
he's like and I have a cold plunge a red
lights on a ground outside and then I do
my gratitude journal and then I like
this list it was like you know he was
taking like three hours to get his
routine done or whatever in the morning
um
I was like you know you could
just not do that and work
for three more hours every day I was
like I'll bet you'll make more money and
so I think there's a lot of superstition
right now especially Entrepreneur Space
around routine as like if I don't get my
morning routine and I'm just useless and
I'm like man I'd love to compete against
you right because like you have one bad
night of sleep and you're I was
like
I will continue to work because working
has worked for me in the past but I love
what you were saying earlier with like
success doesn't really care or the
result doesn't really care one plus one
if you still do the addition it equals
two whether you're a good person or a
bad person if you make 100 calls or you
you know make 100 pieces of content the
likelihood that somebody will find out
about your product is greater than if
you make zero period fight me and so you
can do those things and be you could you
can drink and do drugs and watch porn
if you still do the that's all that
matters
now those things might make it more more
difficult but I I always came in from
the perspective of like I want to do the
formula and then live my life how I want
to live and if that means that sometimes
I drink more and sometimes I drink less
or sometimes I work out more and
sometimes work out less sometimes eat
dessert sometimes I eat really small
desserts
um that's fine and so I it's just like
what like what are the what are the
actual things that matter and if you
look at and I know you have a lot of
wealthy friends like people the way
people work the routines that they have
are so varied which to me means that
they don't matter
because if there were something that
absolutely has to be done then it has to
go down to First principles of okay in
order for people to find out about your
stuff you have to let them know great so
you have to advertise it in some way for
people to find out about it to buy
period no like anybody who has a
business that rule applies now some of
them are you know don't drink some of
them drink a ton some of them watch porn
some of them don't watch porn at all and
also make tons of money and so I
I try to have as few rules as possible
to give myself as much latitude to live
my life
that is
um that's really interesting and I will
no no for sure I'd love that and I think
that's one of the most interesting
things about the era that we're living
in is people get all these different
perspectives
um so for I the thing that we agree on
is that there are physics to everything
so success has physics and if you're not
trying to do something that violates
physics then you're going to be fine and
so how you get there is somewhat
irrelevant yeah
um I I have a feeling speaking to the
people that are caught up in the um
they're they're wasting their time
they're not doing the things that they
need to do they're they're going to need
to create some structure now that
structure may be as simple as what
you're talking about which is because if
if from my frame of reference the way
that I would put thoughts in my own head
about what you're saying is I have a
rule and this is a literal rule of mine
I only do and believe that which moves
me towards my goals which sounds very
akin to what you're talking about it's
like if I do this thing I get this
output uh when I wake up early I've had
better things happen when I'm in shape
better things happen than I put in the
work better things happen
um and ultimately
that's the thing that I'm trying to get
people to Anchor around is their
everything you do as a test your test
will have results it's what I call the
physics of progress so to make progress
one must have a hypothesis know where
you are know where you want to go
understand the obstacle between you and
that come up with a hypothesis about how
to overcome that obstacle run that test
look at the data very frankly don't BS
yourself
and then come up with a more informed
hypothesis and try again over and over
and over and over but ultimately you're
steering by results and I think very
often people either don't know how to in
fact I think there's a few things that
will happen one they don't know how to
conceive of the problem so they don't
understand the obstacle two they don't
know where they're going or three they
cannot break themselves out of the
dopamine cycle they haven't identified
the pain they're moving away from
whatever insecurity they have and so
they end up in that death Loop of
um feeling like they don't have enough
time when in reality they're the same
time as hyper efficient successful
people they just don't use it in the
same fashion
I think Seneca said that we all think we
don't have enough time but it's really
we just
don't use the time we have well
um
and I think I think a lot of it is
around like how we how we choose to pick
our identities to your point earlier
like someone might say like man I'm lazy
I I would say like that's amazing like a
lot of great CEOs are lazy that's fine
um let's use that and so let's just make
working more convenient than the other
thing and then your laziness will take
over or you don't mean just like in
terms of how we can frame the problem
right like is a as an example you're
saying earlier with the iPhone
um like
scientific study anyone can do this you
can decrease your iPhone usage by simply
going to grayscale
like across age groups if you switch
your colors on your screen to grayscale
you'll lose use it 30 less than you
normally would it's like great for most
people that's like an hour plus a day
30 is an hour plus oh my God yeah well I
think it's way I mean I think average
iPhone usage is probably like I mean I
think one hour is like conservative on
that I think it's like like might be
even two
yeah hours it's like there you go found
your time you can make all your content
you get all the stuff you watch a movie
at the time that you have from saving it
but like anyone can do it and so just
like how many how many of these little
things can I make convenient right so
like if you're like if you're trying to
eat healthy right I mean obviously you
guys like we both came from that space
it's like well you just make it more
convenient to eat healthy than need
unhealthy it's like okay we'll remove
all the stuff in your house that you
don't want to be eating make sure all
the snacks you have are protein related
snacks
um you know anything that has calories
in it that's a beverage don't include it
right like just the just simple things
that all of a sudden you're like I'm
hungry and you're like you're like I've
got cucumber slices and uh
and protein chips you're like what do
you think will be more effective that or
dehydrating the horse I think that is
dehydrating the horse interesting that
one's never spoken to me one because
that's not my problem you can fill my
house with snacks and if it either
violates one of my rules which I'm
obsessed with because I created them and
they're designed to give me the results
that I want or they violate my identity
I'm not going to do it yeah uh that's
unique to you I don't I think that's
like a Tom like one percent thing just
me from the outside I think a lot of
people have a hard time following rules
you don't think people will drive 30
minutes to gorge on something I think
they could but they're just as likely to
break a rule and I think it'd be I think
it's it's more likely that they will
break a rule because it takes less
effort to break the rule to themselves
than it does to drive 30 minutes and so
I just want to make it as inconvenient
as possible to do the wrong thing and as
convenient as possible to do the right
thing that will clearly be advantageous
so in no way is what I'm about to say
arguing against that uh so huge love
that total support on board now uh
having said that I have a feeling that
the thing that people are up against and
and I thought a lot about this with food
at Quest I wasn't thinking oh I need to
make this convenient that was part of it
and we certainly were not blind to the
fact that giving somebody a package good
that they could carry in their purse was
going to be really helpful yeah but the
Mantra I kept saying to myself was I
want to make food that people can choose
based on taste yeah and it happens to be
good for them because I think people
will go way out of their way violate
rules all that uh to eat something that
makes them feel the way they want to
feel and if I had to Anchor all of my
fears around people not being able to
accomplish what they want to accomplish
it would all be around the things you're
going to need to do don't feel the way
you want them to feel and because they
don't feel the way you want them to feel
you Veer towards the things that do make
you feel the what the way you want to
feel
now part of that you can accomplish by
reframing but part of it I think is
inescapable you're going to do what
feels good and you're going to avoid
what's painful for the most part okay I
love this so
one of the one of the big misnomers in
my opinion about discipline is that
people who who like some people might
look at me and say that oh Alex is
really disciplined but I actually really
do what I want to do every day and it
just so happens to be work that is
productive and makes money but that
statement that you made earlier that uh
people shoot what do you said you said
people do what makes them feel the way
they want to feel right and then they
you said well oh it's because it's not
making them feel the way they want to
feel and my only addition to that would
have just been yet
just yet and so it's usually because
their Extinction curve is too low
right on the behavior
and so if I go let's say I'm the best
door knocker in the world best door
knocking sales guys and I knock on Five
Doors
I might not get an answer from any of
those five doors and I walk away and I
say I guess door knocking isn't for me
and I might be the LeBron James of door
knocking right
but if the sample size is too small
because my Extinction curve just cuts
off really fast
I'll never know and so that's why it's
like if if you can give the thing the
opportunity to reinforce its own
behavior then it goes from external to
internal we're like video editors for
example like there's people who love I
mean we're going to film school right
um in the beginning you suck at editing
film but then you like make the letters
appear and you get instant feedback and
you're like whoa that was rewarding
right and then you do it again and then
you learn another technique and another
technique another technique and so then
the behavior itself becomes rewarding
and you begin to like work right you
begin liking your work and so I think it
really is that just getting over the
hump in the beginning of knocking on a
thousand doors rather than five and
realizing that it would make sense that
you would suck because you haven't done
it before
um but knowing that if other people have
done it too that there is a reward that
will eventually come and it will
reinforce me just like it has every
other human before me who has done this
and I think just like one of my my core
you know assumptions
um as I like to say
um is that if if somebody else can do
these behaviors I can do these behaviors
and get the same outcome you know
barring external environments or timing
and things like that but you know
assuming that those are the same like
they're not going to sell solar today is
the same as it was last year and if I
see somebody who's number one in solar
and I do the same behaviors as them I
will likely get an outcome that is
decent
and so I that that's what gives me uh
confidence going into a new environment
is modeling somebody and just being like
ignore all of these other things what
are the behaviors how many times this
you know is this person you know how
quickly do they walk from door to door
do they only go to apartment buildings
are they you know like what's their what
is all the steps that they do
operationalizing success
um rather than kind of like the
theorizing that I feel like happens a
lot and I think that's to be fair I
think the reason a lot of people kind of
like some of the content that I put out
from a money making perspective is how
can I operationalize this word right so
like patience for example is when people
throw out a lot but for me defining
patience was helpful which is
figuring out what to do in the meantime
like that's patience
like you're like I'm not patient it's
like no you just need to figure out what
to do in the meantime that's all like
you and I are being patient on all the
Investments that we made last year while
we're having this podcast like they are
happening we're figuring out what to do
in the meantime so we're being patient
and so it's like if patience feels bad
when you're focusing on it but if you're
not focusing on it then patience happens
by default
um like sadness for example like that
was really helped me to find uh figure
out just even defining the word in terms
of operational perspective help me get
out of those phones faster which is um
sadness comes from a lack of options a
perceived lack of options
which is why it feels like hopelessness
but if it comes from a perceived lack of
options then it means that you solve
that with knowledge because it's
perceived lack of options which is an
ignorance problem which means it's
solvable which all of a sudden gives me
something to do so then all of a sudden
I do have an option and you can get out
of the funk and like anxiety is the is
the reverse of that which is I have many
options and I don't know which one to
pick which means I don't have priorities
so like you solve sadness through
knowledge you solve anxiety through
decisions
and so like helping me just spell those
out to myself I'm like I feel anxious
okay that means that I have lots of
paths and I need to make a decision so
which one am I going to decide so I can
get out of this bad feeling if I have
sadness great what do I not know okay
now I have to go figure that out great I
have something to do
and so that like you can I think these
are like mental models around
using emotions to fuel the behaviors
that you want
I didn't want to say a word during that
because I think
um what you're talking about is so I'm
as as you're talking I'm trying to map
[Music]
um
my fear about people not being able to
make the change
um and I the more I think about it the
more I think this boils down to people
feel the way that they don't want to
feel and they don't know how to handle
that yeah and you just without me even
thinking to ask you
um you were going through how to deal
with different emotions and by having a
plan by having a procedure which I think
you're going to call operationalizing
yeah
um then you know what to do oh when I
encounter sadness then I do this when I
encounter anxiety Then I do this and so
it's a very action-oriented plan so I
want to plant a flag in that and then I
want to follow up with how one goes
about operationalizing something okay so
I'm going to lay out a thesis you can
push back or whatever
uh people
one of the the things that you and I
have both said historically that I think
is maybe the most powerful thing we will
ever say and everything after that is
just what you do once you get over that
your life is an exact reflection of your
choices you're not a victim and even if
you are it does not help you to think
that way you have to break through that
and one of the intros to this episode
that I considered was that every day
each of us has to make a choice whether
we are going to play the victim or play
the game and if you're going to play the
game play to win it's the only thing
that makes sense but that is
um negative emotions can be so gnarly
that we need to make it somebody else's
fault that to point all ten fingers back
at us and this is one of the things to
get higher to impact Theory uh you're
going to be asked the question along the
lines of something horrible happens to
you
how many fingers go outwards and how
many fingers point back at you and the
punchline is if all ten are not coming
right back at you it's just
disempowering it doesn't mean that bad
things don't happen nothing you can do
about a tornado et cetera et cetera but
still to realize that you can make
different choices and get a different
outcome
but people don't do that a lot because
to do that if you don't have the right
frame of reference if you haven't leaned
on the right traits if you aren't
building your self-esteem around the
right thing in that moment to say that
it's your fault fault fault is just
emotionally devastating and people have
not operationalized their encounter with
negative emotions and therefore they
will do anything they have to do
completely unconsciously to not feel
that way now if that is uh doing drugs
they'll do drugs if that's drinking
masturbation cheating whatever they will
do all of it but it really boils down to
what's your relationship with your
emotion now to push us farther and to
really
um make clear what I think
I don't think emotions are objectively
real I don't think that people ought to
believe an emotion I think people think
because they feel it it is the right
reaction to objective truth rather than
a subjective reaction to perception sure
and if you can understand that all of
your emotions are a subjective reaction
to perception that you can take control
of that that you can reframe things you
can have a different emotion and now in
that moment instead of doing something
that moves you away from your goals you
can replace it with something that moves
you towards your goals okay so that's my
thesis as as I really think about
boiling it down to what messes people up
it's that if I'm right about that how do
you operationalize anything like what
does that mean because I have a feeling
the thing that makes you phenomenal is
the ability to operationalize everything
so if I love this the conversation just
a side note
um
so in my opinion a lot of things even
huge Apartments practices in business
and medicine and everything come down to
learning and communication
and so
let's define terms so learning is same
condition new Behavior
so to the point I felt sad last time I
learned this new thing from this podcast
on impact Theory which is okay if I feel
sad then it means that I don't see an
option which means I need to get more
education or knowledge on the subject so
that I can figure out what to do at
least deciding that I need to learn more
gives me the next step that I need to do
and boom I'm not sad and so you've been
sad before and then it took you five
days to get out of it and you're sad now
and it takes you five minutes to get out
of it same condition new Behavior so you
learned
and so if we go one degree move from
that I'm going to circle back to the
original point
if we think about intelligence right
um like what is intelligence as I Define
it from an operational perspective it's
rate of learning right so somebody who
learns really slowly is less intelligent
someone who learns really quickly is
more intelligent but that means that
intelligence is just a rate it's a
measurement of how quickly you change
your behavior in the same condition and
so if you continue to listen to podcasts
and you're wake up in the same exact
conditions every day and your behavior
does not change it means you learned
nothing which means you are not as smart
as you think you are
but it also means that you can influence
and have a direct influence on your
intelligence by increasing or decreasing
the time it takes you to actually act on
the knowledge you have when the same
condition presents itself and so for me
that's incredibly empowering because
it's like I can be smarter by simply
hearing what this person says getting
the same condition and then immediately
changing my behavior wow that's cool
and so that then like from the fingers
perspective it's like okay all 10
fingers are on me of how I can influence
my own surroundings and do the things
that I want to do
um so to to Circle back to the original
question I think which I probably
dovetail a little bit was
can you repeat it one more time how do
you operationalize things what does that
mean
so okay so it's breaking down what does
this word mean from a behavior
perspective
so it's it's it's it's really hard like
I think the reason that so many people
are confused and they have a hard time
remembering things and understanding
complex topics is because they have lots
of words in their heads that they have
not defined I really mean like I I truly
believe that which is why every book
that I have begins with the definition
of terms just like this is what an offer
is this is what a lead is right these
are these are what this means right
um and until you have that you're just
you're basically making face noise right
like if I say leads and you perceive
that as something different then we
can't actually have a conversation
because we're not talking about the same
thing and so a lot of people have a lot
of words they've heard other people say
that they not along to and some people
are like makes sense and they say yes
but when someone says does that make
sense we have been trained as humans to
nod and say Yes it doesn't mean it makes
sense it means that when we have that
cue that's the behavior we do right
because we know that we get punished
when we say no because then it becomes
all this big thing and then you know you
dovetail into all these other
conversations and you get punished for
it right and so you learn what's
reinforced and most people say makes
sense and then you say which means nod
your head when I say this and you're
like I nod my head great and then you
move on and so I think that's why a lot
of people don't learn because they
actually don't know what the words mean
and so to operationalize something it is
simply going back down to
when I say I'm confident what does that
mean it's not a feeling it's not a what
other people say about you like none of
that is measurable like how much like
what is measurable it's a percentage of
likelihood that what I say will happen
will happen period that's what it is now
what you'll also find is that there are
a lot of words that mean the same thing
and that doesn't mean that the the
concept wrong is just the fact that
English or whatever language you learn
usually has a Melting Pot of like well
this is the version of the Nordic word
and this is the version of the Hindi
word and this is the version of the
French word and they're all in the
Lexicon but most of them more or less
mean the same thing and so getting away
from words meaning what the the
dictionary tells us it means and just
say what does it mean to me in terms of
what I can do with it then I think makes
navigating life a lot simpler because
the only thing we can control is our
behavior and so if we Define the words
in terms of what we do about it then
these all become things that we can
control and
and can change our lives with
yeah okay that I think is super
important
um
one of the things that that changed my
life and the easiest way to explain it
is how it manifested in my marriage was
to Define terms and because what Lisa
and I were realizing is we're saying the
same words but we don't mean the same
thing totally and that's creating a lot
of confusion now as a leader in a
business this becomes problematic often
because you will say something that to
you is self-evident exactly what it
means people do the it doesn't make
sense yeah not and
um they do that a lot and So Lisa and I
started defining really simple words
like what when you say you promise what
does that mean when you say something's
important what does that mean yeah and
so like in our marriage if we use the
word important it means stop whatever
you're doing I don't care if you're with
the president of the United States you
will immediately get up leave that and
deal with this thing because it's
important so if it is Meaningful but not
important then fair enough it's
meaningful but I'm in the middle of
something I'll get to it later doesn't
mean that it's you know not something
that needs to be addressed but it isn't
important
cool now we have a shared lexicon yeah
um and I think that
going back to my thesis around emotions
emotions are the subconscious's way of
communicating to the conscious mind so
when you think about and this isn't I
mean this is me making things up this is
me connecting dots that Behavioral
Science has made abundantly clear but I
am admittedly connecting dots but uh
Lisa Feldman Barrett wrote a whole book
on this called how emotions are made so
this is not me just shooting from the
hip but I'm putting my own words to it
um
the the way that you feel is the
subconscious mind which can process
information uh faster and faster as they
say so it's a a much larger number of
data points processed much quicker but
when you bring it into the conscious
mind you're going to think either in
images or in words most people probably
think primarily in words and so it
really Narrows down your ability to deal
with a lot of information and because
emotions are coming from the limbic
brain which we had before we had the
higher level cognition that humans have
that other animals don't have you're
going to be in a situation where oh
snake and you just jump you just have
the emotion and you move
um most people leave things there and so
they're never pulling that into the
light to say oh why do I feel so
uncomfortable in this moment what what
is it and if they would take the time to
Define what the discomfort is then they
might be able to operationalize the
response that they should have to this
predicated on at least from my
perspective what's your goal so I feel
some kind of way but I have a goal my
goal makes demands which is something I
don't think people think about very
often to achieve your goal just hey
there's physics to it so certain things
will move you towards your goal and
certain things won't so my goal makes
demands but I feel some kind of way that
make me want to move in the opposite
direction of the demands my goals make
so now using your words I have to
operationalize my encounter with this
emotion Define it Define a response and
then actually adhere to that response in
order to move towards my goals and that
the the moment where you pull the
emotion into the spotlight of your
conscious attention
and Define it in a really simple way I
think it's where the vast majority of
humanity get lost so I do something
called impact through University and I
answer some of the same questions over
and over and over and they often have to
do with that moment somebody does not
understand their own emotions and
therefore they cannot operationalize the
next move
I have so much to say I will keep it
short so
so I wanna so in reference back to what
I was talking about like with sadness
and anxiety and patience like these are
all well patience is more of a behavior
sadness is a feeling that and then how
do we translate that right
um I want to be clear that I use those
terms because I
want to meet people where they're at
me personally
and if you look at it from like the the
Behavioral Science perspective
you have stimulus and you have response
what happens in the box of like what
this person feels right like if I hold
up a red flash card to a random person
and then I slap them and then I hold the
red flash card again
like all of a sudden some of them might
feel anger some of them might feel fear
like what they feel when they see the
stimulus which I've now paired with a
response right is going to be different
and so I think a lot of effort goes into
people and even people in our world
trying to help people describe their
feelings talk through things blah blah
and I I just genuinely think that it's a
waste of time because
not who cares but why does it matter
because
you can do it when you're sad you can do
it when you're angry you can do it and
you're fearful and again to the point is
if 100 people more find out about the
thing that I'm trying to sell or
whatever I'm trying to do then I'll have
a greater percentage likelihood that I
will get this outcome that's it and I
think a lot of people they just get into
this cycle of trying to analyze their
feelings and then they're like oh it's
because I had this trauma when I was a
kid and you know because my dad didn't
hug me enough and like blah blah it's
like the because for most people's
explanation is irrelevant because I get
like I had a podcast question the other
day that asked um
do you feel like uh uh trauma you know
is is something that creates success
later in life among entrepreneurs blah
blah and um I really thought about it I
was like
I think people suffer and some people
become successful
so do I think that
suffering creates success no I think
that everyone suffers and some of them
become successful and then they
attribute their success to make it feel
worth it to have gone through that
suffering because they have an outcome
but I don't think that they're related
in any way
because like you were successful because
you did the thing
how you thought about it is completely
irrelevant and I just think that there's
so much effort that gets put into that
conversation
um which is why I have really contrarian
views around like therapy and things
like that but um I think like if you
keep opening a wound like what does it
help you
I don't know like you still didn't make
the calls
so like let's let's let's create an
environment where it's more likely that
you create that you do the calls that
you need to make and it just it
simplifies the variables that we can
control because no one knows like
even even adding the because to things
like I did this because it's like you
don't even know why you're doing what
you're doing and so when people are like
Tom what's your number one reason for
success we're making it up
we're making up our response I mean it's
what it is we're like how do I there's a
hundred things a zillion things I don't
know like is it because my dad didn't
hug me enough is it because my mom like
who knows maybe if he would have been
president it would have been fine like
it could be completely irrelevant but we
just choose to give this thing that some
percentage of the audience then says oh
that's like me and maybe then I can be
successful too and that's fine but I
think the the boiling it down to the
absolute Basics or not even Basics the
absolute truths of it are that
there's a stimulus and there's a
response what happens in the Box inside
of your head does not matter if you
respond a certain way you have learned
and if you continue to see the same
stimulus and you don't respond the way
you want to you have not learned so you
need to learn
I love how direct and simple that is see
a red card get slapped see a red card
duck yeah you learned or block right
even better right you preemptively
slapped and if I have to show the flash
card to you 7 10 12 times the person I
showed to once and then Ducks the second
time is smarter more intelligent than
the person has to show it to 10 times
before they react in a different way
than standing there and getting slapped
dude I love that
um I will
I will say for all the people that uh
because the the people that I have
um maybe I glom onto because of my own
hat here's me making up a reason that
I've gone on to because of my own sort
of a the journey that I've had to go on
everything I've had to deal with is that
I think where people fall down because
you are right there is no in no
uncertain terms if upon stimulus you do
the right thing for goal attainment you
will attain your goal right like that's
just how it works uh but then the
question becomes why do the vast fast
majority of people never reach their
goals and I think it's because they're
not able to either because either will
work they're not able to either stop
caring about what the reason is or they
never take the time to figure out the
reason now given that I think most
people struggle because they just don't
have Clarity yeah I do think people are
going to need to they might not need to
understand why they feel that way but
they're going to need the very thing
that leaves them uncertain about why
they feel that way is the thing that
leaves them uncertain about what they
want to do with their life or how to
achieve what they want to do okay I
really I love that okay so the first
part of the statement was uh people
aren't doing the thing and then it was
because and then the second part of the
statement I would posit that with the
because I would put the reason they're
not doing the thing that they want to be
doing is because they've been rewarded
for doing what they're currently doing
in the past and so all they're doing is
continuing to do they have learned works
and so it's like if you are continually
rewarded because like there's a reason
that you do what you do right which is
that you have been trained to do it Now
train is a you know
the environment can train you
which is what most of us switch to over
time you have an external stimuli that
wants to pair a new Behavior with a
stimulus right if you want to teach
someone to duck right you share the red
card and eventually they learn right but
at a certain point once you do the red
card and then eventually you pair the
red card with a fist then all of a
sudden uh the person gets into fighting
right and then you don't need to pair
that anymore because the environment
will self-reinforce and reward the
behavior of ducking and will punish if
they don't get if they don't duck right
and so if you just think about that as
like a really simplistic microcosm of
how we learn thousands of things like
even even the concept of speech is a
million reinforcement points from the
time a baby is alive right so if you
think about a baby as stimulus response
so they're alive they make noise
reward they're here right if attention
infection approval right reward and then
they make no noise and they make noise
again reward make make noise again
reward reward then once they learn to
make noise consistently we then start
rewarding noise that sounds like words
so it's like like
right and they're like whoa It's like
that's We're Not Gonna reward that one
and then all of a sudden they start
approximating the first word
and so all of it is is this continuous
feedback loop of me doing something and
it having an Extinction curve because
nothing happens or me doing something
and I get a reward
and so that is the that is the micro and
so you can apply that to everything
that's happened so like when you when
you start seeing the world in that way
it becomes much simpler to navigate
because you don't need to find the
reason you just say like I do this
because I've been rewarded in the past
cool so I just need to reward myself in
the present for this new behavior and
like how can I pair this new Behavior
with something good
which is like as a total side note for
me a little trick like when I go to the
gym I always get a little Shake even
though it's a little bit more expensive
at the gym because it's like a little
reward that happens immediately after I
left and I look forward to that and so
it's just like little things that you
can do to reward yourself to to hijack
that cycle that changes Behavior
and so it's like we want to change our
Behavior I think we have to define the
terms of what behavior is to begin with
um and how we Define learning uh because
that's all it is you know learning is
pairing a stimulus with a response and
so if they want to learn things that's
what they have to do all right if so
many people fail so many people have a
victim mentality what reward are they
getting that reinforces that
so it could be that they're because uh a
reinforcer can be both a more of a
positive or less of a negative right so
if I remove a slap that's a reward in
its own way or I add a positive and so
they may be avoiding punishment in
certain ways by staying in this place
because in the past
because everything's extrapolations from
the past in terms of how we see Behavior
because that's our pattern right like we
look back at what like we use our
history to make predictions about what's
going to happen with when I when I try
to turn this door knob to get into the
room I turn it and I turn it because
when I have turned doorknobs in the past
it worked and the first time I
encountered the door I was like what do
I do now what I probably did is I looked
at somebody else and when they turned it
the door opened so I know when I see
this thing now if I made that thing
solid and it can't be turned I would
like
and then I would think what other types
of doors are there and then you'd be
like is there another handle in the
store like and so you go to secondary
and tertiary behaviors whereas the most
likely one that's going to work is the
first one you start with and so we have
these behaviors that let's say laying on
the couch and watching Netflix has been
rewarded watching Netflix is a rewarding
experience it's I mean like it's it's
more positive and it avoids negative but
then you get into short-term and
long-term reward and Punishment right
which is why it's harder which is why I
think it's the meta skill which is on
top of those things which is that I know
that I can delay a short term for a
long-term payoff
um and I think that's where that's where
the big leap has to happen because if
you can train yourself to know that like
I know that if I do one workout I'm not
going to look different and I know if I
do six workouts I'm still also probably
not gonna look different right but if I
do 600 workouts I probably will and as
soon as you have that one first thing
where you had to delay gratification you
got a much bigger payoff you start to
associate the behaviors in while you're
doing it with reward and so the
difference between experts and beginners
is that experts find more ways to reward
themselves while they work on whatever
the thing is
and so it's not that they are more
disciplined which is the finally the
full 360 on this is that experts are not
more disciplined than you they've just
found more ways to win
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today so how do we effectively take
control of the process of rewarding
punishing ourselves to keep us on track
towards our goals I think being
cognizant of it at the absolute base
layer you start to see the world through
very different lens and you're like okay
that was punishing huh like that was
rewarding great I'll do more of that but
then you start to think you're like why
do I do that you really start thinking
about you're like well because I it
sometimes it's so funny like I'll have
um because we you know we we invest in
buying products and whatnot and so I had
two different products that were in the
same category because I liked the
category that I was looking at and one
of the products had a better result like
it had a better better end outcome when
the customer uses it and the market
leader and this is who they were trying
to disrupt
um had a slightly inferior result
um
but it delivered the result almost
instantly and the other one took like
five minutes and this one was like five
seconds and the other was objectively
better like even like like science it
had all the stats and everything like it
was objectively better and they wanted
me to invest in this company and um
they're like we have a better product I
was like no you better resolve you're a
better product
the reason these guys are still number
one is because uh latency matters more
than intensity when it comes to the
reason that a little icon on your phone
is because it's a media right and then
it goes away right like you have this
immediate feedback loop whereas
um you I don't know if you've heard this
okay so I'll sorry I love this stuff so
if you're trying to train a dog right
they uh there's this I wish I could I'll
maybe send it off the show but like a
graph that shows how you can train a dog
to sit with like a treat
and so if you
tell the dog the command and then you
wait and you immediately reward it it
learns faster if you wait 30 seconds it
learns you know it takes more tries to
get it to learn
after a minute
the dog's untrainable
a minute
and so it doesn't know why it's being
rewarded now the thing is it's not that
you aren't training the dog because
whenever you have some sort of reward
you're training it you're just not
training what you think you are so you
have to look at what happened
immediately before you gave the reward
which happened a minute later right and
so we think because it's like it's at
I'm going to wait a minute and then give
it the cookie but I'm not reinforcing
the sitting I'm reinforcing the thing
they did right before they got the
cookie and so as a as a as a zoom back
out here when we're thinking about like
and the reason I brought up these two
products was that the the the original
product the one that was the the market
leader was better because it gave even a
smaller benefit but it gave it
immediately and so people will probably
it seems silly but when you really try
and be honest with yourself like why do
I why do I go to this gym instead of
that gym because I have a bunch of gym
memberships like why do I because I like
to think about this I'm not surprised
about that right I'm like why do I go to
this place I'm like because the other
place has better equipment and I'm like
the person at the front always says hi
when I walk in
immediate reinforcement for walking in
the door
I was like I think that's what it is
so I like it like when I come in they
always say hi and I have like a two
minute conversation and like I look
forward to that I drive 10 minutes
further for that
I'm like how silly
but when I think about it when I'm
really honest with myself and so to go
back to the person who's on the couch
it's sometimes the rewards are minuscule
and then when you name them they feel a
little bit less powerful but it also
means that you can say how can I make
another minuscule reward in another
direction that gets me moving towards my
long-term goal and then I can kick start
that cycle where I start to learn like a
master does because Masters enjoy love
the process it's like easy for a master
to say because you're good at it
easy for you to say right like when
you're you know if I'm right like I
write my 19th draft of the book I've now
written a decent amount you know I mean
like I've I've spent a long time writing
and so I the act of writing itself is
rewarding for me like you must work so
hard which I do but it's not that I'm
willpowering my way the whole way
through not always of course there's
times where it's like not the most fun
but big picture
the process is rewarding because I've
gotten good enough that is rewarding and
so
um the more ways you measure the more
ways you can win which is like one of
our one of our little monikers and so
it's like how many different ways can we
measure so that we can make progress on
these little things and have wins as
quickly as possible in the direction
you're trying to go and then start the
loop
okay so
um to say that really succinctly to make
sure I understand no no the exploration
was amazing I just want to make sure
that I understand it
um
I think we've covered the reward part so
I'm going to do something measurable and
see my growth and that starts a positive
reinforcement Loop that's going to send
me down the right path okay so that
makes all the sense in the world uh
proximity the rate at which you get the
reward is really going to matter that's
really interesting from a product
perspective you're the first person I've
ever heard talk about that super
interesting but now how do I punish
myself do I like I'm a big believer that
you need to punish yourself but when I
say that sentence out loud I know what
people hear and it feels icky and weird
but it's been incredibly powerful for me
so do you believe in the power of
self-punishment and if you do how far do
we take it so um
I will just uh just for sake of everyone
I will just State this as my opinion and
we'll just leave it at that
so you have praise and you have
punishment or you can have rewarding of
punishment whatever you want to call it
punishment is more effective to change
behavior in the short term
like if I hold a gun to somebody's head
I can immediately change the behavior
right reward is more powerful over the
long term
and so like if you look at an
environment
so we think we talk a lot about this
that acquisitions.com because it's kind
of part of our mission internally is to
create a culture of reward
non-punishment
uh and the way that we think about this
is if you have like let's say Goldman
Sachs or McKinsey some of these very big
organizations that attract some of the
best and brightest and are renowned for
having relatively terrible or punishing
cultures right they work people to death
and blah blah so what happens is if you
if you put an animal in a cage and uh
they can't escape then they will revert
to the law of least effort so they will
do as little as they can to not get
punished and so then when you're in a
punching environment you all you have to
do to get them to do more is you just
raise the bar
for what they have to love least effort
do to not get punished and so in an
environment of high performers that gets
everyone to raise the bar but then
quickly burn out
now that model works if you have an
endless supply of bodies
but if you are the person who is being
burnt out then that works for two years
or whatever
Praise on the other hand or reward
can unlock in my opinion
discretionary effort so the effort
beyond the law of least effort required
to keep your job and not get punished
and so
the issue is that the people who are the
most able are the ones who are able to
work the least and still keep their jobs
but they're also the ones who get the
absolute most upside on if they work
because they want to not because they
have to
and so
that is kind of our our our thesis of
how we try and build companies at
acquisition.com and we're not perfect we
you know believe me there are plenty of
times when I want to choose someone set
off but we really try I know my teams
are nodding but like we really put
serious effort into saying like
so if let's say like I find out the dog
shits on the on the carpet when I get
home
I hit it
it doesn't learn
all I'm doing is hitting a dog
like if it was less than if it was
within 60 seconds from the time that
happened it's not going to learn and so
like if you know that
and then you hit the dog anyways what
does that make you
interesting right and so um
now obviously if we're like punishing
ourselves and whatnot
um
that might be somewhat different I'm
talking about how we relate to others
um
but
you can either avoid punishment or you
can seek reward and I think both of them
are powerful uh motivators avoiding
punishment is powerful more powerful in
the short term to change Behavior it's
faster a reward is more powerful in the
long term to keep Behavior going
because eventually you uh like kind of
like hedonic adaptation you get used to
a punishment and then it no longer works
so you have to have you have to increase
the variety and intensity of punishments
in order for it to continue to be
effective
do you punish yourself
honestly not a ton
I have super high standards
but I don't know if I punish myself
I don't know if I'm like Alex you're a
piece of
I don't
not really
because I you know Layla and I are kind
of sitting on opposite sides like I'm
like some people have like a base of
anxiety that they like work through I
don't come from that side I come from
probably like a base of laziness
like and just you know like and that's
why I have all these things to get
myself to do stuff
um but punishment just like it's also
just never been effective for me like
when I get punished I I want to just
figure out how to avoid punishment not
do what they want me to do right like
when you when you use punishment to like
train kid you get them to sneak out more
right um not like they just find other
ways to get out of the house quietly
they don't necessarily change their
behavior but if you reward them for
staying then they never want to leave
that kind of idea the reason people
leave when they're younger is because
there's more reward outside of the house
than inside the house and so if you want
to fix in the long term make the reward
for beings home more than leaving home
it's interesting so uh this is probably
one where defining the term would be
very meaningful
um I I personally use what I call
self-punishment yeah now to me
self-punishment is to force myself to
acknowledge that I said I was going to
do something that I did not do that's
normally where this will come from
interesting I would call that stating
the facts interesting I would call that
punishing so oh and this is very
important so I understand why people
always react so negatively when I say
that you you are missing out on an
incredibly powerful tool yeah if you
don't punish yourself now just to
acknowledge and you've said this as well
we we are all speaking from this is what
works with me yeah
um so this is the experience that I've
had the comment section exactly uh and
there so getting out of bed in 10
minutes or less is I I struggle with it
every day of my life it's it's
hysterical to me that even now all these
years later I still have to be like you
said you'd get out I stay in bed for
like 45 minutes almost I can't allow
myself immediately well if I'm doing
something in bed I suppose I should
change it to working
um then I have 10 minutes to be
productive is probably the right way to
think about it
um and because there are times where
there's something that I can do in bed
like this morning when I could start
researching you the second I wake up
then then I would still call that a win
but if I don't do the thing that I said
I was going to do then I forced myself
to to acknowledge to myself with no I
don't let myself run yeah so I don't let
myself be distracted I'm just like you
said you were gonna do something you did
not do this thing and therefore you
should not feel good about the behaviors
that you enacted in this moment okay and
then I will often confess to my wife or
my employees or my community so that I
am holding myself accountable and now
I'm sitting in something that I do not
like the way that it feels I'm not
letting myself run and so then I'm like
I don't want to be back here yeah so
next time I'm going to take a different
set of behaviors
that has been
transformative for me interesting and
that not using that for me would be to
miss out on a huge
motivational I love this and I want to
draw similarities for the audience
because and I think I think this is why
I think this stuff's kind of interesting
for anybody who's listening is like is
there are different ways this is why
like there there are only a few things
you need to do to win and the way you do
it is entirely up to you which is why I
love boiling things down just like what
are the few a few things that everything
has in common everything else is
preference but with what you just said I
think I have like the first thing we do
is we State the facts is that
I said that I would wake up within and
do something within 10 minutes
observation that did not happen
then comes the third step which is that
you this is me putting words is that you
label that as bad
and then maybe label yourself as bad
depending on you know that I don't do
right yeah but for the for the audience
just to be clear
um okay I need to not say so one so if
one wakes you know doesn't wake up in 10
minutes and then
States the facts I did not do what I
said I was going to do
um then uh labels the the thing as not
good and then says I am also not good
then that becomes trouble now one degree
before that is just labeling the
behavior is not good or not ideal for
the outcome that I want
um but I'm not sure
how much it matters to feel bad about it
again with the behavior box of like
stimulus response because once you feel
bad about it right and then it's like
well what what do we do to increase the
likelihood that next time it increases
now because we could feel amazing about
it we can feel terrible about it we can
feel neutral about it but all that will
matter is what Behavior we change in
order to increase the likelihood
that we do what we want next time at
least as as I see it and I found that I
put for me a lot of energy
into trying to understand things trying
to label things as good or bad trying to
label myself as good or bad as
consequence
um and the only part that mattered for
me to actually get what I wanted was the
last step which is what am I going to do
about it and I can also just skip these
I can just skip these other three steps
and just go straight from
I always said I was going to do this
thing
observation I did not do it
what is the change in my behavior or my
environment that I'm going to do next
time to increase the likelihood that I
do it and then even with the binary
thing that we're talking about earlier
with rules I'm actually more of like a
weighing system of okay
over the last 60 days I got up within
the first 10 minutes
60 of the time okay
next 60 days if I can do 70 of the time
I am making progress and so rather like
because most people will fall short of
perfection
and so I feel like it ends up setting up
a
an inevitability of failure if we Define
it as binary
just my own perspective
so how do you then deal with people that
are not hitting a standard whether it's
you or somebody else I have found in
business if you let people get away with
low standards not only will it devastate
their performance it will begin to drag
down the company and and it really
matters totally so
um do you stick to only rewards do you
call it out like what do you do yeah so
we absolutely we State the facts
and then we say what we're going to do
about it and then if someone
consistently cannot do because at some
level there's always there's always a
chunk down skill someone doesn't have
right so if I say hey can you send an
email to so-and-so we have assumption
that they have a stack of skills before
that I assume that they can read I
assume they can write I assume they can
use a computer I assume they have from
an environmental perspective they have
access to Internet they know how to use
a word processor like they know how to
open up an internet route like I know
where this sounds
silly but we make these assumptions but
for some people they're missing one of
those and so they have all this failure
because they're just missing one link on
that chain and so try to identify what
is the skill deficit and then is it a
skill that I'm willing to invest time
into teaching somebody and so we want
somebody who have as many base skills as
possible
that apply to many scenarios so like if
two people go through the same training
program right and one person gets the
outcome the other person doesn't it's
usually because the training program
doesn't account for every single skill
that is required to get the outcome
there are certain assumptions that come
in like if someone reads my book I
assume that they can speak English
I mean I'm saying as simple as that
sounds right but there's a hundred other
skills and the people who are successful
faster just have more of those skills
stacked up so that when they get the
right information they can immediately
use it and some people still need to go
back and learn how to wake up on time
and like have someone say no and not cry
right like these are these are other
skills and so um in the environment of
work how do we address somebody who is
not performing we State the facts we
recommend a course of action that can
help increase the likelihood that they
do it again in the future and if that
doesn't happen then we say like this is
what will happen as a consequence
neutral of you being good or bad or this
situation be good or bad it's just these
are the standards that we will accept
and you are beneath those standards
based on these facts
that's it like you showed up to work
late okay just to be clear you
understand that our expectation is that
you show up on time yes I understand
great
you also understand that that what you
did was not to that expectation cool so
let's do this do you have an alarm on
your phone yes do you use it no do you
know how to set an alarm on your phone
yes great so why don't we do this from
here on out let's hit two alarms five
minutes apart at this time that'll give
you ample time to get up clean your face
whatever and then get on camera does
that work yes and then we measure and if
it doesn't happen again
if it does then it's like
why did that because then you get into
the base skill being do I adhere to
Authority
like can I listen to instructions like
those are skills and if someone nods
their head and then doesn't do that
then they don't have that skill and then
the question is whether I'm am I willing
to take the time to invest in teaching
someone this skill when the opportunity
cost of that time could be allocated to
somebody else who might already have
that skill or Suite of skills
that's how we think about it
so one of the things that is a recurring
theme is the idea of extending the time
to extinguish
what if we're going to operationalize
that what what do we do with people and
um if I were going to personify the the
length to extinguish I'll give a
historical example and then I'll give a
more modern so historically uh Winston
Churchill dude I don't know if you've
read much about him
unbelievable uh what that guy was able
to pull off and how long he was able to
delay gratification yeah and then a more
modern example would be a David Goggins
yeah so
um how do we operationalize it what do
you take from those guys I think it's
the the Master's thesis of those guys
are Masters at whatever the thing is and
so they find ways to reward themselves
in the meantime
and so we only think that they have
Supreme Ultra discipline willpower
because we are measuring what we can see
as the outcome of running a race you
know 26 miles or whatever it is
but if they are rewarding themselves
throughout the entire process then if
anything the end of the race might be uh
a removing of a reward and might be
actually anticlimactic which is what
happens with most athletes after they
compete in the Olympics or they win the
championship or lose the championship
um the build up is where they have all
the reinforcement and then when that
thing actually happens then they have to
get right back on the the horse of where
they get their reward from which is the
work to get there because they are good
enough at it that they can win in more
ways and so just the more you know about
something the better you are at it the
better you are at it the more you can
win the more you can win the more you
want to do it
how much of that do you think is
identity like when I look at somebody
like
um
a Churchill or a Goggins it that feels
to me like a game of who am I or who do
I want to be one of my favorite
Churchill quotes
um is well so quotes failure is the
ability to go from uh sorry success is
the ability to go from failure to
failure without a loss of enthusiasm
speaks directly to this but one thing
that I got reading his biography is uh
he said to his mother when he was really
young that uh this is a paraphrase not
exact quote but I yearn for a reputation
for physical courage
um more than anything I mean it was and
and this is a guy that's for people that
don't know a story that sent himself
into war zones multiple times in his
life when he absolutely did not need to
do that including World War One when he
was like he was basically the equivalent
the British equivalent of a senator yeah
now imagine you have an active senator
who felt like he had let people down and
so he said send me to the front lines
and they're like whoa why would we do
that like you do not need to go to the
front lines even if you want to engage
yeah with the war you certainly don't
need to go to the front lines and he
said nope I want to be literally where
the bombs are falling in the dirt with
the men
um and that was somebody who had such a
strong internal Compass of this is who I
want to be or how men ought to be
um same idea with Goggins right just
felt like I'm a loser he's staring at
himself in the mirror the accountability
mirror doesn't like who he sees decides
he's going to change or become a
different person and I'm sure you've
seen the clips of him screaming you
don't know me you don't know who I am
um
that's an identity play so
how do you see that is is
extending the time to extinguish purely
an an identity play or is there
something else going on so I think
I think the wording matters
um but if you uh want to extend how long
you continue to do something without
seeing the result of you're doing uh
you need to find a way to be rewarded in
the meantime like that's that's
what it is like that in my opinion and
so whether we call it Identity or we
call it a skill or we call it Behavior
we call it character trait so saying
like with the the many words that
ultimately mean like what is the
percentage likelihood that this Behavior
occurs
um that is really all I would look at
and is it as simple as I I was today who
I said I was like how do we make that I
mean Not To Beat to Death the idea of
operationalize but when I think about
what I'm doing when I reward and punish
myself is I am trying to feel the way I
want to feel or not or make sure that
I'm feeling discomfort so that I will
move away from that behavior yeah
so what is it or how do we leverage
identity
to feel the thing that we want to feel
like is it just words in your head like
how do you play that identity is really
internal culture
so if you think if you Define culture as
a set of rules of behavior
in a within an organization identity is
just the rules of behavior within an
individual
and so I think to your point you have
your rules of behavior that occur I
would say that my rules of behavior even
though I hate rules is the concept
um
when I do these things like when I see
this this happens right I do have the
these these behaviors that have been
queued that I have learned
um see now we have all these words that
we've defined so now we can at least
everybody can agree on what we're
talking about which is why it means a
lot to me
um but yeah I just I think identity is
just a big stack of Behavioral cues that
we've said because people change over
time and so it's really just like a
mental construct of this is how I behave
like what is an identity it is like and
even if you want to say like I know this
person what it really means is that I
have a high predictive score on what
this person will do or say as a result
of whatever I do or say
and so if that's the conversation that
I'm having with someone it's like I know
I'm really well oh he'll love that
because I have a good predictive score
that when this happens you will do this
now somebody who's all over the place
are super erratic right then or do they
have a unformed Identity or do I just
not know enough about them
Maybe
and so I it just that has just been my
litmus test and maybe maybe it seems
like oversimplification but
um for me it has been incredibly
fruitful to just because then for me it
takes a lot of the the Superstition a
lot of the magic a lot of the black box
of feelings and emotions and and
identity out and it's just
Alex is a series of behaviors
that's who I am that I that have been
trained Into Me by my environment and
that I have tried to learn myself
and I will change in the future because
if I get better then it means I can't be
the same person I am today which means
some of the things that I have learned
now I will unlearn and learn new
behaviors when I see a different
stimulus or the same sorry when I see
the same stimulus
so interesting so
um the way that I have always approached
this is I I am trying to get people to
change their frame of reference
frame of reference speaking of things
that need to be defined frame of
reference to me are your beliefs and
values okay and I didn't even think
that's what you meant I thought I
totally thought you meant something
different so that's why yes exactly this
is why you define things okay so
um and and I will say all of this in
what I just heard you say is that where
I'm coming at things is from beliefs and
values where you're coming at things is
from behaviors and traits
it's very interesting very interesting
like I am going to think about this so
much moving forward uh as to one is it
is beliefs and values just particular to
me and that is I try to help people make
change in their life I'm wasting all my
time because this is just the
thing that resonates with me or is there
something I'm getting to the thing
that's underneath your behaviors and
traits and that if people don't address
this they'll never get to that or I'm
just wasting my time yeah you were going
to say something I think it's value so
if we were to like when it's like I have
these values a value is just a
behavioral short code
when this happens I do this someone who
is loyal when he's out and his wife
isn't there hot girl comes up and says
hey want to get a drink
value it means a set of behaviors I say
no or I say I'm married or no thank you
whatever
and so values are skills because you can
train them
and interesting values are skills I
would say the adherence to a value is a
skill that you can train but if you have
the wrong value that you adhere to
you're going to be in trouble here's why
I start with beliefs and values I think
so much of the human animal is invisible
to the person and that if they they'll
never be able to control their behaviors
if they don't control the emotions that
drive the behaviors and I think emotions
are an echo of your beliefs and values
and I can change somebody's emotion like
their cognitive
um the way that they frame something
cognitively will drive their biological
response to that moment which is insane
so the quote nothing is either good or
bad but thinking makes it so the death
of your mother is not good or bad
totally thinking it's bad makes it bad
now
that is uh you and I think come at that
from very different angles totally and
so not a bad way I think it's great no
no dude this is so intriguing one
because all I care about is are you
getting the outcome that you want yes or
no and if you are amazing and so you're
giving me new tools new ways to think
about this
um okay so just a quick breakdown of of
frame of reference so
my hypothesis is that everybody's life
is entirely controlled by their frame of
reference okay the frame of reference
the best analogy would be to say that
your frame of reference is a pair of
glasses that you put on that distort the
living out of the world that none
of us have the
um option of taking the glasses off
taking the glasses off would be to exist
outside of your biology nobody's going
to be able to do that so you see the
world in a hyper distorted way now all
of us over a lifetime of reward
punishment
um oh God would you call it approval
like there's all kinds of things
approval yeah attention affection
approval okay so all of us are getting
that constantly from the time that we
are born until now and we choose who to
value that from and you've talked about
your parents and all that like so anyway
you can choose but you most people never
become consciously aware of what's
happening and so they're the Distortion
of their lens happens slowly over time
in ways that they simply recognize
mistakenly as objective truth so they
think they see the world as it is not
through the Warped lenses of their frame
of reference now once you realize that
you can change the way the lenses warp
the world now you can start to shape
your lenses based on action outcome I
did a thing and it had this outcome and
so it all becomes about your ability to
predict the outcome of your actions
which is yeah and we will get into sort
of the physics of making money
but
um to me that's all about the ability to
predict like what tests to run and how
to interpret the test and all that so It
ultimately boils down to your frame of
reference and if you don't get your
frame of reference right the world will
be so warped you will not be able to
predict the outcome of your behaviors
most people end up in the mistaken Loop
of my emotions are the the correct which
one needs to Define and they don't my
emotions are the correct response to
this stimulus even though it does not
lead me towards my goals and they spend
their whole life spiraling in emotion
and that's why they're never able to get
out of it and begin to polish the lens
in a way that actually gives them
um something useful and what you're
saying is none of that matters
all that matters is whether they do the
thing that's going to yield the outcome
or not I think it just I think it just
saves a lot of time and a lot of because
when we try to name these emotions like
you know what am I feeling I'm kind of
it's like this whole conversation of not
this but like that self-conversation
it's like what does that accomplish
until you
then decide to do something the real
world like nothing matters and from a
from an outcome perspective but I'll
just share something with the audience
because I have a my my first really big
viral video was me just talking about
like what how you scale companies and I
first thing I talk about scaling the
entrepreneur and I have four frames that
I go through in the video and I used to
believe that uh entrepreneurs get
limited by skills what this is this is
what I used to believe which is skills
uh character traits and beliefs those
are that's what I used to say I now
believe that character traits are
another way of saying when this happens
they do this which is trainable which
makes it a skill
and then beliefs are
when they are presented with this
information they then make this decision
which is yet again another thing that
can be trained because if you can learn
it and it's a skill
between the just comes to as I see the
world it just comes down to skills and
just because it's harder to Define uh
Charisma because it might be 20 things
because we have a term that buckets 50
behaviors or whatever it is
just because it's hard to describe
doesn't make it not a skill
and that's why I like the soft stuff in
business like we probably agree that the
Soft Stuff matters a ton in building a
big company the culture right McKinsey
did a big study on this Layla sites a
lot more than I do because she's usually
on the people side
um but uh in a normal business two out
of three strategies fail like new
initiatives fail in businesses where
they have the soft stuff down
one out of three strategies fail so two
out of three succeed so you get twice
the percentage likelihood of success on
big strategic initiatives if I guess why
why is beyond is beyond me I that was
just that was the yeah I don't get it
about that yeah I don't get into because
it's right this is that yeah Dr cash is
my my closest friend like a brother he
jokes about he he obsesses about why
things work I just care that it works
um and so
um anyways to Circle back on this is
that people consider like leadership to
be like a Fufu or like communication
skills it's like soft stuff right sales
metric you know like we have all these
metrics driven things versus this and
it's just because it's harder to measure
it doesn't make it less important and
that was that was a big realization for
me is that it was just because it was
harder for me to measure but it doesn't
make it less important and so these
skills that we're talking about
um we try to find ways to measure them
by saying when I'm when somebody walks
like I'll give you an example with our
video team
um we realize that we have much better
direct camera work for our content if
because we were like man we have this
one guy on our team he's so good to film
with and some of the other guys are just
like not as good I'm not like as amped
about it like why is that so we could
control the things that we're going to
walk into the into the video session
with like okay am I did I sleep well did
I you know all that stuff if that's
controlled and I still change then it
means there's something in the
environment and so we then observed
actually to be fair we asked the the
Superstar to observe what are the things
you're doing and so we noticed that
while he's while he's filming he's like
yeah he's like yes this is awesome and
so he said write that down and then what
else do you do it's like oh I I write
down questions while you're talking
while I'm so he had to be able to
multitask so he had to Bob his head
while we're talking and write down
follow-up questions for what we were
saying and so then all of a sudden it
became this continuous flow of
Consciousness with literally constant
reinforcement while we were filming
visually
and so then we gave that sop to the
other people on the team and all of a
sudden filming with them was way better
and so people would be like he's just
got a great Vibe it just means that we
don't know how to describe all the
little behaviors that that person does
and and say when I start talking nod
your head
real right and when when there's
something that you don't understand
write it down and ask me because I mean
somebody else doesn't understand it too
and it makes for great content oh right
and so we had this big list and then now
we operationalized what it's like or
what what you what behaviors you have to
do to become somebody who's good behind
the camera
which means it's a skill that can be
learned like Charisma like patience like
confidence like whatever and so
um boiling it down that way has just
demystified the world for me and just
made it a lot easier to navigate because
I don't have to spend 90 of my time
trying to figure out why I'm doing
whatever I'm doing
all I care about is weather I do what I
need to do to get the outcome and if I
do the thing and I don't get the outcome
that means there's another variable that
I haven't controlled I don't understand
and if you know in the words of BF
Skinner
um
if many variables are present many
variables must be studied
so sometimes we want to oversimplify it
but like there might be 10 cues in the
environment that create a banger session
but if we have nine is it better than
the last one that had three probably and
so then we just make progress in that
way
okay so this is your superpower this is
the thing that dude I just look at you
in awe this it's really really
incredible what you do and I am so
grateful to live on the timeline where
the internet exists and someone like you
with this insane ability comes out and
just creates all this content
um you know I am as obsessed with
learning as you are and so
um yeah it's just incredible and to
never stop learning is is the great gift
of being a human Okay so the thing that
I think that you're just unreasonably
good at is taking a very complex problem
that maybe I'm spending too much time in
the why is this happening and you're
just skipping past that and you're going
okay I'm going to break it down into
these do this when this happens do this
when that happens to that
um I'm gonna try to get to the physics
of business through a weird question but
keep in mind for anybody watching this
that doesn't know my story I I've been
in the world of Entrepreneurship for
over 20 years I've had some pretty
incredible success so this is uh this is
a well-educated question from I've been
in this for a long time so it's gonna
seem like a weird angle to attack it
this is for the audience more than you
um hang with me because if we really can
dissect this I think it will help people
understand the magic thing that you do
you rewrote your book completely four
times
something happened when you read it the
first time the first time that you
realize I have to start over completely
yeah
that thing whatever that was I promise
you have the chills just thinking about
it that is the thing that makes you go
to business and so I need to understand
what abstract use the book as an example
but I want people to understand this is
an abstracted version of something very
important which is you were able you did
a thing yeah
I'm guessing you had to do the thing in
order to find the part that wasn't right
but you were able to then identify that
part reconceptualize get more
intelligent as you did it again it's
what I call the physics of progress but
like what your ability to learn and
break into constituent Parts is is the
thing certainly I want to learn from so
when you re-read what you first wrote
what clicked do you remember
well I got feedback so I sent the first
which was really the first draft I ended
up sending to people was v9
um had you Rewritten it all over how
many times have you read that so that
was like I had gone through I mean I
start back at the top I re-edit
everything again start back the time
without feedback correct that's the one
I want to know about okay the first time
you read through the book I have to
reconceive of the whole approach yeah
what happened in that moment uh it
wasn't clear or wasn't simple enough
that's that's it like and
um I like to use this example because it
it might make sense for a lot of the
audience if I were to say
edit a six assuming you know how to edit
videos just for the simplicity
if I said go edit this video
someone might edit it and I said get you
know edit this video in 30 minutes and
they edit this short clip and they give
it back to me and I say okay
if I give you two hours
what else would you do and they're like
oh I might do this I might do this I
might do this I'm like okay go do that
and come back then come back and I'm
like okay
if I gave you two weeks
for this 30 second clip what else would
you do
like I might reimagine the entire thing
and actually lay it out in this way it
would take way more time but like I
think it would actually still be better
it's like cool do that and then come
back
and then when there's no more loose
where I'm like what else could you do to
make this better
at that point to me the work is done I
have exhausted my level of skill and
understanding like I can't make the
leads book better at current now I'll
bet you in a year I'll think of some
things that I could have used to make it
better but at present moment there's
nothing that I can think that I would
either cut or add in or break down or
add a visual for uh or lower the reading
level on uh to make sure that everyone
would understand it and so whenever I
have those like it's like a hangnail you
know what I mean it's like this little
Splinter where I'm like this could be
better does it start with a feeling or
with a fact
um
it's a good question uh
I don't know I think I read something
and I think
that wasn't as clear as it was in my
it's not as clear reading it as it is in
my head so what's the discrepancy like
this term is confusing or this phrase
doesn't make sense or I need to break
this into a paragraph or whatever it is
um and honestly it's just doing that
like it took me it's funny I had this
this cover letter that I was going to
include in every book and it was one
page and I think I put uh 25 hours into
the one page
um and it's it's interesting because
people hear that and they're like that's
crazy I'm like to me 25 hours doesn't
count as one unit of work yet
um thinking hundreds dude you got it
yeah 100
um and so
I ended up actually not using the cover
letter which is even more ironic
um but when my team saw how many
iterations went through it I was like
every single person will read this part
now chapter you know the last chapter in
the book maybe it's 20 or maybe it's 13
or whatever it is we'll get to the last
chapter but the first page
every single person
who reads the entire book will read that
page every person who reads half the
book read that page every person reads
only the first chapter read that page
and so it's like if anything I should
put more time into that but I approached
just about every page of the book that
way it was just that my team was able to
see it on one page
publicly and so that's
we we wrote my editor not Dr Kashi
um wrote the book because we wanted it
to be around 100 years
and so that was the frame was like it
has to be it has to work now and the
easiest way to know if it's gonna work
in 100 years is does it work 100 years
ago
could someone 100 years ago read this
book and it still helped them advertise
better because someone read this book
100 years ago and help them make an
offer that more people say yes to
if the answer is yes then we pass that
limits test and that's actually really
hard it's a very simple sentence to say
very hard to do especially when you're
talking about media content platforms
like all of these different things
um
and so
I think it's having an exceptionally
High bar for what you what you want to
do and having been rewarded in the past
like if this had been my first book it
wouldn't have been as good
but offers was my first book and I wrote
offers in one fifth at the time as it
took me to write leads
because you didn't hold yourself to as
high of a standard because you knew what
better looked like I'd never been
rewarded for writing a book before
and so once I was rewarded
the amount of time I'm willing to put
towards something to get rewarded again
extends
so it's like intermittent reinforcement
from a Behavior Support like that's how
you get addicted to the slot machine
whatever it's like you reward the first
time immediately the next time reward in
30 seconds the next time humans have a
have a longer attribution than dogs do
just for context
um
but you can continue to extend
reinforcement until eventually you can
eliminate it in the behavioral processed
which is kind of cool which is very cool
yeah okay
I don't know what you're apologizing for
okay so we're at the beginning of uh
what we'll hopefully be a magically
delicious breakdown of how Alex ramosi
uh hermosiah's things yeah okay so what
I took away from that um is that step
one is going to be start with the goal
so when I think about business
um you need to understand what your goal
is because you're and this this goes for
life as well boys and girls if you do
not have your North Star if you don't
know what is guiding everything then
you're going to be adrift and so when
you think about you and okay this is
definitely me putting my language on you
here's how I experienced that first
moment I read something and something
feels off so for me it always starts
with a feeling yeah but I know that
feeling translates into a fact and so
I'm going to try to find the fact yeah
and so you were saying this isn't as
clear as it could be and so now you have
this North Star I'm trying to write a
book that's going to be around in 100
years again I'm I'm maybe connecting
dots that don't line up and so you'll
correct me anywhere go wrong we've got
the idea of the the guy with the one
goat who's sleeping with this under his
pillow which dude you cannot imagine how
much a that makes me like you even more
than I already did uh and B that's so
important for people to have like a
person that they're thinking about that
will make all the fight worth it uh okay
so be around in 100 years the guy with
the goat needs to really understand this
I read it and because I know what my
goal is I have a feeling a trained
feeling that something is off that's my
again this is me I understand you're
different
um this is my feeling is my subconscious
speaking to me it's already picked up on
the problem I can feel it and I'm going
to translate that into something what I
really need people to understand is
you're going to take all of Alex's
advice and you're still going to fail
and the reason you're going to fail is
because you're not yet good at the thing
that you're good at which is
um finding the fact and saying oh this
is the very thing that's broken now as
you have said so I'll just Channel you
for a second you're gonna suck at this
for a while but don't worry just keep
doing it and you will get better at
identifying the fact okay
given how much you're nodding gonna
assume so far I'm on the right track
here so
how do you yeah exactly right uh how do
you identify that fact so what is is it
just repetition you've just done it a
thousand times
so you can either have uh basically it's
got contingency-based reinforcement
which is the environment corrects you
right you put the thing on the market no
one buys it no one watches it whatever
it is right
um the other is that you get feedback
from somebody who has more knowledge
than you and so you can either have a
person give you direct feedback on you
know listens to your sales call and says
hey you know try this next time
um and ideally that's where the feedback
loop is like if if I have a one-on-one
with somebody and I give them that
feedback a week later it's much more
powerful to be there an hour after the
call like the moment the Call's over and
even more powerful if you're sitting
there with them and you can be like
and then you get the feedback loops way
faster because they'll remember it
because they'll be in the moment of
trying to learn like so if we're trying
to teach sales and I'm gonna I'm gonna
come back but if we're trying to tcls
because we've got three brick and mortar
chains in our portfolio
um teaching Frontline sales like very
transactional like front desk walks in
go here whatever if you train them
off-site which is what most companies do
then they will remember it better off
site than on-site so you want to train
them in the environment that they have
to do the behavior because they'll have
environmental cues while they're
learning just like if you if you study
for a test if you can study in the
actual chair that you're going to take
the test in you'll remember more of your
answers what oh for sure what
yeah if you ever have you ever been on
the phone and like had some conversation
and then you walked the same path a week
later yeah and then as you see a tree
you're like oh yeah I was thinking about
because it's because you learn and you
have
geography that's interesting actually
now that you say that it makes a lot of
sense I wonder if it's different for
guys I don't want to derail it yeah okay
guys have spatial memory yeah uh
interesting all right step one we'll
start with the goal we went through that
identify the fact yeah okay how do we
get that contingency versus uh versus
individual so either either your
environment uh gives you that feedback
because it didn't work or somebody who
knows more and has done it before
multiple times can recognize the pattern
for you so when you uh say like find the
fact I would have just the only thing I
would have maybe tweaked on the earlier
uh preface was uh the feeling is because
of powder recognition I know this isn't
right because it hasn't been right it
looks like something that has been right
again in the past and we always have
something called successive
approximation so like success of
successive approximation right like uh
girl's name Tiffany are crazy right and
I mean
uh also crazy but looks different but
I'm like wait a second I know Tiffany's
you're all crazy right like so you have
a successful product like you learn it's
a silly example but
um that is like that's how we can
generalize learning and um the bigger
the the more depth you have in terms of
the principles around any skill the more
you can generalize learnings from one
thing to another
okay that makes a lot of sense pattern
recognition huge uh getting people to
help you short circuit that huge okay so
um getting into the reinforcement yeah
what I want to understand is
um how
uh I'm gonna ask it and then we'll see
if I think I know the answer but
um the real thing you're trying to
figure out when you're doing the testing
is what would need to change in order
for this to work yeah
um
the reason I say it like that is because
the language I would have naturally used
is why didn't this work yeah but you
don't care about why you just want to
know what would I have to change in
order to get this to work how do you
we'd use experts if they're available
sure uh but if we're just testing let's
say we have to Brute Force this how do
you go through that you uh I've heard
you say the number of tests that I
thought were going to crush and they
just absolutely tank so you you thought
you had it and all you get is an answer
says no yeah so all you have is no yeah
how do you turn that no into a new
action item yeah so
um I think it's breaking down didn't
work from binary to a Continuum so it's
not it didn't work it's it didn't work
well enough and so that's a huge one
when it comes to like running ads making
cold call whatever it is to get
customers whatever you want to do it's
not yes or no it's how well right and
that just says it's an easier frame and
so then you have to go at least from my
perspective you break it down to First
principles of okay what has to happen
for someone to buy it's like well so
that's just a whole lump of psychology
right there
behaviors they have to see it they don't
see it or hear it they will not buy it
because they won't know you exist okay
that so and that luckily like within the
marketing world because that's what the
book is about is measurable like did the
impression get displayed did the email
get delivered
that is you can see that on any any
platform the next one is like did they
engage with it so that's a behavior they
engaged which would be they opened the
email or they open the email and click
the link inside of my email they click
the ad to then get to you know the
landing page whatever it is so they
engaged to a degree
um
the next you know the next thing is that
they're going to like in order for me to
contact them in the future then I need
to have some way to contact them so they
have to give that to me
um if I don't already have like an
outbound thing you'd already have their
contact information you want to reply if
you're running an ad then they need to
give you the account information so that
you can reach out to them
um but it's really breaking down forget
what they think forget what they feel
like I
I wholeheartedly reject the like there
are seven stages of awareness it's like
how the do you know
like well they have to have a desire and
then it's like how many people have
bought things without desire tons all we
know is that when they see this thing
they take their wallet out and they
purchase period right and the same thing
with like a sales script like I truly
believe that
if you knew every single variable that
it took for somebody to buy you get 100
of people to buy
now the problem is that we don't have
every variable every time for every
person and so we do the best
approximation we can to hit as many of
those piano keys to get them to purchase
right
and so
that is how I that's how I approach all
of them whether it's you know what do I
figure out what to sell which is the
offers book uh who do I sell it to which
is the leads book
um and then you know future books will
answer One Singular question
and the leads book was fundamental like
and the reason it's called leads instead
of advertising is because I test
advertising versus leads and leads beat
advertising even though the book is
fundamentally about advertising into
Divine advertising it's the process of
making known and so
did I make it known great I advertised
like she advertised that she was with
that guy all last night you're like oh
she let it be known right she made
people aware and so there's only four
ways you can do that right you can do
one-on-one you can do one to many like I
can tell you one-on-one in an
environment where no one else can see me
or I can put it on a bulletin board
worked a thousand years ago works today
uh and then I can do that in public or I
can do that in private
so you've got sorry I just repeat the
same uh you can do that to people who
know you and people who don't know you
so you've got one to one to people who
know you which is warm reach outs you've
got one to one to people who don't know
you which is called reach outs you've
got uh one to many to people who know
you which is making content to your
audience and then you've got one one to
many to people who don't know you which
is paid ads you rent other people's
audiences and you display your thing you
let them know about your stuff and so
break it down that way like there's no
other way that someone will buy unless
they find out about you period fight me
know what like
no one can fight that and that's
basically what the process of writing
these books comes down to is I want to
make a series of statements that are
that are Beyond reproach so that no one
can argue with them
like you you cannot get someone to buy
unless they have given you a way to
contact them so like you walk down that
that logic tree and then you figure out
which of these didn't happen so I ran an
ad and I didn't make money well there's
like a hundred things that have to
happen between then between them seeing
it and them giving you money so we just
look at and we start at the front
because
if you don't get to the third step
there's no point in trying to fix the
third step because you haven't gotten
people to even click and so the first
thing you know we'll talk about is like
how do we create a hook how do we create
a headline that people that will capture
someone's attention
that's it and then from there it's like
if you master that part or get good
enough at that part then you move to the
second part and I this has worked very
well for me because then it demystifies
the concept of success and I stopped
judging myself as being a good or bad
it's just like How likely is the thing
that I did here get them to move to the
next step okay How likely is it if I
share this thing they get to move to the
next step and you just keep going until
eventually you're like oh wait
I made money
and then you have all the the pieces
together and then you do as many times
you can
all right
just gonna I actually first let me
address something so uh to say things
that are Beyond reproach that's what you
said I want to make sure that I'm saying
things that are Beyond reproach uh to me
it's like another way of saying it's
Gotta all be first principles 100 cool
makes sense so you're trying to boil
things down to this is true does not
matter what people say think believe ah
it just is true okay that I think is
critically important for anybody that
wants to scale a business
um
you believe that we live in a
deterministic universe okay I actually
don't even know what that means okay so
cause and effect pure and simple
billiard balls bouncing around a table
that behaviors are the the cause of a
behavior is knowable
uh
uh I wouldn't
I'll say there is a cause of the
behavior I don't know if we can know it
necessarily we can try and control as
many of the environmental factors but I
don't know if we can say this is why
well I'm trying to avoid this okay yeah
yeah and get to uh if if the cause and
effect God is that a pure why okay for
for Alex I'm going to disagree with you
violently based on your own principles
cool uh that none of what you do would
work if it couldn't be known what you
needed to do to elicit a given response
otherwise everything would be entirely
random and so what I think you know and
what makes you so good at overcoming
sales objections is that you know if I
can get them oh God I don't know how you
would explain it the difference between
knowing why and knowing that so this is
cool I just care about that and so this
conversation I know that if I say these
12 questions when this person walks in
the door the likelihood that they will
buy is 38 percent
do I know why they buy no I know that if
I do these things this will happen
perfect deterministic okay so
that that helps me to understand how you
go about doing this so it seems to me
what you are doing is you were trying to
map behavioral cause and effect which is
why at the beginning of the episode you
even said like I'm really into
behavioral
a personal Obsession of mine because I
also believe that we live in a
deterministic universe which calls into
question free will we're going to set
that aside for now yeah uh and so it
totally does
do you think that Free Will exists
less and less by the day yeah I I think
eventually we all get to the point where
it's like it can't yeah then you get
into very interesting questions about
morality yes right which we won't get
into correct at least not now maybe at
the at the end but it's okay if you kill
somebody if it's temporary insanity but
if it was premeditated it's bad but to
what so where do we draw the line of
okay that means that there was
environmental conditions that made this
person act in this way that they
wouldn't otherwise do but it's like were
there not environmental conditions that
created the person that that train these
behaviors that then created the murder
yeah
correct I'll just but now as as
marketers if if we can understand right
right if we can understand what triggers
behaviors now now the you can truly
predict and execute because ultimately
that's what this game is and the
feedback loop that I think people either
know about you or Intuit about you is
that you're really good at this process
I did a thing it did not yield the
results that I wanted and I was very
shrewd about the next thing that I tried
and getting people shrewd about because
there's going to be
10 is really ten thousand there's going
to be a lot of things you could do when
the first thing comes back and you only
got 38 of what you were looking for and
you want to get as close to 100 as you
can so being able to do the next most
logical thing logic as defined as I have
a goal and this is the thing most likely
to get me closest to it the ability to
do that rapidly I will I don't know if
you'll agree with this but I'll add
bolt-on to your definition of
intelligence okay that if your
um you said the rate at which you change
your behavior is is the definition of
intelligence I will say the the rate at
which you can identify the
the most meaningful next step or the
most likely to be successful next step
is also uh intelligence not that that
really matters but this is the game
people are playing and this chunks up
what does that mean so uh the re so
learning is defined by similar condition
new Behavior right and so if I have a
fast rate of learning means that I have
a new behavior that I do in that
condition the only way I can have that
new behaviors have some sort of
knowledge so I think it chunks up to the
same got it got it got it okay I see
what you're saying
um right so if these two are the same
idea of manifesting in slightly
different ways as you come back down
that I think is what people are learning
from you and why you're so effective
um so the the question becomes do you
have a methodology for identifying the
next most useful test to run or is it
true this is all just going to come back
to the same answer experts and
repetition
it is and then I did try to create an
operationalized version of that from a
funnel perspective because I realize
that some people don't have the money or
whatever to test more times they need to
you know succeed faster and so I operate
off the theory of constraints meaning
that every system is constrained in some
way and then if you simply identify what
the constraint is and deconstrain it it
will grow until it's next natural
constraint can you give me a concrete
example
um
let's say you uh you've got a a Shopify
store that sells uh coffee mugs uh and
you spend a thousand dollars a month and
you make three thousand dollars back uh
on on the mugs so the constraint of the
system at some point will either be I
run out of mugs that could be the
constraint uh it could be that I just
need to spend more money because that
might be the constraint today and then I
spend enough that I run out of mugs or I
spend enough that my cost per impression
exceeds my profit because I go to colder
and colder audiences so then the
constraint there might be like I need to
build a brand or I need to get trusted
sources to increase the likelihood that
increase the awareness let more people
know about my stuff so that when they do
see my ad they're more likely to make
the purchase and so it's really being
able to accurately identify what the
constraint is and so for me uh when I
walk this through the book I said
usually uh the constraint that I will
focus on in a funnel uh is usually the
one that has the largest incremental
has the largest throughput difference
with the smallest incremental change and
so it's like if I have
uh you know 50 of people who are
scheduling uh 30 of people who are show
or let's say 25 people are showing and
then you know 30 of people are closing
it's like okay if I'm looking at these
things which one am I going to attack
well I'll probably attack the 25 show
rate because if I get a 10 or 25
increase just for Math's sake uh I would
double the throughput if I increase my
schedule rate from 50 to 75 which is a
25 increase from an absolute perspective
um I would only have a relative
difference of 50 so I would make I would
get more bang for my buck by focusing on
the constraint which is the one that the
smallest incremental Improvement
increases the throughput the most and
that you can use math to find out
yeah this is um this is business for
people listening so my obsession is
helping people understand how to solve
novel problems not problems you've never
heard of before problems no one has ever
heard of before and this is where you
have to get down to First principles
thinking anything that can be turned
into math should be uh something that we
talk a lot about here oh cool yeah so uh
because then you're pulling it out of
the realm of emotions I know I've been
talking a lot about emotions but um I'm
only trying to identify that as a as a
predictive mechanism for the next thing
which may be just where you and I um
don't see the world the same so for me
to understand what the next smartest
thing is you think you think uh
behavioral Behavior what's the behavior
I need to do that may be more useful and
I will really be thinking about this
after this discussion the way that I've
always thought about it is if I can
understand the psychology in that moment
I'll be able to predict the behavior
right um so maybe wasted time or maybe
necessarily Maybe you intuitive I don't
know uh time will tell them that but
um it's it's very very interesting okay
so people are
um
they need a rubric by which they figure
out what the next thing that they need
to test is you've just offered one which
is to understand the limiting factor
when you understand the limiting factor
then you're able to think mathematically
and remove said limiting factor or at
least know where to approach that
problem I think that's incredibly
helpful
um as so when you're explaining all this
I
your business model at acquisition.com
is a pure understanding of even though
you're able to even though you're
willing to give all of your secrets away
there's still going to be a gap in
execution sure why why are you better at
this than most people
um I've done it more times that's it
yeah really believe that yeah I've done
it a lot of times
um I think that's a big part of it and
then I think that there are elements
that we have that are kind of
competitive modes which we purposefully
um set up like we are building this
brand so that we can attract the best
talent so like if you have let's say a
chain of nail salons right which is a
company I'm looking at investing in
right now so if you're listening to this
you're great love your company
um and and so you have a chain of nail
salons and
you will probably struggle to get a plus
talent to go to that I will not struggle
to get a plus talent to place for you
because they will want to work in an
acquisition.com company because they
know there's a huge backing behind it
they know that we're going to be
shooting big we're going to try and do
big stuff and they might think the
founder might be a first-time founder of
getting to business of that size but we
are not and so they have a higher
likelihood they have a higher confidence
that we will help the business grow to a
much higher degree meaning that their
career can grow they have more
opportunities it'll build their resume
all that kind of stuff and so from a
competitive mode perspective we're able
to get better people and if we get
better people we build better companies
and then that becomes a flywheel because
the more companies we take on the more
we grow the more success stories we have
the more Talent wants to come and it
just it just continues to feed itself
and that's something that continues to
compound in time and that's purposely
built as a long-term competitive
advantage okay talk to me about leverage
I think that's an important part of this
puzzle so there's a couple moments in
your story around leverage
um one is is the guy that told you hey
you shouldn't be in the gym business you
should be teaching people how to do this
and then the other moment at least for
me on the outside
um was when you realized I'm not going
to help these guys launch their
businesses so I'm gonna sell them the
course that I put together
um
what's the what is leverage why does it
matter and how do people get some okay
so first off just for the just for the
audience
um it was much closer to a franchise
than a course uh so it was it was a
licensing model so we had it was more it
was closer to licensing plus Services
than it was of course just because it
would just do it we don't even sell
courses so like I think that that's
because there's a lot of people in that
space that follow my stuff and so they
make that assumption um which is fine
and I only set the record straight for
for clarities
um beyond that
um
leverage as we Define it is the
difference between what you put in and
what you get out and so if I uh
and it's volume times leverage equals
output
so it's how many times you do something
times how much you get for each time you
do it equals output so if I do a hundred
sales calls and I have no skill
then I will get fewer scale fewer sales
than somebody who does the same 100
sales calls and has much higher skill so
skills create leverage you get more for
what you put in
at a simple at a at a basic level but it
works with anything so if you're trying
to invest it's like if I can invest a
smaller amount of money and get a bigger
return then I have more leverage right
the reason debt is considered Leverage
is because you can put 20 of the cash in
and get eighty percent of the loan you
buy a building five times bigger than
you normally could so you get more for
what you put in
um and so
there are degrees of Leverage and this
is wholeheartedly taken from Naval and
I'll probably have to think more about
it because I haven't written the book on
Leverage yet so I'm borrowing
um but I I remembered as the four C's he
has different words for it but you've
got collaboration Capital code and
content those are the four C's of
Leverage
um like we make this video right now we
make this podcast and we put x amount of
effort in but we get unlimited upside on
it many millions of people can see it or
one person can see it but
we get more for what we put in the
better and better we get at this uh code
you can write you can write an app one
time and then unlimited amount of people
can use the code or use the app uh
collaboration is I say okay I will now
teach 20 guys to sell and I will get 10
times the output that I had if I were
selling and so I might not take any
sales calls but make more sales than
anybody else does because I have more
leverage and so a big you know through
line of the leads book is there's the
core four which is the first four things
that I expect to do one-on-one
one-to-many uh trainers and friends or
people know you people who don't and
then the other four to the four lead
Getters people who let other people know
on your behalf which by their very
nature have more leverage because you
don't have to do it so if you can get
your customers to tell other customers
about your stuff using the core4 because
they also have to use that like a
customer can only tell a customer by
telling somebody throughout warm
Outreach posting content about it
writing an ad unlikely and doing cold
Outreach also unlikely but they could do
one of those four things and that's
complete that completes the advertising
cycle so you do something
to get a lead getter who then does the
core 4 and around and around you go so I
could also make ads to get affiliates
who then run ads to get customers for me
but if I uh go and let's say I spend all
my time and I get 10 sales a month of
customers right and let's say each
customer is worth a thousand dollars to
me great I'm in a cap at ten thousand
dollars a month
if I use the same effort of marketing
and sales and I sell 10 Affiliates so
still still same number of conversations
same number of humans but I sell 10
Affiliates per month and then those
Affiliates each month after that get me
one customer each well then the first
month I'll get ten thousand dollars
because each one of those guys got me a
customer
but then I'm still going to work and get
another 10 Affiliates next month so then
next month I'm going to have last month
10 plus this month's 10 so now I'll have
20 new customers and I do it again I
have 30 new customers and so I'm using
the same amount of work to get more
customers than I divide I directly went
through it and so that is that is a
basic example of how leverage Works uh
within the context of advertising to get
customers in a business
so what is the
what is the
way that you
think about
constructing a a business or the way
that you're going to structure something
so when I first asked that question
about leverage you you said something
really interesting which was hey I just
want to point out to everybody that that
was a licensing model yeah it meant
something to you to make a distinction
there which I have a feeling there's
there's a little bit of hormuzy sauce in
there that we would all benefit from
understanding what what drove that
decision
why does that matter to you you mean
saying that
structuring the business to be so um
this is exactly what went through my
head when you said that was oh like
he actually had a more keen moment of
understanding than has come across at
least I mean I've heard you tell that
story multiple times
um and I've heard you say oh it was a
licensing thing but it never I don't
know it never landed for me but this
time I realized it really meant
something to you so there was a keen
insight there what what was the Keen
Insight why why do it as a licensed
model instead of just saying oh this is
of course go use it
if we added
assistance and services where we would
maybe run the ads for them and we would
train their sales teams which we do
and we would give them the ads to run
for their local area and we would help
them build the landing pages to attract
customers and we would give them the
white label you know meal plans grocery
list for food preparation you know
instructions for their clients if we do
all of those things then we would
increase the likelihood that they would
succeed and make more money and I can
charge based on the a fraction of the
value that I can produce for the
majority of my customers and so if the
average so right now gym launch until a
company still continues to grow the
average gym Lord which is what we call
the community Jim Lord Lord yeah lording
um the average gym Lord uh adds two
hundred thousand dollars shoot I have to
know the metric a lot yeah ads this is
it there we go uh adds two hundred
thousand dollars a year
um to their business and a hundred
thousand that's profit there there
that's what the math is so the average
gym Lord adds a hundred thousand dollars
in your profit I think a little bit was
like 118 whatever
and
we can charge a percentage of the
increased net profit that we are help we
were able to help them generate on
average and now we have to usually
charge a significant
uh discount on that because half the
people are going to be below the average
so for the people who are for for half
them it's an even crazier deal you know
they they pay for the licensed model
they don't have to spend money to test
ads we would say we already spent 50
Grand in 20 markets these are the
winning ads this month and they could
just run them through the system and
then just collect the money on the other
side and so they get the speed and they
don't have to have they don't have to
taste the test you know the the failed
ad test because we would incur that cost
but we were able to distribute that cost
at scale so no individual gym owner
could spend fifty thousand dollars to
test ads in all these different markets
we could and then give it to a thousand
gyms
and so and again from a media
perspective uh leverage we could do that
one time and a thousand gyms can do it
at no incremental cost to us and so it
is a very profitable business it still
is a very profitable business all right
when you had that moment and I'm sure
people know this part of your story
you had the moment where you're
desperate you've lost everything twice
you're scrambling to make money and you
tell the guy I'm just going to give him
a number that's high so that he doesn't
bother me with it uh six grand he's like
yes had you already thought of it as a
license model or you do those first like
whatever 150 Grand that you made uh with
the seven people or something I forget
the exact details of the story it was
like seven people that you'd promise to
do their gym and instead you sell them
this model yeah had you already thought
of it in that moment as a licensed play
I had
um I just I think honestly a lot of a
lot of the the words around like what we
did came from outside sources because
people saw how quickly we grew and we
were in a world that was direct response
marketing and so many people in that
world sell courses so they use the words
that they know how to describe something
um but it was much closer and arguably
like significantly more support than
what a franchise does for a franchisee
and that's how we structured I wanted to
be I want to deprive more service make
them more money for a lower fee than a
franchise would
and potentially this is smarter and um
I'm really my goal in this part of the
interview is to help people map the
models that you have running in your
head that allow you to do the things
that you do
um because even from my perspective it's
very unique it's very rare you just have
a real ability to break things down to
what I'll call the essence of the thing
the anybody listening I will tell you
right now the biggest mistake you're
gonna make is what I'll call a category
error people fail to understand what the
true essence of the thing is which I am
as guilty of as anybody so I don't put
myself outside of this but have spent a
lot of time trying to understand my own
failings and shortcomings so as I'm
hearing you tell the story I'm thinking
okay one to identify the license thing
is very shrewd and so trying to map how
you conceptualize a thing feels tied to
me to the the same idea of
understanding that an individual gym
cannot afford to do the market testing
thing that you can afford to do and
therefore if you do it you now have a
moat you have leverage you have a
service that you can sell that is
understanding the true nature of the
Beast yeah do you ever stop and model
the the nature of this thing is and then
you break into constituent Parts yeah
what does that process look like and is
it Universal or is it nail salon nature
of uh gym nature of yeah
um I I boil it down to something
probably hilariously simple which is
number of potential units sold times
gross profit but that that's and then
and then the you know the tertiary piece
is what up front or Capital Investments
required to be that would enable that
right like if I had if I had to go buy a
machine that could manufacture widgets
that have you know phenomenal margins
because the value that people get from
it is you know ten dollars and I can
make them for 10 cents then that's a you
know great business but if I can only
sell it to you know one town in Alaska
because it's a really unique fishing
tool that only works in their
environment uh there's elements of that
that would make it an attractive
business but there's almost that won't
so it's like it'd probably be a very
small very profitable business that
could not scale
um nothing wrong with that there's
definitely huge place in the economy for
things like that but when I'm looking at
opportunities that's what I would that
is the simplest way of looking at it for
me is number of potential units sold uh
gross profit per unit and then what I'll
call competitive Dynamics as the as the
third part which is like if you look at
you know cell phones it's like what does
it cost them to add another cell phone
to this massive Network probably not a
lot is it really sticky yes do people
stay and pay for a long time yes okay so
there's probably a lot of gross profit
to be made there and how many people
need you know cell phone service a lot
right it's like okay so that might be
really attractive but the competitive
Dynamics is that I would have to have I
don't know
a billion dollars or I'd have to partner
with somebody that would allowed me to
White Label so this is when you get into
the competitive dynamics of like okay
well is there is there value in creating
a brand and wrapping on top of an
existing solution and say hey I might be
better at marketing a sales than you and
you already have the infrastructure to
deliver cell phone services to people
Nationwide or maybe just in this region
um and I will do what I'm good at and
you deliver on the back end we structure
some sort of deal where you know the
more volume I get the more of the
economics I get to you know participate
in so those are kind of the the big
three variables that I look at if I'm
just trying to analyze a business uh in
terms of opportunity and uh and the big
piece that I think a lot of folks will
miss out on is when I say uh gross
profit
um I'm talking lifetime gross profit and
so that's where like I have less care
about recurring versus not recurring
um you know if from uh and this gets
into the push and pull of selling a
business or not selling a business but
you know if uh if a company has
something that's super recurring let's
say it's a service like accounting or
bookkeeping let's say there's really
high you know gross profits on that
because we've automated a ton and we've
got some offshore workers doing you know
the remainder of it we have really
amazing margins and it's really sticky
um that could be a super high gross
profit business but at the same time if
you're Elon Musk and you sell everyone a
Tesla and even if everyone buys one
Tesla that might be still more gross
profit than you know the bookkeeping
services just as a completely
contrasting example and so I just look
at what is the lifetime gross profit and
some of that might be better structured
for recurring and some of it might be
better structured for a one-time
transaction and then I know I'm going
into like stuff that will probably bore
the audience but if you're looking at
the business as a product then it then
it also becomes you have two customers
you have the customer that you're
selling a product to and then you have
the customer that you're going to sell a
company to and most customers who are
investors who are buying companies feel
better
buying something that is recurring in
nature uh
because then they feel that the
likelihood that it will continue to make
money in the future is higher
even if the Tam's huge all that stuff
they still feel they sleep better on it
until you get a premium for the company
and so that's that's kind of big picture
how we think through what companies we
want to invest in uh or at least the
opportunities that we could look at and
then from a personal investing
perspective is how much value can we add
to that specifically like I probably
wouldn't take on a wireless cell phone
company
likely but if there's a you know a brick
and mortar chain of services that's like
Med spas or beauty or you know health
and fitness like that's my wheelhouse
like we know how to crush those and so
it decreases my risk because I know that
even From value-ad perspective if I can
5x the company because I know how to how
to build those marketing and sales
processes at scale at the unit level
then the likelihood that I don't get a
tremendous return is really low okay
there's two things um there one sorry
that's soliloquist no no this is this is
amazing and I hope people are taking
this as it's intended so in fact let me
uh let me give people a frame of
reference this is the way that you
should be thinking about what we're
talking about right now which is all of
these things abstract so that you can
think through novel problems so big data
sets with a few filters so you can make
quick decisions on massive amounts of
data what do you mean by that in terms
of what we're talking about right now so
if I if I so if I so I get every day on
my phone I'll have a list of all the
companies that have applied at
acquisition.com and they'll be ranked in
terms of like this one looks among most
interesting these ones are less
interesting and here's why we didn't
think they were interesting for my team
and so I will basically go
pass pass pass pass second call and ask
these things and then they'll go and do
that for me to be able to quickly make
the decision because otherwise I would I
would be inundated with the amount of
data that I have to take in I have to
have filters that are faster just LTV to
CAC ratio
like I feel like you can boil down most
businesses to what does it cost you to
get a customer what do you make from
that customer over the lifetime period
that's it now Tam is you know how many
of those customers can you sell short
but like if I just had if I could only
look at one metric in a business that's
what I would look at okay so mostly
entrepreneurs that are listening to this
or people that want to be an
entrepreneur no I think they'll get that
but they're that's not where they're
going to be at in their Journey that's
certainly a more advanced thing so the
part that I want to bring you back to is
they're gonna they're they're gonna be
thinking through how do I start a
business sure what business do I start
how do I identify the opportunity and so
there's a couple things that you were
just going through that I think are
really relevant one of them is how you
identify the business model so
um looking at a total addressable Market
uh lifetime value of the customer versus
what it costs you to get them all 100
they will have to figure that out or
they're gonna end up doing something
dumb chasing a small opportunity
whatever
um but the all of those metrics will
change based on the decision that they
make around what business model to
pursue so just by way of what a business
model is uh selling courses that's one
business model licensing a business is
another business model so people you're
saying even when they try to retell your
story they are confusing the two so uh
but very different when it comes to
execution there's no recurring yes so
um how do you process through if if you
were starting so not as when you're
looking to acquire how do you process
through what is the right business model
to pursue
so this is pulled from my 100 million
dollar offers book which goes the point
of that book was to answer the question
what do I sell and I think that a lot of
people especially when you're starting
out you're like I need a business plan I
need a I don't think any business I've
had is had a business plan as an aside
um it's just what are we going to sell
and how we're gonna get customers and
then from there we build everything
around it and so
um isn't that a business plan
I have two things on my plan
I mean I've seen like 16 page business
plans right like okay all these numbers
are made up it doesn't matter like do
you know how to get customers
um and so
picking the Avatar which is the customer
that you want to go after
and then picking the problem that you
want to solve for them and probably you
want to solve is I feel like kind of a
trite term in the in an entrepreneur
space
um but
you usually want to make their lives
easier in some way uh it's usually going
to track down a status or it's going to
track down a time right like those are
those are two huge buckets that that can
that cover a lot of stuff and you know
different people say there's health
wealth and and relationships there's you
know there's a million bigger buckets
that you can try and chunk this stuff
into but if you are starting out so let
me just get you really tactical so we
were just really clouds for a second let
me just get you Tactical
number one
you can go and set up all of your autos
of incorporation your LLC and all that
stuff online with a few clicks of a
button under 30 minutes so you do that
at step one step two you take those
papers to a bank and you get a bank
account step three you hook up a payment
processor to that bank account which is
again a series of clicks that nowadays
are almost automated once you have those
three things you get a stranger to give
you money in exchange for doing
something for them and so I would
categorize businesses as I see them
usually as you either sell products
you sell services so physical products
something like a mug right you sell
Services you do something that they
would otherwise have to do for them you
write software that does something that
a human would do for them but because
you have an auto you have automation
with code uh you can get them to do it
or you create things that entertain
people that they want to have access to
and so those basically function into
media again you've got people
products uh code and and uh and and
content so it actually
breaks out to those four types of
businesses and I think that most people
if you have no like let's say you aren't
a software developer right and you want
to start a business uh the easiest once
you start are either
the easiest one to start is a service
business because it only requires your
time and you to learn a skill that other
people can also learn but some people
just might not want to do it
and that is all you need to solve and I
remember like when I was in college and
I spoke at some universities for uh for
entrepreneurship and everyone there is
always like here's my business idea
right and it's always like weird Gidget
widgets and gizmos and like these these
never before seen businesses and most of
those will fail whereas like if you want
to make your first business and the big
fallacy is that the first is going to be
the forever business which it won't most
entrepreneurs have many businesses over
their career and each business you learn
elements that help you build a bigger
and better business the next time and so
you start with something that people
already buy so it's like you can look
what do people already buy they already
buy lawn care services they could mow
their lawn they just choose not to they
could optimize their website for SEO
they just choose not to they could run
their own ads they just choose not to
they could edit their own videos they
just choose not to you could set up
email you know autoresponders for people
but they choose not to you could set up
voicemails for businesses and and
transcribe it and send it to them
because for those people it saves them
time and so you can pick any problem you
want that someone already does or
already purchases look at the solutions
and you can literally just do it the
same way and have a way to get customers
that's it like that's that's it you just
reach out to people that you know
one-on-one you reach out to strangers
one-on-one you make content about the
problem and you run ads there's only
four things that you can do to let other
people know about your stuff so once you
decide what you have to sell you then
use the core four one of them pick and
then you let people know about it until
eventually someone says yeah I'd be
interested in you solving that problem
for me
and that's how you make your first off
all right Focus becomes a problem people
end up getting really scattered they
want to try a bunch of different things
and see what sticks
um how
how do you make Focus work for you and
not against you
I feel like Focus can only work for you
um
the nightmare scenario most people spend
their time in yeah I think it's um so I
love showing this visual uh and maybe we
can grab it at post for this but if you
imagine a curve right where you go uh
you start here a little bit above the
line at uninformed optimism is that you
see your buddies doing Drop Shipping and
he's making money and so you're like wow
this must be amazing I will do that too
so then you leave your current
opportunity to do or maybe you start you
start doing that then you move to stage
two so you go over the hump of
excitement and then you go to informed
pessimism now you're below the line
then you're like wow okay you have
there's a lot of other stuff it's really
competitive I don't have a brand it's
hard to differentiate you know the cost
of goods is actually continue to rise
and so our ad costs and well you start
realizing the other things that you
didn't know before so you have a
slightly more realistic view of the
opportunity then you go to stage three
which is the value of Despair where
you're like nothing's working I don't
know what I'm doing and this point is
where everyone then jumps to
uninformed optimism and the next
opportunity and they replete repeat one
two three one two three one two three
until they're eventually able to learn
that they just need to stomach because
every single business has and when
the grass is green on the other side
it's because there's lots of manure
there right same as yours and then you
go up to informed
optimism
and then you hit achievement
and so those are the five stages that I
see most entrepreneurs going through and
they continue to cycle the first three
over and over again until they learn the
lesson so this is a skill focus is a
skill I can train someone to do it if
you're in the same environment and
you're at this point where you're not
sure what to do but other people have
succeeded at this thing and then you
think something else is easier that you
find out about that is a stimulus that
we can then say here's the red flash
card are you going to duck are you going
to get slapped and realistically most
people just need to keep getting slapped
until eventually they realize that
nothing is going to be easy and they
have to go through the period of not
knowing what they're doing because
that's like that in essence is what
entrepreneurship feels like his
uncertainty of whether or not all of the
time that you've put in is actually
going to work out and you have to get
really comfortable with that is that you
won't know because if you were to be
guaranteed the outcome that you're going
to get what you want you wouldn't want
to do it to begin with because everyone
would already be doing it because it's
already guaranteed which means the
opportunity is gone
so the opportunity is in the uncertainty
and so as long as you can Embrace that
which is why you have to have some
tolerance for risk as an entrepreneur
because you have to pay down your tax of
ignorance which we all have to pay down
every single day for not knowing the
things we should know
um and the only way you do you pay down
that tax is that you test and you
iterate and so you just want to get as
many no's out of the way as many
failures out of the way because you're
not actually failing you made progress
it wasn't yes or no did it work or not
it's how well did it work and I think if
you can make even that frame shift
you're like okay well I'm reaching out
to people they're responding but I'm not
getting them on the phone okay well then
you have a scripting issue okay then you
get them on the phone okay well they're
not buying okay well then it might be a
offer issue it still might be a sales
issue depends on why they're not buying
if they're saying you know it's price
it's like you might be mispriced but you
also might just be really terrible at
explaining the value and so you just
continue to work your way down until
eventually someone's like yeah that
sounds good and they read you their
credit card over the phone and you're
like holy this is actually
happening and you make your first dollar
and I promise you have to make your
first dollar the second one comes a
hundred times faster than the first one
did
if there are many variables present many
variables must be tested yes we studied
yeah that is certainly uh marketing
summed up yeah they're no doubt that
people are going to have a hard time
figuring that out
um I want to better understand
you just did a book launch for your most
recent book and
it I mean you set records it was Unreal
I mean really like blew people's minds
set a standard in in the world of online
marketing
um what was it about that that or what
did you demonstrate in the way that you
did that that other people don't
understand
so with each book I wanted to
demonstrate the concept of the book with
the book itself and so offers when I
released it was uh 1.99 I've now since
made it free
um but it was 1.99 on Kindle it had a
course that went with it that many
people charge five thousand or ten
thousand dollars for
um and
it was the sub headline of the book and
offer so good people feel stupid saying
no and so I actually launched that book
with a single post on I had 10 000
followers on Instagram that's it and
every month after the first month it
continued to sell more and more copies
into the state continues to sell more
copies every month and that is based on
the offer being exceptional and people
sharing it because they got tremendous
value relative to what they paid that
was the that is the entire concept of
the book The Core framework of that book
is is called the the value equation
um which I'll get into but that is
basically people say the word value but
how do you operationalize value right
and so that book is about
operationalizing value making the thing
that you currently sell more valuable in
the perception of the customer so
they're willing to trade more of their
money for it
the Leeds book had an entirely different
core concept which was the core 4 and
the four lead Getters and that is the
advertising cycle and so it's how do you
let other people know about your stuff
and so the sub headline of that book was
how to get strangers to want to buy your
stuff not to be fair it's not it's not
how to get strangers to buy your stuff
because that's sales but how to get them
to want to buy your stuff is advertising
and so this book sits literally just
between they don't know who you are and
they show interest and that's where the
book ends
you get lots of leads saying I'm
interested I'd like to find out more
about your stuff and that's all I could
fit in one book to make it actually
effective and operational for most
people and so since the concept of the
book was to advertise and to get lots of
leads then I thought it would be
appropriate to
advertise and get lots of leads and I
used every method in the book all eight
for the book launch even though I could
just have made a post on my you know
across all my social medias and probably
sold plenty of books just doing that but
I wanted to show that this stuff works
today and it will work in 100 years and
it worked 100 years ago and so I went
through I had some people that I reached
out to one-on-one purposely just to
check the box I reached out to some cool
people so I could do podcasts I ran ads
for it even though I didn't need to run
ads we still got 137 000 people from ads
uh we had Affiliates we had 104 000
people there from Affiliates uh we had
27 000 Affiliates promote the book
um we had customer referrals people sent
their friends there so I had an
incentive that if you just get 10 people
to come you'll get two bonus chapters
that aren't released with the book uh
Affiliates uh which is the the
another lead getter right I mentioned it
earlier but uh Affiliates uh we got them
uh to to promote the book we got
agencies who actually were the ones who
ran the ads for us because we don't run
ads at hold code because we don't
transact
um and then employees which is the
fourth type of lead getter which is they
do the core four on your behalf for you
so we had Mosey media which is our
internal content team made all the
content and the ads for that matter uh
for the event and the book itself and so
I actually only did uh 17 long uh 17
short form pieces of content and six
long four pieces of content and then
that got cut into uh 143 posts that we
did over six weeks on top of the 2200
posts that we were making anyways uh
over that same period of time and so I
used all the methods in the book to
demonstrate to give proof that the book
works and so you know the next book I'll
try and continue that meta theme of I
have Concepts in this book and I will
show you that they work because I will
use them to Market and promote the book
the thing that I really want to make
sure that people understand and if you
think I'm crazy definitely let me know
but I doubt you will
um the reason that all of that worked so
well isn't what you did at the time it's
what you did for the years leading up to
that moment building brand uh building
awareness generating massive amounts of
Goodwill
um
is that
like what amount of magnification did
the whatever four-ish years leading up
to the launch of that book play in the
the launches success
it was everything
I mean it was everything now that being
said you could still absolutely use it
like you can still use warm Outreach you
can see this cold Outreach you can still
like and one of the concepts in the book
is making content and I talk about how I
structure content how we pick topics how
we pick headlines how we format it how
we do all those things so that people
can use that and make content for
themselves
um
but usually the longer you can wait
um before making any asking to be fair
that I gave the book for free and if if
you wanted to buy a physical copy you
could that was the whole that was let me
let myself spoil the surprise of the
launch was that I gave everything away
for free and said if they want to buy
physical copy you could
um
I'm I can't wait to write the book on
brand because I have a lot of thoughts
on it and I can't wait to have really
clearly crystallized like UNR you know
beyond reproach ideas about brand
um but I'll give you a working teaser
for for how it works but brand is
basically teaching
it's associating something people know
with something they don't know and we
associate these things enough that
eventually I can remove this and then
you'll associate water with my hand
and so if I do that enough times and I
have you know water and you know
coffee and whatever then you might
generalize and say the hand is a
beverage thing
right and I like thinking about it that
way because what do I want people to
associate me with I want people to
associate me with tremendous value on
people that associate me with long-term
Goodwill I want them to associate me
with money right so every book's 100
million dollars something offers 100
leads
um and so I want them to associate with
investing which is what a lot of the
stories that I talk about are companies
that we've invested in that we owned and
scaled or exited and so I
we do those things so that when you have
a brand a brand is put on something to
direct someone's behavior is a physical
sign so if you look at the you know
original the origins of the word brand
it was a brand
you put it on a cow right and so if you
have a cow that doesn't have a brand and
a cow that does have a brand you will
behave differently with a cow that has a
brand on it you're not going to go
capture it you're not going to go kill
it you might return it to its name its
neighbor or whatever like the brand
changes your behavior
and so brands have at least as far as
I'm concerned like these you know I
haven't written the book yet but
um have kind of two two continuums you
have the strength of the brand and then
you have the positive or negative uh
inclination towards it so away or
towards so like Nazis for example have a
very strong brand away
for most people now to be fair there's
also a subset of people who are strong
super strong towards there's a subset of
people kind of way right it changes
their behavior yes it does and then and
the inclination says towards your way to
some degree
um
you know Donald Trump has a strong brand
right for many people for a percentage
of the population it's it's uh negative
and for percentage of population it's
positive right and so when we think
about brands that way it's been helpful
for me because you really answer the
question who and what do I want to
associate myself with and then by doing
that eventually your logo and your
identity will then have
a set of things that people associate
with which then will change their
behavior which is why I think brands are
the most valuable things that you can
build because it really becomes a way to
influence the behavior of the masses at
scale and so if every single person
recognizes the Nike Swoosh and I can
take a water bottle and then put a Nike
Swoosh on it and triple how much I can
charge for it and still get more people
to buy it then you can measure the
strength of the brand by the difference
in price between the commoditized
version of it and the Branded version of
it
and that translates into tremendous
profits from a from a capitalistic
perspective and so if you're trying to
build something really valuable then you
make many associations that are positive
for specific audience because uh I think
Black Rifle coffee right they're kind of
like politically charged-ish right so
Black Rifle coffee is going to be really
positive for people who are probably
right leaning uh in terms of their
associations with that brand it'll
probably be kind of negative for the
people who are more last learning and
that's okay because they're like we can
sell to half the population whatever and
so
I'm kind of agnostic to the direction of
it and obviously Nazi's negative on that
but like for for most of these things
I'm just looking at what is what is the
percentage likelihood that people will
adhere or comply with the requests that
the brand makes of them
buy my thing go to this thing whatever
and so that is the that's why you can
have somebody who has a huge brand in
terms of uh the amount of people who are
aware of it but have very low ability to
direct or change Behavior
and so you probably I'm sure you know
this better than anyone with Quest you
guys were one of the first ones getting
into the influencer space like way back
way back when the term influencer was a
new term
um and you probably saw some people with
million person accounts and they
couldn't drive any sales and then you
saw somebody with 15 000 and crushed it
because they had a stronger brand for a
narrower audience even if it was just
like a girl cop who has an audience of
all girl cops they might
have lots of positive associations with
that person and then be more likely to
you know comply with whatever request
they have and so I know this is a
branding discussion
um but
the reason that I think many people
wanted to come to the event is because
they were awarded in the past for
consuming content for reading my last
book and so they felt like the
likelihood that I was going to reward
them again at this event would be high
and I try to like I'll tell you a secret
I try to make many promises and keep all
of them
and the more times you can make promises
and keep promises the higher the
likelihood
people will ascribe to you for being
somebody who is predictable in a good
way if he said this will happen this is
what's going to happen if he said it's
going to be worth it it's going to be
worth it and so that was woven in for
the 24 months from the time I released
offers to the time we did leads was
trying to actively build up the Goodwill
so that we could set records and do
something really cool and demonstrate
the concepts in the book in the real
world so that people could know that it
would work for them too
I mean it's incredible it's breathtaking
um what you guys were able to do what
was a record that you broke so the
Guinness Book of World Records for a
business virtual conference live was 21
000. for a business conference so you
absolutely
demolished yeah that which is really
cool that's awesome I will say this as
an aside uh I think the the the the
Fanfare about the launch will decrease
soonish and I think that the actual
contents of the book is going to be the
thing that that can that people that is
that machine will start spitting because
inside of the book referrals is always
the one that I always try and drive the
most in any business I have because it's
the lowest cost to a car customers not
that it's a customer acquisition thing
for me but
um or sorry not a money-making thing for
me books are not the best way to make
money just throw that out there
um but it can create a viral effect so
that you can get more customers every
month without paying a cost to acquire
and so the mission of acquisition.com is
to make real business education
accessible for everyone
and so in order to do that I can't do it
alone and so that is why I have to have
other people help me
yeah uh you're only going to scale as
much as you can get high quality people
to help you that's for sure there was
something fascinating that happened
during your launch
um which I would love to hear from a guy
who did not in the beginning consider
himself a salesperson somebody that has
gotten very good at sales and as I was
saying in our first interview which the
funny thing is I ended up taking you on
a side tangent before you answered it
but I said the world does not think
you're creepy why aren't you creepy when
it comes to sales but there there was a
a moment which you did on purpose but I
want to know what you're going to say it
doesn't matter it's all about Behavior
but I want to understand what you think
about this so you intentionally took
people on an emotional rollercoaster
ride where you start I'm going to give
you this for free and I'm gonna give you
this but if I ask you or sorry I'm gonna
give you this uh it normally goes for
this much and this normally goes for
this much but you're Crossing it out
classic thing where you then ask for
money now you could see the comments
coming through at the time and people
turned on you totally and I'm assuming
they were saying something akin to I
knew it this guy just after money
whatever
um if there's nothing wrong with sales
why did they turn on you uh actually so
I don't know why they turned on me I can
make a guess but at the end of the day
like I'm never gonna know what the main
reason you knew they were going to you I
did that on purpose
I don't know why I knew that
so when people see this thing
um there is an aversive reaction to it
in a certain percentage of the
population that being said I got a
zillion messages people would be like
dude I was ready to give you my credit
card at 5K and so sure like we could
have taken 50 million dollars at the
event
um but what I wanted was you know 500
million dollars of value to many people
that later will come through companies
that get started and scaled using the
stuff and then they want to partner with
us
um but the reason that I did it was or
at least this was my hope for doing it
was that I wanted people to remember it
and so memory is driven by emotion
um and so I uh I took this roller
coaster approach uh because I also
wanted to subvert the audience if I just
said hey it's all free it's all amazing
here it is I don't think nearly as many
people would have talked about uh the
thing I also don't think they would have
perceived the value as high so I wanted
to sell them on the value of this thing
and then give it to them rather than
just saying if I got on and said hey
guys uh there's a free course with eight
different things in there that are you
know I spent a lot of time on go enjoy
them I mean it would have been fine
people would be like you're amazing uh
but doing it this way
it becomes uh like I think a lot about
this it's like what is that person going
to tell the next person like what words
are they going to say they're probably
going to be like dude he did this like
fake pitch and he like and he like
everybody was going left and then all of
a sudden he made it all free was Unreal
like like the place went nuts like that
they will remember and um that was what
I was going for
I figured there was a higher likelihood
that they would remember it if I did it
that way
yeah I think you are very correct about
that
um talk to me more about your mission
um
so um and I I would I like to put this
big disclaimer out up front
I'm a ruthless capitalist I am
absolutely here to make money I am not a
saint I have no like
many nice things were said about me
after the event and I also remember that
the same people also threw stones at me
30 seconds earlier so like that doesn't
sway me a ton but I'm letting everybody
know I'm here to make money I'm just
measuring how I make my money over a
longer time Rising that's all it is and
so I could have
taking 50 million dollars you know from
from the event I think that's a really
realistic number
um
but if I do one deal from somebody of
the now probably million something
people who have just even just seen the
event recording or where they're live
um
I will probably make more than 50
million dollars and also get a brand
that continues to compound at a faster
rate and so to be clear I don't think
there's anything wrong with monetizing
an audience I don't think there's
anything wrong
um it really comes down to keeping
promises so like for example like I I
will probably be launching some product
at some point uh in the in the future
um whatever could that be yeah and um
I don't think that I will have any
negative response to it and so it really
just comes down to like what have you
promised or what expectations have you
set and then are you meeting those
expectations and so I think my my view
on this has shifted a little bit over
time is I used to think like you have to
exceed expectations but now I think that
it's really just like can you perfectly
meet the expectations the person has now
somebody might have really high
expectations
um but you try and set them and meet
them and you do that cycle as many times
you can so that their predictive measure
of trust with you if you want to
operationalize that
um is that you are trustworthy because
you keep your promises and so I think
that's a lot where uh like
the only the other reason is that within
the unfortunately within the the course
creation world this is one man's two
cents all right now I want to be really
clear about this because people get
their pennies in a bunch
you can choose to feed your family
whatever way you need to I have zero
judgment on it what I do acknowledge is
that people make associations
and so I could find the most ethical
porn business in the entire world as
soon as I stand on stage and talk about
our porn company I will forever be
associated with porn
is there anything wrong with that yes or
no I don't know for me I think that
there is uh there are other businesses
that I would like to do that I would
like to do a deal with that might view
that negatively
and so it might prevent me from doing a
much bigger deal in the future by having
that and so I won't do it not out of
principle but out of pure dollars and
cents materialism if you want to call it
that and so
um
the course world to that point has a lot
of charlatans and a lot of people who
make promises and break promises and a
lot of people who set bad expectations
or unrealistic expectations and then
people get really frustrated and upset
over what they get
and so for me
even if I had the best course in the
world
I wouldn't want to sell the information
because it would associate me with that
group and so I've taken a lot of time to
disassociate myself with that category
um and it was because I mean I was a
brick and mortar owner but like I
learned a lot of direct response
Marketing in that world so I made a lot
of friends in that world who then made
commentary and then put me on stages and
so I had a really strong associations
early on with that Community again
nothing wrong with that Community I'm
saying but the associations that I would
prefer to have with my brand are the
ones that I said earlier which might
seem in direct conflict with that which
is like long-term oriented Enterprise
Value being patient giving first like
these are all things that many people in
that Community not all but many people
and in that instance especially with
branding in my opinion
the good apples do get thrown out with
the bad so I do absolutely think that
there are
amazing education businesses that exist
absolutely like Bar None period end of
statement there are just so many that
aren't
that it's very difficult to make the
association and so that's why I think
that if I had let's say a no strip that
I was going to come out with or I had a
dessert company that I was going to come
out with I don't think anyone would have
any issue supporting that or me saying
like hey I want to I want to build this
with you guys but this in public I think
these are all things that people would
be totally fine with but why it's
because of the expectations that I said
at the beginning and so acting in
accordance with that over a long period
of time and to one sub note on that is
that I do believe that Brands can change
over time and so the concept we're
talking earlier with like successive
approximation we're like if you are one
shade to the right one shade to the
right one shade to the right you can
slowly move a brand now whenever you
make that move you will lose some people
who liked the thing that you had before
and you will gain some people that like
the new thing and the idea of
repositioning or you know directing a
brand is making sure that that trade-off
is positive it's like uh it's like the
local band that you know has that local
you know Vibe whatever and then they
they go a little bit more mainstream and
then all their early fans are like they
sold out but what they really did was
they trade a small group of people for a
much larger group of people and more
people like this brand than the old
brand because if they like the old brand
they would have already been big and so
it's really just a calculated trade on
what you're willing to associate with
that more people will
have a positive strong association with
to make it increasingly likely that they
will do what you would like them to do
that helps you with your long-term goal
so zooming in on your the mission of
your company which is to make
entrepreneurship accessible or business
success accessible to everyone yeah
um you have a quote which I think is
really really interesting businesses
solve problems businesses make the world
better there are too many problems for
any one person to solve I want to help
create as many businesses as possible so
we can solve as many problems as we can
what are some of the problems that you
think business can solve I mean I would
probably have a shorter list of problems
that businesses can't solve interesting
yeah in a world where entrepreneurship
is not always celebrated and capitalism
is often vilified
um
is that
just a contrarian stance or do you think
that people are a little crazy to not
see the value of business so if we're to
zoom all the way out and just think
about the economy as a whole is
allocation of resources just time energy
money
Etc
capitalism in and of itself is the
is a is a system about efficiently
allocating Capital now there are
trade-offs with that because if you have
a pure capitalistic Society then there
are a lot of other things that we say
are important to us like we believe
people should have health care we
believe people should have a place to
live We believe people should have
education and you know services for
their kids when they're younger whatever
it is right
um we have these beliefs and so we make
trades based on that pure idea of
capitalism because capitalism can
absolutely be pure but most
actually I don't know of an economy
right now that's a true pure capitalist
because most humans say that that market
is too ruthless
and so we're willing to make some trades
and that's where legislation where we
actually artificially move the
incentives of the market to incentivize
certain behaviors the problem with
governments as an allocation vehicle for
capital is that they are one-tenth as
efficient as private because it's not
their money and they never earned it and
so you get really good at capitalism by
allocating resources well and getting a
return on your resources
you don't get you it's very hard to get
fired in the government and you manage
billions and billions of dollars and
the requirements to get in are not as
high as they are to spend even a modicum
of that kind of money in the private
sector and so you just have to be more
efficient with what you have because you
have to survive every day rather than
having a guaranteed stipend from the
whole country that gets taken off the
top before everyone sees their paycheck
and so um
if Government can solve it private
sector can solve it better faster
cheaper
the only real issues come into how much
regulation do we put on top to prevent
Bad actors or one I mean that's the
whole concept around I mean you know
this I'm just saying for the audience uh
around like why we try and break up
monopolies which now we've just given up
on because they're bigger than
governments uh but we we do that because
we want to protect you know we want the
capital Society competition in general
is good for society tough for the
competitors
but if you have 10 dry cleaning stores
the best dry cleaning store win and then
everyone gets better dry cleaning so
it's good for society it's bad for the
nine guys who fail
and so
um I do think that entrepreneurship is
the way that we solve problems and I
think that there's usually an Innovative
way to solve any problem if we have
enough knowledge uh to do so I mean in
elon's proving that with kind of first
principles approach to like can I rock
can I launch rockets that attempt the
price well where do we get our metal
from right like what is required for a
rocket right so we have to get this from
here to here let's build from there
right rather than like well we have to
go for this guy who's our contractor for
space navigation well why can't we make
space navigation well you know like and
then again though and then the prices
expand and so that is my tldr is that I
can't learn everything everyone has a
unique life they are uniquely uh
positioned to tackle opportunities that
I only have one lifetime to live and I
might be able to solve two or three big
problems in my lifetime Maybe
but if everybody has these skills then I
think when I die I will be proud of the
meta contribution even if I don't
capture all of the economics because I'm
going to then die and then
someone else will have it and it doesn't
even matter anyways and so I I there's
an element of that that just makes me
feel good about it that drives me
forward like the 17 year old who's going
to sleep with the book under his pillow
to serve you know
provide for his family with the one goat
they have
um
I think that if I can equip that guy
that he can do whatever like he can
solve problems that I never could and so
I don't think it's my life purpose to
build the next rocket or cure cancer I
just don't think that's in my skill set
it's also not in my interests but I
think I can help equip the entrepreneurs
who will
I love that man I hope more people hear
that message about business I think that
to your point about
serving people in a more efficient way
in a way that they prefer is so powerful
and to watch it slowly get villainized
as I've gotten older has really been sad
and I think will lead us down a super
dark path
tell me for those that are just
listening and aren't watching across the
bridge of your nose on a nose strip it
says the one of zero yeah B one of zero
excuse me uh what does that mean so one
of our kind of big themes in our content
creation at Mosey media is one of one
content or it was one of one content
meaning I don't want to do a breakdown
of Coca-Cola's business model because
literally anyone could do that that's a
book report a college could do that
anybody could do that and so I only want
to make content that I can make and so
one of my big rules of advertising is
show it only you can show and say what
only you can say and so if you're the
the only triple black belt something in
your local area then say that and then
also show what you can do that other
people can't do and if you don't have
that reality you either need to Niche
down and make it a much a narrow thing
that only you can do or you get better
and can beat more people and you expand
it but that's fundamentally anyone can
become a category of one if you go
narrow enough and then you just continue
to expand over time so the one-of-one
content was the concept that we've
adhered to now as the team started to
see what was going to happen for the
event and how much we were putting into
it and all the free stuff we're gonna
give away
um and how much money we were choosing
actively to not make
they were like dude no one would do this
they're like this is even one of one
they're like this is one of zero and
it was like
that's it for 18 months I've been
looking for like uh a saying or an ism
that was short and could encapsulate
many of the values skills that can be
learned uh that I believe are important
and that one of zero concept which I
love because also from a math
perspective one of zero you know one
divided by zero is undefined and so it's
really about being Beyond definition
writing your own path you know keeping
promises in a world that breaks them
delaying expectations giving first and
giving over and over again until they
ask or even if they never ask and
trying to live your life in a way that
you earn your own approval by the end of
it
and I think that's what one of zero is
all about and so for me
one of zero and that's a that is a brand
that I I really want to stand behind
because that's what I believe
I love it where can people follow you
you're listening to this on audio both
my books are free on my podcast the
leads book and the offers audiobook are
on my podcast you can just listen to
them you don't have to you don't have to
opt in it's just right there you can you
can listen to them I love that all right
everybody speaking of things that you
will love if you haven't already be sure
to subscribe and until next time my
friends be legendary take care peace
check out this interview with my friend
Peter diamandis about Ai and the future
of Business and Technology you said that
the next billion dollar company will be
founded by three people how is that
possible first of all just say that
we're living in a different day and age
the ability to start companies