This episode explores counterintuitive growth strategies through Hormozi’s insight that most businesses need fewer customers at higher profit per customer to scale sustainably. Taking fewer consulting clients at higher prices or raising minimum deal sizes (Serious Land Capital moved to $50K minimum purchase price) decreases volume but increases backend profit enough to justify six or seven smaller deals’ worth of returns.
Key Takeaways:
- Pick Two: Profitable, Fast Growth, or High Enterprise Value You can’t have all three simultaneously—Hormozi’s friend lived on $70K through their 30s and exited at $250M by reinvesting everything, while another took profits early for lifestyle but capped enterprise value.
- Coaching Businesses Can’t Scale Both Ways You either give diluted full sessions with a team (full glass of watered-down milk) or undiluted short segments with the star talent (shot glasses of pure milk)—both reduce satisfaction versus one-on-one, making coaching inherently hard to scale.
- Land Businesses Are Profitable + Fast Growth, Not High EV Most land operations are lifestyle businesses (profitable and growing quickly) but lack high enterprise value due to lead churn dependency, no repeat customers, and limited M&A activity in the space.
Listen for why Serious Land Capital is sacrificing some volume to chase bigger deals and how the trade-off between profit-taking and reinvestment shapes long-term enterprise value.
(Podcast transcript below)
Welcome to Get Serious. So wanted to jump back into more of the review of my notes from the 11 straight hours spent with Alex Hormozi. This was at the affiliate live event from the a hundred million dollar money model launch. A few of these podcasts episodes, you know, check, check over the past couple of weeks. If you want additional recap here, again, never taken more.
notes at a live event compared to this. And if it’s pure, pure Hormozi, given it to you straight for, for literally a half day, a half, like full day, 24 hours. like it, it’s, it’s just pretty incredible to, to get that. jumping back into this again, the format was, you know, 10 fireside chats and then an open mic for the audience afterwards. So just
Constant back and forth of questions and Alex just giving back his thoughts and feedback on specific situations So he’s mentioned this in other areas before I think it’s it’s it’s Something that just bears worth repeating and so few people actually do it where he’s like especially Earlier on in your business. I just focus on one channel and one one audience until you hit a million dollars in annual
uh, recurring revenue. Um, and so, you know, a lot of us in land, you know, this, this is another kind of tricky area because, know, especially nowadays where there’s a multitude of different marketing techniques, you know, I’d say even like five years ago or a little over five years ago, like pretty much, you know, everybody was just doing mail. Um, you know, there were a handful of folks doing other strategies. Um,
not that there are that many, like there’s only so much direct marketing that efforts that you can do to reach customers. nowadays it’s such a grab bag where yeah, you can do the mail, you can do the cold call, you can do texting. Some folks will do PPC as well. And so folks will just bounce between each of those and never…
really start to reap the rewards. if you really, really get good at one of those channels, like, you know, whenever you start something like, again, volume negates luck. You can never forget like that. That is the golden rule here where you just have to get reps in like the best people. They just constantly get reps, more reps and more reps. like, you know, for it, it’s another, project I was working on, but like, probably reviewed roughly 2000.
land comps over the past five days. I’ve never reviewed that many comps in my life. And it was just like an extraordinary amount to definitely burnt myself out. I was under the gun to get this done by a deadline for something I’ll get into later. know, just my, you know, understanding, which was already very high level about, you know, reviewing land properties and how to price things like I’m still just okay. More reps are never going to hurt.
I was even getting increased insights in different states around the country and characteristics that were more reliable in certain areas to bump price or decrease price in the reverse direction than like I would have done before. thousands and thousands of these, just getting those reps in. So same thing again, if you’re marketing, like, yeah, it could take you.
potentially tens of thousands of letters until you start figuring out what mail techniques are going to work for you or, you know, cold calls or texting. Like, you know, whenever you listen to the podcast and people are on and like you, people with similar size businesses or folks who have found some type of staying power, like very rarely they will have the exact same marketing method, but they found a way to make it work in one, you know, at least one direction. And some of them, as they got bigger than they can throw in another arm.
to market out further, but you know, that is an example where it’s like, okay, get that one channel nail, like become a million dollar business first before you really try to push in in other directions. you know, Alex is just mentioning where, you know, every business is incurring debt every single day, but you have to pick carefully what
debt you are incurring. it monetary? you’re actually taking out loans to finance your business? Is it on a manpower perspective? Like are you burning out your team to get certain initiatives done that is not sustainable longer term, but it’s a debt that you’re willing to take on to reach certain…
Uh, certain objectives, um, you know, is it, you know, uh, you know, related, collected the, the ignorance tax, like, are you paying, are you paying a debt with just not knowing, you know, what you’re doing? You’re, you’re trying something newer that is going to be riskier. And so you’re incurring a debt of not focusing on items that may more sustainably and reliably bring you in revenue, but they might.
lead to the next breakthrough. So you have to pick one of these areas, hopefully not all at once, because Alex was like, always take out the debt in the business that you can pay back the fastest. Sometimes it is monetary, sometimes it is from a time side or picking a new area or like, yeah, burning out your team, but knowing like it’ll help break you through for better operational.
setups in the future that can kind of prevent that. like, really kind of heavy AI build out for instance. So it’s like, okay, where can you pay that debt back the fastest knowing that you are always paying debt every single day? Something to think about strategically for businesses. And you’re related to that strategy and what makes business
so hard to teach and again, because it’s just always evolving the, infinite game. and Hormozi was just like, you know, the only way to grow is that you eventually need to determine and experiment with counterintuitive strategies. because that is where the growth is for, any business that’s trying to get to the next level.
You can kind of think about that because like the actual intuitive strategies, you’re almost assuredly already doing that. Again, there’s no shortcuts, right? Or as soon as a shortcut is found out, it ceases to become a shortcut because everybody does it that becomes a new baseline. I would even say, know, or Mozi’s money model, put it like that. That’s a shortcut for now because it starts teaching you certain marketing strategies and tactics that can help get you to the next level. But pretty soon that is baseline operations.
that any entrepreneur is going to need to even, you know, maintain a status quo. Yeah. So you can kind of assume, yeah, maybe you have your bookkeeping like QuickBooks or whatever, like, okay, anything, you know, intuitive, you know, need to maintain some type of marketing and, you know, sales channels and have some type of operations like.
what’s the way that most of the businesses in your market are doing it? Okay, that’s probably the intuitive pathway might’ve gotten you to a certain level, but in order to grow further, it’s like, okay, what are those counterintuitive pathways? And like to provide a concrete example and one that Alex mentioned and something related to us too, is to actually take fewer customers, but more profit longer term.
Like say you’re running a consulting business. Yeah, if you bump your prices, naturally that’s going to price some people out from your services, but it can bump your lifetime value and potentially the satisfaction of your customers a lot more over the longterm as you’re advertising and kind of testimonials and so forth build up to where, yeah, you might take a shorter term hit as your business adjusts to fewer customers, but that longer term profit bumps up.
Same with what we’ve been doing in our business too is like we have been steadily rising the minimum purchase price for deals that we go after. Now we’re sitting at 50K minimum purchase price. they’re, you know, even on our outbound channels, like looking for properties that people are seeking funding on, like there are so many, probably more than half of all deals that we’ll see are like, you know, in the sub 50K range, you know, even in like the, you know, 10.
15, 20, 25K, like we could still continue to do those. But to me, like I just value liquidity even more to go after juicier, bigger deals where, you know, I might have backend profit that could justify like six or seven of those smaller deals that may require the same amount of effort to go after. So yeah, like that.
you know, we were building up our business to focus on so much volume over time. But then I realized, yeah, like, you know, as we were starting to plateau revenue wise, it’s like, yeah, we need to open up our operations even more to go after bigger stuff, even if it’s even if our volume decreases because, you know, I just know like the
biggest operators in the land space. we’re talking into like the hundreds of millions, like billion dollar levels, like they work on fewer projects, right? Like the check sizes get bigger inherently, because there’s just less and the volume goes down because there’s just less properties at that size that are gonna truly pencil out. So that’s like the only logical pathway to follow.
but it’s counterintuitive in the immediate term because it’s like, we’re running our business well, like we have this solid volume coming in, it’s profitable, but at some point you need to take a counterintuitive strategy to reach that next level. And another piece here too that he just mentioned, know, cause a whole bunch of businesses were represented there and a number of folks run coaching businesses or like, you know,
or what could more broadly be considered, you know, info related businesses. Um, and there’s a whole bunch of those in the land space too, like looking at how many, you know, coach, like the whole coaching segment has just exploded over, you the past five years, say even over the past three years, um, especially. And, you know, I think there, I mean, there’s already so many solid operators out there and some people’s personalities like Mike Click with certain, you know, coaches better.
do really think the content is that different? No. but yeah, at the same time, like the industry almost requires that amount of coaches because it’s just inherently tough to scale. and because, know, usually the highest price items that you know, within coaching businesses, like one-on-one help, right? Like one-to-one direct consulting work. Like it’s, really hard to scale, right? Cause you only have so many hours in the day to do that work and you’re usually the talent behind it.
And then you can start doing like one to many or, recorded coach, you know, sessions and so forth and like, but naturally that price is, is going to decrease or for what people are willing to pay. And usually satisfaction is not going to be as high. So, you know, Alex is bringing up, um, this analogy, like take a glass of milk for instance. And, um, you know, if you just have like a full, you know, normal, I don’t know, a 12 ounce glass of milk, um,
And that represents like your star talent, your coach, know, one-on-one consulting session. You know, great. you know, that that’s what will give people the most satisfaction, but like the only way to scale coaching businesses is like, you just can’t give that, that full glass of milk away over time. So you’re either going to have to get, you know, a team of coaches to work with you could still be like very qualified people. And like, this was, you know,
similar to going to this Formosie live event here, where we got for 11 straight hours just the full glass of milk, right? But that’s not typical. For most live events and the acquisition headquarters, I think they do four to five live events every single week. They do a ton. It brings them in ton of business and they do a lot of upsells there and so forth. But generally, Alex is just…
of one session per day. So maybe he does like an hour ish each day there compared to 11 hours. but he has this kind of crack team around him that leads to the rest of the day. But that’s still a smaller amount of time with Alex himself, but you do get significant amounts of time with these other coaches. And so you get kind of a diluted full glass of milk.
You get a little bit of Alex here and then this kind of leads to the other part of, you know, with these coaching businesses, yeah, you can either get like the diluted full glass. You have a team of other coaches working with you and they’re very solid, hopefully, but they’re not like that key person who initially started the business. Or you just have to distribute your time as like the main coach for, you know, shorter and shorter segments. So he’s like,
instead of a diluted full glass, you can get small shot glasses of the undiluted milk. But it’s just much shorter time, like even 10, 15 minute type of spans here. In the case of these live events, it’s like an hour of Alex’s time is kind of the shot glass, right? Or like a Tony Robbins event. You might be able to get direct coaching from one of his coaching team.
in a much more extensive session. But, you know, as Hermos was mentioning, like if you probably check the NPS scores from like, you know, folks just being attended to by Tony’s coaches versus like, you know, short segments with Tony himself, like probably people will still prefer those shorter segments with, you know, Tony Robbins. So, like that, that’s what makes it so hard to scale these. cause again, it’s either much shorter segments, you know, with the main person.
the main firepower or diluted full sessions with the team. So there’s just always a trade off there, right? And that’s something we see within the land space too. Why it’s so hard to scale that and also run separate land businesses in and of themselves. So something to think about from that side.
You know, just in the spirit of trade-offs here, Alex was just mentioning of like, everybody always just, again, they want all the benefits right away without any of the trade-offs. But again, life is just all about trade-offs. he’s like, know, these type of businesses, like he had a friend of his, I think it was one of the guys who was on the launch event.
And it was, it was one of the software companies, but this guy and his wife had, you know, they lived on like roughly $70,000 income, you know, not like impoverished, but you know, it’s, it’s not, you know, going to allow for anything lavish really. And they lived on that for like their, their twenties all the way through their thirties roughly. And then they had a $250 million exit.
you know, by around that age 40 mark, because they just stayed so focused on reinvesting further into the business and building up that potential exit value to now like, you know, be set easily, you know, generationally wealthy from an exit like that. Whereas another friend of his, you know, it’s running just a much more profitable business, but like taking, taking out a lot of those profits just for personal lifestyle.
you know, earlier on, just to enjoy it more. But the trade-off was that, you know, the enterprise value of the company was just less because, know, there was just less, being reinvested back into the business and back into the operations and growing the team and so forth more like to just, you know, let, the founder, in, in, in, his life more. so like Alex was like, Hey, you know, you can kind of pick three out of this,
grouping where you can have super profitable business grows really quickly and has high enterprise value. Like you can pick two, right? So like there has to be a trade-off within that. so like the, you know, when I think of land, for instance, you know, for the most part, I think
it generally falls into the super profitable business and grows quickly. Like that would be most folks, but like, I don’t think many land businesses have that high of enterprise value just because first, know, so much just relies on just continuous churn of incoming leads. And you don’t really have repeat customers for the most part either. Like there’s not like great lifetime value.
I mean, I guess there is generally on like an average sale basis, but you you’re, you’re just utilizing one, one sale pretty much primarily on the Dispo to like assign lifetime value to your, to your customer base ultimately. so it’s like, it’s kind of a weird setup there, but it’s, it’s hard businesses to buy, right? Like you don’t really hear much about exits within the land space and a lot of, know, I know folks are getting bigger businesses more recently.
as it starts to operationalize, but like you really don’t hear much like an &A type activity, but like, you know, a lot of folks just funding it or, you know, more for lifestyle type business, like profitable and growing quickly, right? So you can just feed more into the machine, but at some point you have in order to build up that enterprise value. Yeah. You would have to sacrifice some of the profits. You know, is that bringing on more A players? Is that investing further into your operations? How, how your
Leads are being handled, higher sales is being handled, taking less out as a founder. That’s what we’re trying to do more is a bit like it’s profitable. We take like, we reinvest constantly. But also with like a, capital kind of determines the value here. yeah, so without belaboring those points.
Um, here, I think you can start considering those examples, um, and other examples of, of different businesses. I guess some of like the, the mag seven, they’re probably. Yeah. Like Nvidia is super profitable, it grows quickly and high enterprise value. Um, even that it’s quarterly revenue has been decreasing quite a bit, you know, still really good, but quite a bit even over the past year. So.
even that it’s probably, you know, it’s not growing as quick as, as it had been. It probably hit all those three, but even that, like even the best companies in the world, like the most valuable company ever, by like a long shot, will eventually, you know, descend into only two of those, like just kind of a log market, that things become more efficient over time. And you just, can’t like continuously, infinitely capitalize on all three of those. So.
Just something to think about for your own business. And it’s not always gonna be the same too. Like you can orient towards two that are more primary or for whatever your goals are in your life. There’s no rules, no one can force you to run your business in any certain way. Just make sure you find a way to stay in business. So with that in mind, we’ll end another one here that…
that knocked out another fireside chat. I honestly think I might do like 10 of these, maybe a little bit more. Like this is just, even going through these notes, it’s just helping open up so much more, know, lines of thought for my own self here and hopefully for you too. So comment if you like this or let me know. I’m gonna continue to do it regardless. Because this is super helpful to me. So I’m confident it will be to you too.
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