Alex Hormozi's Net Worth is $200M. His Goal? Build a Forever Business He Can Do for Decades.

On Moneywise, we don't do secrets—Alex Hormozi shares the full breakdown of his wealth, from his $42M Gym Launch exit to how he's spending every dollar.

We spoke to Alex Hormozi in this week's episode of Moneywise. Alex is the founder of Acquisition.com and former CEO of Gym Launch, which he sold after taking $42 million in distributions. He's known for his no-nonsense business advice and transparent approach to entrepreneurship. At 35 years old, he's built multiple successful companies and has become one of the most recognizable faces in the business education space.

Like all Moneywise episodes, Alex breaks down his net worth, income, portfolio, and monthly expenses and then I, your humble host, pick it all apart.

We also went deep on: his transition from management consulting to entrepreneurship, why he prioritizes cash flow over appreciation, his biggest financial mistakes, and what he's learned about spending money to actually improve happiness.

Below you'll find my summary of the episode along with the entire transcript.

And by the way...this podcast, the concept of it came from Hampton. Hampton is my community that I started a couple of years ago. It's a private, highly vetted community for high net worth founders, people who have companies ranging from 3-5 million revenue all the way up to hundreds of millions in revenue. The reason why I started this podcast is because I've been able to see all types of amazing conversations about money, about growing companies that typically happen only behind closed doors. And I thought it would be awesome to just share all of this information. If you're a CEO, founder, or business owner, check this out. New Moneywise episodes come out weekly.

Listen to this episode on:

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• Spotify
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• Amazon Music

Now, below are the notes and the full transcript.

The Numbers

• Total Net Worth: ~$200 million ($95M tradable assets, $100M+ illiquid equity)
• Tradable Assets Breakdown:
  • 40% public equities (mostly index funds)
  • 25-30% real estate
  • 5-7% venture investments
  • Remainder in cash/cash equivalents
• Monthly Personal Expenses: ~$100,000
• Gym Launch Exit: $42 million in distributions before sale + $31 million cash from sale
• Age at Exit: 31 years old
• Current Age: 35 years old
• Peak Gym Launch Revenue: $37 million (year 3)
• Peak Gym Launch Profit: $15.9 million (year 2)
• Early Gym Launch Income: $3 million profit in first year of licensing model
• Consulting Salary: $50-60K starting, up to lumpy $20-30K bonus checks
• Austin House: Bought for $1.8M, sold for $4.2M (36 months later)
• Side Investment Income: $2-4 million annually during Gym Launch days

Building Wealth Through Cash Flow, Not Appreciation

Alex's approach to wealth building centers around one core principle: cash flow over appreciation. "I love cash flow. I feel very bad unless I have a huge amount of cash flow," he explains. This philosophy shaped his entire investment strategy and business decisions.

When he sold Gym Launch at 31, Alex experienced something counterintuitive. "I felt poorer after I sold the company than before," he reveals, "because you cut off the fire hose." This realization led him to start Acquisition.com the very next day after his sale closed, driven by the need to rebuild that cash-generating engine.

His investment approach reflects this cash-flow obsession. Beyond traditional equities and real estate, Alex has found significant success in lending deals. "I have yet to lose money on lending," he notes, describing scenarios where he might lend $3 million against a $10 million building for 5% monthly returns. "The downside is that I have to take ownership of the building if they don't do it, but I'd happily buy a building for $3 million if I can get it for ten."

From Awkward Kid to Business Mogul

Alex's path to wealth wasn't linear. Growing up in Baltimore with doctor parents, his initial goal was modest: "I thought $100,000 a year was a lot. That was actually my first goal of income." College at Vanderbilt opened his eyes to real wealth when he met kids from New York money and learned about private equity and investment banking.

After a brief stint in management consulting doing defense contracting work, Alex made the leap to entrepreneurship with almost no money. His consulting job paid around $60,000 but was lumpy, leading to periods where he worked without pay for months, then received large bonus checks. "I got two checks for one for 20 and one for 30, and that was like 50 grand. And that was basically enough for me to start whatever I wanted to start."

The gym business taught him crucial lessons about reinvestment and delayed gratification. For four years, he made virtually nothing personally because "I just kept opening new locations with the cash." When he finally sold his gym portfolio, he netted only around $80,000—money he promptly lost in a failed partnership.

The Gym Launch Explosion

The transformation from struggling gym owner to multi-millionaire happened almost overnight when Alex pivoted to the licensing model. "I literally was looking at bankruptcy attorneys 12 months earlier and then made $3 million in profit," he recalls about his 27th year.

The growth was exponential: starting at $180,000 monthly revenue, then jumping to $320K, $480K, breaking $700K, hitting $1 million monthly, and finishing that first year at $6-8 million revenue with $3 million profit. The second year exploded to $25.9 million revenue with $15.9 million profit.

What made this possible was Alex's obsession with systems and his ability to remove himself from operations. By the time of the sale, he had constrained himself to just "one executive hour per week" managing the company, proving the business could run without him.

Lifestyle and Spending Philosophy

Despite his wealth, Alex maintains a surprisingly analytical approach to spending. "I have to be very clear about what the objective of the money is," he explains. "Am I buying this house because I want to get a good investment, or am I buying this house because it's a house that I want to enjoy?"

His biggest recent frustration came from trying to have it all—getting both the perfect house AND a great investment. When a $25 million Las Vegas house got cut to $20 million, Alex offered $15 million, thinking he could get a steal. The back-and-forth negotiations cost him the house when another buyer came in with a clean offer. "I was just being cheap. And I regret that," he admits, noting he'd made the exact same mistake three years earlier on a condo purchase.

The experience taught him a valuable lesson about decision-making frameworks. When buying for enjoyment, "I should just get the fucking house." When buying for investment returns, focus purely on the numbers. Trying to optimize for both usually leads to getting neither.

The Psychology of Never Being Satisfied

Perhaps the most revealing insight from Alex is his recognition of his own psychological patterns. "I've been probably about equally satisfied and dissatisfied at all points of my life," he reflects. Whether he had no money and lots of work, lots of money and no work, or lots of both, his satisfaction levels remained constant.

This realization led to his current life motto: "Just working hard because I felt my most satisfied when I had nothing left to give, like when I left it all on the field." During the year leading up to his Gym Launch sale, when he and his wife Layla traveled city to city on one-way tickets, Alex became deeply depressed despite having complete freedom. "When I don't have stress, I'm like, man, there's nothing going on. Like, this is stressful. The constant is me."

His goal now is simple but challenging: "I want to be in a better mood, regardless of circumstance." He's accepted that changing external conditions changes "very little about my subjective well-being," so the work has to be internal.

Other Key Quotes

"Social media makes it appear so much more common. If you had a lottery ticket, like every one of the business owners who starts a business... if you knew your chances were 2.6 out of 10,000 or 1 out of 3000, it's like shit, that's not that common."

"I don't have any fear of not being able to make money or provide for myself."

"I could have a backpack and a credit card. Like, I need very little. But the life that we've built has stuff in it."

"It felt good to know that I was right all along. You could talk about business, but if you had no proof, it's a little bit tougher."

"I have dissatisfaction independent of condition."

"The worst mistake you can make is consumption. It kind of feels like a lack of self-regulation. And that's why I don't like it."

"I made $1 million in what broke means. I'd be like, that's horrible."

"I've had ten executive assistants. I haven't had any of them work out. What's the common thread between me and them? It's me."

Links You Might Like

• Join Hampton Community: https://joinhampton.com
• Acquisition.com: Alex's current company
• Gym Launch: His former company (sold)
• MoneyWise Podcast: Full episode archive

Full Transcript

[00:00:00] Sam Parr: I have a friend who has done a bunch of business with Alex Hermosa, and he said that Alex might be the smartest person who he's ever met, which I told Alex that.

[00:00:08] Alex Hormozi: I made my day.

[00:00:10] Sam Parr: So here's the thing. Alex Hormozi. He definitely knows how to make a lot of money.

[00:00:15] Alex Hormozi: We'd taken $42 million in distributions before the sale.

[00:00:18] Sam Parr: And so you're 31 years old and you have something like $60 million in cash.

[00:00:22] Alex Hormozi: Yeah.

[00:00:23] Sam Parr: The question is, though, does he know how to use it well enough to make him his happiest self? And just like the rest of us, he's still figuring it out.

[00:00:30] Alex Hormozi: The reason I'm really annoyed about it is because, like, I actually made this mistake another time three years earlier.

[00:00:36] Sam Parr: I'm Sam Parr and this is MoneyWise, the podcast where we get super deep and transparent on people's personal finances. Typically people who are high net worth. And the reason why this episode is going to be pretty cool is because Alex Hermosa is a very well-known person. If you're watching this channel, you definitely have seen Alex before. The only difference is, is that on MoneyWise, he's not necessarily going to talk too much about business, but his personal finance is probably one of the only times that I've seen him do this. And so he's going to talk about how spending for both business and personal has changed over the years. And he's also going to reveal all of his numbers. And we're also going to learn the main thing that has brought Alex a ton of fulfillment. And it's not money. And by the way, this podcast, it's made for a very specific audience. It's made for people who are inside of my community. Hampton Hampton is my community that I started a couple of years ago. It's a private, highly vetted community for high net worth founders, people who have companies ranging from three 5 million revenue all the way up to hundreds of millions in revenue. And the reason why I started this podcast is because I've been able to see all types of amazing conversations about money, about growing companies that typically happen only behind closed doors. And I thought it would be awesome to just share all of this information. And that's what MoneyWise is. And so if you're a founder that does at least 3 million in revenue and you love having these intimate sort of private conversations about money, about growing businesses and things like that. Then check it out. Join hampton.com. All right. Let's get to it. Starting with what I'm sure you guys are all wondering. For a guy who talks so much about money. How much is Alex or Mozzie actually worth?

[00:02:12] Alex Hormozi: It really depends on if we're valuing illiquid assets or what I would consider, like, very tradable assets, you know, like a real estate building. Maybe it's up or down by a little bit, but you'll probably be within 10% of a guess, roughly speaking. So my like my tradable assets are about 95 million. My equity in school is worth a lot. And I have other equities that are like that that are illiquid, that aren't going to have liquidity events for periods of time, but have, you know, third party events that have occurred that have given them values and those are in excess of 100 million. On those on that side.

[00:02:45] Sam Parr: So you think that on things that you can sell within 30 to 60 days, your net worth is 100. And if you had 6 to 12 months, you're going to be in the 200 range.

[00:02:52] Alex Hormozi: Yeah, that's probably about right. And just to cover my, my, my FTC got my bases. I promise, everything that I say here is not for purposes of guarantee or income. You have your my results vary and those equity values vary every day.

[00:03:04] Sam Parr: Do you keep any public equities or. I think I heard you say you keep mostly in cash. How's that broken down. And if it was a pie chart.

[00:03:12] Alex Hormozi: I probably have like 40 ish in equities.

[00:03:15] Sam Parr: Index.

[00:03:16] Alex Hormozi: Yeah mostly. Yeah just indexes I think I've got like 25 or 30 ish in real estate. Then I've got probably 5 to 7 in venture stuff. And so a lot more logos there, but smaller check sizes. And then I probably say the rest of it is kind of like distributing in cash or cash equivalents.

[00:03:32] Sam Parr: And then the rest being acquisition equity value and school of equity value.

[00:03:36] Alex Hormozi: Yeah. Oh yeah. That's yeah. That stuff's yeah for sure.

[00:03:39] Sam Parr: And for all the nerds out there, there's another number that I'm sure you also want to know what type of lifting are you doing?

[00:03:45] Alex Hormozi: Uh, I've just been doing bodybuilding stuff, which to me is just normal strength training. Like, I just, I had my reps. I add weight every so often and keep doing that until eventually I can and then I'd start over again.

[00:03:55] Sam Parr: What do you think some of your maxes are at the moment?

[00:03:58] Alex Hormozi: Oh, I mean I don't I haven't done barber lifts in years.

[00:04:01] Sam Parr: Just a dumbbells.

[00:04:02] Alex Hormozi: Dumbbells. Yeah I do I only do dumbbells for overhead press machines. Like I'll do dumbbell like shoulder press I'll do shoulder press with dumbbells as my primary pressing move. So I do um I do hundreds for like 20. That's a lot.

[00:04:13] Sam Parr: It's not it's not just for show.

[00:04:15] Alex Hormozi: It's not just for mostly show. But every once in a while I have some go.

[00:04:19] Sam Parr: But the For Alex is worth $200 million. He was actually a pretty awkward kid.

[00:04:24] Alex Hormozi: I didn't fit in. Well, um, I had like a handful of friends that I like did some of the social stuff with, but I didn't feel like I really meshed anywhere, but I was. I was decent at sports. I had pretty good genetics for muscle. That's I mean, that's always been the case. I always I was always I was always pretty strong.

[00:04:40] Sam Parr: The Persian.

[00:04:41] Alex Hormozi: Blood. No. For real though, I was varsity, um, wrestling, uh, soccer. I was a goalie. And then, um, I played tennis because my dad wanted me to play tennis.

[00:04:50] Sam Parr: What did your parents do for work?

[00:04:52] Alex Hormozi: Both doctors.

[00:04:53] Sam Parr: And so was there a moment that you remember where you're like, I want to pursue making money?

[00:04:57] Alex Hormozi: Yeah, I always wanted to make money. It's just that making money was redefined because in Baltimore, being a doctor was rich. Like, that's that's considered like you've made it. And so.

[00:05:06] Sam Parr: What, like $250,000 a year or.

[00:05:09] Alex Hormozi: Something? Honestly, it's like when I grew up, I don't like I didn't like no one really talked about like, like for me at least. Like no one really talked about how much money they made. I thought $100,000 a year was a lot. And so that was actually my first goal of income was $100,000 a year. So if you'd asked me in high school, do you want to do six figures a year? But it was only when I went to college and then I went pre-med, and then I met all these other guys like New York Money that it was like I learned about like private equity, investment banking, management consulting. I was like, whole and like, these kids had money. I was like, what is going on? And that's when I like my world kind of opened up.

[00:05:44] Sam Parr: I think that's the value of college.

[00:05:45] Alex Hormozi: Yeah. I think the opportunity and the network that you build, it's just really the biggest thing is the opportunity, like the expansion of what you, what you see as possible. And I don't know what the like you can say it, you can follow people on social media, but until you see somebody in front of you, just like offer to buy a building because they get like turned down from the club, you're like, what is this? There's a girl who wasn't getting let in because she was underage, rightfully so, to a club. And then she just says, put it on my black card. And they were like, this isn't how this works. And she was really drunk. And she was like, my dad will buy the building, whatever. Like just put it on the card. And I and I just was like, I don't even know what's happening right now. I was like, how can this level of wealth exist? And it just it shaped a lot of just like, how much more was out there?

[00:06:26] Sam Parr: Were you a partier in Nashville? Because Nashville is an easy place to go off the edge.

[00:06:30] Alex Hormozi: It is an easy place to party. Yeah. No, I was fraternity president. So of an sec. College. So, yeah, we we partied like, hard.

[00:06:37] Sam Parr: But you don't know. I mean, you're pretty straight edge now. I mean, you only care about 1 or 2 things. It seems like it seems like you care about, like, work in your life. What changed in college? You think that was like, I'm going to be laser focused on 1 or 2 things.

[00:06:49] Alex Hormozi: I'll give you the short story. So my freshman year, I came in and had made a pretty bad reputation for myself in high school. And so I said, you know, college is going to be like my my new virgin ground. I can, you know, create a new name for myself. And then within.

[00:07:03] Sam Parr: What was the reputation?

[00:07:04] Alex Hormozi: I kind of slept around a lot in high school and just like, yeah, just I didn't have a good reputation. And so I was like, okay, I want to not do that again. And then went to college and was like, oh my God, this is like high school, but 20 times is big. And then just went absolutely nuts. And I was at a won something for all the classes I was in. And my dad being the father that he is a middle eastern, you know, like it was just like, oh, you don't need to go to Vanderbilt if you're going to do this. It's like, you could just do this here for free. And I'm, you know. And so he said, if you don't if you don't pick this up, he's like, I'm taking you out from that moment, which is fall break of freshman year. I didn't go out once and I studied for everything and pulled my great my GPA up to a three. I think it was A32 for the semester. So I got I got an A on every single assignment from that point forward. And then right after that I was I pledged and that was when, like I learned that you could just study ahead for things and like that. It just became I would always do 9 to 9 with my shift. I'd be in the library from 9 a.m. to 9 p.m., with the only exclusion of going to the gym or going to the cafeteria, and that was my schedule. And so I still partied though the partying realistically, like, I would love to say, it's because I had some like new virtues that happened, but honestly, I think it's just because hangovers become worse.

[00:08:25] Sam Parr: Alex is already a pretty famous guy, and so you're likely expecting the Jim launch story, which has been talked about a ton on different podcasts, but what you might not know about him is that before he started Jim launch, he actually had a really interesting way of getting into entrepreneurship.

[00:08:37] Alex Hormozi: I did two years of management consulting and then, well, then it was four years of me running the gyms, and then I went to Jim Lloyd.

[00:08:43] Sam Parr: What did you do? Consulting.

[00:08:44] Alex Hormozi: It was a defense contracting DC.

[00:08:47] Sam Parr: That's crazy to me that you have that life, by the way.

[00:08:49] Alex Hormozi: That's just cyber and intelligence.

[00:08:51] Sam Parr: Maybe that's just crazy to me, I do not. It's really challenging for me to picture you doing that.

[00:08:55] Alex Hormozi: Yeah, it was a ride. Our whole job was like, okay, well, all these different sources of intelligence cost this much. There's all this overlap. Is there a way that we can make this? Can we make getting bad guys more cost-effective? Uh, but yeah. Anyways, that was some of the stuff I worked on.

[00:09:09] Sam Parr: When you were doing those two years. Were you thinking, um, this is a stepping stone, or were you thinking, I got to get out here and get rich?

[00:09:16] Alex Hormozi: Interestingly, it wasn't. I got to get out here and get rich. It was I got to get out of here, period. And so. Me leaving that job, I was actually very miserable. And I don't blame the job. I think it was just me at the time. Like I was very miserable. And for me, it felt like a rock top moment because, like, I made very good money and still lived in like I lived in like 1200 bucks a month. So I was like, making way more than I needed.

[00:09:36] Sam Parr: How much are you making?

[00:09:37] Alex Hormozi: I think I was making 60 a year, but it was really lumpy because it was this very small firm. And so I lived on nothing. And then I would just get these like $20,000 checks. I think the last year I made more, but like, I think starting out, I think it was 50 or 60 out of college. And mind you, this is 20, you know, whatever. How many years ago. And then it's a very random thing happened. But basically like it was a super small private firm, they would spin up and spin down contractors as they got jobs. We were a sub under Booz Allen, and basically at the very end, I essentially worked for no paycheck for like six months. Very weird. And then right at the end, I got two checks for one for 20 and one for 30, and that was like 50 grand. And that was basically enough for me to start whatever I wanted to start.

[00:10:20] Sam Parr: Yeah. And it's kind of like forced savings because you're like, oh shit, I gotta live off 20. And then so you have a $20,000 a year budget or a lifestyle, and then you're like, oh hell yeah. Bonus. I just got 30 K. I'm about 30. You know, I'm worth. I'm rich. 30 K. Yeah.

[00:10:34] Alex Hormozi: You know, I think there's something to what you just said, though, because, like, I've actually lived without paycheck for, like, many, many years of my life. Me too. Yeah, you did too. Yeah. Like when I had my gyms, I lived for multiple years without taking a paycheck, and I didn't take a paycheck. You know, like, for a period of time with the consulting thing. So, like, I've always lived not just, like, kind of within my means, but, like, so dramatically below my means. I still probably deal with this, but like, I have a decent amount of anxiety around overspending because I think, like the worst mistake you can make is like it's because it's so like it's just consumption. I guess it kind of feels like a lack of self-regulation. And that's why I don't like it.

[00:11:07] Sam Parr: Like I have the exact same fear.

[00:11:09] Alex Hormozi: And when broke, yeah, I made $1 million is what broke. Brooke, I'd be like, that's horrible.

[00:11:14] Sam Parr: So you were roughly 22, 23, 24 when you left the contractor, and then you did the gems and then Jim launch. So that gets us to what age to like 30, 30.

[00:11:24] Alex Hormozi: So I exited Gym lunge at 31.

[00:11:26] Sam Parr: And how much money do you think you made between the ages of 23 and 31?

[00:11:32] Alex Hormozi: Yeah. So I basically made almost no money for like the four years of the gym because I just kept opening new locations with the cash. So like from personal income standpoint, I was making one was nothing. Then I sold the gyms in aggregate for I think, $80,000. And so I probably had something like 100 grand ish saved up after all the gyms, because.

[00:11:50] Sam Parr: After what.

[00:11:51] Alex Hormozi: Age 26.

[00:11:52] Sam Parr: So you're 26 with 80 grand?

[00:11:54] Alex Hormozi: Yeah, right around there. And then I started the turnaround business and we were flying around and that kind of work didn't work. I lost the money twice because the 80 grand that I got from selling, I then put into the that a partnership that failed. I think I've talked about it before. Yeah. The money?

[00:12:08] Sam Parr: Yeah. You got robbed?

[00:12:09] Alex Hormozi: Yeah. So then I was back down to zero again at 26 after having the chips and then did the. I started doing the launches. I started making a little bit of money there. And then once we switched the licensing model, that's when it really took off. And so 20 when I was 27, I took home 3 million in income. And like the audience, how wild this was. It's like I literally was looking at bankruptcy attorneys 12 months earlier and they made $3 million in profit, like in six months, because it was the back six of that next year. So it was just insane. It was absolutely absurd.

[00:12:37] Sam Parr: How much profit in revenue did the company do when you were 27?

[00:12:41] Alex Hormozi: I think we did six eight and three, six, eight. Top line, I think I did three in bottom line.

[00:12:46] Sam Parr: Got it. So you had no very little CapEx or no CapEx. So you just scraped it.

[00:12:49] Alex Hormozi: It's just me. Yeah. Me and Layla and I just got married and it was like me, her and I had an assistant. We were doing like 300, 400 grand a month at the very beginning. And I was like, this is nuts.

[00:13:00] Sam Parr: So, so almost overnight.

[00:13:02] Alex Hormozi: Yeah. No, I mean, very much almost overnight. Um, and so then at the end of that year, I think I still even remember some of the numbers, but it was like we did as I was turning around the, like, flying out business to the licensing one like it was during that month or two period, or I transitioned.

[00:13:15] Sam Parr: And the license meaning like, uh, that's Jim launch. That's like the playbook to make your.

[00:13:20] Alex Hormozi: That's the one that really that really worked. Yeah. So. One 2180 and then I think we did 320 and then 480, and then I think we cracked 700 the next month, and then we hit a million the next month. And then I think we finished the year at either 1 million or 1 million, two, uh, run rate.

[00:13:35] Sam Parr: Profit per month.

[00:13:36] Alex Hormozi: That was revenue. That was revenue.

[00:13:38] Sam Parr: And that was still three people.

[00:13:39] Alex Hormozi: I think near the end of the year we added more people. But at the very beginning, when like when it was just us, like that first three months or so, that was that. But yeah. So we finished the year six, eight, three. The next year we did 25.9 million. Top line. It's 15.9 million in bottom line I think it might have been 26. I remember the exact number, but it was 26 ish top line and then 15.9 million in bottom line in the second year. The year after that, we did 3037 million top line. And I think I did 13.5. Bottom line, I put a ton of cash into starting the supplement company Prestige Labs. And so that took a lot of my bottom line away. And then the next year was Covid. And the EBITDA for the next two years is under NDA. But I did 30, 31 million top line in the year of Covid. And then the next year we sold.

[00:14:28] Sam Parr: And then you you sold it. And so at 31 years old.

[00:14:32] Alex Hormozi: We had taken 42 million in distributions from Jim Launch before the sale.

[00:14:36] Sam Parr: And so you're 31 years old and you have something like $60 million in cash.

[00:14:40] Alex Hormozi: That was less than that because of taxes, because we had 40 ish. And then whatever, 0.6 on that, it's 24 ish. And then we got 31 million in cash for the sale because we kept it third of the company. So we sold two thirds all cash for 31, and then we paid pay 20% on that. So whatever that is, 22 plus 24 or 5, whatever. Somewhere in there we're like 45, 50 million. What did you say?

[00:15:01] Sam Parr: 60.

[00:15:02] Alex Hormozi: Okay. Yeah. So that's what that's that's what it was. Yeah.

[00:15:05] Sam Parr: Were you spending a lot?

[00:15:06] Alex Hormozi: No, not at that time. I had a house in Austin that we bought for 1.8 million in cash. And that house we sold for 4.2 36 months later. So that was cool.

[00:15:16] Sam Parr: What neighborhood were you in?

[00:15:17] Alex Hormozi: Spanish Oaks.

[00:15:18] Sam Parr: Yeah, you timed that one nicely.

[00:15:20] Alex Hormozi: Yeah. Yeah, it worked out really well. That was brave. But we, um. We didn't really increase our spending. Not really. Like, I don't have a fear of running out of money anymore. Like, that's not really been a thing anymore for a minute. Um, but I would say, let's say it took like, three years to, like, start learning how to spend money.

[00:15:37] Sam Parr: Well, when you're 31 years old, 32 years old, you've worth 45 million liquid. What do you think? Your monthly expenses was over under six figures a month.

[00:15:45] Alex Hormozi: Uh, so I think it was under I think it was under at that point. I think it's probably around that now.

[00:15:50] Sam Parr: 100,000.

[00:15:51] Alex Hormozi: Yeah, probably. It's probably around that. It might be more. I'd have to ask the I may be the worst guess from this perspective. Like I don't even have logins to my bank account. I have no idea. I check like our our assets like once a year.

[00:16:03] Sam Parr: My deal happened when I was 31, so we were both about the same age. So it was like we went from like it felt like hand to like I frankly felt poor to not being poor. And it made me still very, um, fearful for a long time.

[00:16:16] Alex Hormozi: Interesting observation on the feeling. Poor thing. I think it depends on the type of business that you sell. So like, I felt poorer after I sold the company than before.

[00:16:23] Sam Parr: Because you lost your cash flow.

[00:16:24] Alex Hormozi: Exactly. Whereas if you have like a software company or you don't have a business that has cash flow and has more enterprise value is kind of the play.

[00:16:31] Sam Parr: Your company was a sell on cash flow and you had a lot of cash flow. So yeah, you you cut off the fire hose?

[00:16:36] Alex Hormozi: Yeah, I don't think I'll do that again. And then all I thought was like, well, shoot. Now I got to take this cash and go by that amount of cash flow. And I was like, well, shit, it's gonna be hard for me to buy that amount of cash flow with the money that I've got. And then I was like, shoot from there. That's where acquisition.com started. I was like, okay, let's see if I can figure out some sort of deals where I put some cash in and some work in and, and figure things out. And then at the same time I started making content. And so that was kind of the, the trajectory from there.

[00:17:00] Sam Parr: That's such an interesting insight. I was going to ask you about that because when I made my money, I go and invest this 8020 in stocks and bonds, and I'm just going to assume that it's fake and I'm just never gonna whatever it's gone and I'll build another company. And so my whole shtick was how do I start from scratch and just do this, build another company again? And except this time it actually makes cash flow. Your perspective was I have cash flow now. I got to use it to go buy some more. It's the difference between cap gains and cash flow strategy kind of. And that's like interesting. It was in your blood to have that cash flow.

[00:17:28] Alex Hormozi: I love cash flow. I feel very bad unless I have a huge amount of cash flow. It's an observation I've had of myself. Like, I really, really like cash flow.

[00:17:36] Sam Parr: To your business or to your personal account?

[00:17:38] Alex Hormozi: Both. Yes.

[00:17:39] Sam Parr: Are you taking distributions from acquisitions now or are you. Yeah. Okay. So you're taking distributions?

[00:17:44] Alex Hormozi: Yeah. I take distributions, you know, outside of whatever we need to, like, reinvest in the business. If we need to do that, obviously we're going to leave that in. But I take distributions on top of that.

[00:17:53] Sam Parr: When Alex says that he jumped into something right away immediately to get that cash flowing again, he means immediately.

[00:18:00] Alex Hormozi: It was the next day.

[00:18:01] Sam Parr: And what was the vision?

[00:18:03] Alex Hormozi: I wanted to basically say, okay, well, I started that company with no foresight, no plan and no money and just skill. And I was like, well, what if I had foresight, a plan, money and skill? And I was like, maybe I could come up with a better business model if I did it on purpose rather than on accident, but not acquisition. Acquisition.com was okay. What would it look like to have a forever business? You know, I looked at the people who were significantly wealthier. They'd been doing the same thing for a long period of time. I was like, okay, so a long period of time is a constant. So it has to be something that I can do for an extended period. It has to it has to have leverage. We have to create supply demand, you know, inequities. And so it's like so how do I do that. I was like, okay well and that's that's basically where building a personal brand came from was like, I'm not going to beat Warren Buffett or some of these, you know, super smart whatevers at trying to play with public equities. That's not going to be my game. Right. And so it's like I have to have a different game. So I have to have people who want to do deals with me where I can add unique value to a business. And so I don't need to be exceptional at at picking them. I can just be exceptional at doing what I'm good at and then getting better returns on capital. From that perspective.

[00:19:10] Sam Parr: It's pretty interesting that you said at 31 when you just had a sale the next day, you already had a vision and a plan. I think that like, for example, for me and I know a lot of people like it's like, well, I want downtime or it's like, I don't know if I entirely I wasn't intentional about reflecting on what did I learn? What did I not learn? What am I going to avoid? What am I not going to avoid? Am I just going to fall back into this lizard brain where I just followed my instinct versus following, like the rules of the game that I said I was going to play by? Do you know what I mean?

[00:19:33] Alex Hormozi: Yeah. So I'm a I'm a fairly large advocate for if you are going to sell a company, know what you're going to do next. I think some people don't like that. That's just my $0.02 because I've just I've seen it feels very binary, like I see some guys just like devolve into nothingness and then like, drink themselves to death and just like, have like be really depressed and like, aimless. Some people are like, well, you got to go through the desert to get to the other side. I don't know if that's a requirement. I think we could put a narrative on the narrative on that after the fact. But for me, I the year leading into the sale, I had done two deals that had done really well privately, just the capital we had, you know, just because we, you know, we had money before the deal and those had done really well. And there was like didn't take any time and it was really low stress. And I was like, man.

[00:20:17] Sam Parr: You bought a company or you bought a part of a company or something.

[00:20:19] Alex Hormozi: Like that. Yeah, I had a minority deal. I'd also done a bunch of like. I don't talk publicly about this stuff, but like, I'd done a handful of lending deals that had done really well. I actually really love lending. I don't talk about it much, but like, I have yet to lose money on lending.

[00:20:31] Sam Parr: So lending means what?

[00:20:32] Alex Hormozi: Like a hard money deal? Yeah. Somebody says, hey, I need $3 million in two days, and if you can get it to me, I'll give you 5% a month, and I'm gonna hold it for three months. And I'm like, okay. And I'm like, well, what's it collateral against? They're like the whole building. I'm like, okay, well how much, how much the building worth? Ten. It's like, well, how much do you need? Three. I'm like, all right. Does that mean the downside is that I have to take ownership of the building if they don't do it? But on some level, yeah, I'd happily buy a building for $3 million if I can get it for ten, you know? So you got.

[00:21:00] Sam Parr: To you got to go use those muscles and, like, intimidate someone every once in a while.

[00:21:03] Alex Hormozi: Yeah, right. So, like, I had a handful of deals that all went really well with that. So that was cool. And I was like, this is crazy. I was like the amount of like, I didn't have to do anything I talked about. I mean, once YouTube video about a deal that I did where I got 100 grand a month in An interest for someone holding my cash for like 90 days and then gave it back and I was like, this was so chill. I was like, how do I do more of this? And so that's what kind of got me, got me into it. I think I was doing some in the neighborhood of like two, three, maybe 400. Like I don't pin me down to, but somewhere in the neighborhood of like, call it 3 or $400,000 a month. Uh, near the end of the Jim launch days from, like, other stuff. And I was like, okay, this is kind of cool like this, you know?

[00:21:43] Sam Parr: So you're making 2 to $3 million of income from other.

[00:21:46] Alex Hormozi: Yeah. Yeah. Other. Yeah.

[00:21:48] Sam Parr: And the other was investing.

[00:21:49] Alex Hormozi: Yeah, yeah. Active though, to be fair, like, you know, I mean, I was looking at deals. I was, you know, talking to business owners, I was helping them out and things like that. And so I did that for the year leading into the sale, which is what made me feel more okay about the sale. And then I was like, well, if I actually put all my attention to this rather than like tiny bits of my attention, this would probably do well. And I think the reason I was really willing to start the next day is that the year of the sale we basically like took that year's the year off because it was the back end of Covid, and we had already had an executive team in place that was running the company, and it was growing and making money again because Covid was kind of we were on the back half, right. And Layla and I decided we didn't want to be in Austin during the Covid stuff. And so we just started doing one way tickets from city to city to city for the whole year of 2021. And so we would spend, you know, one week, two week, three weeks in a city, and we'd just leave when we felt like leaving.

[00:22:43] Alex Hormozi: And that was actually like really fun. And so I didn't work that much for me during that year. It was also a very depressed year for me because I didn't work that much. And so that was when I realized that, like, I am the problem, you know, when I have lots of work going on, I can be like, man, there's a lot going on. I've got some stress. And then when I don't have stress, I'm like, man, there's nothing going on. Like, this is stressful. And so I'm like, the constant is me. Like I have dissatisfaction in independent of condition. Anyways, I was like, okay, well I like the game. The game is what I like. That was when I realized, at least for me, my my, my life motto just became like basically just working hard because I felt my most satisfied when I had nothing left to give, like when I left it all on the field. And that's when I felt. That's when I felt the best about me. And so I wanted to just get started on something, a big chunky problem as soon as I could. And so that's why I started the next day.

[00:23:37] Sam Parr: Now on the investing side, Alex, being able to shift into that and make it work for him, that does not mean that it's easy. We've talked about that a ton on the show. The difference between investing and building a company and how they require very different skill sets. And so in my opinion, something I've talked about a ton is that if you're building a business and you're making money, in my opinion it's best to stick to a very simple allocation, just something like an index fund, assuming that you're going to be good at investing because you were good at business and making money in the first place, I think it just means you're really naive. And again, I say this a lot, but it's important and it's crucial to acknowledge the amount of luck needed to start and eventually sell a company and make a lot of money. Alex, by the way, has thought about this a ton as well. Do you have.

[00:24:19] Alex Hormozi: The stats on.

[00:24:20] Sam Parr: This?

[00:24:21] Alex Hormozi: No, I looked it up. So there's 32.5 million small businesses in the US or start out small, just businesses in the US. Last year it was 8600. I had a private equity transaction or institutional level transaction. And so that's 2.6 out of 10,000. Like social media makes it appear so much more common or prevalent, like if you had a lottery ticket, like every one of the business owners who starts a business, it's like, I'd like to sell someday. Or maybe. I hear it a lot. So I'll just say, like many business owners say, I'd like to sell someday. But if you knew your chances were 2.6 out of 10,000 or 1 out of 3000. It's like shit, that's not that common.

[00:24:56] Sam Parr: And the the numbers are actually worse than that, because if you include private equity or something, that doesn't mean that the owner is actually getting the money. Or sorry if you include VC or institutional because I know so many people that have raised tens, hundreds of millions of dollars and they have some type of exit, but because of the numbers that didn't work out, they walk away with their salary. So it's even lower than that of how many people sell their business. And they're happy with the amount of money that they received. Selling a company involves so much luck. And so that's why I think it's a bad thing to plan on.

[00:25:25] Alex Hormozi: Yeah, it's there's so much timing. And the thing is, is that businesses are inherently volatile. Like, most businesses are volatile. And you have to appear as though you're incredibly stable for like a 12 month period of time. And you want your revenue to just, like, keep slowly ticking up and your gross margins to continue to maintain, like all these things that like while you're actually running a business like you care about, but you're like, I don't care if this month is higher or less like you just you're just looking on a much longer time horizon. And so you're willing to make moves. But like, that's why that year that we basically took off, I took it off because I was like, I can't mess with anything. I can't try anything new. I can't show that I'm the one who's doing anything. So I purposely step back so that they can't be like, oh, this is key, man. Like, because like, I taken myself out of the ads, I'd taken myself out of the delivery, and I'd taken myself out of the operations day to day. And so the only thing we gave ourselves as a constraint for the sale was we have to be able to manage the company with one executive hour per week. So we do one meeting with the execs. That was the entirety of our of our time on the company. And then the rest of the time, Leyland. I kind of like talked about what we wanted to do next. We still own the business, but, you know, we were in the sale process and but we couldn't start anything new because if the sale doesn't go through, then you're like, I don't want two businesses. Like, that's not a good idea. Which is why, like the day afterwards when we started, it was like, okay, the check cleared, we're in. Let's go.

[00:26:46] Sam Parr: Now, just to refresh you, Alex says that he's worth around $200 million. If he was given about a year to liquidate all of his non liquid assets, if he had to come up with a lot of money right away in a few months, he says that he's worth around $100 million. So let's find out how much of that money he's spending and what he's spending on. I know what I spent, I spent around 40 or 50 grand a month. You seem like you spend more than Triple my amount.

[00:27:08] Alex Hormozi: That's probably right.

[00:27:09] Sam Parr: You think?

[00:27:10] Alex Hormozi: Yeah, that's probably right.

[00:27:11] Sam Parr: Do you think that you'd be less happy going down to five and 10,000?

[00:27:15] Alex Hormozi: No. Me personally.

[00:27:17] Sam Parr: Like you wouldn't care. You're okay being a caveman?

[00:27:19] Alex Hormozi: Me? I'm fine. Honestly. Like. Like I could have a backpack and a credit card. Like, I need very little. But the life that we've built has stuff in it. And so I kind of see it as, like, almost like there's two extremes. It's like you're either you're either going to build like a complete minimalist lifestyle where you just need nothing, and you can just kind of like wherever you want, whenever you want, which is like a purely freedom based or the other side. It's like you're going to change your environment around you. So rather than, I'm going to move myself to change my environment, I'm going to change my environment and stay where I'm at. It's like I kind of see them as like two sides of the same coin. One just costs a lot more money than the other. I would say that my life right now is like, I have this very large headquarters, we have a campus because we have we bought the building across the street as well. And like, we're kind of building out acquisition and home base, like the whole bottom floor of this is a 4000 square foot gym that has, you know, half $1 million of equipment in it. And like I do that because it's awesome. But at the same time, if all that gym equipment disappeared, I'd be bummed because I do like having my gym, but like, I would be fine.

[00:28:23] Sam Parr: Do you get nervous about, like, do you think that your company now is at a place where it's a machine and it's going to work? Or do you still have fear of running out?

[00:28:30] Alex Hormozi: I don't have fear of running out. I don't have any fear of not being able to make money or provide for myself.

[00:28:36] Sam Parr: I still get nervous spending money on things. So like, we got a new apartment in the city and like I was like, damn, this couch is 8000 and this is like 4000. Like, I would rather have the $4,000 would or get the $8,000 would like at a huge discount. Like, that's a lot of money for a couch. Do you still have those conversations?

[00:28:51] Alex Hormozi: I think that we have to make like for myself, like I have to be very clear about what the objective of the money is. And so it's like, am I buying this house because I want to get a good investment, or am I buying this house because it's a house that I want to enjoy? And if I'm buying the house because I want to enjoy it, then I should just get the fucking house. And if I'm buying an investment, then I should just make it a really good investment. And this residential thing is probably not going to be it, I think, where I've gotten in trouble and I've done it more times than once, which is why it's very frustrating for me, is that I try and say, can I have it all? Can I have the house that I really love and also get it to be an amazing investment? And the answer is just no.

[00:29:26] Sam Parr: When have you tried to do that?

[00:29:28] Alex Hormozi: I just did it and I feel so dumb about it. So Layla wanted this house and she's been looking at houses for a while, and I hadn't seen any of them because, like, she didn't like any of them that much. But we went to the house and she liked it, and she was like, let's make an offer. So I was like, okay, so the house was listed for 25 million, then got cut to 20. And so then I was like, well, all for 15. And like, we'll see. Because it had like the owner had had some hard times. Somebody had like died or whatever. And so I was like, maybe we can get it for, you know, a good deal. Now this house is like by far the most expensive one in the neighborhood because the person who owned it like it was like their retirement house. It was like the house that they wanted to build as their final home, so they didn't care about the expenses. And so I think they'd put like 18 million into the house. So getting a 50 like they're losing money on this, right. Anyways, I put I put an offer for 15. They came back and they were like 15, five. And I was like, well they they said, you know, 17. And I came up and said, 15 to 5. And then and they came down to and then they came down to 16. And then I was going to put the next offer in. I let it expire because I was like, let's let them sweat for a little bit, you know. And then somebody else came in and just made an offer and they didn't let me counter.

[00:30:40] Sam Parr: So you lost your you lost your place.

[00:30:42] Alex Hormozi: They just closed on the house. And I was like, fuck. Because Layla has very unique taste. And so, like, how many houses in Vegas are call it 15 to 20 plus million dollar homes. There's like 15. You know what I mean? And then like, of those, like, if you're buying a 400,000 a house, there's literally another house that's just like that that's also built. You just haven't seen it, right? If you're buying it a $20 million house and this is like boohoo, anybody who's listening is like, you know, screw you, Alex. Like must be tough. But like she wanted a very specific thing and we had it and it would have been great. It was in the right spot. It had everything, and I was just being cheap. And I regret that. I regret that. And so now we're back to, you know.

[00:31:23] Sam Parr: That's interesting because you are such this like introspective framework thinking person. And that's like a pretty dumb mistake that you made. Like, that mistake seems beneath you. That's not a mistake.

[00:31:33] Alex Hormozi: I appreciate it.

[00:31:34] Sam Parr: Do you know what I mean? And like, we're talking huge numbers, but particularly for a home. It's like my wife really wants it and I can afford it. Yeah, I have to move quickly.

[00:31:42] Alex Hormozi: So the the only defense I have is that one. I didn't expect that anyone would just not give me an ability to counter. So there was no other buyers at the table. So.

[00:31:50] Sam Parr: Well, that's because real estate is stupid like that. And like the auction process is stupid, but but you should have known that. I would think where it's just like I found it, and like, I should just. Yeah. Like when you negotiate, are you the type of guy that leaves things as a win win for everyone? Like, I wouldn't pegged you as a guy who tries to get the best of every deal. Like you're like, no, I don't believe meat on the bone for all of us.

[00:32:08] Alex Hormozi: No, and I don't. I think, honestly, it was just like, in my mind, it's like I hadn't even seen other houses. I was like, we've only seen one house, but I didn't. I didn't think about houses meeting all these criteria. I just figured all houses at 20 million bucks, all had all these things. And like, that's not the case. And so I kind of had a lot less urgency around this particular house versus others. There's just a lot of like it was. And I was kind of doing on the side. I was doing a bunch of stuff was going on in the business and I just like, I just wasn't paying attention. But yeah, it was a mistake. And so, like I talk about, I mean, this is the nature of the content I make. It's like, here's this dumb thing I did and, you know, here's I'll try not to repeat that mistake again. The reason I'm really annoyed about it is because, like I actually had I actually made this mistake another time earlier, probably two years earlier. Three years earlier where? Layla, we walked into this really nice condo. Same thing. God was like really sick. Spent all of his money on it and it was beautiful. And they were like, we want this. And it was way above the other, other units. I was like, I don't want to get the award for the guy who spent the most money in this building on a unit.

[00:33:18] Alex Hormozi: And so I, you know, I went back and forth, I put a lowball offer in and then they ended up closing with somebody else. And I was like, fine. But then after that happened, I was like, shit. Now I'm back on the market again. And so it took another like 18 months for a penthouse to come up. And so then a penthouse came up and Lila walked in and she was like, I want this one. And then this time, because the other thing had just happened. I just looked at the guy and was like, just get it, I don't care, just get it. And we won the award for the most expensive condo sold in the building, right? Which didn't feel good at the time. But then a billionaire came in next door and bought like the comp unit for like a million and a half above what I did. So and it was three months later. So I felt like a little bit better about it. But that one, I'm so happy I bought that one because I love the condo that we're in. But she wanted to have more space, which is what started this whole house thing. So yes, I like I make mistakes, you know what I mean? Like, of course it's funny.

[00:34:08] Sam Parr: I like hearing you talk. About what? Where you're fucking up because I admire you. And it's always fun to see people you like and admire, like screw up because you're like, okay, thank God they're human. And it's okay that I fucking.

[00:34:19] Alex Hormozi: I got.

[00:34:20] Sam Parr: Tons. What, are you frustrated? In the last couple of months, what are you frustrated with in terms of your own lifestyle, your mindset, your, um, your leadership abilities? What's like one thing where you're like this year I'm trying to solve or I'm trying to grow and to become this type of person.

[00:34:33] Alex Hormozi: I want to be in a better mood, regardless of circumstance. I'd say that I've had enough, like ups and downs to realize that I've been probably about equally satisfied and dissatisfied at all points of my life. And I think thinking about that has just been like, very real proof that me changing my circumstances changes very little about my subjective well-being. And so I have this refrain that I come back to in my head over and over again, which is like, I'm the problem. I've had ten executive assistants. I haven't had any of them work out what's the common thread between me and me and them? It's them obviously. Uh. I'm kidding. Um, and so it's like, yeah, it's me. Right. And then same thing with, you know, I've had good seasons and bad, like I've had times when I had lots of money into work. I've had times when I've had no money in lots of work. I've had lots of work and lots of money, and I'm about as satisfied at each of these circumstances. And so I want to get better at that. I want to be in a better mood.

[00:35:27] Sam Parr: At the very beginning of the episode, I told you there was going to be one thing that made Alex much, much happier. Truly happy. Not including, of course, his wife and family and that thing. It's not money. But it did come from money.

[00:35:39] Alex Hormozi: I think going from like potential to some level of realization definitely makes you feel a little bit better. Like, I mean, despite what everyone says, like I do think I mean, to your point of like, if you can spend money, money can relieve you of pain. And I think that that is for sure useful. I think a lot of it is just making you feel or like for me, like making me feel less crazy. It's like I heard Patrick but David say this and I actually really liked it. He said they were like, what changed? You know, before and after the sale of the company, said it felt good to know that I was right all along. And I think that I think very confirming is the right perspective because like, you know, I could talk about business, but if I had, you know, bank account that I, I might not be that good at it. Right. And so and so if you want to be skilled in an endeavor and you have no proof, it's a little bit tougher, it's a little bit more like you're, you know, baking on delusion. And, and the thing is, is you might very well be right. It just like, takes longer for the world to recognize that and for you even to have the proof that you're not just dreaming it up. So I would say that's probably the biggest difference between when I was in my 20s and now is I have evidence now.

[00:36:47] Sam Parr: All right, that's a wrap on this conversation with Alex. And if there's one thing that I think you need to take from it, let it be. This Alex is an incredibly smart guy who I think has a lot of things figured out. And if he had to go back to zero and start over, I'm confident he would end up in the same place again. But still, he has struggled with what it actually means to have this much money, and how to let it make his life better and not take over. Like Alex, I'm sure you're going to make a ton of mistakes. We all do. But you can make fewer mistakes if you surround yourself with people who have already been through it all, who have been there, done that, and are willing to talk openly about their wins and their screw ups. And that's why I built my company, Hampton. It's a community where we talk all about the stuff we do. Most of the conversations in real life once a month. And so if you're the founder of a company that does at least 3 million in revenue and want to be part of a private and again, highly vetted community, I bet everyone where these types of conversations, these real conversations, happen every single day. Check it out. Join Hampton. Also, if you want a podcast like this one, like Money wise, check out the company that produces it. I love giving them shout outs in this pod because I love the end product. It's called Lower Street, lower Street Echo. All right. See you next time.