Exploiting the Pyramid | Multi-Level Marketing

Exploiting the Pyramid | Multi-Level Marketing


Hey guys, thanks for clicking my Facebook
link!
I was just thinking back on our time in high
school and I realized that you would be perfect
for this new business I’m involved with.
Don’t click away yet, there’s nothing
shady about this.
I used to be like you, I used to live paycheck
to paycheck, I used to split the flavor packets
of my ramen in half to make them last longer.
Now I use the whole packet.
I’m my own boss, I make my own hours, I
work from home, which gives me plenty of time
with the kiddos.
So how would you like join this amazing journey
with me?
This video was brought to you by Skillshare.
You’ve been hearing about MLMs a lot recently.
They’ve been around for over a hundred years
– the company that would eventually be known
as Avon started in 1886 and is still the second
largest MLM.
But there was a big explosion of them after
World War 2.
At the same time that new religions were being
founded, old ones were being rekindled, and
alternative and eastern medicine were becoming
popular – direct, network marketing companies
took off.
Thanks to social media, we’re seeing a surge
of new MLMs.
The r/antiMLM subreddit keeps a running list
of all current and past MLMs, it’s worth
scrolling through just to see how many of
them there really are.
But in the last two or three years, a few
of the larger MLMs have gotten into legal
trouble with the Federal Trade Commission.
Causing several of them to shut down or restructure.
So it’s worth taking a moment to examine
what these companies do, how they work, and
why people fall for them.
And wait, aren’t pyramid schemes illegal?
Look, we all eat, and sometimes, we eat less
than we make.
What are you going to do with the rest, throw
it out?
Nah, save it for later with Betterware.
It’s a plastic container with a lid that
you’ll probably lose.
Put it in the fridge, put it in the microwave,
put it in the dishwasher, you know how this
works.
But you see, this isn’t your run of the
mill crapperware, these are some serious fiber
woven bowls.
Now I’m a fairly strong guy, let’s see
if I can… so uh, how does the dealio sound
to you?
MLM stands for Multi-level Marketing, sometimes
referred to as network marketing or a chain
referral scheme.
Which right away makes it sound like a pyramid
scheme.
The Ponzi scheme is probably the well-known
variation of the pyramid and was somewhat
recently made famous by Bernie Madoff and
Bitconnect.
The way it works is that you start with a
founder who convinces a few people to invest
in some fantasy venture or company.
When one of those people calls asking for
the return on their investment, the founder
recruits more people and uses that money to
pay the original investor.
This continues until the founder is eventually
caught – but as you can see, the money always
stays within the pyramid and it’s not on
the recruits to recruit more.
The only person who knows about the pyramid
is the founder.
Ponzi schemes are obviously illegal, but MLMs
still exist, so let’s take a look at how
they work.
It’s important to note that they all work
a little differently, but in general…
You have a founder who recruits a few people
to sell a product, so far so good, sounds
like a regular business to me.
But there’s a catch, you make more money
recruiting than selling.
So these people recruit a few people, who
recruit a few people, who then, you get the
idea.
This is referred to as your downline, while
the person who recruited you is your upline.
I personally think this looks more like a
family tree than a pyramid and I’ll explain
why later, but this is a pyramid scheme.
In fact, both of these are pyramid schemes.
And while Ponzi schemes are always illegal.
Things get hazy when we look at MLMs, which
allow people to say stuff like this…
It’s not an illegal pyramid scheme, it’s
a direct selling network marketing company.
Is it shaped like a pyramid, the business
structure?
It is shaped like a pyramid, yes.
But you’re saying it’s not an illegal
pyramid scheme.
It’s not an illegal pyramid scheme.
Running a company with a pyramid shape is
not, in itself, illegal.
There are legal pyramid schemes.
In general, MLMs make money in two ways.
Through the direct sale of product to outside
customers and through the recruitment of more
members.
The balance between these two revenue streams
is what determines the legality of the pyramid
scheme.
Some MLMs make most of their money through
direct sales, like Tupperware, making it legal.
Tupperware was the first MLM I ever learned
about while living on a military base almost
30 years ago.
Another thing we’ll get to in a bit.
I didn’t know this until making this video,
but they still throw Tupperware parties, and
it’s their primary source of revenue.
Who throws Tupperware parties anymore?
While they do still recruit consultants and
receive a cut of their downline, most of Tupperware’s
income still comes from outside sales.
Totally fine.
But when this balance is reversed and a company
is making more money from its members, it
becomes illegal.
And according to the FTC, the legal ratio
is 80-20, a company must receive at least
80% of its revenue through sales and not recruitment.
Most MLMs that currently exist do not follow
the 80-20 rule and the only way to find that
out is to pressure the FTC investigate.
You’ve heard the saying, “it’s only
illegal if you get caught!”
So, while every MLM is a pyramid scheme, not
every pyramid scheme is illegal – you have
to look at each one individually.
Hey girls, it’s Fall!
It’s back to school season and time to update
that wardrobe – so you know what that means…
Sales!
If you’re anything like me, it isn’t fall
fashion without leggings!
That’s right, I’ll be showing off the
best LoLuKno leggings tonight on Facebook
Live.
So get your wine and wallets ready ladies.
Because if you share this video – and I’m
not supposed to do this – free shipping
on all items.
Hashtag bossbabe!
Lularoe is a women’s clothing company started
in 2012 by Deanne and Mark Stidham.
Their name is a combination of their grandkids,
Lucy, Lola, and Monroe.
They became famous for their buttery soft
leggings and experienced explosive growth
in 2016.
Which is also when everything started to fall
apart.
Lularoe, like most MLMs, specifically targeted
women, and even more specifically, stay at
home moms.
It has to do with the post-WW2 economic boom.
Remember, women weren’t always allowed to
have a job and make money outside of the house,
so for many of them, selling makeup, or Tupperware,
or leggings, was their only option.
A lot of their recruitment pitches use feminist
empowerment language.
For many of these women, MLMs offer a social
outlet and a feeling of community that they
might not get otherwise.
Especially military wives, another favorite
of Lularoe.
Other MLMs have their own targets, but typically,
it’s moms, military, minorities, college
students, and…
Mormons.
Which might sound weird, until you think about
it.
Imagine a group of people with deep community
connections and built in door-to-door sales
experience.
Lularoe fashion consultants typically sell
during Facebook Live sessions lasting anywhere
from 2-4 hours.
I watched more of this than I care to admit
– these days they typically average one
or two sales per hour, and customers buy stuff
by typing “Sold plus the item number”
in the chat.
After the live stream, the consultant will
contact the buyer and perform the transaction.
Some consultants have a helper reading the
chat off screen, some have software that take
care of it, but most people do it manually.
Don’t forget guys to share and comment with
that heart emoji to be entered into the drawing
for Lula-Cash tonight.
Lularoe was unique in their use of Facebook
this way and other MLMs have started to catch
on.
But selling Lularoe on Facebook is not how
you make money, if you want to do that, you
have to recruit.
Lularoe is the most expensive MLM to join.
They call the process onboarding and you’re
presented with three options for a starter
kit, ranging from $5000 to $9000.
It’s called front-loading and almost all
MLMs work this way.
You buy the starter kit or onboarding package
and then it’s on you to sell it – the
company has already made its money.
But…
$5000?
Most MLM starter kits are around $100.
All businesses have a start up cost, you have
to spend money to make money.
But these aren’t venture capitalists, these
are stay at home moms.
Most people who join Lularoe use a credit
card, putting them thousands in the hole before
they even get started.
You start off as a Consultant, there’s nobody
underneath you so the only way you can make
money is by selling clothes.
The average Fashion Consultant makes 85 dollars
a year – a year.
Which is immediately negated by the fact that
in order to maintain your business status
with Lularoe, you are required to purchase
at least 33 items a month.
And you don’t get to choose the items.
While looking at the starter kits, you might
have noticed where it says Classic T, 50 pieces
or Leggings One Size, 40 pieces – that means
you’re picking the style, but not the print.
It’s basically a loot box.
You’re ordering a specific cut or style,
but the prints and colors are totally random,
a lot of it ugly as sin.
You think I picked this on purpose?
In your random assortment, you are guaranteed
a few high-value items, which they call unicorns.
Which I guess are shiny or foil cards in this
analogy?
Either way, a lot of consultants have taken
to selling outfits rather than individual
items, pairing unicorns with undesirable junk
and selling them as a set.
Adult leggings come in three sizes.
One size, which isn’t the only size, for
people between size 2 and 10.
Tall and Curvy for 12 to 18, and Tall and
Curvy 2 for 18+.
Here’s where all of the men are going to
make a joke about “What about size 11?”
During live sales, they typically refer to
these as OS, TC, and TC2.
The fact that they do these QVC-like sales
one at a time like this means that for any
pair of leggings they hold up, there’s a
very small chance that it fits you.
When you refer one person, you move up to
Sponsor, where you start earning bonus checks
that average around 7000 a year, on top of
whatever you make from sales which is negligible.
27% of all Lularoe members are at this rank
and they are required to purchase 175 pieces
a month – which costs around $3000.
Once you’ve personally referred three people
and have at least ten people under you, you
become a Trainer.
You’ll make an average of $52,000 a year,
but you’ll also have to buy 250 pieces a
month and all of the people on your team must
collectively buy 1750 pieces a month.
This is your Team Volume and your personal
purchases don’t count towards that number.
You would think that making $52,000 a year
would be great, but you’re also spending
at least $4500 a month on product, which is
$54,000 a year.
You aren’t even in the black for the year.
This is how most people in an MLM lose money,
even the apparently successful ones.
Sure, they’re making a lot – but they’re
also spending a lot.
Lularoe consultants are encouraged to live
a luxurious lifestyle, with expensive purses,
cars, houses, and vacations – whatever it
takes to look successful.
So other people will consider joining.
They also have expensive conventions and retreats
every other month to keep you spending.
But more sinisterly, to keep you involved.
You’re not going to quit if you’ve already
paid for your flight and hotel to the Coach’s
Retreat next month.
To become a Coach, you need at least three
Trainers underneath you in separate branches
– it’s starting to get complicated.
On top of the 250 personal volume and 1750
team volume.
Lucky for you, you’ll be earning an average
of $226,000 a year, just like 0.61% of Lularoe
– you might actually make a profit if you
can keep the trips to Tahiti to a minimum.
And lastly, the highest rank possible in Lularoe,
the Mentor.
3 Trainers and 3 Coaches in six different
branches, along with the same requirements
as Coach.
If you’re a Mentor, you are a millionaire,
congratulations… all 0.08% of you.
A Lularoe Mentor can have over 3000 people
in their downline.
If you think that’s complicated, Lularoe
has the simplest rank structure of any MLM
I researched.
But the bonus structure is somewhat easy to
follow.
You earn 5% from your direct referrals, 3%
from theirs, and 1% from theirs.
It’s important to note that that’s how
it works for everyone, so this person receives
5% from that person.
It’s also important to note that the rank
structure doesn’t directly follow the pyramid
structure.
It’s technically possible to be a mentor
under a sponsor, because they don’t have
enough coaches in different branches or they
didn’t have enough personal volume.
So, while you might be at the top of the rank
pyramid, you might be on the 20th step of
the referral pyramid.
During their 2016 popularity boom, Lularoe
was unable to keep up with demand and instead,
lowered quality.
In 2017, multiple class action lawsuits were
filed, many of which are ongoing.
To get ahead of the FTC, Lularoe changed their
bonus structure to resemble more of a legitimate
pyramid scheme, emphasizing sales rather than
recruiting.
And that was basically the end of Lularoe.
Since nobody would buy the tissue paper quality
leggings, nobody was selling, so nobody was
making money, so a mass exodus occurred.
Lularoe still exists, but… barely.
Hey, you’re fat.
You know you’re fat and you know that I
know you’re fat.
Because I’m fat and I know I’m fat.
Takes one to know one.
But at least I’m doing something about it
with Betterlife.
Betterlife is a total nutrition program designed
to get you the body you’ve always wanted.
All it takes is one heaping tablespoon in
the morning to start your day off right…
Herbalife Nutrition was founded by Mark Hughes
in 1980 as a nutrition, supplement, and weight
loss company that primarily sells protein
shakes.
Over 30% of its business comes from this product
alone.
And since this is food, it has an expiration
date, so if you don’t sell it in time, it’s
worthless.
Unlike Lularoe which lasts until… the first
time you put it on.
So while I can buy this from a going out of
business sale, where someone is just trying
to cash out before donating it to a thrift
shop…
I had to buy this from an actual distributor.
So the question becomes why would I buy this
when I could get this at basically the same
price?
The answer is that I’m paying retail price.
If I join Herbalife, I get a discount that
starts at 25% and grows to 50% as I move up.
Why pay retail when I could be paying wholesale?
And that’s what makes Herbalife unique,
80.2% of all Herbalife members join just for
the discount for themselves.
There are two ways to join Herbalife.
Most people join as an at-home distributor,
which is just like any other MLM, but you
aren’t required to sell anything, and you
can keep the discount for yourself.
You’re basically just a customer.
You aren’t necessarily recruiting other
distributors, you’re recruiting other customers
who frontload product they’ll never sell.
But the ultimate goal is to recruit more distributors.
Herbalife has ranks as well, you start as
a distributor, then move to senior consultant,
then success builder, and then qualified producer
– where your discount is 42%.
Or you can skip this line entirely and open
a nutrition club.
Where you join as a Supervisor with an automatic
50% discount.
A nutrition club is a physical storefront,
where you serve protein shakes and other Herbalife
products to members who pay $5 a day.
The initial startup cost is at least $5000.
And that’s not including rent, utilities,
and any food inspections or certifications
you need, which can double the cost.
Notice how I didn’t say advertising or signage?
Because you are not allowed to advertise your
association with Herbalife or the fact that
you exclusively sell their products outside
of the club itself.
Which makes it somewhat difficult to attract
customers or turn a profit for obvious reasons…
I mean, would you go into a store with no
signs or even a name?
Or just something incredibly generic?
It almost seems like it’s designed to fail.
As most of these clubs do within the first
year, saddling their owners with an average
of $8000 of debt.
Herbalife’s rank structure continues with
the World Team, the Global Expansion or GET
Team – which I know is a lot like saying
ATM Machine or HIV Virus but that’s how
they say it.
And then there’s the Millionaire team, which
no, you’re not a millionaire at this level
– in fact, you’re barely making six figures.
You know, words either mean something or they
don’t, you can’t just call it whatever…
You may be wondering what these Active ranks
at the bottom are, and it’s just a lateral
promotion for any of you familiar with military
ranks.
They don’t get anything special aside from
the pin.
The President’s Team is the end goal – there
are actually 11 sub-ranks in here that I’m
going to ignore, but the Chairman’s Club
is a member of the President’s Team who
has five other President’s Team members
in their downline – and the Founder’s
Circle has ten.
Only people in the GET Team and above earn
production bonuses on their downline in what’s
known as the TAB Team… and now you understand
why we deep-dove into Lularoe’s ranks instead
or we’d be here all day.
Here’s just a sample of what it takes to
be a Supervisor…
How to qualify: 4,000 Volume Points or VP
in 1 month with at least 1,000 Unencumbered
Volume, or 4,000 VP over 2 consecutive months
with at least 1,000 Unencumbered Volume, or
4,000 VP in 3-12 months, with at least 2,000
Personally Purchased Volume.
What you get: 50% Potential Retail Profit,
8-25% Wholesale Profit, and up to 5% Royalty
Overrides.
I promise, that was English.
How does that translate into actual money?
Of the 69,000 Herbalife distributors in the
US in 2015, 93.4% of them made less than minimum
wage and 72.6% made less than a thousand dollars
that year.
And that’s just their revenue, when you
factor in expenses, almost everyone loses
money.
These aren’t people who joined because they
wanted cheaper shakes, these are people with
a downline trying to turn a profit.
The top 0.3% makes all the money, averaging
over 600,000 a year.
The neat part about this chart is that you
can see fewer than a thousand Herbalife distributors
are making middle class wages.
This is Herbalife’s Income Disclosure Statement,
they’re required to do it every year for
every country.
Though they haven’t in the US for the last
few years.
Because in 2016, Herbalife was investigated
by the FTC and ordered to fundamentally restructure
its business, since it was found to be on
the illegal end of the pyramid spectrum.
The FTC ordered that…
The company will now differentiate between
participants who join simply to buy products
at a discount and those who join the business
opportunity.
That’s why in some newer Herbalife materials,
the lowest rank is Member rather than Distributor.
At least two-thirds of rewards paid by Herbalife
to distributors must be based on retail sales
of Herbalife products that are tracked and
verified.
Companywide, in order to pay compensation
to distributors at current levels, at least
80 percent of Herbalife’s product sales
must be comprised of sales to legitimate end-users.
And perhaps most importantly…
Herbalife is prohibited from allowing participants
to incur the expenses associated with leasing
or purchasing premises for “Nutrition Clubs”
or other business locations before completing
their first year as a distributor and completing
a business training program.
They were also ordered to pay $200 million
dollars to reimburse former Herbalife distributors,
especially those that started a club.
Despite that, Herbalife is still growing.
They’re declining in the US, they peaked
at 80,000 distributors a few years ago, but
fell to just under 50,000 last year.
A large portion of which are minorities.
But they’ve been expanding globally – especially
in developing countries for some reason…
Hey, are you getting older?
Of course you are, I can see it right now,
it’s like watching paint dry but in fast
forward.
You starting to get lines on your forehead?
Maybe your knees crack when you stand up?
Yeah, that’s what I thought, you need these
pills from Knoway.
Just two a day is all you need to completely
reverse aging, but that’s not all, they’ve
also been clinically proven to cure most cancers,
balance your pH levels, stop snoring, and
block blue light.
What’s in it?
A unique proprietary blend of… it’s deer
placenta.
But it’s not like you can taste it.
That’s right, the freshest deer placenta
on the pl-
I can’t, this one is just too gross.
This one is real, it’s called Riway, and
it really is made out of deer placenta.
Can we pick one that’s a little less disgusting
please?
Right so I just spoke to a Facebook friend
I met once on a plane five years ago, and
she told me I can get all of that stuff I
was just talking about.
But without the deer placenta.
It’s called Better Living Essential Oils
and just one drop on the bottom of your feet
at night will fix everything that’s wrong
with you.
Yes, even block blue light.
So I got some tea tree oil, the ferrets love
it, it’s in their shampoo, it’s … ooh
that’s strong.
So they say this one helps with acne and nail
fungus, but I’m sure it has some blue light
properties.
Science doesn’t know everything!
Young Living Essential Oils blurs the line
between MLM and religion.
It was started in 1993 by D. Gary Young, the
D stands for Donald, not doctor.
Before selling essential oils, he practiced
naturopathy in Mexico, where a reporter once
submitted cat and chicken blood for clinical
testing… turns out they had cancer.
No mention of them not being human, though.
Before that, he was convicted of practicing
medicine without a license in the US, in fact,
throughout his life, he opened and was forced
to close at least four different clinics.
But then he started Young Living.
The name evokes images of living a healthy
and youthful lifestyle forever.
But no, it’s just his name, Gary Young.
When he was 24, he was paralyzed in a logging
accident and cured himself using the products
he would eventually sell.
Where have I heard that one before?
While they didn’t invent the product and
they’re certainly not the only one, they
are one of the largest sellers of essential
oils – which sound like a vital nutrient
or mineral that your body needs to survive.
Nope, an essential oil is just the “essence”
of the plant.
What does that mean?
Basically, whatever you want it to, there
is no…
Look, I don’t want to spend too much time
debunking essential oils.
When you boil it down, this is just a bottle
of perfume, if Tea Tree oil did anything aside
from just smell nice, we’d know by now.
And if that’s all you use the oils for,
knock yourself out.
It’s like lighting a candle, aside from
smelling nice, aromatherapy is a real thing
and can help with anything from depression
to pain.
But… it’s not going to cure anything like
cancer.
The people in Young Living see this bottle
as a panacea, a natural cure-all tonic handed
down by God himself.
Being a Christian and reading the bible, they
talk about oils all the time.
God created these things, these natural things
for us to use that have these amazing benefits
for our body.
Why am I not using them?
Tea Tree specifically is an insect repellant,
under arm deodorant, antiseptic, hand sanitizer,
mouthwash, and it treats acne, dandruff, nail
fungus, and athlete’s foot.
If Tea Tree doesn’t cure it, something else
will.
Young Living sells over 150 essential oils,
some of them single and pure like this, while
others are special blends, and each one does
its own thing.
If there’s something wrong with you, or
your pet, there’s an oil for that.
Melrose, I told you guys Melrose was going
to be in here!
So, this goes in my swimmer’s ear blend…
It must be really inconvenient to have to
boil some eyes of newt and summon an ender
dragon every time you want to go swimming.
They claim the oils cure everything from autism
to night terrors to diabetes.
But, since this is just some mom doing an
unboxing in her living room and not Young
Living making these claims, the FDA can’t
really do anything about it.
Young Living advises those who want to share
their oils to avoid making any claims about
treating or curing disease, but instead talk
about the structure or support of the body.
So rather than treating insomnia, an oil can
help with sleep.
It can’t cure the flu, but it can support
a healthy immune system.
I wasn’t making up that bit about blue light
by the way.
It’s called IlluminEyes, it is a whole food
essential oil supplement that is specifically
for eye health and protecting against blue
light.
That’s like taking a pill to prevent a sunburn
it just doesn’t work- I told myself I wasn’t
going to do this…
Okay, just one last thing.
In case you didn’t buy that the non-existent
active ingredients in essential oils did anything
medicinal.
They also apparently have a frequency.
The human body has a certain frequency that
it stays between, it’s like don’t quote
me on this, 60 to 70, maybe 50 to 60, somewhere
in there.
And learning the frequencies of different
oils, you don’t have to have them exactly
memorized, but just know which ones are low,
which ones are kind of mid-range and which
ones are high, can help you…
You use essential oils by diffusing it into
the air, which is basically vaping an entire
room, absorbing it through the skin, or ingesting
it using the special Vitality line of oils.
Looking at the ingredients list, there is
no difference between Lavender Vitality and
just regular lavender.
Thieves is by far their most popular blend
and gets put in everything from cleaning products
to toothpaste.
Yes, they put essential oils in toothpaste.
Young Living isn’t just selling some nice
smelling oils, it’s a lifestyle that completely
takes over.
If you wanted, you could fill your entire
house with Young Living products.
I don’t mean hoarding it in boxes in your
garage, I mean replacing every other brand
you currently buy.
Which is what a lot of them end up doing.
Because just like Herbalife, you get a discount
for joining.
Unlike other MLMs, they aren’t trying to
sell a product to outsiders, the idea is to
get more people to join and live the all-natural
lifestyle.
They don’t even call it selling – they
call it sharing.
Empowering you to love and share all the many
benefits of Young Living with confidence and
a clear conscience.
The religious and language aspects are somewhat
unique to Young Living, combined with everything
else, it ticks enough boxes to be considered
a cult.
But don’t worry, you’re not obligated
to join.
They think if you buy an essential oil kit
with Young Living you are committed to a monthly
order you have to spend money every month.
That is just not the case.
You can buy the starter kit, that doesn’t
mean you’re like, part of a business and
you have to sell things now.
You never have to sell anything or buy anything
ever again.
You’re not, so you can cancel Essential
Rewards at any time you guys.
Well, not if you want to keep that 30% discount,
you can’t.
Essential Rewards is Young Living’s monthly
auto-shipment program, you get a discount,
but you’re required to spend at least $50
a month.
In exchange, you also get points and free
promo items.
Look, for spending $300 this month, she got
a branded mason jar – and how!
Young Living also has a complicated rank and
commission structure, beginning with Members
and Stars, going through Silver and Gold,
and ending with Royal Crown Diamonds.
With commissions paying for eight steps down
your downline.
Though all of this might change soon, since
Young Living was served with a class action
lawsuit in April 2019.
They might have to restructure their payment
and referral systems just like Lularoe and
Herbalife.
Most people don’t join Young Living looking
to make a business out of it.
They’re looking for that natural lifestyle.
All multi-level marketing companies share
that characteristic, they may differ in a
few areas here and there, but in the end they’re
all selling a lifestyle.
The product is secondary and almost meaningless.
You are a customer of the MLM and you are
tasked with recruiting other customers.
To the exclusion of anything else.
There’s a reason people in MLMs are referred
to as huns or hunbots, everything is about
the MLM and getting more people to join the
MLM.
Anyone who doesn’t support you is a hater.
They’re not approving of your entrepreneurial
bossbabe dream, and you don’t need that
kind of negativity in your life…
Even if they’re family.
The MLM is your family, your friends, and
your job.
Some MLMs even encourage your spouse to quit
their job to help you, so they’re also dependent
on the MLM.
That’s why there are so many couple’s
retreats.
Home school is also very popular among MLM
families – what’s the point in working from
home if your kids aren’t going to be there
with you all the time.
Further growing the pyramid.
And that’s what it really comes down to
– you are either crushed by the pyramid
or you are crushing others as part of the
pyramid.
Even the perpetrators are victims.
They’re told that if they aren’t successful
and aren’t making money, it’s because
they are doing something wrong.
MLMs are capitalism on steroids.
We often hear about the top 1% reaping all
of the benefits of our economy – well in
an MLM, it’s the top 0.3% or 0.08%.
You can make it if you just work hard enough
and market your business properly.
A skill you can learn by going to skl.sh/knowingbetter11.
Skillshare is an online learning community
with thousands of courses taught by mentors
in their upline.
Take this course in social media marketing,
learning how to create the perfect profile
and gain more followers since none of your
friends from summer camp will answer your
messages anymore.
Or this course in social media strategy, where
you can learn how to make the right content
and even optimize for Facebook, how else are
you going to tell people about this amazing
journey that you can’t wait share?
You can learn this and much more with an annual
subscription costing less than $10 a month.
And if you head over to skl.sh/knowingbetter11,
you can get two months of unlimited access
to all of Skillshare’s courses for free.
You’ll also be supporting the channel when
you do… but, like…
I don’t get a commission.
You don’t have to recruit anyone.
This, this isn’t a pyramid scheme!
Now, I know we haven’t spoken since that
one math class we had in college five years
ago, but I was just thinking about how you
would be perfect for this business opportunity
I’m part of.
It’s called Youtube, and odds are, you’re
already a member.
If you’re just starting out, you’re a
graphite – but once you get a thousand people
under you, you become an opal, which is when
you’re eligible to start earning commissions.
Or what we call in the biz, “adrev.”
I’ve been doing this for a while so I’m
a silver-tier creator, but I am working my
way up to gold and you can help by hitting
the subscribe button to join my downline.
It’s free and you can cancel at any time,
you guys.
But, for those of you who are committed to
helping small business owners like me, there’s
a special pyra- program we call Patreon.
We have colored tiers and ranks there too.
Trust me when I say this is the easiest job
in the world, I just make videos, put them
online, and earn a passive income.
I don’t even have to leave the house.
Now, none of you mentioned this in my last
video, but you might have noticed I have a
new couch.
It’s actually a futon from Walmart.
But that, that is an IKEA bookshelf.
Now, I’ve only owned three IKEA bookshelves
in my entire life – two of which are right
now.
That’s how good things are going for me.
And that’s how good things could be going
for you, if only you had the ambition and
you knew better…
I’d like to thank Ben and Peter for being
the latest Golden Forks to join my downline.
But a special thank you to Josh for being
the first to join this amazing journey with
me.
Sorry this video took a little longer, as
you can imagine it was a large project, so
thank you for being patient… and sticking
around to listen to the end.

93 comments

  1. I love their shakes though. Herbalife. I just can't sell the products haha even if my last breath depends on it. I lost 10 kgs when I first took the basic set while I still worked. Now I'm staying at that weight for more than five years. I just need to lose 10 more kgs of fat but I don't have the financial status to drink that same set for a couple of months straight. Edit: Forgot to mention that my upline is a wealthy enough doctor who first got to the Presidential Team when Herbalife had just started in my country. Her team is fantastic & healthy, energetic people, which includes her family. I'm not a part of it though haha. I'm just a consumer through & through.

  2. Tea tree oil works pretty well for antiseptic and acne.

    Will not cure cancer tho. I've tried. Still have this weird sentiant cancer cell in my basement.

  3. When I found out people going nuts about essential oilsni was hopeful id have friends who love fragrances as much as I do. … and then I saw them eat them and grew fearful of our direction as a species and sad.

  4. That clothing 1 sounds like they buy failures from other companies for pennies and make their money selling to there sellers at too high price. Then sellers have to offload the junk to make their money back

  5. Navy wife and those damn bad leggings where everywhere! Scentsy and weird sex toys parties! Hated it and they where trying to pull me in! Ugh the only thing I want is weed and its illegal in military housing! I am now a drunk 😉😂

  6. Most company charts would look like a pyramid. Top level is owner(s), next is managers, next are assistant managers, next supervisors, next workers…..the SHAPE does not determine it LOL – What I detest about them is they encourage you to get your friends and family involved – That destroys life-long relationships when it all falls over

  7. It drives me nuts that you describe MLMs as "Capitalism on steroids". There's nothing particularly "Capitalist" about MLMs. Indeed, the entire basis of Capitalism is two people coming together and making a deal on something that's mutually beneficial for both.

    MLMs don't do that. They walk the border between outright fraud and "Well, ok, we'll help you make money."

    (And I say this as someone who played a part in the "recruitment" process at a company I worked for — mostly tech screenings, but occasional interviews as well. We worked darn hard — perhaps a little too hard — to try to screen out people who we thought wouldn't be beneficial for our cause. Sometimes I wondered how I made it through the process myself. And I only tried once to recruit a friend, but that was a different company, and that was because I worked with him at a previous company, and I wanted him to be a co-worker at my new one. Sadly, I didn't have his phone number, and I provided what information I had to the CEO, rather than talk to him personally, so I don't think he even got contacted….)

  8. Tupperware is an MLM?????
    Tupperware is the Kleenex of plastic fridge containers how can it be an MLM
    What am I supposed to call these containers now??

  9. Oh man, a topic I'm far, far too familiar with. My Aunt has been in and burned by more MLM's than I can count. She lost over 250k to one, managed to get in a class action suit and got it all back, then turned around and invested it all back into a different one over the course of a year. She realized that was also a scam, once again got in a class action suit and managed to make back everything she lost and then some. A month later she was in a new one. She went through SIX in one year!!!

    I keep trying to explain that they are ALL scams, but she's convinced she'll get rich quick eventually. She's constantly losing money to one then making back a ton from some lawsuit she managed to get in on, only to lose it all again. I've given up even trying anymore, my garage is filled with dozens and dozens of boxes of old product she's bought then never sold…

    It's absolutely mind boggling how people fall for the stuff. Sure, I'd love it if I could quit my job and spend my life vacationing with my wonderful Kids, but so would everyone else. There's no magic way for that to happen, we can't all just not do anything anymore, ever.

  10. You have to gently boil the deer placenta capsules for 5 minutes in 1 to 2 quarts of steamed milk, let the liquid cool in the fridge, then lovingly it on your head while showering. This will release the latent antioxidants in your scalp, where all of the body's natural healing occurs. Be sure to also get plenty into your ears, as this should remove any toxins that cause debilitating nose itching.

  11. I remember when my Facebook exploded with LulaRoe and people I haven’t spoken to since high school who I barely spoke to then started hitting me up trying to get me in on the craze. I finally just posted on my Facebook that I would never spend $40 on polyester leggings sewn in a sweatshop in Indonesia so please don’t even ask. Got a few triggered messages from people I knew selling about how I was missing out blah blah. I literally watched every single one of them offloading their inventory probably not even breaking even 6 months later because they had spent all this money and hadn’t made any of it back. Interestingly enough, when I was a kid in the late 80s and 90s my mom sold Tupperware quite successfully. I mean both parents are healthcare professionals so their income hardly depended on it but she kept at it after graduating from nursing school because she was making a profit. She never had any down lines though. I think she just liked the product. And honestly, I’m 31 now and she still has a lot of that Tupperware. I even have some. That shit was well made back in the day. Booger green and mustard yellow food containers are hard to come by now too.

  12. You seem pretty smart.

    That's why it's confusing to me that you:

    Have a problem with people doing things that "aren't illegal if you don't get caught"– but have no problem committing to slander and defamation– or using someone else's production and likeness without their permission… Which "isn't a problem until you get sued".

    Also, you have a problem with direct referral business models because it "takes advantage of others"– but are leveraging every viewer you have to directly market the products that are advertised by your monetized channel.

    So, when you say, "like and subscribe", just remember, that you too are recruiting. And not making the money PewDiePie is.

    Maybe mind your own business, versus just complaining about everyone else's?

    Love your ferrets though. Probably shouldn't put them in the dishwasher though. Seems like you should… Know better?

  13. dude I allmost disagree with everthing in your video, but Im ver very glad that you took the time and effor to do the homework and point everything in a informed fashion. Idont like how ppl just say MLM is evil and everything related to it brings despair. Still, if you change your mind, I have a spacial Hrblf link that get you 25% off in your….

  14. The ad YouTube crammed in the of this was some workout business coach who has made millions teaching fitness. It might not be an MLM, but it didn't smell right to me. I thought it was an ironic ad for such a video.

  15. Don't forget the dumb Karen's who don't vaccinate their kids but claim a glorified perfume can cure cancer. Stupidity at it's worse.

  16. >dividing ramen flavor package into 2
    Do people in US actually do that, or was it a joke?
    Now I wonder when will MLM will reach here en masse. Because every stupid US trend will reach my country in some horrible and perverted way. Since every socio economic trend gets here, usually with 5-7 years lag.

  17. Not that I support MLMs but how is this pay and organizatiom structure different from say Wells Fargo, where .08% of the people (aka the CEO) makes most the money and then income decreases the further down you get? All big business are pyramid schemes.

  18. I just watched your Columbus video, this is the second video of yours I've seen and I really like your content already. You're very articulate and examine events very logically, thank you very much for your content.

  19. Hey there! Great video! Could you please do an analysis on Kropotkin? please please please. I haven't seen any in depth video on him.

  20. I keep see these ads

    Quit your job
    We'll show you how to be rich

    Yeah sure I'll walk into work and quit my fucking job because YouTube told me to

  21. is it just me that i am excited by the division 2 posters behind him? but besides that, thanks for the explanation about MLMs! 🙂

  22. Holy shit you just opened my eyes to the idea that Uncle Rico was in a pyramid scheme. How have I been so blind all these years?!

  23. most people smell fish in the pitch when a recruiter approaches them even if they have never been exposed to it. im so glad i went with my gut feeling and gtfo of that before they had any of my money. Pokemon helped me to avoid this.

  24. And if a quote on quote "independent distributor" (or dealer, sales rep etc.) denials a product to be snake oil, something's amiss!

  25. If someone contacts you to join an MLM, invite them over and break their fingers. If they contact you again, break their kneecaps.

  26. I think a great next subject would how horrible the English Empire was. People tend to see it as "It wasn't that bad" or "it was "normal" at the time" where in retrospect, they are the one who normalize the whole "Colonisation" (We would call it an Invasion by today's standard) and try to make it sound grandioze with names like "The Great Empire"
    P.S.: I have no good reason to suggest it, I have a lot of resentment and I want more people to share it 🙂

  27. Do you have any recommendations for books or other material on this topic? Been really interested in it, so I was so happy to see this video on your channel!

  28. You had me at deer placenta…lol!!! Sorry don't know how to comment on that other than deer in the headlights. Thanks for the laugh!

  29. I love you and your videos. Cant get enough of them :-D. The ending was perfect. Guess I fell for your pyramid scheme month ago by subscribing. Can't stop laughing at that one. LOL.

  30. Actually, according to mayo clinic tea tree oil does have potential topical applications. But it is one of very few exceptions. Generally essential oils are bullshit.

  31. Someone tried to get me to work for Vector Marketing. They're just a marketing company but they're still slimy as hell.

  32. LMAO 16:18 they're not a millionaire at the millionaire level. "words either mean something or they don't, you can't just call it whatever" 😂 😂

Add a Comment

Your email address will not be published. Required fields are marked *