Price Doesn't Make a Difference?

Want to SCALE your business? Go here: acquisition.com
Want to START a business? Go here: skool.com/games
If you’re new to my channel, my name is Alex Hormozi. I’m the founder and managing partner of Acquisition.com. It’s a family office, which is just a formal way of saying we invest our own money into companies. Our 10 portfolio companies bring in over $200,000,000+ per year. Our ownership stake varies between 20% and 100% of them. Given this is a YT channel, and anyone can claim anything, I’ll give you some stuff you can google to verify below.
How I got here…
21: Graduated Vanderbilt in 3 years Magna Cum Laude, and took a fancy consulting job.
23 yrs old: Left my fancy consulting job to start a business (a gym).
24 yrs old: Opened 5 gym locations.
26 yrs old: Closed down 6th gym. Lost everything.
26 yrs old: Got back to launching gyms (launched 33). Then, lost everything for a 2nd time.
26 yrs old: In desperation, started licensing model as a hail mary. It worked.
27 yrs old: "Gym Launch" does $3M profit the next 6 months. Then $17M profit next 12 months.
28 yrs old: Started Prestige Labs. $20M the first year.
29 yrs old: Launched ALAN, a software company for agencies to work leads for customers. Scaled to $1.7mmo within 6 months.
31 yrs old: Sold 75% of UseAlan to a strategic buyer in an all stock deal.
31 yrs old: Sold 66% of Gym Launch & Prestige Labs at $46.2M valuation in all-cash deal to American Pacific Group. (you can google it)
31 yrs old: Started our family office Acquisition.com. We invest and scale companies using the $42M in distributions we had taken + the cash from the $46.2M exit.
32 yrs old: Started making free content showing how we grow companies to make real business education accessible to everyone (and) to attract business owners to invest or scale their businesses.
34 yrs old: I became co-owner of Skool.com to help the many people who want to start a business online do so.
Today: Our portfolio now does $200M/yr between 10 companies. The largest doing $100M/yr the smallest doing $5M per year. Our ownership varies between 20% and 100% ownership of the companies. Many of them we invested in early and helped grow (which is how we make our money - not youtube videos).
To all the gladiators in the arena, we’re all in the middle of writing our own stories. The worse the monsters, the more epic the story.
You either get an epic outcome or an epic story. Both mean you win.
Keep crushing. May your desires be greater than your obstacles.
Never quit,
Alex
FULL DISCLOSURE
I make content to make money - just - on a longer time horizon than most. I want to build trust with business owners so we can find the best ones and help them scale. And if they’re awesome, write them a check and go all the way as partners.

[@Olurii]

Loved the perspective of wanting a larger base of customers to keep and upsell to. I'm going to keep scooping up these golden nuggets like my life depends on it. 🎉❤

[@Lindo0209]

Dear competitors ignore this mans content, save your time it definitely doesn't work

[@Daniel-tb6gn]

😂😂😂😂

[@Someone-ct2ck]

joke hahaha

[@cosmicbricks3339]

Lol

[@matlachaine]

Depending on the product/market, usually with this you want to cream the 50k$ segment first for max *profit* that you can reinvest to lower your costs and scale enough to handle the mass of customers as you go down to a 15k$ ticket and cover the whole market.

[@marcemarc6516]

Also the barrier to entry is lower so it extends to more future clients

[@aarodful]

I am a professional pricing analyst. It is very rare you would have very similar profits at wildly different price points. It's possible for innovative products or services where the value is difficult to evaluate, but this isn't practical advice for pricing almost anything. There is almost always an optimal price point in a tight range. Sometimes, this guy makes me wonder if he really knows what he is talking about. I know he's successful, but it doesn't mean he has a good grasp on everything he talks about or doesn't like to BS some things.

[@ClimbClear]

I'm curious what the models are/ how you decide on prices. Are there best practices in the field or, more importantly common mistakes that new business owners make

[@andrewmitchell7592]

Branding makes a big difference too

[@meredithmaher]

Depends on the type of good or service - I studied economics & now sell fine art where the elasticity of demand is much different than that of non-luxury items. What is your primary area of research?

[@aarodful]

@ClimbClear There are many models and methodologies that are used across many different industries. The 2 spectrums of pricing are either marketing focused (like retail), where price sensitivities and markets are studied to develop pricing, or cost based pricing for large projects. There are tons of models you can use, and it all depends on your industry and business, but every model is trying to find an optimal price by understanding marketing data or cost/risk data. It's all about volumes vs margins. I would say most new businesses tend to price too low or don't understand their value in the market. Many of them don't really think about their pricing much and don't realize how much profit they are leaving behind by not studying it. There are many ways to structure pricing to drive profits. They also tend to lower prices just to get volume and don't make data driven decisions. Dropping prices should not be a lever pulled haphazardly. You have to think about what pricing communicates to your customers.

[@cipela193]

Some people literally can’t afford the extra $35,000

[@warrenstrife4818]

Just looking for clarity if anyone can weigh in on this, I have heard Alex say that raising prices is the last strategic thing you can do, as presented with his example of the business genie. This seems to be a contradiction, not sure what the takeaway should be

[@Owen.Montgomery]

Crazy

[@pedramnegahdar2142]

is he clean?

[@adnanazmi.]

Yo why are there so many hater bots in the comments... get a life bots & keyboard warriors!

[@D_punkster]

They suck

[@RyanJacobs-tl9lp]

😍😍😍

[@user-gj6rl7po9q]

Guys, there’s no one else in the room. He’s talking to the cameras

[@mcrepresentative4232]

Lolol the link to the original video shows and captures audio of the other people 😂

[@samplesource6566]

Not true at all. This is a snippet of him in a mastermind, watch the full video. 20+ people in the room.

[@TradewithJT]

Guys, this guy needs attention and has no Idea 💀

[@cosmicbricks3339]

Loo

[@cosmicbricks3339]

@@samplesource6566more than that

[@ChristopherDaySMM]

You’d be pulling your hair out with 4x the customers. $200k with 4 customers is much preferred over $200k with 16 customers… Second scenario you’re working yourself to death for the same amount.

[@AustrianEconomist]

You don't know that. If it's a service that is relatively automated like a course with a community, you'd be better off with the larger customer base & bigger community. It all depends on how fulfillment works.