The 6 Levels of Making Money | Ep 955 - The Game with Alex Hormozi Recap
Podcast: The Game with Alex Hormozi
Published: 2026-03-24T09:00:00.000Z
Duration: 1036
What Happened
Alex Hormozi begins by categorizing the four primary ways to acquire money: stealing, inheriting, marrying into it, and trading for it, emphasizing that most people will find themselves trading. He elaborates on how he made a million dollars 106 times over a weekend and owns a portfolio of companies that generated over $250 million in revenue last year.
In the episode, Hormozi outlines six schemes of trading work for money, starting with 'I work, then you pay,' which he describes as the most reliable method but with limited upside. The second scheme, 'You pay as we go,' is typical for contractors who get paid in installments, yet face higher turnover rates compared to employees.
The third scheme, 'You pay, then I work,' allows for greater leverage, as illustrated by professionals like surgeons who require payment upfront. This model is beneficial if one can command such terms, reducing the risk of non-payment.
The fourth scheme is outcome-based payment structures, where compensation is tied to achieving specific results. This model is less risky for skilled individuals, as compensation is based on outcomes rather than time spent working.
The fifth and sixth schemes involve buying and selling risk, such as insurance, and getting paid regardless of performance, like taxation by the government. Hormozi notes that these models are difficult to achieve but offer substantial rewards due to the unique nature of risk management.
Hormozi emphasizes the importance of understanding and managing perceived risk, citing Peter Thiel's and Jeff Bezos' views on risk-taking. He argues that successful individuals often take on perceived high risks that they understand well, leading to disproportionate rewards.
Key Insights
- Alex Hormozi identifies six levels of trading work for money, starting from basic employment to complex risk management strategies. Each level offers different risk-reward balances.
- The 'I work, then you pay' model is reliable but limits earning potential. In contrast, 'You pay, then I work' and outcome-based models offer higher leverage and rewards.
- Buying and selling risk, as seen in the insurance industry, allows for compensation even when nothing happens, highlighting the importance of risk management in financial success.
- Understanding and managing perceived risk can lead to significant financial rewards. Successful individuals like Elon Musk and Jeff Bezos often take on risks that appear high to others but are calculated and well-understood.