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How Do MLM Companies Defend Themselves Against Being Classed as Pyramid Schemes? - How Money Works

Frames How Do MLM Companies Defend Themselves Against Being Classed as Pyramid Schemes? - How Money Works

Description How Do MLM Companies Defend Themselves Against Being Classed as Pyramid Schemes? - How Money Works

Comments How Do MLM Companies Defend Themselves Against Being Classed as Pyramid Schemes? - How Money Works

Sign up for my newsletter compoundeddailycom 👈 Comment from : How Money Works

Why is it "DLM" in the title?brAlso, it now seems rather strange with the video of "why MLM's are worse than Pyramid Schemes", or is this the video defending them, so that you give both sides a voice? Comment from : egal17

Amway has or at least had a 10 customer rule You should not be able to be a wholesale customer and still access bonuses or Points Value If you dont retail to customers your not in a credible business If this is not enforced the credability is gone Its a good opportunity for anyone to build a network and thus scale but the focus on business building and no retail is negative This is what gives the bad impression Love the video content Comment from : Doug Lachman

How come you radically changed your mind about MLM? Comment from : The_Rebel

I have a family member who has done several MLMs Despite claiming to make “over 30k a month” she had quit and started several new ones It’s almost as is these businesses don’t actually make her a profit! And to this day she won’t show me her tax returns when I asked her to prove her wild profit claims Comment from : John H

done Comment from : Brave Shine

Where are you getting this information that Amway's products are cheaper than products available in stores? Your information is completely false At target you get that lysol spray in your for $399 and the value size at Walmart is $618brbrIt's so ironic that you are making a defense that's not true in your anti MLM video and you're using numbers that are false just like the MLM industry This is pitiful, do better Comment from : Milap Mehta

I'll save you 10 mins - people who join MLM are just as greedy at the person who starts it Simple math tells you you have to screw the people under you to get rich quick Thats why MLM survives throughout time Comment from : Tamara I

I was pulled into an MLM, two actually, by an ex- I have never seen such religious fervor outside a church MLMs are cults of capitalism that prey on financially unsavvy people Especially sad was how MLMs specifically target strong family ties, as they are well aware of the immense pressure this places on relatives to buy-in MLMs are evilbrbrI did win a Versace scarf in a raffle once though, so it wasn't all bad Comment from : Felcaster

I cannot agree that it is good for anyone to sign up Anyone that wants to join an MLM is likely already not doing well It is like recommending they buy lottery tickets The chance of success for so many reasons is so low Comment from : Tyler Shaw

This is imo the best MLM video I've ever seen Love it <3 Comment from : Jan Nový

I fell for one of the insurance mlms back in the day At least I got a free financial seminar out of the deal Comment from : DBens Drawin Vids

Me: Opens this videobrYouTube: Let’s start him off with an ad for a pyramid scheme Comment from : The_stewbear

If you need a protein drinkmake it yourselfsimples ! Comment from : ScotlandMaggieJiggs

997 of all MLM IBOS lose money Comment from : MLM is Fraud

I went to an Amway promotion event out of curiosity and it was nothing short of a cult following I felt super alienated The people there were chanting weird shizz about striking it rich and living the American dream and all that, but in reality they are just stay at home moms who are too bored and would like to meet other stay at home moms with the promise of making an extra buck doing this glorified sales jobbrThe MLM also had a confusing sales to point conversion system and 'promotion' and 'ranking' to gamify the process, but somehow a lot of people were scarily enthusiastic about the system To me, either they are delusional, or they are paid actors to make the event look like a huge success on paper with an enthusiastic crowd and big turn out They really should look at their monthly paycheck to decide if joining an MLM is worth the time and effort compared to other jobs Comment from : Khanh Kha Minh

It's incorrect that MLM is just like any other business What business has over 99 failure while promising the world? Herbalife isn't even about selling the product to make money, its about recruiting others There in lies the secret Just because they don't take all a person's life savings doesn't make it right MLM basically try to steal a couple hundred dollars from everyone That doesn't seem like a big deal compared to schemes where a person's entire life savings disappear Comment from : LHT Nguyen

to "defend the indefensible" i will go a step in an alternative direction there is a legitimate subset of products that just CANT be marketed in the same way that others can its easy to market house cleaner or makeup but marketing something that takes education and validation by peer reviews studies thats not easy to do in a 30 second commercial Comment from : A T O M E N T

These were some impressive, olympics-level mental gymnastics, not gonna lie Comment from : Aldo Roberto

A friend of mine got involved in a MLM and even invited me over to his place to have one of their salespeople hype it up to me I thought it sounded dumb at the time Like why would I buy overpriced consumer goods from my friend's MLM when I could get the same goods at King Soopers for less money and without having to wait for them to ship? Comment from : Vircervo Teksisto

I think you have a lot of talent and your channel has a lot potential, but I’m not a huge fan of this “defending the indefensible” The devil doesn’t need an advocate! Each of these industries or segments has plenty of paid propagandists defending the indefensible I think your time and talent would be better used to strongly argue for positions you actually hold, rather than this sort of… intellectual exercise Comment from : Rob Hebert

There are three kinds of pyramid schemes, multi-level marketing is just the only one that's legal Comment from : thecianinator

searching and searching for good vids on mlm i found something! thanks! subscribed Comment from : aice336

Yeah, these companies are experts at handling objections Comment from : akiko Isobel

The US military made financial training against MLMs mandatory for military spouses Comment from : vxicepickxv

mlm is basically like working in sales but with no base salary and thus all the risks being offloaded on to you Comment from : РОГОФОС

Mlms are a legal scam, don't do it 🙂❤️✌️ Comment from : mark richardson

Tl dr: start your own mlm business to become rich Comment from : Cryptaveli

Avon? This is odd to me, because here in Brazil we have thousands of people making main or extra source of money selling Avon The one to one salesperson concept Herbalife once in my life I saw the true concept, so, mostly, is a scam Comment from : Bruno Branco Pontarolli

I went to (SC) Amway website, I can't understand why ppl would pay that much money for second hand products! my cousin sold Mary-Kay, another great MLM! she actually won a car from getting high sales in her district all a scam on ignorant poor ppl who are looking for a dream they can make reality but, aside from my cousin delwho got really lucky and sold a lot of stuff to friends and co-workers/del , Idk anyone who was successful at it cause it's a racket Comment from : Needful Things Designs

I finally joined! idk why I haven't sooner, I watch the eff out this channel and rewatch it over and over every other month! Great content bro, keep it coming Comment from : Needful Things Designs

I’ve been a been binging your channel for and this video is the first to give me serious pause I kept waiting for the other shoe to drop and present the actual fact of the business model but you kept it so close to the industry talking points that I’m concerned you’ve missed the point The business model is not, and has never been, about the products The product is creating the illusion of profits that can be made from building your “upstream” It has been shown time an time again that it is virtually impossible to make money after a certain level of market saturation and that the name of the game is getting people to invest in the so called low overhead “small business” and moving that money up to the top It has a long history of lobbying against regulation despite what we know and the branding and image they have created as an industry has been pushing the narratives that you discussed to convince people that they are a legitimate business They are not, it is not a sustainable business model, and it has financially ruined thousands of people lives who are typically not well off There is a great podcast series called “the dream” that takes you through all of this, if you have the time to give it a listen I think you would consider taking this video down as it has the potential to show a so called “balanced opinion” that might legitimize this industry I seriously believe you’ll see the mistake and danger in not calling these companies out right scams Comment from : Riley Millican

This series is fantastic, btw There are so many "mlms-are-evil" videos whose main resource seems to be each other This feels like you actually thought about it Comment from : Seth Trey

Mum’s Losing Money is the best way I’ve ever heard these scams described They’re no better than Madoff or Ponzi himself just with a veneer of legitimacy by selling a product Comment from : The Peacock Rhino

well, i'm gonna flat out calling it a scam since it's essentially a SCAM! most people are suckered into it for variety of reasons, you don't make any money unless you are at the top! the promises of making money hand over fist is just a salesman's pitch, a very bad one at that but that still suckered crap loads of ppl into this SCAM! Comment from : kunzilla

If you are thinking of going into business fulltime, and you can't be bothered to do your own research, joining a MLM will not save you from your own incompetence You will just lose less money than you would have had you built your own business, and you will have a giant gap in your resume Try explaining that one to HR Comment from : jpm8288

I believe when they say "they're mathematically destined to fail" its referring to individuals that join these MLM have really low chances of success Comment from : Castle Mason

I hate MLMs with a passion, but you make some great points brOne thing though, not every country has these "evolved" ones Around here, the old "we will pressure you into burning all your social bridges with guilt trips and plain bullying" method is alive and well Comment from : cchutney

The top earners in MLM make their money speaking about Stadium Events, selling tapes, CDs and selling books giving advice on how to run an MLM Business You missed the main point that the money is not in Selling MLM Products but by selling Motivational/Training material to other MLM members Comment from : MLM is Fraud

MLMs are trash Buyer beware And Costco is not a fair comparison because once you spend the $50 membership fee the discount is available to you for the rest of the year regardless of whether you buy one item or a hundred A lot of these MLMs require you to make a certain amount of purchases every month or quarter in order to keep your "discount" Even if you don't sell the merchandise you are still pressured to buy to maintain your status Also, Costco doesn't pressure me to go find other customers to join Comment from : Carol Perdue

This was a great video MLM isn’t necessarily a scam, it’s like a private franchise Comment from : AdminTuning

The actual legal issue of whether MLMs are a scam has little to do with these arguments The argument is, the company (and those few that do make tons of money) makes the overwhelming majority of their profits off recruitment, not the product they're selling brbrIt's better to look at it as a Ponzi scheme In a ponzi scheme, the first people in actually do make money But that money comes from other investors, not a return on an investment In an MLM, the people who make real money, are not making it from end customers They're making it off commissions from people they recruited And more often than not, the commission is on products the people they recruited bought, not actual customers Therefore, most MLM make less than 15 of their profits from end customers Instead, they make their profits off their own employees Much like a traditional ponzi scheme, the first people will make money regardless of how the "investment" or product does But that only remains true for as long as they're able to recruit more sales agents Comment from : Cameron Hall

You lost me when you said “whilst” Comment from : Goberry

I was just thinking about this a few days ago so glad I found this!!brbrAnd since you won't call it an outright scam, I will brbrA casino is an outright scam as well, and they are legal and thriving Sad but true Comment from : Francisco Danconia

Fantastic Video - would love to see more Would like to hear you defend conglomerates, certain life insurance policies and timeshares Comment from : Ervin Fowlkes

Is joining a MLM company really “starting a business”? Since you don’t set prices, determine what products to sell, or do any back end admin work, it seems more like a 100 commission salesperson Comment from : Somuchgam

please change that paper background i'm gonna get an epilepsy crisis watching your video Otherwise great stuff, still thumbs uped the video Comment from : Alexandre

Honestly, comparing hedge funds with mlm does not speak well of your understanding of asset management Comment from : Niveau Limbo

Here’s how I was brought into the mlm I joined: as a “small business owner”, you get a 1099, which allows you tons of flexibility during tax season Just declare all your lunches as tax deductible and you can save far more during filing season than you ever would by buying the products Still requires good tax knowledge, which I will admit most people lack in this day and age Comment from : Team Time Riders

Up front (before passing 1:20):brYes! Definitely more defending the indefensible!brbrThere are so many elements of different markets that don't make sense and still exist and make some a living Comment from : Der Zieher

or, you know, tens of thousands in student loans Comment from : Fred Schmitt

"A small loan of a million dollars" Comment from : Aamir Chhapra

I'm genuinely surprised that these things are legal in most countries Comment from : 黑龍 - Hắc Long

The 200+ dislikes are probably the ones who run or "made money" in mlm Comment from : SS

This is a good info channel, I have had friends selling me their MLM schemes which I wasn’t convinced of but I didn’t know what exactly is wrong with it, just a gut feeling Comment from : Lau Peter

7:10 I see how you Trump-ed it there Comment from : Let’s Overthink

Mlm is really profitablebrbrbrFor the guy who started it lol Comment from : Y Y

One aspect you did not mention is that MLMs are fundamentally flawed in that they inherently encourage you to recruit your competition Comment from : Paul Walker

I had experience as an Amway member I would never sign up again in the hopes of making money, but the Amway products were the type I would like to use again The energy drinks were tasty Comment from : emanym

You should do more catchy titles like:" DEFENDING THE INDEFENSIBLE - MLM Companies" Comment from : Igor U

OT: a friend of my mum brought her to a Herbalife meeting once and she was kinda convinced to start with them Fortunately I told her in time what this company is about Comment from : Igor U

you could read Walter Block's book "Defending the Indifensible" for more content ideas Comment from : UGP

You’re always so cynical, but I like your videos Comment from : Little Brother Money with Michael Ennis

Its not about the product thoe, they tell people that the way to make the big bucks is by getting people to join Comment from : Smith Johnson

Holy fk that graph! Even at the 95th percentile at Ruby class you're just averaging $474 a month 😜 Comment from : Delicious Deviant

2:54 thats so right Comment from : Kunal Kumar

Basically a "Shades of Grey" deal Comment from : BJCMXYs Lists & Commentary

Ah yes the business my friend tried to get me in, he has high hopes and started with 1500 $ ish investment which is also a loan and alot in this country, hope he does well in there I personally hated the very concept of it but ya they were very good at persuading wont lie, also another reason i disliked them instantly is how they had encouraged the crowd to take loans and invest for a better future where money flies into their bank accounts tsk also a funny thing that happened was the "inspiration" speech took all day and this one girl prolly broke up with her bf who was consistently calling her to know her whereabouts, i could easily sense everyone in the room was desperate for money while i was more worried of catching covid cuz of how packed the room was Comment from : YYS Snowfy

At least costco doesnt promisr you will make 1 million Comment from : CORONAKAIZOKU1

How much smoothie can you drink though 😅 you have to buy a lot of product in that startup pack Comment from : Owen

The worst thing about MLMs is that they pollute the job market with completely worthless "interviews" that you walk out of the moment you realize it's an MLM and not a real job Comment from : Rad Dykal

An issue with MLMs not adressed is that the goal of the person recruited is to further recruit competition essentially alienating themself from the real life finite market And while you rightly argue that most regular businesses also fail, the percentage of failed MLM members are not comparable MLM members with every recruit made are working against themself in the long run It'll be harder to sell that shake to anyone when everyone in town is selling itbrAlso you argue that MLM members pay a smaller up-front price for starting a business, but that's not necesarry the case MLM members also bear every business expense regular businesses do, while having limited autonomy over their products, inventory, marketing and other business aspectsbrThe problem is that you only compare MLMs high investment businesses like the example mentioned as starting a coffee shop While starting a full shop would be similarly expensive even if you offered MLM products Defending the non-MLM business side, you do not need extreme amount of investment to start your own business You can start your own business with similar scale, similarly from home and for similar entry price For example you can start to flip items online or offer repair if you are skilled with that Sure it requires understanding the products and services you offer, but so would a successful MLM campaign However with the nonMLM business you can decide over and even abbandon products, services and business practices being more flexible with the market, while most MLMs even mandate inventory (meaning you have to re-stock on your own expense even if you sold nothing previously) brSo to summerise it all up, in MLMs you get all the responsibilities of owning a business, without the autonomy and flexibility to make meaningful decisions over it Comment from : Márk Kocsicska

If mlms remove the recruitment aspect, I would probably not bet an eye at them as most of the scammy part of mlms is eliminated Comment from : Random Person

Beware of the phone call from that “friend” you haven’t seen in years and they suddenly “want to catch up” Usually, “a fantastic business opportunity” is close behind Comment from : luxsuvlover

most businesses are pyramidswhere management and owners on the top collect the profit made by the work on those on the bottomwithout even being nice to them Just the traditional jobs has salaries in the end of a period rather than commission for sales Comment from : MNdkv

I think another aspect of the success that MLMs have had in generating profit is that people have gotten more desperate over the years The economic landscape hasn’t always been the healthiest and if people are desperate they’ll try anything Even if they know deep down that it won’t pan out Comment from : DedicatedCaffeineUser

MLM's are the perfect business to get into to learn how not to be fooled by shady business practices Comment from : ClassicJukeboxBand

My mother was pressure to buy Mary Kay started box for $500 The whole market is highly predatory towards the gullible Even the lady she bought it from has boxes stack of boxes collecting dust Comment from : Woodrow want

Calling it even an opportunity to "start a business" is a gross misrepresentation of what working for an MLM really is You're not working for yourself no matter what they tell you, you're under their roof and the house always wins Comment from : Larry Lentini

In short; if the company is selling an actual product, it is not a pyramid scheme Albeit, most MLM's don't have great products Comment from : GoodLife

adding a comment now to support a new series! love to see it, man😤 Comment from : William Thompson

If I were a scam artist and owned an MLM, I'd defend it by stating (truthfully) that it follows the same model as the government-sanctioned Social Security system in any democratic country today (well, minus being obligatory Even I couldn't do that) Surely, it can't be a scam if the state does it, right? Comment from : Xqwzts

At 5:15 there was a MLM ad Comment from : Warrior Link

I’ve literally ended friendships over MLM recruitment bullshit Comment from : Jason Mackay

Why does it always sound like you're talking with a jolly rancher in your mouth Comment from : Number84

i thought this mean MLM as in man love man oh well Comment from : Sommer

Costco is a MLM Thanks now I summon storm troll swarm cardbrThis now explains why Costco items are now more expensive and it's cheaper to go to Walmart, Aldi, Menards, and other grocery stores Comment from : 2020 YouTube Purge: the black plague

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