How to Know If You’re Joining A Multi-Level Marketing or Pyramid Scheme Company

You’ve probably heard of the show King of Queens starring Kevin James (when he was actually funny) and Leah Remini (when she was actually a Scientologist).  Well there was an episode where Doug gets approached by his neighbor with a great offer to sell water filtration systems and thinks it’s his way to make a ton of money.  Until he realizes he can’t even sell one.  The episode pokes fun at the idea of a Multi-Level Marketing company.  It even has a young Bryan Cranston (before Breaking Bad).  The reason I mention this is not to shout out King of Queens (which used to be my favorite show ever) but actually to highlight the idea of Multi-Level Marketing and Pyramid Scheme companies.

low angle photography of structure

Now before I get into some signs you may be getting involved in one of these kinds of companies, just a refresher on those two terms before we get going.  Multi-Level Marketing and Pyramid Scheme are sometimes used hand in hand, but they are actually different.  Sometimes the lines can blur together, so it’s important to know the difference.  I’ll sum it up in easier terms because it can get a little confusing reading some of the longer definitions.  There’s a good resource for more in-depth information on the difference at Michigan.gov on the Attorney General’s page if you’re interested in really getting more information.

Multi-Level Marketing: A company who focuses on a product in a certain industry where independent sellers make a majority of their money selling the product and get bonus money for signing up other sellers to work under them.

Pyramid Scheme: A company that offers a product, but the main source of income for a person involved is getting other people to sign up to work under them.

group of people sitting indoors

Okay now that we got an idea of the definitions, let’s take a look and see how you can figure out if you’re getting involved in one of these things.

  1. They approach you, rather than you approaching them

Most of the time, someone from the company will approach you.  Most likely, a distant friend (maybe someone on Facebook, Instagram, etc or a neighbor or someone in your community.  The reason for this is, they are most likely desperate to get someone involved under them so they can get out of the financial hole they are most likely in.  If they were doing that well, the girl who used to be in your Biology class Sophomore year of college probably wouldn’t be reaching out to you through an 11pm Facebook message.2The product seems very generic

Vitamins, beauty products, household products.  These are all products that could be sold by an MLM or worse, a pyramid scheme.  Let’s be honest though, do you really want to buy a package of multi-vitamins from Bobby the waiter at your local pizza place?  The answer is no.  Without even thinking, Amazon will most likely have something similar and you’ll have to click one or two buttons rather than having an awkward conversation with someone desperate to get you into their world.

women at the meeting
  • The job description seems very generic

Now if you’re someone who’s searching for a job, and you see a job posting for a Sales Representative or Marketing Representative with a company that doesn’t sound legit, I’d probably head the other way.  Does the job description sound generic, and even have misspellings?  Another reason to search for something else.Their website looks fake

Okay so you either find the job online or hear about the company through someone you kind of know.  Now you take a look at the website and it seems extremely generic.  There’s some stock photos of business people laughing or business people doing other things together.  Or a sunrise or sunset.  Again, you see some misspellings (which would never happen on this site…ever).  You really need to use your judgment in these cases because if you feel like something is off, something is probably off.

  • You find troubling reviews

Okay so the product seems good, the company website seems good, and your last check?  Check the reviews.  Reviews can tell a lot about a company.  I’m not really talking about whether or not the company is a 3.5 or a 4 on Glassdoor.com.  I’m talking about whether it’s even on Glassdoor.com.  Even worse, do you see any reviews that even mention the word Multi-Level Marketing or even worse, Pyramid Scheme?  If so, why even waste any more time getting more interested.  Just close your computer and walk away and that’ll be the end of it.

Now for some reason, if you are someone who thinks “Hey, I am great at sales, I want to join an MLM.”  Am I going to stop you?  No, it’s a free country (if you’re reading this and you live in a country that’s not free then disregard that part).  What I’m saying is, you need to take extreme caution before getting involved.  There are a very, very small percentage of people who do succeed, but I’m talking very small.

For the 99% of people, an MLM and more importantly, a Pyramid Scheme are two things you should really steer clear of.  There are literally millions of jobs out there so spend more time on those.

Now here’s John Oliver teaching you a little bit more about what I talked about.  Enjoy.

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