Flush the Toilet: Young Entrepreneurs

What’s all this talk about MLM (Multi Level Marketing) that all of your friends, neighbors, and mailmen seem to be trying to get you into? Or what about the time you were at a bar or coffee spot and someone asked you what you do for a living, then asked if you’d like to be financially independent, or if you’d like to retire in 10 years at the age of 30?

I’m sure that you’ve heard those lines before and if you haven’t then you will, just watch.

Ok, this is a good definition of what MLM is:

Selling goods and services through a network of distributors, multi-level marketing is also known as network marketing. The multilevel marketing concept is based on the concept that if a person sign ups to sell a company’s products, the company will pay a commission on all sales generated by that person, as well as the additional distributors the person recruits. Multi-level marketing can create extensive downlines, with thousands of members in each line(source).

Basically, the goal of the business is to convince enough people to join your selling team (your downline) and have them and their families spend all of their money on whatever products the parent company is offering.

A few years back my aunt convinced my older brother to get into the business and he subsequently sucked me into the cult (oh… I mean business). My aunt painted all of these rosy pictures that we’d be basking in riches in a few years if we worked hard enough and always made sure to spend our money to buy the products and of course, to convince a ton of people to also purchase which led to earning points that could be redeemed for cash in what seemed like months later.

Well let me tell you, this MLM stuff definitely was not cool at all. I’d go to these weekly meetings at night where people who supposedly made it big from the business (usually from scamming enough people over a 25 year period) who would be running all over the place screaming how they are going to retire in 2 months and how anyone could be a millionaire in 5 years if they worked hard and spent their cash on theses piece of sh*t products. I wonder if these people were on crack?

I remember it so clearly… I would spend anywhere from $100 - $200 to buy these products every month and even have my mother spend serious cash using my business number (a number that you have to pay $125 to track your sales…insane!), then I would go online or call my upline (the people above you that you basically have to make a lot of money in order to move up in the business) and be informed that I will be receiving say, $75 in commission based upon the points that I racked up from buying suits, food, kitchenware, whatever… and when it came down to actually getting the check it would around $12, I kid you not.

So of course I would call my brother and aunt and they would always have some excuse about the accounting or this and that (BS)… What was really happening is that I was being fed lies about how much I would be making every months. At the end of that day, it all came down to convincing (basically forcing) other people to buy these products, feed them a bunch of BS about the more they buy the closer they’ll be to becoming rich, and ultimately taking their hard earned money to try to move up in the business (and that’s even hard). It never really worked the way that they so excitedly explained at the meetings.

But I couldn’t really blame my brother, because he was also brainwashed into thinking that the business was legit, too. It was basically a legal pyramid scheme. I couldn’t believe what that they were doing. Check this site, it’s a detailed explanation of how they scam you .

Just yesterday a student asked me if he should go the route of a MLM business. I told him that I couldn’t in my right mind send him in that direction. But maybe I was too harsh… just about the only thing MLM networks are good for is the experience that you’ll gain from giving presentations, cold calling, things like that.

But I’m still all about creating a business where you’re in control of how much you make. Starting from scratch. Not a business that you have to spend all of your money and convince others to spend all of their cash in order for you to move up – not for me, sorry.

So be aware of the next time some dude approaches you and asks if you’d like to be “financially independent” in a few years, because if it was that easy millionaires would be popping up all over the place like nothing. It’s never that easy.

Please post a comment and let us know if you’ve ever been a victim of MLM or if you’ve had success with it.