The Vendor-to-In-House Playbook
Hire the best vendor, insert an interface hire, then absorb the function in-house
- Difficulty
- Moderate
- Time to result
- ~months to results
- Steps
- 5
- Confidence
- 84%
Hormozi's playbook for internalizing any function starts by paying the best person already doing it at a high level, buying proven quality rather than betting on a cheap unknown. He's explicit with that vendor from day one that the intent is to take the work in-house eventually. He then hires one internal person with the right skill set to act as the interface between his company and the vendor, which is the channel through which knowledge transfers. Running both in parallel doubles output for a period. When the in-house person's work provably beats the vendor's, he fires the vendor. The sequence protects quality throughout the transition instead of gambling on an early, cold in-house build. He applied it across podcast, LinkedIn, YouTube, and short-form production.
Origin
Extracted from Deep Dive with Ali Abdaal, where Hormozi described his roughly hundred-thousand-a-month content operation and the simple playbook behind staffing it.
Core principles
- 01Start with proven excellence by paying whoever is already doing it at a high level
- 02Be explicit up front that your intent is to bring the function in-house
- 03An internal interface hire is what lets knowledge transfer from vendor to company
- 04You only cut the vendor once the in-house capability provably beats it
How to run it
- 1
Buy proven excellence
Find the best person or vendor already producing at a high level and pay whatever it takes to engage them.
Watch out Don't start with the cheapest option; you're buying a quality benchmark to learn from.
- 2
Declare your intent
Tell the vendor openly that you plan to internalize the function over the long haul.
- 3
Hire the interface
Bring on one internal person with the relevant skill set to sit between your company and the vendor.
Pro tip This role is the conduit for transferring the vendor's know-how into your team.
- 4
Run parallel and double volume
Have the vendor and the in-house person each produce, doubling output during the transition.
- 5
Cut the vendor on proof
Once the in-house person's output beats the vendor's, end the vendor relationship.
Watch out Cutting before in-house provably wins risks a quality drop.
In the wild
Hormozi staffed his content operation with a podcast vendor, a LinkedIn vendor, a YouTube vendor, and a short-form vendor, plus four in-house people. Each vendor is the best available, hired with the stated plan to internalize, with in-house staff learning the interface until they can outproduce and replace the vendor.
→ A roughly hundred-thousand-a-month engine across every platform, transitioning to in-house without quality loss.
Common mistakes
Starting cheap instead of best
Hiring the lowest bidder first gives you no quality benchmark to learn from and internalize.
Firing the vendor too early
Cutting the vendor before in-house provably beats them causes an avoidable drop in output quality.
Is it for you?
Best for
Founders scaling a repeatable function like content who want in-house capability without a quality drop.
Not ideal for
One-off projects or functions too small to ever justify a dedicated internal hire.
From the transcript
“go find the best person who's already doing this at a high level pay whatever to get them to do it be clear that your…”
“when the in-house person beats the vendor you fire the vendor”
From the episode
Alex Hormozi: How He Built A $150 Million Empire And His Best Business Advice
Alex Hormozi