Money model

What It Means

A money model is the term Alex Hormozi uses in $100M Money Models (2025) for the planned sequence of offers a business makes to each customer: what it offers, when, and how. The book sets a target for that sequence: within thirty days, one customer should bring in enough to pay for getting and serving at least two more customers. It's his framework for planning offers, and he presents the thirty-day target as his own goal, not an industry standard.

How People Say It at Work

• "Our ads work, it's the money model that's broken."
• "What's the upsell in our money model?"
• "We need a continuity offer so people keep paying."

The Breakdown

Formula

Hormozi's test for a money model compares two numbers over a customer's first 30 days:

Money from one customer in 30 days ≥ 2 × (cost to get one customer + cost to serve one customer)

The three stages, as the book names them

Worked example. A small gym (made-up numbers) spends $200 to win a member and $100 to serve them in the first month. Its starter program brings in $300, and members who finish it are offered a coaching package; on average that adds $350 within 30 days. That's $650 against a goal of 2 × $300 = $600, so by Hormozi's measure each new member pays for two more.

Benchmark. The 30-day target above is the author's own goal. Most published guides judge acquisition on a longer clock: the SaaS guides cited for CACCustomer acquisition cost (CAC)The average amount a business spends on sales and marketing to win one new paying customer. See more payback period commonly call 12 months or less healthy, and Harvard Business School Online gives an LTV to CAC ratioLTV to CAC ratioCustomer lifetime value divided by customer acquisition cost, showing how many dollars a customer brings in for each dollar spent winning them. See more of at least 3 to 1 as the benchmark in most industries.

Where It Comes From

The term comes from Alex Hormozi's book $100M Money Models: How To Make Money, published August 20, 2025, the third in his series after $100M Offers (2021) and $100M Leads (2023).

Good to Know

If continuity means automatic renewal, tell customers plainly what they'll be charged, when, and how to cancel, and check the consumer protection rules where you sell before launching it. When comparing this test with a CAC payback figure, use the same measure on both sides: the payback page counts gross profit, so count gross profit here too, or label which one you used.

Related Terms and Categories

• Grand Slam Offer

  Alex Hormozi's name, from $100M Offers (2021), for an offer built to be so different and so good that buyers stop comparing it with anyone else's.

• Customer acquisition cost (CAC)

  The average amount a business spends on sales and marketing to win one new paying customer.

Business and entrepreneur terms