Ownership Creates Wealth

Alex Hormozi shares his perspective on selling businesses versus maintaining ownership, reflecting on his experience selling Gym Launch and his evolution in understanding business strategy and wealth creation.

Key Points:

• Evolution of Understanding Business Sales:

  • Initially sold Gym Launch for $46.2M after taking $40M in distributions
  • Still maintains 1/3 ownership, potential for $100M on next exit at $250M valuation
  • Acknowledges it wasn't the best financial decision in retrospect

• Learning About Leverage:

  • Didn't fully understand debt mechanics at the time
  • Realized buyers leverage 80-90% of purchase price through debt
  • Could have kept ownership and pulled similar money out through refinancing

• Why He Sold Despite These Factors:

  • Was emotionally done with the business
  • Needed space to create Acquisition.com
  • Sale provided credibility for next ventures
  • Personal brand benefited from public exit

• Current Philosophy on Ownership:

  • Prefers to be long-term holder of businesses
  • Only sells if founder specifically needs/wants exit
  • Focuses on compounding investments over time
  • Views businesses as long-term wealth creation vehicles

• Strategic Evolution:

  • Moved from tactical understanding (growing business) to strategic thinking (financing, leverage)
  • Learned importance of understanding both business operations and financial engineering
  • Now approaches acquisitions with long-term ownership mindset

• Key Learning:

  • "Life is basically looking back and being like I was such an idiot and that's how I mark years of time"
  • Each experience provides new understanding about better ways to structure deals and create wealth