MLM: Sounds Like a Pyramid Scheme

June 1st, 2013 by
Categories: Opportunity

At one time or another, everyone has hit a wall.

MLM pyramid scheme cartoon

We’re fed up with our job and frustrated by the lack of opportunities. We’re discouraged that we don’t make enough money. We’re annoyed by the limited time we have for vacations. For some people, that frustration eventually leads to positive change and those thoughts lead them to start their own MLM business, but is it a pyramid scheme?

Here’s how the internal dialogue goes:

“I have decided that my job sucks. I don’t want to be doing this forever. What can I do about it instead of just sitting around and complaining? Hmmm. I remember hearing something interesting about network marketing. Yes, that’s it! I am going to build a network marketing business.”

Great choice.

With the decision to control your own destiny and work for yourself, you need to recognize that people are going to start asking you questions. People will likely ask, how can you make money doing network marketing? Or what are you actually selling? But this gives way to the most commonly asked question…

Isn’t it a pyramid scheme?

In this hilarious video, Pat Petrini highlights the most common question asked of people that own their own network marketing business, and provides some great responses that demonstrate how ridiculous that question really is.

A pyramid scheme is…

a non-sustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, where no actual product or service being exchanged with the public. via Wikipedia

Network marketing is…

a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for creating a group of distributors and customers that consume the product sold by the company. This recruited sales force is referred to as the participant’s “downline”, and can provide multiple levels of compensation. via Wikipedia

There’s a clear difference. No matter what you say, some people don’t want to hear about it and that’s perfectly fine. Some people will make assumptions without taking the time to investigate for themselves, and that is not your error to correct.

They’ll refer to their brother-in-law, cousin, or friend of a friend who is convinced that any MLM business is a pyramid scheme. Even though they have no ACTUAL experience with multi-level marketing, but refuse to believe anything different.

If you buy someone’s opinion, you buy their lifestyle.

Let’s look at some people who have changed the world and built billion dollar wealth in the process. What do they have to say about multi-level marketing?

If I would be given a chance to start all over again, I would choose network marketing.
     ~ Bill Gates, Net Worth $73 Billion

This is the best investment I have ever made, investing in Network Marketing Companies.
     ~ Warren Buffet, Net Worth $60 Billion

I am often asked if Network Marketing is a Pyramid Scheme. My reply is that corporations really are pyramid schemes. A corporation has only one person at the top, generally the CEO, and everyone else below.
     ~ Donald Trump, Net Worth $2.9 Billion

We’re in the midst of a boom in home-based businesses, and it shows no sign of slowing.
     ~ Paul Zane Pilzer, Net Worth $10 Million

Network marketing teaches basic, critical life skills. It teaches people how to overcome their fears, how to communicate, and how to handle rejection and maintain persistence. This kind of education is absolutely priceless. Here’s what I tell people: “Even if you don’t like it, stay with it for five years and you’ll be better equipped to survive in the real world of business. And you’ll be a better person.” The people who are successful in network marketing have a spiritual cause. They genuinely want to help better others’ lives. If you don’t have that, if you just want a paycheck, work for the post office!
     ~ Robert Kiyosaki, Net Worth $80 Million

Are you going to listen to your brother-in-law, or some of the most successful entrepreneurs of this generation? The choice is yours. Continue to work at a job you hate, or create a new path for yourself of endless opportunities.

Matt likes to get his feet wet in whatever he can. Constantly seeking new adventures and following his curiosity, Matt has a diverse resume that includes an expansive scope of business, team building, and management experience. He brings a wide range of knowledge to the CatalystMLM team, and he shares the passion of encouraging people to reach for their dreams and achieve success in network marketing. His mission is to help others, no matter what level of experience and entrepreneurship they’ve established.

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  • Dan DeBiase

    Great article Matt!

  • Chris Brogan

    Super fun! Thanks for sharing this. :)