Introduction To Marketing | Business Marketing 101
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- čas přidán 22. 02. 2021
- 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.
Feel like I’m getting my PhD degree through these vids for free. Thanks for the gems!
Takeaway (one of many) - Get the 30 day cash as big as possible, so you can have a higher CAC. Higher CAC = more reach, leads, opps to convert. Essentially Dan Kennedy's "the company that can spend the most to acquire a customer wins" right?
100%
really you want as low of a CAC as possible that way you're making more profit. High CAC equals less profit.
@@vladmkrtumyan7924 if you can outbid your competitors and afford to spend more to acquire customers (which is basically being able to afford being underwater longer), then you can put your competitors out of business.
@@CopypastedatesLower CAC = higher profit, higher profit = higher CAC, but still profit is the name of the game. All you're saying is "if you can afford to spend more" yeah you can with lower CAC too this is also how you can be "underwater", but no one in the history of business has ever killed competitors by increasing their profit and paying more to acquire more clients like this. Everyone has killed competitors by lowering their own CAC in their business model: example Uber, their CAC is super low vs. a traditional towncar company.
My model works with a clear company, you're going for a luxury company that will never put cheaper competitors out of business, you're just niching down. Alex's goal in his business model isn't to "take over a market" his goal is to serve the few that can afford what he does, that's it.
@@vladmkrtumyan7924 what you say is wise.
How to lower CAC?
Thank you again Alex. I listen to you now every morning as my guru on my business. You provide such important information that I never got from my parents or schooling. I know it’s never too late because of people like you! Thanks man👍🏽👍🏽
Same 🙏
Thank you so much for the value you provide Alex. You and Leila are changing the world!
I wanted to learn this for long time. Never understood them and I paid big money for other courses. Thanks for sharing this for free. Mind blowing.
Ever since I started watching Alex's high-value videos, there's been a significant transformation in my thinking. Now, I find it hard to enjoy videos from other knowledgeable individuals, regardless of the topic, because nothing compares to Alex's standards.
THIS!!! I feel the same exact way
Alex's videos have been my daily dose of enlightenment. His insights are like a compass guiding me through the complexities of business. Grateful for the wealth of knowledge he shares!
This is insanely valuable. Going to be studying this for the next few days
Yeah. Lots of people have taught this. I think I heard Alex Becker talking about it 3-4 years ago
@@braer240 umm... everyone who runs a successful and profitable biz know this... it's called "knowing your numbers"
Great video much Honor for your wisdom Sir. 🙌👏 Working on my Hormozi MBA reading and applying your amazing book now. So needed this the pandemic has been rough for many businesses. You are helping so many people. I have an MBA and the knowledge is kindergarten compared to your wisdom. 🙌🚀🚀
Alex this is incredible advice. You are the man keep this gold coming
🤯🤯🤯 MIND BLOWN. Better than business school 🙌
What a beast you are Alex. The mentor i needed
Thank you Alex!!
Another great video.
Your content is amazing and so helpful for small business owners like myself 👊
This is the vídeo ive waited my whole life to find thank you please make more like this
Thank you Alex! I heard Russell talk about this but this is much more practical.
Legit thanks a lot. I've worked in sales for years (it's fun) but to go into business I need this stuff
Great and concise information, Alex. Thank you so much!
So much value here, thank you so much Alex
Making things so simple to understand! Thanks Alex
Oh My GOD this is pure wisdom 🤓🤓 Thank you Alex.
Very useful and helpful video, explanation was really easy to understand and should help a lot of people. Thanks Alex
great video! would love to see more handsOn knowledge especially numbers
This channel is super underrated
Thank you so much for the information truly priceless.
Alex, thank you. From the bottom of my heart, I can say this is invaluable for start ups.
Its like a cheat code for business - if you can actually realise these numbers!
I’m starting school next month and watching this definitely helped me understand more. Thanks dude 🤘🏾
lmao have you not learned school is a waste of time?
THANKS ALEX, NICE VIDEO TO LEARN !
GOLD, PURE GOLD!
Thanks Alex! Amazing as always!
Would if your CAC is time and you’re not spending anything to acquire customers? All organic reach out.
Would love to see that calculated out?
Lollll more value in this 10 minute video than most classes I’m taking in school
AWESOME content Alex!
just a great video man!
Glad I learnt this
Every day I come back to CZcams Alex has gained 2k subs, not surprised
Watching Horomozi's old videos - Pushes me to push more content.
Nice growth business marketing model
Great content!!
This video is amazing
Thank you Alex
Excellent video
This blew my mind! Thank you Alex.
Not sure how I will go through the ups and downs in my journey.
But you being there is like having my future me helping me.
Thanks for creating this content, can't convey in words how much this helps!
Thankyou
Gold!!
so many gems better than college
incredible stuff. still trying to find a place to implement it though.
The speaker identifies three important numbers to focus on in any business: the cost of acquisition (CAC), the lifetime value (LTV) of a customer, and 30-day cash.
CAC includes all costs associated with acquiring a customer, such as sales commissions, ad spend, and marketing expenses.
LTV is defined as the total gross profit a business will receive over the lifespan of a customer.
The speaker emphasizes the importance of understanding the gross margin of a business and recommends a LTV to CAC ratio of 3:1 or greater.
Thanks
How do you calculate CAC?
Would analyzing 10 past customers determine a good LTV?
@@forrealtyler To calculate CAC (Cost of Acquisition), you sum up all costs related to acquiring customers, including sales commissions, ad spend, and marketing expenses, then divide it by the number of acquired customers within a specific period.
Analyzing the past 10 customers can give you insights into their behavior, but for a more robust Lifetime Value (LTV) calculation, you typically consider a larger sample size. LTV is often calculated by assessing the average revenue generated per customer over their entire relationship with the business. This involves analyzing customer retention rates and their spending patterns over an extended period, providing a more accurate representation of long-term value.
Compelled to comment… THIRTY days from marketing to profit to pay back a potentially very high interest loan? Have fun in Vegas!
Savage concept
Very helpful!
+1 for the algo
Thanks Alex
Basically, the fundamental framework of a business lies on its LTV (Loan To Value Ratio), CAC (Cost of Customer Acquisition), and its 30 Day Cash (The amount of time one has to repay credit card debt). The LTV should be 3x the CAC in order to have a healthy profit margin. The fundamental understanding of this is that credit allows you to basically be able to acquire customers without any of your own money initially which gives you a large amount of time to be able to gain data or make improvements to the business which gives you time to play around with.
What are some advantages of having your 30 day = your cac?
Thanks
6:26 I feel ya..bro
😂
With CAC are you including operating costs as well as sales costs?
This is amazing info. But what I’m getting from this video is not Business Marketing 101, but What is Profitable Business 101.
How is this free lol. Insanely valuable.
Real life examples needed for sure. It's not as easy as saying this is how much I can spend on acquisition. That doesn't guarantee that the customer actually comes in. Then you end up spending that multiple cac on one customer. And who know how many multiples, that's how real life goes
It's most important I can actually convert my audience into sales
Genius
Mind 🤯🤯🤯. No guru teaches this.
Clear, understandable and practical! Thanks alot
awesome
Anyone else just looking at Alex's muscles lol dudes jacked haha. I came here to learn.. but now I'm going to work out. It's like the hulk is teaching me about business. Jk very valuable information. Thanks
Thnk u . It does help. Appreciate ur effort.
I just started my startup, how can I open up a business credit card? And which one should I get?
Let’s say I’m not covering my CAC in 30 days.
Can I use one person who “prepays” to cover my CAC for everyone.
Is this equally as affective?
Great example! Nice looking cac! lol
How would you attack this in case of a business where you are dealing in contracts which means sometimes it takes a year or more before you start getting paid as only then the old contract of the client expires
is 30D Cash profit collected in 30days or revenue collected in 30days?
"The amount the customer pays you has to be more then the amount it takes to aquire them"
Trying to figure out how to do this with a clothing line
Another +1 for the algo.
Shark 🦈 Tank Material!
"And that is the game I try to play"
6:10 is the only work assuming you are able to get the customers on the same day you take on the debt?
genius
🔥
🔥🔥🔥👍👍
Can someone explain the 30 day cash? I'm a bit confused on what that is in relation to the CAC
Use a credit line or another 30 day cash pool, and use it towards the CAC
30 Day Cash Collect (Profit) has to be higher than your acquisition cost. So you break even on the front end ("Free Advertising") and can profit through upsells etc. in the backend. If you can always manage to at least break even on the frontend, you can theoretically scale your businesses forever, since advertising is "free".
@@borisazihuwa6323 what do you mean by backend and frontend?
@@melissajones__ In this example front end is the CAC. Back end will be all the upsells you have throughout a customers LTV
Love hormozis cak
Debt add massive risk. I like the CAC and LTV but adding debt to 30 day cash works until it doesn’t. Debt = risk
Let me just say I'm 2 minutes in and not hearing "like" every 10 seconds is the most comforting thing I've seen in a professional. Haven't heard it once, he knows what he's talking about
how you whipped out $266 was just mind blowing to me hahaha. now i KNOW you are a wizard!
What are practical ways to increase LTV of a recurring client? How did you do it for your gym clients?
read his book and you wiill gett all the answers..
if i could afford him as a coach, i would hire him. he will be my first hire when I make $100,000,000
With CAC does that include the cost to make the good or service and the advertising/marketing to get the customers or is it solely just the marketing cost.
Marketing Cost
🤙🏻
Can you share the spreadsheet calcs? 😂😅
I'm going to say this is 301 for my knowledge
Ok. So you need to borrow $260 to get a customer that's willing to pay at least $260 upfront minimum. Use that $260 to to buy the next customer willing to spend $260. Keep the cycle going. The added money over time is just gravy. 👍
I am a realtor
Are you including Cost of Goods in the CAC?
Great question i wnna know too
Is there any sheet to keep track on this?
Could you please share with us?
Excel
Why get an MBA when there is Alex.
Are you calculating profit before tax or after tax
Gross = before tax
Why is YT only showing me this now?
Cheap and fast
VVALUUUUUUUUE. ❤️
and what if they don't give you back your CAC money within the first month?