Alex Hormozi emphasizes the importance of choosing the right people to guide and support one's business and personal wealth, highlighting that integrity and skill are crucial traits in advisors. He shares insights from his own experience as a business owner with an $85 million portfolio aiming for a billion in revenue. Hormozi outlines a process for assessing advisors' integrity through extensive interviewing and ensuring aligned incentives, while skill evaluation involves personal education and expert consultations. He concludes with the profound notion that true success lies in being surrounded by people who genuinely care for you, even in perilous times, suggesting that trustworthiness often trumps sheer expertise.
"Selecting the right people can make or break your life and the trajectory of your business."
This quote highlights the importance of choosing the right individuals for one's personal and professional circles. It sets the stage for discussing the significance of having trustworthy and skilled advisors.
"So the first is integrity. And I know that might sound silly, but when you think about it, you need someone who you can trust."
Alex Ramosi identifies integrity as a foundational trait for anyone providing counsel. He emphasizes the need for trustworthiness in those handling your affairs.
"The second is efficacy or their skill set."
This quote underlines the importance of having advisors who are not only trustworthy but also highly skilled and effective in their respective areas of expertise.
"So let's think of different scenarios here. So let's say you might trust your mom implicitly, but she doesn't have the skill of knowing much about how to structure insurance policies or trusts or investments in tech startups, right?"
This quote provides an example to illustrate the need for a balance between trust and skill. It shows that personal trust does not equate to professional competence.
"And for those who don't know me, my name is Alex Ramosi. I own a portfolio of companies that does about $85 million a year."
The quote introduces Alex Ramosi and his business accomplishments, providing context for his insights on the importance of selecting the right people for business success.
"One is I always try and interview as many advisors as humanly possible, all right? And I do that because I'm going to get as much information from each of the council during this process that will give me perspective from which to make a judgment, right."
This quote highlights the strategy of interviewing numerous advisors to collect extensive information, which aids in making well-informed decisions.
"So let me give you an example. So in the real estate market, if you're a realtor, for example, you may think, oh, this realtor has my best interest at heart, right? Because they have an incentive to sell the house. And so that is why they're going to get compensated. So they want to sell it for as much as possible."
This quote introduces the concept of incentive misalignment using a realtor as an example, where the apparent incentive to sell a house for the highest price may conflict with the incentive to sell quickly.
"And so for them, the, the $50,000 decrease to drop you from 500 to 450 means that they're going to give up $2,500. So they're going to make 22,500. So let me ask you a question now, in the reverse, if they sell for 525, they're going to get 27,500, right? And so it's a $5,000 swing off of a $25,000 nut for them, and one of them might take them three months, and one of them might take them a day. So what is their incentive?"
The quote provides a detailed explanation of how a realtor's commission is affected by the sale price of a house, demonstrating that a realtor may prioritize a quick sale over the client's financial gain.
"The only ask that I can ever have of you guys is that you help me spread the word so we can help more entrepreneurs make more money, feed their families, make better products, and have better experiences for their employees and customers."
The quote highlights the purpose behind the request for audience support, which is to extend the podcast's reach and positive impact on entrepreneurs.
"And so now they're highly incentivized to push, and now your incentives are aligned because each increment for you is worth almost as much it is to them."
This quote explains how a tiered incentive structure can motivate advisors to work harder for higher results, ensuring their goals are in sync with the entrepreneur's.
"And so when you do these interviews, and this is the lazy part, this is what most people don't do is they won't do this work."
The quote suggests that conducting thorough interviews to assess the skill set of potential advisors is often neglected, which is a critical step in making informed decisions.
"That one decision can be one of the most, if not the biggest influence on your total net worth over a long period of time."
This quote emphasizes that a single financial decision can have a profound impact on long-term wealth, highlighting the importance of making such decisions with great care.
"Do I think this person is integris? Do I think this person has my best interest at heart? And then two, do they have the skill to deliver on that promise?"
Alex Ramosi outlines two key questions to ask when evaluating a potential financial advisor, focusing on their integrity and competence.
"In the insurance industry, they're kind of incentivized to rip you off. It's pretty terrible. And there's a lot of industries like that, mortgage brokers are incentivized to rip you off."
Alex Ramosi points out the unfortunate reality that some industry professionals are motivated to act against their clients' interests, which underscores the importance of being vigilant when choosing an advisor.
"These types of decisions can make the biggest impact on your net worth and your financial future simply based on who you decide to work with."
Alex Ramosi emphasizes that the choice of financial advisor can significantly affect one's financial trajectory, making the selection process critical.
"He defines a successful life based on the number of people who truly love you when you die."
Alex Ramosi shares Warren Buffett's measure of a successful life, highlighting the importance of deep, genuine relationships over material success.
"Would this person hide me if the Nazis were coming? And that's been such a powerful frame for me to think through."
Alex Ramosi elaborates on a profound standard for judging character and trustworthiness, which he applies to both personal relationships and business dealings.
"I would rather have somebody who I trust, their intention, and I have eight, an eight out of ten on the efficacy than somebody whose intentions I am unsure of. And they have a ten on ten of the efficacy."
Alex Ramosi expresses his personal preference for trustworthiness and good intentions over flawless capability, suggesting that integrity is a critical factor in business relationships.