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Alex Hormozi: The 4 Steps To Your First Dollars Tomorrow — Transcript

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0:00What are you going to unblock for them
0:03when you if someone read all your books,
0:06listen to your podcast, listen to
0:08today's podcast, what are they going to
0:10unblock that's been tripping them up,
0:12keeping them behind or holding them
0:14back? I think they would have clarity on
0:16what actions were required to get what
0:20they wanted and then at that point they
0:22would only have to just think like why
0:23am I not doing it which is a separate
0:25conversation but there's a lot of
0:27confusion I would say around like what
0:29are the things that are required in
0:31order to create a business in order to
0:32create an income I would say that I'm an
0:34objectivist and so I just look at what
0:36are the things that are observable and I
0:38think a lot of time people spend inside
0:40their heads trying to think about
0:41manifesting and energy and all of this
0:43stuff when it's like we got to let
0:45people know about the stuff we have. We
0:47got to have something to sell and we got
0:48to make sure that what we're charging
0:49costs less than [laughter] than it costs
0:51to deliver it. And we try and do that as
0:52many times as we can. And so each of
0:54those pieces obviously has frameworks
0:55behind them. But they're all tied to one
0:57thing which is just what actions are
0:59required. And that's been the single
1:02pervasive frame in my life that has made
1:05navigating reality significantly easier
1:07for me because I was very confused
1:08coming up and I was like I don't know
1:09what any of this is. And I read all
1:10these self-help books and and I felt
1:12more confused after the 10th book than I
1:14did on the first book. And and then it
1:15was just like, okay, what do I have to
1:16do? And then that is kind of what has
1:18started this journey for me.
1:20>> What's that number one misconception you
1:22hear when people are thinking about
1:24building a business, making money,
1:25changing their financial situation?
1:27What's the number one thing you hear and
1:29you go that's the issue? I think they
1:31conflate sequence is probably the first
1:32and biggest thing because a lot of
1:34people who are wanting to make money
1:36believe that the making money comes from
1:38investing and investing is the last
1:41thing you do not the first thing you do
1:43and so one of the things is they'll look
1:44at people who are at the end of their
1:45careers and say okay well these guys are
1:47making all these you know these bets
1:49right I if I if I just bought this
1:50memecoin or I just bought Bitcoin in
1:522013 I'd be super rich but it actually
1:54doesn't take into consideration what a
1:56decision-making process like that would
1:58create which is if you took a swing at
2:00every type of Bitcoin because you can't
2:01just say I would only pick this one.
2:02You'd have to say I pick every single
2:04super long shot. It's like we probably
2:05would have lost them 99 of the other
2:06bets.
2:07>> And so it's like we have to take it in
2:08aggregate. And so I would say making
2:11active income cool again [laughter]
2:13uh rather than the passive bet and
2:15really just gambling um is probably the
2:17the first thing that that people mess up
2:19is that they're they somehow think that
2:21working or active income is not scalable
2:24when in reality the people who have the
2:26most money typically have tremendously
2:28high incomes. And it's because of the
2:29excess of cash flow from that income are
2:31they able now to make big swings with
2:33riskier bets that sometimes pay off and
2:35sometimes don't. But you can't take
2:37those swings unless you have more cash
2:39that's coming in from the things you do
2:40every day.
2:41>> You know what? No one's ever said it
2:43that well, like from everyone I've
2:44spoken to. And I'm so glad you pointed
2:46it out because I completely agree. I
2:49have so many friends who when they saw
2:52the rise of crypto or whatever it was,
2:55jumped in with a large sum of their life
2:58savings
2:59>> because they heard of a friend of a
3:01friend of a friend who'd made a killing.
3:03>> Put it all in there. A week later it
3:06dropped by like 10k. They pulled it all
3:09out. The next week it went up double
3:11like and and it was just a mess. And so
3:13many of them lost like 10 20 30 40,000
3:16dollars.
3:18>> And it's all because you're thinking
3:20that's the way to get there
3:22>> and it's cooler and it's smarter and
3:24like you're a genius
3:25>> if you and you're right. Actually,
3:26everyone I know that's made
3:28>> amazing money on any of that already had
3:31tons of money and it was play money for
3:33them. So it just changed into this. So
3:35what's happening there? Why is it that
3:37we've been led down this thought process
3:39and how do we get out of it?
3:41>> I mean I think it's fundamentally the
3:42something for nothing fallacy of like
3:44how can I get rich quick? How can I do
3:45it really easily? And um basically the
3:48more it feels like luck is usually where
3:50you should have your first red flag. If
3:51you I mean I have a belief that if you
3:54control all the variables then you can
3:55predict the outcome. Now, we don't
3:57always control all the variables in any
3:58given situation. But the greater number
4:01of variables we control, the greater
4:02influence we have over the outcome. And
4:04if you're getting into something like
4:05this and you're like, I actually don't
4:06even know what the variables are. Then
4:07it's like you are you are 100% gambling.
4:10And so this is your life savings. Would
4:11you put it on black at the casino?
4:13Probably not. This is really not that
4:15different than that. Except at the
4:17casino, you have no nods at least right
4:19here. It's like you have no idea. And
4:21typically by the time especially genpop
4:23uh kind of retail investors find out
4:26about something it is the peak and it is
4:28too late. And so you have to be at the
4:30very beginning of these if you want to
4:32be speculative which I wholeheartedly am
4:34not a big fan of speculative investments
4:35in general because it's basically the
4:37greater fool theory which is what they
4:38call in the investment world which is
4:39just like we just keep selling to the
4:41greater and greater fool until sometime
4:42somebody is the greatest fool of all and
4:44then it drops right and so I prefer to
4:46think about instead of thinking of
4:48investments and active income I think of
4:50just money per unit of time and that
4:52kind of takes out this binary or what I
4:54would consider a false binary of active
4:56and passive and think well and I I I
4:58feel like I and prove this pretty
5:00clearly which is we live in time and we
5:03collect money in that period of time and
5:05so fundamentally all we want to do if we
5:07want to increase our income is just
5:08think what are we earning per unit and
5:10this is where again bad piece of advice
5:12is like never sell your time it's like
5:14okay well if someone gave you a billion
5:15dollars for an hour would you not sell
5:16that I would [laughter]
5:18right so it's a question of how much is
5:21your time worth and then that creates a
5:22much more actionable uh decision-m
5:24framework of is this worth it or not
5:26>> you can build something very big in
5:29about 5 to seven years. And the problem
5:31is that I think most people spend that
5:33same 5 to seven years reliving the same
5:3630 days over and over again, jumping
5:38from thing to thing to thing and never
5:40actually getting the root set so that
5:42they can pay down their ignorance tax of
5:45not knowing enough. Basically, there's I
5:47would say there's five stages that most
5:49newer entrepreneurs or people who want
5:50to pursue income go through. So the
5:52first is um what I call uninformed
5:54optimism. So your friend tells you about
5:56this thing they made 10 grand on and
5:57you're like that sounds amazing. You're
5:59uninformed but you're optimistic, right?
6:00And so then you get into it and then all
6:02of a sudden you get to uh informed
6:04pessimism. So you get in and then you
6:06put your money in and then it drops and
6:07you're like wow this sucks. And then you
6:09know people are like buy the dip. And so
6:11you're like okay I'm going to I'm going
6:12to put more money in. And so then you
6:13get to kind of stage three which is the
6:15value of despair where you're like oh my
6:16god I've lost so much money. I have no
6:18idea what's what's going on right now.
6:20And at stage three there's kind of a
6:21fork. And so either people then go,
6:23"Well, my other friend told me about
6:25this other thing." And they jump back to
6:26step one and go to uninformed optimism.
6:28And then they just they funnel through
6:30that loop over and over again. Now, to
6:32break through that that dip, you have to
6:34basically get to stage four, which is um
6:37informed optimism. So now you understand
6:40the rules of the game. You understand
6:41the variables at play. And it's not as
6:43good as you thought it was, but you at
6:45least get it. And so from there, then
6:47you can get to achievement, right? Which
6:48is the fifth step. But the thing is is
6:50that you have to stay in that third
6:52painful place because staying in the
6:54pain is what gives you the catalyst to
6:58learn how to get out of pain. And so
7:00rather than trying to pull your
7:01parachute, it's like I have to trudge
7:03through this so that it forces me to
7:05learn the individual skills, the
7:06individual variables that affect this
7:08outcome. And that means I might have to
7:09take 20 more lashings to finally get it.
7:12And then at that point, it starts to
7:14tick up. And then that's when you start
7:15to become more of an expert, more of a
7:16master at something. People make the
7:18mistake where we go, I don't have time
7:20to learn,
7:20>> right?
7:21>> So, I'm going to learn from someone who
7:22makes me feel like I can learn it in an
7:24hour.
7:25>> Yeah.
7:25>> And then I'm going to do it, which still
7:28is uninformed optimism. So, how do we
7:31learn? Where do we go? How do you build
7:35that time to say, "How many hours do I
7:37need to even learn about this? I'm going
7:38to put money in it." How would you
7:40calculate that? If someone was like,
7:41"I'm going to put in a,000. I'm going to
7:42put in a $10,000." Yeah.
7:44>> How much time should they put to value
7:46that amount of money?
7:48>> So, great question. I would reframe the
7:50premise, which would be we we'd still be
7:53operating under this as I'm going to put
7:55money into something. And so, I would
7:57reject the original premise and say,
7:58well, if you want to get really good at
8:00something, then why don't we start with
8:01skills that generate income? And so, if
8:04we follow kind of the the three elements
8:05of a business at its most basic form is
8:07you have some element of promotion. So,
8:09we got to let people know about our
8:10stuff. The second element is we got to
8:11have a way to convert them. So we have
8:13to be able to sell some sort of exchange
8:14mechanism and then finally we have to
8:16deliver right so attract convert
8:17delivery easy um well easy to easy to
8:21say hard to do right within each of
8:23those things it's like okay well how do
8:24I let people know about my stuff or even
8:26before that what stuff do I sell right
8:29and so that's where I like to think
8:31about it as people try to think man
8:33there's so many people and and try to
8:34boil the ocean like it's impossible to
8:36try and like try and think what business
8:38could I possibly start because you're
8:40trying to address the world when It's
8:42much easier to say what are the problems
8:43that exist in my life and I kind of
8:45think of it as the three Ps like most
8:47businesses come out of a passion. So
8:49something that you're just inherently
8:50interested in. They come out of a
8:51profession. So you currently exchange
8:53right now you have a job whatever it is
8:54and you get paid maybe not as much as
8:57you want but you do get paid uh for
8:59exchanging some sort of value with the
9:00business. And the third is P which is
9:03pain. Right? So there's some deep pain
9:05that sometimes you went through. So
9:06maybe it's a mom who had to figure out
9:07how to um create non-allergenic food for
9:10their kids, right? It's it be something
9:12as small as that. And so from that those
9:14three kind of uh buckets is I think the
9:17best starting point for most people who
9:19want to start making an income. It's
9:20like okay well if you're inherently
9:21interested in this topic it's like can
9:23we make can we let people know about
9:25stuff around that topic? Can we create
9:26solutions around that stuff? Can we
9:28create services? Which is where I prefer
9:29most people start? Which to be fair in
9:31the United States 78% of businesses are
9:33service based businesses. And I think
9:34it's because they're the easiest to
9:36start. You just trade time for money.
9:37Should you do what you love for money
9:39and love what you do?
9:41>> I think this is big myth number two. So
9:43if we have we start with you know
9:44passive versus active is big problem
9:46number one. Um number two is follow your
9:48passion. I think the reason that this is
9:50so espoused I'll start where I think the
9:52idea comes from and then kind of break
9:54down from there. I think it's because
9:56most of those commitment speeches are
9:58billionaires or very successful people
10:00and they say follow your passion. But if
10:01we think through what other advice could
10:04they give that would be socially
10:05acceptable. They can't say, you know, I
10:07got lucky. They can't say, um, I worked,
10:10you know, super hard because people were
10:12like, sure, you know, like, and so then
10:14it's like, okay, well, they're never
10:15going to get attacked for saying follow
10:16your passion. But the problem with that
10:19is it also assumes that your passion or
10:21your interest will never change.
10:23>> And I mean, anybody who's listening to
10:24this, just think about what you were
10:25really interested in 10 years ago. It's
10:27probably different than it is now. And
10:29if you extrapolate that another 10
10:30years, it'll probably be different
10:31again. And so if we can think about the
10:34hypothetical extreme of a really
10:35successful person as someone who sticks
10:37with the same thing for an extended
10:38period of time, which is something that
10:39I believe because you learn all the
10:41lessons you possibly can in a very
10:42narrow field, right? And that you
10:44basically try and make as many mistakes
10:45as you can. And if you basically, you
10:47know, pay off all the all the ignorance
10:49debt you can, it's like you end up just
10:50succeeding by default if you just fail
10:51every other way. [laughter]
10:53But if you try and if you try and do too
10:54many things, you never actually get to
10:56to push the road all the way, you know,
10:58trudge through the mud and get there
10:59because you're only learning one or two
11:01mistakes in many fields and not many in
11:03one.
11:04>> And so the follow your passion issue is
11:06that yeah, number one, the the passions
11:08will change. Number two is that
11:10sometimes you're passionate about things
11:11that people don't value. And the thing
11:12is is there's nothing wrong with that.
11:14It's just that it'll be very hard to
11:15make an income that way. The third thing
11:17is that I think that it creates an
11:18emotionality around business or income
11:20which is that the moment it doesn't feel
11:23good that you believe the myth that you
11:25should stop when I think that oh good
11:27>> you if you and I were to talk about you
11:29know the business side of anything there
11:31are elements that I love and there are
11:33elements that I hate and I see them as
11:37both required you know I would love to
11:39maximize one versus the other but it's
11:41just the cost of doing business
11:42literally but I try to reframe that pain
11:45that comes from doing the things that I
11:47don't want to do to do the things that I
11:48do want to do as the price tag required
11:50to become the person that I want to
11:52become. And so if we think about the
11:54traits of any person, so it's like if I
11:57want to be patient, then I can't expect
11:59things to happen faster, right? Like if
12:00we were to go to the end of our lives
12:01and say, "Hey, I want these character
12:02traits." It's like, well, if you had to
12:04play a character, you know, in a video
12:06game and make them that way, it's like,
12:08well, what would you have to put them
12:09through in order to get those traits?
12:10It's like, well, if you want patience,
12:11then you're not going to get things
12:12quickly. If you want to have endurance,
12:14it's like you have to be able to
12:15tolerate suffering, right? If you uh if
12:18you want to be wise, it's like you're
12:19gonna have to get burnt and you're gonna
12:20have to learn the value of judgment. And
12:22sometimes that means you're going to get
12:23betrayed in order to learn that pattern.
12:25And so it's like we we lament the price
12:28tag for the things that we want. And I
12:30think that at least for me, my ultimate,
12:33you know, long-term goal is just to
12:34become the person that I the best
12:35version of me, right? And I think that
12:37in order for that to happen, I will have
12:39to go through pain. And so the follow
12:42your passion, you know, moniker also
12:44creates this emotionality that gets you
12:45to quit when you really are on the right
12:47path and it's just this is just part of
12:49it. And so I think those are probably
12:50the big three um that I think about when
12:52it comes to why follow your passion
12:54doesn't serve most people. My third myth
12:56that I would probably tack onto this as
12:58we're building these is um overbelief in
13:02idea and underbelief in execution.
13:04>> Oh yeah, so true.
13:05>> And so there's two elements to this. So
13:07one is that I think many people who are
13:10you know intimidated to start believe
13:11that they have to start the next
13:12Facebook and you know the Zuckerbergs
13:15and the basis of the world are so
13:17incredibly rare. The vast majority of
13:19people who got into business have many
13:21many failured and many many failures
13:23many many failed businesses uh that that
13:26led them to fail into success right and
13:29so uh one is that the idea has to be
13:31this big amazing thing and the second is
13:33that you shouldn't that the idea itself
13:35is is the success right because they'll
13:38share with as many people as they can
13:39and they almost scratch the itch of
13:41starting when you haven't done anything
13:43>> I say there's basically four steps to
13:45starting a business it's like you have
13:46to get an LLC you take the LLC to a bank
13:49and then you get a bank account and then
13:51you connect that bank account to a
13:53payment processor and then you go ask a
13:55stranger if you can do something in
13:57exchange for money and if you do all
13:59four of those things you have a business
14:00that's it [laughter] right and so a lot
14:02of people like spend years being like
14:05I'm going to start a business one day
14:06it's like you can do it tomorrow
14:08literally do all of this tomorrow
14:10>> and then it's like okay well then how do
14:11I get the person to exchange money it's
14:13like well you reach out to the people
14:14you know right you open your phone you
14:15look at the 400 contacts you have there
14:17you open up your Facebook profile. You
14:18have 300 friends. You you look at those
14:20friends and then you just say, "Hey,"
14:22you send a personal video, send a
14:24personal text and say, "Hey, I am
14:26starting this thing. Um, this is what
14:28we're doing. This is what I'm solving.
14:29Uh, do you know anybody?" That's it. And
14:32so, it's not even like you're asking
14:33your friends to buy something from you.
14:34And what's interesting though is that
14:3590% of the time, the person who responds
14:36is, "Oh, you know, you could do that for
14:38me if you want, but that just gives you
14:40the easiest way that costs 0." And
14:42because we're all connected with the
14:43internet and phones, it's like the
14:44barrier to entry has never been lower
14:45than it is now. It's just the problem is
14:47that um the barrier to distraction is
14:49even lower. For those of you who are
14:50like I don't want to work for free. It's
14:51like you're not working for free. You're
14:53earning and then you're sorry you're
14:54learning and then you're earning. And so
14:55we got to go through the learn phase
14:56first. And the best way to do it is
14:58people who aren't direct connections of
15:00yours maybe one step step removed. And
15:02then at that point they're going to give
15:03you very real feedback. And if you do a
15:05good job then after a certain point my
15:08goal is to get people to basically shift
15:10supply demand in their favor. Like I say
15:11the two the two laws of business that I
15:13am the most moved by are supply and
15:16demand which is this X right here and
15:18then leverage. So that's a fulcrum for
15:19leverage. And so I see those are the two
15:20biggest forces in business.
15:22>> And so I want to create artificial
15:24demand for somebody who's starting out
15:26by just saying we'll do a lot of stuff
15:27for free. And then what happens is when
15:28you have more no more time to give and
15:31if people still want you to do stuff and
15:32you say hey I can't take any more
15:34people. If you want you can pay and
15:36people like yeah that's fine. And then
15:38boom and then you make your first sale.
15:40And so, and you'll have confidence
15:42because you're like, "Well, I just did
15:43it 20 other times." And look at the
15:45results from those people. And but and
15:46the first one, you'll be embarrassed
15:48about the 19th one, you're like, "Wow,
15:49you're going to already paid down 60 70%
15:51of all the mess ups that [laughter] you
15:52were going to do."
15:53>> And then at that point, you're going to
15:55start feeling good. And then from there,
15:56my way of doing it is just you just keep
15:58bumping the price by 20% every five
16:00people until eventually people start
16:02stop saying yes. And then up, we're
16:04like, "Okay, this is the price I can do
16:05for now." And that's basically a very
16:07seamless transition into how do I go
16:09from nothing to making my first dollar.
16:11>> How do you get over the block of I don't
16:13want to work for free?
16:14>> I actually think it's entitlement. I
16:17think it's believing that you deserve
16:18something for nothing. Like to to flip
16:21the flip the rules in reverse. Imagine
16:23somebody comes to you, they've never
16:25done anything ever in this particular
16:27space and they say, "Hey, will you pay
16:28me to do this thing?" Would you
16:31immediately, now maybe some people would
16:33be like, "Sure." then it's a charity
16:34thing which is different but would you
16:35be like you know what I I really believe
16:37that this guy is the best person that I
16:39can get this problem solved from
16:40probably not and so to carry some of
16:43that risk for yourself you say I'm going
16:44to front this but if you want to not do
16:47it for free thing number one is that
16:49you're getting educated so like you're
16:51you're getting free education which I
16:53see is absolutely valuable the second
16:55thing is that you can make terms that
16:57don't necessarily mean that it's free
16:58like there's the price and then there's
17:00the terms the terms of the agreement can
17:01be if you do this with me, you have to
17:04give me feedback uh throughout the
17:06entire process and at the end if I do a
17:07good job, you leave a review, right? And
17:09on three different formats and leave me
17:10a video and leave me, you know, a text
17:12version of it. That's now absolutely
17:14like I'll say it differently, a business
17:16owner, they do illegally and and so
17:19therefore they are very willing to pay
17:21people to leave them testimonials. And
17:23so if you'd be willing to pay $500 to
17:25get an amazing testimonial, then they're
17:26basically you're they've paid you that
17:28$500. But I promise you, those first 5
17:3110 reviews will make you so much more
17:34than they could ever have paid you and
17:35not given you a testimonial. So if we if
17:37we flip it and say, "Hey, would you
17:39rather get $1,000 from this person and
17:41have them not leave a review versus free
17:43and a glowing review, I promise you, you
17:46will make so much more from one glowing
17:48review than you will from the $1,000
17:49long term."
17:49>> You know, talking to you today and Alex,
17:51I watch your stuff all the time. The
17:52thing that's standing out to me is
17:54you're super tactical. There's all these
17:56methods. there's all these systems, but
17:58then when you were talking about your
18:00life, you were like, "It's all about who
18:02I want to become."
18:03>> Mhm.
18:03>> Is there a number that you stop at or is
18:07it actually who you want to become
18:09that's your north star?
18:10>> I see entrepreneurship as the single
18:12greatest path for personal development
18:15because if if we define, you know,
18:17learning as fast feedback loops, there
18:19are very few other, you know,
18:20professions that give you that much
18:22feedback, that brutally honest, brutally
18:24honest feedback as the market will do.
18:26And so at every point where I get stuck
18:28in a business, I think to myself like
18:30what skill do I lack? And I define
18:32everything by skills. So even traits,
18:33which is just, you know, a colloquial
18:35term, which is really just a bucket of
18:36many skills, um I just think, okay,
18:38well, in order for me to appear
18:39confident or be confident, it's really
18:40like 38 things that I have to learn. And
18:43all of these things, if I break them
18:44down easier, I can do them. So it's
18:46like, okay, when I shake hands, I make
18:48sure that I web the the middle of my
18:50hand and I squeeze firmly and I look at
18:51the person in the eye. It's like that's
18:53thing one. thing too is that when we're
18:55talking like you nod because you've been
18:57doing this for so long but some people
18:58who don't know how to have conversations
18:59just stand like this but somebody who's
19:01an active listener will nod they'll say
19:02oh that's a great point whatever and so
19:04it's like that's a second thing when I
19:06walk into a room I'm going to call
19:07people by name it's a third thing and so
19:08when I when I try and think about these
19:10traits of who I want to become it's like
19:11can I break these down into actions that
19:13I can actually do and so I think that is
19:15that has been a large part of the the
19:16growth that I've I've hopefully you know
19:18been able to uh achieve but in terms of
19:20the ultimate goal for me it's always
19:22just been to be useful Mhm.
19:24>> And if I think I just do that, then I
19:26like that it's such a simplified goal
19:28because being useful has uh it actually
19:30includes multiple parties because you
19:32cannot be useful unless there's someone
19:33else you're being useful to. And so it
19:35gives you something controllable which
19:37is that I have to learn skills so that I
19:38can serve someone else and that is how I
19:40can ultimately be useful. And so even
19:42when we're, you know, we're making
19:43content or whatever it is that we're
19:44putting out, I I always try to think
19:45like is this useful? Like can someone
19:47actually will this change someone's
19:48behavior? I be like I want to educate.
19:50It's like what is education? It just
19:51means same condition, new behavior. So
19:53if someone has had their same day over
19:55and over again, then they're not
19:56learning. So if your day looks the same
19:58every single day, you have learned
19:59nothing. And so that means that if you
20:01listen to this podcast and then nothing
20:02changes about your behavior as a result,
20:04this was just entertainment, not
20:05education.
20:07>> What do you think is the number one
20:09emotion
20:11>> that people don't know how to control
20:14that leads to failure?
20:15>> That is such a good question.
20:18Fear.
20:21Because I think one of the one of the
20:22most one of the wildest questions um
20:25that I read that you know kind of stuck
20:27with me was like
20:29what would you do if you weren't afraid?
20:32And I think that's just a such a such a
20:33a powerful question to ask because every
20:36person has the the fear is the thing
20:38that gives you the hundred reasons. And
20:40what's really interesting about this is
20:41that we are our brains are exceptionally
20:44good at finding problems which is why
20:46I'm a big fan of inverted thinking. So,
20:48how can I think about all the ways to
20:49kill my business and then do the
20:50opposite? You'll your brain is so much
20:51better at spotting problems than
20:52spotting opportunities. And so, it's
20:54like use that problem that problem
20:55finding thing and then just flip it. And
20:57it sounds like, oh, well, I would just
20:58think of the opportunities that way.
20:59It's like it doesn't actually work. You
21:00actually have to think for the threats
21:02and then flip them.
21:03>> But that's genius. I love that.
21:04>> Yeah, that's Charlie Mongers. That's,
21:06you know, you know, rest in peace. Um,
21:08but from a from a fear perspective, it's
21:10I think it's playing it out. It's like
21:12what what am I actually most afraid of?
21:14And so fear typically only lives in the
21:17vague, not in the specific. We tend to
21:19catastrophize to death. So if I make
21:22this post and people laugh at me, I'll
21:23get shunned and then I'll eventually go
21:24alone and then die, right? So it's like
21:26everything just goes to like death,
21:27right? And so playing it out into the
21:29specific is like, okay, well, I make
21:30this post, some people will like it and
21:32some people won't and maybe I'll get
21:33some negative comments. If I get
21:34negative comments, I'll get more reach.
21:35So maybe that's not a terrible thing.
21:36And then and then that night I will have
21:38dinner, [laughter]
21:40right? And that night I will go to bed,
21:42>> right? And so uh making making it really
21:44really specific and then just to add one
21:46more thing on that. The other really big
21:49downside of being human from an
21:50opportunity moneymaking perspective is
21:52that we underestimate the upside and we
21:56overestimate the downside and that has
21:58been incredibly valuable for us to stay
22:00alive
22:00>> and not very valuable for us to make
22:03money. And so when you if you're in the
22:06developed world, the the the absolute
22:08worst case scenario is that you still
22:11have I say fortress, you still have you
22:14still have a cover and you still have
22:15food and you still have air and you
22:16still have water because in the
22:17developed world all those things are
22:19available to anyone. And so it's like
22:20okay so the worst case scenario is that
22:22I live and I'm completely free and no
22:23one bothers me. It's like you know that
22:24actually sounds not so bad [laughter]
22:26>> when you actually play it all the way
22:27out. And so um I think playing it out
22:29and actually really thinking what would
22:31I then do? Well, I'd probably reach out
22:32to Sarah and she would let me sleep on
22:34her couch. Okay. So, and I would I would
22:36ask her if you can play. I'd be like,
22:37"Hey, Sarah, if I were to do something
22:38and I were to fail, how long would you
22:40let me sleep on your couch?" She's like,
22:41"I'd give you 6 months." And you're
22:42like, "Okay." So, it all of a sudden it
22:44becomes concrete. And I think that that
22:47starts to really evaporate fear rather
22:49than like, "Oh, I will die."
22:50>> Alex, we end every episode with a final
22:52five. These questions get asked to
22:53everyone. Um, and so these are your
22:56final five. They have to be answered in
22:57one word to one sentence maximum.
22:59>> Okay. So, question number one, Alex,
23:02what is the best advice you've ever
23:04heard or received?
23:06>> Do so much work it would be unreasonable
23:08for you not to be successful.
23:10>> Second question, what is the worst
23:12advice you've ever heard or received?
23:14>> Follow your passion.
23:16>> Question number three, a piece of advice
23:19you wish you received sooner.
23:22>> Find people better than you and do
23:24whatever you can to get them to help
23:26you, including helping them first
23:27without expectation.
23:29>> [clears throat]
23:29>> Question number four, a lesson that took
23:31you far too many times to learn.
23:34>> Focus. One thing all in.
23:37>> And fifth and final question, we ask
23:39this to every guest who's ever been on
23:40the show. If you could create one law
23:42that everyone had to follow, what would
23:44it be?
23:45>> Everyone has to give all their wealth
23:46away at the end of their life.
23:47>> I love that one.
23:49>> But not to your kids, but not
23:51>> Oh, no. But it has to Yeah, exactly. Has
23:52to be given away
23:53>> to kids or or It doesn't matter.
23:55>> Yeah. Not to your kids. Like your kids.
23:58Yeah. Yeah. Are you saying beyond your
23:59kids? Yeah. My friend just told me the
24:00other day that his dad just took him out
24:02the will [laughter]
24:03and his dad's given all his money away
24:05to charity and all the kids are not
24:07getting anything. He was heartbroken.
24:08[laughter] He was like, "Oh god, I
24:10thought I was going to pay off the
24:11mortgage on my house."
24:11>> It's so funny. So
24:12>> there's a Sanskrit saying around that
24:14which is um uh if you have a good son,
24:19there's no need to accumulate wealth. If
24:21you have a bad son, there's no point to
24:23accumulate wealth. And so at the end of
24:25the day, that's I mean that's my
24:27worldview, which is the reason that I I
24:28want the reason that I would want the
24:30game to be structured so that everybody
24:32has to give all their stuff away at the
24:33end is because if you look at second and
24:35third order consequences of that, the
24:37people who are the best at allocating or
24:38sorry, aggregating capital, the people
24:40are the best at making money uh would be
24:41the ones who are also the best at
24:42allocating it. And so you would actually
24:44have the the best tools and the people
24:46who are best skilled to use them. And so
24:48if you know you have to give it away,
24:50then at some point near the the later
24:51part of your life, you would stop trying
24:53to amass um and start trying to you'd
24:56focus on giving. And I think most people
24:57who do give get addicted to giving
24:59because they realize they actually it
25:01fills a hole that the wealth never did.
25:02Yeah.
25:03>> Right. And so what ends up happening
25:04though is that from a societal
25:05perspective is that if all the best
25:07allocators of capital then tried to
25:08solve all the world's problems with the
25:10capital they had, so many fewer problems
25:12would exist that would the whole world
25:14would get better. The other downstream
25:16effect of that is that it would get rid
25:17of a huge amount of kind of the
25:18cronyism, the the nepatism, the things
25:20where, you know, these these seventh
25:22generation massive, you know, wealth uh
25:25trust fund, you know, kids who like it
25:27doesn't serve the kids either. You look
25:28at those families, they're a mess.
25:29>> Um depression, [clears throat]
25:31>> yeah. Yeah. On on so many reasons. Um
25:34>> and so I'm a big believer in equal
25:35opportunity, not equal outcomes. And so
25:37if everybody's slate was clean day one
25:39because no one got daddy's inheritance,
25:42then everyone starts at zero as close as
25:44possible. Obviously genetics, you know,
25:46can can play play a factor there, but I
25:48think that's as as equal of a start as
25:50we can get. And then everyone starts at
25:53zero and and the ones who super win then
25:56turn into supergivers. And I like that.

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