Editor’s note: This article was first published in April 2011, and describes Donald Trump’s endorsement of ACN and Robert Kiyosaki’s support for network marketing as they stood in 2011. Trump’s ACN promotion later became the subject of US litigation.
We had set multi-level marketing companies aside for some time, because we thought people nowadays no longer considered them the way they did at the beginning. Clearly I was wrong: some of these companies are expanding again across several countries, Spain included, taking advantage of the crisis to recruit new candidates (let’s call them victims).
I’m taking the opportunity to give my opinion, since today Fran Carreira, an editor at El Blog Salmón happens to be writing about the subject.
His contribution is as useful as the opinion we’re going to give here, because it runs along the same lines. Fran Carreira may have bitten his tongue a little, though, because multi-level marketing companies are exactly pyramid companies, and there is no reason to call them anything else. The moment new candidates stop being recruited at the lower levels, those at the top stop earning income.
Nobody is going to get rich in a multi-level company, except the founder and the first and second lines of workers. From there on down, earning even a minimal income becomes far more than a full-time job.
This means that in multi-level companies that boast a network of more than 5,000 affiliates around the world or across the country, only 2–3% enjoy a comfortable standard of living. The rest are people who come and go, although the moment you walk into one of their meetings it is as if all those people behaved like a sect: every one of them will tell you their life changed completely and they are now rich or have achieved financial freedom. Is there any other way to sell the product?
The truth is that, in a way, Donald Trump and Robert Kiyosaki, in an act of “greed” and ambition, have lent their image to promote this kind of multi-level company. Our two masters of building assets and residual income have really put their foot in it by lending their image. They will certainly earn that residual income through their affiliate programmes and multi-level companies, but only at the expense of the long-suffering and naive people who will try to follow in their footsteps.
Donald Trump has lent his image to ACN, the latest multi-level company promising to make you rich. I’d rather not talk about fraud with this kind of company, because I honestly think nobody is forced into them at gunpoint. What is certainly true, though, is that the time you devote to this kind of company could be put to better use in other kinds of business.
I have always seen one very significant drawback when someone joins an affiliate programme or multi-level company: it does considerable damage to their social circle. The most devoted lose their bearings and stop seeing friends and family as people, and start seeing them as future customers. They tend to lie to sell their business model and even take their own friends to those meetings where they get to see the yachts, mansions and Ferraris of the supposed workers. At that moment you only need to take a look at the car park, and you’ll clearly see that the affiliates’ cars, as a rule, are not exactly luxury models.
I respect people who work in this kind of business, since, all things considered, it is an honest way to make a living. But if any of you are thinking of joining one of these companies, you should know in advance that you’ll have to work very hard to earn even a minimal income, and with a bit of luck, over the years, you’ll receive some residual income, provided the company is still standing. As for getting rich, forget it.
Further reading
Featured image: Didier Descouens, Public domain, via Wikimedia Commons.
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