Alex Hormozi: Why The First $100k is the Toughest | Charlie Munger Secrets

Last updated: Jun 14, 2023

The video discusses why the first $100k is the hardest to make and the reasons behind it, including the limited thinking of only pursuing time-for-money opportunities and the lack of leverage when starting out.

This video by Alex Hormozi was published on Jan 14, 2021.
Video length: 10:46.

In this video, Alex Hormozi discusses why the first $100k is the toughest to make, citing Charlie Munger's quote that the first $100k is the hardest amount of money to make.

Hormozi explains that setting the goal at $100k limits opportunities to time-for-money vehicles and lacks leverage, making it inefficient and requiring a lot of effort. However, once the first $100k is made, it becomes easier to delegate tasks and have leverage, allowing for faster growth.

Hormozi also shares his personal experience of the first $100k being the most meaningful and impactful.

  • Setting the goal at $100k limits opportunities to time-for-money vehicles.
  • Starting out with no leverage makes it inefficient and time-consuming.
  • Once the first $100k is made, leverage can be gained by paying others to do tasks.
  • The first $100k is the most impactful because it provides a sense of security.
  • Thinking differently is necessary to make more than $100k.
  • Leverage is the key to scaling a business beyond the first $100k.
  • The first $100k provides a sense of security and stability.
  • People often limit themselves to time-for-money opportunities.
  • Acquiring skills and putting them in your toolkit makes you inherently more valuable.
  • You can't be busy and broke at the same time.
  • After making the first $100k, you can start leveling up your skill set.

Why The First $100k is the Toughest | Charlie Munger Secrets - YouTube

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Why the First $100k is the Toughest

  • Setting the goal at $100k limits opportunities to time-for-money vehicles.
  • Starting out with no leverage makes it inefficient and time-consuming.
  • Once the first $100k is made, leverage can be gained by paying others to do tasks.
  • The first $100k is the most impactful because it provides a sense of security.
  • Most successful people started with something that got them to $100k.
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Thinking Differently

  • Thinking differently is necessary to make more than $100k.
  • Thinking differently means finding ways to operate and do business that don't rely on selling time for money.
  • Thinking differently means finding ways to leverage resources and people to scale the business.
  • Thinking differently means being open to new opportunities and not limiting oneself to a specific goal.
  • Thinking differently means being willing to take risks and try new things.
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The Importance of Leverage

  • Leverage is the key to scaling a business beyond the first $100k.
  • Leverage can be gained by paying others to do tasks and freeing up time.
  • Leverage can be gained by investing in advertising and marketing to reach a wider audience.
  • Leverage can be gained by creating systems and processes that can be replicated and scaled.
  • Leverage allows for faster growth and more efficient use of resources.
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Why The First $100k is the Toughest | Charlie Munger Secrets - YouTube

The Value of Security

  • The first $100k provides a sense of security and stability.
  • Having a financial cushion allows for more freedom and less stress.
  • The value of security is not just financial, but also emotional and mental.
  • Security allows for more focus on growth and expansion rather than survival.
  • Security can be a motivator to continue pushing and striving for success.
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The Difficulty of Making the First $100k

  • People often limit themselves to time-for-money opportunities.
  • Outsourcing work without replacing it with higher value skills is a mistake.
  • Thinking about your business in terms of what it would take to make a million or 10 million dollars can help you identify different vehicles to get there.
  • There are many opportunities to immediately get more leverage on your time.
  • Acquiring skills and putting them in your toolkit makes you inherently more valuable.
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Acquiring Skills and Building Your Skill Set

  • Think of your journey as an entrepreneur in terms of skill set stacking.
  • Acquiring skills and putting them in your toolkit makes you inherently more valuable.
  • As your skill set increases, the base level of your building rises, and the level you can fall down to continues to be higher.
  • Volume of work for a specific skill with deliberate effort will improve your skill set.
  • Some people acquire skills faster than others by being more deliberate with their practice or getting mentors and experts to feed into them.
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Trading Time for Money and Avoiding Being Busy and Broke

  • You can't be busy and broke at the same time.
  • If you're busy, you should be making money.
  • If you're broke, you're not busy, which means you've got time.
  • You can always trade back and forth time for money.
  • If you feel like you are busy and broke, you're wasting a lot of your time.
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Leveling Up Your Skill Set and Identifying Opportunities

  • After making the first $100k, you can start leveling up your skill set.
  • You can pay for skills and pay for things to happen faster.
  • You can pay for other people to do some of the lower value work that you're doing.
  • Building the foundation of your skills eventually becomes a skyscraper.
  • You'll have the perspective to identify the 10 million, 100 million, and billion dollar opportunities and go all in on them.

Watch the video on YouTube:
Why The First $100k is the Toughest | Charlie Munger Secrets - YouTube

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