Leila Hormozi on Scaling Smarter, Not Harder

0:0010 years ago, I made the decision to build my personal brand that was elevated, yet approachable, and reflected who I was, not just what I did. I created my website with ShowIt because it's true drag-and-drop freedom, so you can easily build and update your site. Plus, their real human support team, game changer. Want to try it for yourself? Head to jasminestar.com forward slash showit for a 14-day free trial and first month free when you subscribe. You're about to hear a repurposed segment from The Jasmine Star Show, pulled from an incredible conversation Jasmine had with entrepreneur and operator extraordinaire, Leila Hermozzi.

0:34This portion of their discussion delivers some of the most tactical, real talk advice you'll hear on what it actually takes to grow a business beyond six and seven figures. If you're a founder wondering why you feel stuck, how to know what to change in your business, or how to finally step into your role as a CEO, this conversation will be a game changer. Let's get into it. What I want to do is I really want to start with the idea of building. So the whole theme of the podcast is going to be building, and we're going to do it in three sections. So people who are listening right now, somewhere, they're trying to build their first six figures and then to seven figures.

1:08We're talking about like, what are the things that they're going to need to focus on then? And then building and leading a team and then building practical habits. So that's what we're going to start off with. And so I want to start by a conversation before we actually get into building, what I have seen, and please step in and say, no, this is not what I see. I see business owners getting stuck before they even start the idea of building or scaling. So one of the characteristics that we've seen is like, for somebody who's building, and this is what you said, you wrote this on Instagram, that business owners on their way to six figures, the focus should be having to change and iterate quickly.

1:39And then the characteristics of a business owner on the way to seven figures is having the fortitude to stay focused and not change things. So can you talk about this? Business owners who's looking to hit six figures, what might keep them stuck in the process of getting to that point? Yeah, it's often just lack of clarity, right? It's that they don't know what to do. So the biggest problem as somebody that is not at six figures yet, it's just they have no experience and they have no insight and they just really don't know what way is up, right? It's like, do I go left, right, up, down? Like, I don't know.

2:06And so it's often just that they get lost in their own heads. And that's actually what tends to be the issue is they tend to ideate a lot and then hop from idea to idea and not stick through with something enough to even get good at it to find out if it works or not, right? And that's usually what the biggest, you know, I would say like reason that people don't get past six figures, at least from what I've seen, right? I don't have any data on this. What I've noticed is that they tend to start something, they're in the uninformed optimism stage. So they're like, this is the best idea ever. The next, you know, tech stars, the next Facebook, whatever it is.

2:38And then as soon as they get into it, what they realize like anything in life is that then they're in informed pessimism, which is, oh, all this on the other side, which is like with every solution comes a new set of problems. So if you're creating a business that solves a problem, you're also going to come with your solution, like you also get the backlash of that, which is like, what are the consequences, the second order consequences of the business you created? And I think that a lot of times when people experience those second order consequences, then they say, this business isn't right. You know what I mean?

3:06And so more often than not, I think that people, one, don't think through, what are the second order consequences of my business? Just based on the methodology, the way it's structured, the clientele it serves, just like all those. Let's get nitty gritty. So I started my career as a photographer. I saw like a large audience of creative entrepreneurs. And so if we were to take a jewelry maker, if we were to take a photographer, and if we were to take a cake baker, and they're hitting 45 ,000. A month? No. Baby girl, baby girl, we're on a different world. Okay, okay, a year, a year. Remember, remember, we're talking about the business owners getting to their first six figures.

3:42And they're at this point to where they can get a few clients and they can get a few cake orders. And it's like just enough and not enough. And so at this point in time, how do they know what they need to iterate? How do they know what they need to do? Are they in the optimism stage and all of a sudden, I've been doing this two years. I've gone from 37 to 45. I don't see me doing anything different. How do I get to the 100? Interesting. So you're talking more of like a solo operator model. Yeah. Yeah. Solo operator model. Oftentimes for a solo operator, it's being able to stick with the idea and also leverage yourself out.

4:15So now that you've put that in there contextually, a lot of the times what it is, is like you can't get past a certain amount without leveraging yourself. You know what I mean? So like if you own a cake shop and you're still baking the cakes all day, I mean, that's like, I think lean startup uses that methodology. It's like, you can't continue to do that. And I think that oftentimes... It was the e-myth. I think it was... Yeah, e-myth. Okay, e-myth. You just can't do that. And I think that what happens is that most people are just trigger shy to decide what they need to do next, who they need to hire, what systems they need to put in place.

4:43Because you have to have some level of business acumen, right? But at the beginning, you kind of just need to throw it against the wall. Okay. This is so good. This is so good because we're actually going to get into the building and actually the how. And so a large, a large portion of listeners are between that 50 to 150 ,000. And so when you talk about the differences between passing the six figure to the seven figure mark, what's going to keep somebody focused and staying focused? Like when you had said from zero to six figures, it's going to be to iterate on the back of what you're learning.

5:11And then from seven figures to eight, it's going to be staying focused. So people get stuck staying focused. What do you tell people who have a hard time staying focused on? You hit a million, you're at 1.1 and you want to get to three and they want to do a thousand different things. How does somebody hone in their focus? You don't. You just accept the fact that that's how we're designed. Like if you read the book, The Laws of Human Nature, like the grass is always greener on the other side law, right? Which is like our brains are always looking for the next best thing. And so I think, and Alex and I talk about this a lot because he's like, he always says, he's like, you're very patient and focused.

5:44I have all the same thoughts of like, what if we did this? What if we did that? That would be so cool. And I say, that's okay, but I'm not going to do any of that. I'm going to just keep focusing here. And so I think a lot of times focus is accepting the path not taken, right? Because a lot of times we're not focused because we keep thinking about the path that we could take, that we didn't take, that we're not sure if we should take. It's like, just acknowledge that it's okay that that path is there and it's coming into your head, but like, you don't need to do anything about it. So it's not that someone that's more focused doesn't have distracting thoughts.

6:18It's that they don't let distracting thoughts dictate their behavior. See what I'm saying? Totally. It actually happened today. I don't want to admit it. My COO was going to listen to this and I had sent her a message on Slack. And I was like, have you thought about this? And we could do this and this and this. She's like, great. But we could do that in 2025. For now, this is the course. I'm like, you're right. Thanks for like bringing me back. It's like everybody needs somebody like your brain. Because my brain is like all the other stuff and having somebody else to keep them tethered is a good thing.

6:43Okay, so for somebody who is like hearing this, I'm like, okay, I feel like I can leverage myself according to the E-Myth, to get us out and beyond the six-figure mark. And then somebody who's at that seven-figure mark is gonna be like, okay, I can stay focused and put people around me who offset. I actually recently watched one of your Instagram videos about a guy who was asking like, I'm not really an operator. And then you just looked at him and you're like, get an operator. And I was like, wow, deep thoughts. But it's so true. And then you had said, and I really liked this point because somebody who's listening, you had said not to overtitle.

7:11You said probably just start them as a director. Yeah. I was like, oh, this is super interesting. That's going to lead me to my next thing. So you talk a lot about building a team. And on the back of that video that I had seen, I think that when I look back at my career, I think early on, I was hiring a lot of Swiss army knives. Like these are people good. They're good, strong people, good at a lot of different things. And then what I realized as the business grew, I needed specialists. I needed a scalpel. And so as I'm looking through all of these things, let's just say, for example, because I feel like examples work really well for special people, slow.

7:40Like, okay, let's tear it apart. let's say I'm looking for a content director. And what process do I need to get set up? Now, this is going back to the jewelry maker who's looking for her first VA. We're looking at a photographer who's looking for an editor. We're looking for a cake baker who's going to need somebody else to do marketing in her business, right? We're looking at whoever these next people are, specialists in doing this thing. I'm going to be looking for a content director. What systems do I need to have in place to bring in not a Swiss army knife, but a scalpel? I think that that's not a matter of like having systems in place.

8:10It's, so here's the issue. The people that you need at that point are Swiss army knives that must turn into scalpels. So here's what I hire for. So I'll give you an example. Caleb brought him in to handle all of our content. No, Caleb, if y 'all don't creep on Leela like I do, Caleb is one of the very first videographers you guys had ever ever hired. And now he could really has grown in the organization. Yeah. Okay. So he came in and I was like, I was hiring for a videographer, but I was like, listen, man, I actually like need someone that can do video right now. But like in two months, I need you to like build a team.

8:43Like that's ideal. Because here's the thing is that you can either hire one and then honestly, you're not going to need them at some point very soon. Then you have to hire the other person. So there's two ways that you can go about it, right? Either one, you hire the Swift's army knife with knowing that in a year, they most likely are going to end up quitting because you're going to have to start hiring scalpels and they're not going to like that. Most people don't. Now, I try to educate people on this and say like, hey, you're a Swiss army knife. I need you to become a scalpel. Like, here's how it looks.

9:10This is what happens in business. I don't want you to leave. So here's what's going to happen. Right. I always try to like narrate it for them because I know because it's happened enough times. However, a lot of people just don't like that because they're like, well, now you brought someone up above me and there's people around. It's so different. I used to do everything and you took away responsibility. Right. So it's really tough for people to make that transition. But that is one way that you do it is first hire the Swiss Army knife, then bring in the scalpels, try to narrate that for them so they understand this is normal.

9:33When you hire the Swiss Army knife, are you hiring for their potential to become a scalpel or are you fully cognizant? Like this person - So I'm just saying that this is the option that you just hire a Swiss Army knife and you know that they don't have potential to become a scalpel because a smaller business owner often doesn't have the brand or the reach to hire somebody who's a unicorn, like Caleb, for example. Most people that I hired, Sheila, for example, who does, you know, our head of people, I was like, come in, I need you to recruit at first. And she's like, I haven't recruited in years.

9:57I was like, I need you to recruit at first and then build the recruiting team. And then she was like, okay. So she came in and did that. So there's two ways you can really do it, which is either hire the Swiss army and then accept the fact that you're going to have to, it's like in the army, right? It's like there's your session of duty or whatever they call it, right? You have a duration. You're like, I'm here for two years or whatever. It's like that in a lot of businesses. And the reason that a lot of startups get a bad rap is because there's not enough education about this out there for employees that oftentimes the organization has to grow in a manner that they will not like and they won't acclimate to.

10:29I try to always narrate this to my team. I showed my team one time at a team meeting. I said, 99 % of you will not be here in five years. That's the stat. In a startup, from year one to year five, I think it's actually 95. 95 % of employees aren't usually there. Year five. From year one. And it's so funny because I looked back at gym launch in year five and I was like, that is correct. Everyone in that room, pretty much gone. 100 people. Now, is that something I'm proud of? No, because I think that I could have mitigated that if I'd known more. But that is pretty typical. If you have a fast growing business, like if you're starting and right now you're listening to this and you're at like 40 ,000 and then you get to like 10 million, the kind of people even needed, like the kind of Swiss Army Knife you need is so different that it's like, even that's why I talk about not over titling because I'm like, hey, it could grow.

11:13And if it grows, like you want to make sure that title is actually smaller right now so that you can protect yourself and maybe bring someone above them and then educate them. The way I do like to do it, if you do have brand and the ability is to bring someone in, say, I need you to be a Swiss army knife. And then I need you to be able to build a team of scalpels, right? So I would like to, I like to hire from the lead. Because here's the thing, you can hire a bunch of doers. But the issue is this, is that eventually you have to hire a leader anyways. And that leader probably isn't going to have hired the same people you did.

11:40Because they know how to do the job better than you. They know how to build the department better than you. And so even a small business, I think that it is worth reinvesting the resources to hire leadership first. I fully believe that because I've done it both ways. And in the beginning, a few doers, yes. However, very quickly hire the leaders. Like it costs more in the short term and less in the long term. You know what I mean? Because you don't inquire so much managerial debt. Okay. So I heard you on a podcast and there was a guy, it was actually you and Alex were on the podcast and he was kind of like pitching his business for you and Alex to come in.

12:12And you guys were kind of like, oh, like, I just were like, no, no, no, no, that's not the time. and I remember listening and I remember thinking, I was like, is this guy really like getting free consulting and is he really pitching to them right now? And what is your girl doing? I was like, so I have another question. I was like, I'll send you the bill for consulting. No, I'm saying this because one of the things you had said is there's not a lot of education and there's not. There's not a lot of nitty gritty education for us to like stand in the power of knowing at 95 % of the people who want to live in the candy line, like we're building the dream.

12:41There's a lot of times that people don't have the ability to take the dream to where it needs to go. I feel like that statement should be really empowering to people who have felt like, maybe like myself. I felt like I let people down. Like I felt like I had to make moves and understanding the team had to change. So if I had known that step, maybe I would be able to step into it powerfully understanding like this is the cost of growth. Yes, it is the cost of growth. And I think that's what I try to tell people. So I'm like, they make it mean that they're so bad at business. They're like, I had to fire these people that were with me from day one.

13:07I'm like, most people from day one aren't there on day 657. If you've ever felt the tension of loving your business, but not knowing how to grow it, let that conversation be your reminder. You're not broken. You're just building. Layla's advice is a masterclass on how to evolve from scrappy solo operator to strategic CEO. If this episode resonated with you, take a moment to send it to someone who needs to hear it. Or better yet, jot down one actionable step you'll take this week to move forward with focus. Thanks for tuning in. And as always, keep showing up. Growth gets messy, but you're not doing it alone.