"We Can't Find Employees"
A business owner selling custom cowboy hats generates $2M revenue but is supply-constrained by a shortage of skilled hatmakers. The discussion reveals that despite good margins (40-45%), the owner needs to increase compensation to attract talent to Kentucky and solve the staffing bottleneck.
Summary
The conversation centers on a cowboy hat business generating $2 million in revenue with products priced between $800-$1,200. The owner wants to scale to $5 million but faces a critical supply constraint - finding skilled hatmakers. The owner believes hatmaking is a dying trade that takes years to master, and expresses skepticism about recruiters' ability to find qualified candidates. The advisor suggests that the real issue isn't the availability of hatmakers, but rather the compensation being offered. The business maintains healthy margins of 40-45%, which provides room for increased labor costs. The core problem is identified as underpricing talent - the owner needs 2-3 additional hatmakers to reach their growth target of $5-7 million revenue. The solution proposed involves significantly increasing compensation to attract workers willing to relocate to Kentucky and undergo the necessary training, while still maintaining profitable margins given the business's pricing power.
About this episode
Download your free scaling roadmap here: https://www.acquisition.com/roadmap-yt-d The easiest business I can help you start (free trial): https://www.skool.com/hormozi Business owners: Want to scale faster? We provide in-person advisory for companies doing at least $1M per year: https://www.acquisition.com/workshop-yt-d If you’re new to my channel, my name is Alex Hormozi. I’m the founder and managing partner of Acquisition.com. It’s a family office, which is just a formal way of saying we invest our own money into companies. Our 10 portfolio companies bring in over $250,000,000+ per year. Our ownership stake varies between 20% and 100% of them. Given this is a YT channel, and anyone can claim anything, I’ll give you some stuff you can google to verify below. How I got here… 21: Graduated Vanderbilt in 3 years Magna Cum Laude, and took a fancy consulting job. 23 yrs old: Left my fancy consulting job to start a business (a gym). 24 yrs old: Opened 5 gym locations. 26 yrs old: Closed down 6th gym. Lost everything. 26 yrs old: Got back to launching gyms (launched 33). Then, lost everything for a 2nd time. 26 yrs old: In desperation, started licensing model as a hail mary. It worked. 27 yrs old: "Gym Launch" does $3M profit the next 6 months. Then $17M profit next 12 months. 28 yrs old: Started Prestige Labs. $20M the first year. 29 yrs old: Launched ALAN, a software company for agencies to work leads for customers. Scaled to $1.7mmo within 6 months. 31 yrs old: Sold 75% of UseAlan to a strategic buyer in an all stock deal. 31 yrs old: Sold 66% of Gym Launch & Prestige Labs at $46.2M valuation in all-cash deal to American Pacific Group. (you can google it) 31 yrs old: Started our family office Acquisition.com. We invest and scale companies using the $42M in distributions we had taken + the cash from the $46.2M exit. 32 yrs old: Started making free content showing how we grow companies to make real business education accessible to everyone (and) to attract business owners to invest or scale their businesses. 34 yrs old: I became co-owner of https://Skool.com, which is a platform for people to build communities online, making a living doing what they love, with people like them. 36 yrs old: I did a $106M book launch selling 3.6M copies of my $100M Money Models book, in 72 hours, breaking the Guinness world record for the fastest selling non-fiction book of all time. Today: Our portfolio now does $200M/yr between 10 companies. The largest doing $100M/yr the smallest doing $5M per year. Our ownership varies between 20% and 100% ownership of the companies. Many of them we invested in early and helped grow (which is how we make our money - not youtube videos). To all the gladiators in the arena, we’re all in the middle of writing our own stories. The worse the monsters, the more epic the story. You either get an epic outcome or an epic story. Both mean you win. Keep crushing. May your desires be greater than your obstacles. Never quit, Alex DISCLOSURE Information shared here is for educational purposes only. Individuals and business owners should evaluate their own business strategies, and identify any potential risks. The information shared here is not a guarantee of success. Your results may vary. Copyright © 2026.
Key Insights
- The advisor argues that recruiters can find hatmakers by simply Googling hatmaker businesses and calling owners directly
- The advisor claims the business owner is underpricing their talent, stating that people don't want to be in Kentucky for what they currently pay
- The advisor suggests the solution is determining how much more to pay workers to get them willing to move to Kentucky and go through training while maintaining good margins
Topics
Transcript
[0:00] I sell cowboy hats and custom hats. >> Sweet. >> We do around 2 million in revenue right now. I'd like to be at five. >> What's the price of the hat >> right now? Anywhere from 800 to,200. >> Okay. >> The issue is I can double the paid ads, double the content, like you say, but I can't make the hats. >> Okay. So, you're supply constrainted. >> Totally. It takes years to take somebody and make them into a master hatmaker and it's a dying trade. I don't feel like recruiters can find hat makers. Maybe I'm wrong. I don't know. >> I think they can totally find haters. You think so? I mean, I would…
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