How To Identify What Business You're REALLY In | Ep 876

April 30, 2025 by Alex Hormozi

"If you think you’re stuck, it’s usually because you’re solving the wrong problem for your business."

"The product of a service business is the service itself—the people who deliver it and the margins you make from them."

"Every business has a big, hairy problem; you just need to identify and confront it."

In this episode, Alex Hormozi elaborates on how entrepreneurs often misdiagnose their business and mistakenly focus on problems that don’t facilitate growth. He states that many business owners think they are in one market when they are actually in another, leading them to waste time and resources on ineffective strategies. For instance, in the fitness industry, realizing that running a gym is more about sales and marketing than just fitness science was pivotal in Hormozi's journey.

He further discusses his experiences in the supplement business, emphasizing the significance of branding and distribution over just having an efficient product. Hormozi also explains his learning curve in the software sector, where he learned that a successful product needs a solid backend and development capabilities, which he initially underestimated.

Hormozi uses examples from various fields, including plumbing and media, to illustrate how business owners often fail to identify their core constraints, thinking they are in marketing and sales rather than talent recruiting or monetization. The episode encourages listeners to zoom out, learn from industry leaders who have successfully navigated the challenges, and confront the real, hairy problems that require their attention. Lastly, Hormozi offers practical advice on assessing whether to push through existing challenges or pivot towards new opportunities, framing these strategies as essential for sustainable growth.

Key Takeaways

Identify the true nature of your business: Often, businesses focus on the wrong problems, mislabeling their core challenges.
Sales and marketing are crucial in service-based industries, even where product quality seems paramount.
Understand your competitive landscape and the true cost of acquiring customers, whether they're clients or talent.
Recognizing the difference between 'features' (inherent industry struggles) and 'bugs' (fixable operational issues) is key to solving problems.
Successful entrepreneurs are those who confront big, hairy problems head-on, embracing the pain for substantial rewards.