I recently lost a good friend
The title says it all. I recently lost a good friend. No, he didn’t die; but the friendship apparently did. I use Facebook and happened to notice that he is no longer on my friends list. He decided to remove me or “unfriend” me. Why? Because I was honest with him. This isn’t the first time my friends and I have parted ways over my convictions and principles, and it probably won’t be the last. That’s fine. I understand that being the bearer of bad news means getting shot every once in a while. People have a tendency to shoot the messenger when the message does not match their mindset. I am completely comfortable with it because I know that in the long run, I wouldn’t be able to say I did the right thing had I not intervened in this particular case.
So… what happened? A friend of mine was lured into a get rich quick scheme (multi-level marketing) and I told him to get out of it while he still can. Frankly, I thought he had some intelligence and integrity. I guess I was wrong. He plans to try and build wealth by conning people out of their money. It’s sad to see a young christian like himself stray from the flock, but it happens. Nevertheless, I just couldn’t let that go by without someone telling him the truth. My friend is a younger man just getting started in life. He’s away from home at college and working towards his degree while working towards the top of a corporate ladder as well. He has amazing leadership and interpersonal skills, and the company he worked for during high school kept him on and is supposedly considering him for top management spots. This is a big deal. It’s a huge company. In fact, it’s a retail conglomerate and he could really go far with it. Unfortunately, that’s not good enough for him. He’s choosing to jeopardize his career for a scam. I guess his employer does not pay him enough. Either that or he’s living beyond his means and starting to look for ways out. How did I get involved? He tried to recruit me into his MLM pyramid!!!
I had not really heard from him in a while when all of a sudden he contacted me and said he had some business matters he wanted to discuss. He said he was starting some business consulting and business was booming so he needed help. I do business coaching/consulting and IT consulting on the side, so when he expressed his desire to discuss it with me I naturally thought he wanted some guidance or assistance with building the company. I wasn’t exactly sure what his offerings were, but I knew his rise to success with his employer was based on enabling great positive change. I thought that perhaps he had found a way to replicate that success and provide it as a service for other companies. His initial approach intrigued me, so I agreed to meet him for lunch. Over the phone, and during the initial part of our lunch meeting, he sounded like he was really on to some great ideas. Once we sat down and started talking, I realized he’s not doing business consulting at all. He started rambling on about how he planned to do some direct marketing to match up consumers with retailers and manufacturers. He had some supposed success stories (ex-friend, if you’re reading this… I know you were lying on some of those to try and lure me in, and it’s OK). He had some good relationships forged, and everything looked like he was on to something until he started getting deeper into the business description and product lines. That’s when he dropped the bomb. It was mid-sentence, and almost in passing, but he mentioned “Amway International.”
I was stunned that this young man would fall for something so ridiculous. I truly respected him and was very hopeful for his future. In fact, I was really looking forward to watching him succeed and make great, sweeping changes in the way his employer handles customer service. For him to actually fall into this MLM trap was, in my mind, unfathomable up to the point where he said those two words. From there on out, I feigned interest. He pawned off a cheap-looking, crappy business card and invited me to a meeting the following week. I went on about my day. I was not quite sure what to do. I discussed it with my wife and decided to take a rational approach to the matter in hopes that I could talk some sense into him. Knowing that it was probably nothing but a recruiting seminar filled with lies, I decided to give my friend the benefit of the doubt and agreed to join him at the “group meeting” where the guests get to attend for free.
The big night came, and I arrived to find my friend there mingling with other “independent business owners” who all seemed to ask me the same thing: “What do you do?” My response to all of them was along the lines of “I’m a genius. I run several businesses and consult for other businesses.” I shook hands with them and inquired as to their backgrounds. Some of them actually knew mutual acquaintances through a church I once attended but abandoned out of my disdain for using extortion as a personnel committee practice.
When the meeting started, that old Amway Quixtar song and dance came out full force. The coordinator took center stage in his slick business suit and gave the usual welcome speech, then he introduced the speaker. The speaker, we’ll call him “Peter” (because that’s his name), is a high school science teacher here in the Roanoke area. He and his wife can’t live within their means… err… I mean… they wanted more out of life or something. Whatever… point is he nailed the MLM pitch down to the letter. He even drew an ESBI quadrant (read Rich Dad Poor Dad if you don’t know what that is), which gave me a little hope for his understanding, but then completely blew it when it came time to define the “B” quadrant. He mislabeled “Business owner” as “Business system” (which actually belongs under the E quadrant).
During the entire meeting, I made it obvious to my friend and the person sitting on the other side of me that I was taking copius notes as if I was genuinely interested. At the end of the meeting, my friend handed me the “welcome aboard” packet and I laid it on him right then and there. I went over my notes with him in detail (keep in mind I’m a business degree guy headed towards an MBA shortly):
- Misrepresenting the ideas behind side income vs. full-time work
- Flawed way of thinking of business ownership vs. income vs. wealth
- Afraid of divulging details (dumb way to go)
- Rich Dad/Poor Dad (ESBI) quadrant was screwed up
- Sounds like MLM — Amway Global (note: I later circled and checked the “MLM” to make a point)
- Judges success by income
- Understands ROI, but does not have a clue about online ROI
- LTD (the parent organization name) — mentions business classes and a worldwide presence
- Uses a point system to track volume because “international currency makes it too complex to track commissions”
- Peter sucks at math
I told my friend to his face, with much enthusiasm, that the business plan in the packet he had just handed me isn’t a business plan. I told him that if he truly wanted to try and make the business work, I would be willing to help him; but that I am not interested in being scam victim… err… I mean “Independent Business Owner” like him. I already run enough businesses and I’m working on several books. I don’t have time for another workload.
We parted ways, and I went back to the house. I was going through a variety of emotions. I discussed the matter with my wife and decided to contact the young man’s father. I admire and respect his father very much. I knew the father and son would be spending some time together within a day or two of the meeting, so I decided to let the father know what was going on in hopes that he could talk some sense into his own son. Once I got off the phone, I felt better about the situation until I realized that I when I was his age I didn’t listen to anything my parents said. I tossed around the idea and finally decided that I should take action. I wrote my friend a love letter. I slept on the decision and emailed it to him the next day. I’m glad I did it, but alas… it was the letter itself that ended the relationship. I have not heard from my friend since, and he “unfriended” me on Facebook. Perhaps I was too harsh. Perhaps he didn’t appreciate the fact that I chose to use some choice words to drive the point home. Whatever the case may be, I guess this is the end of our friendship. If so, Godspeed, old friend. Know that I am still praying for you (because now you REALLY need it). I’ll be here when you get yourself un-brainwashed and come to your senses.
I’m going to close with a modified version of the letter itself (some names have been changed to protect the innocent). If any of you find any value in the letter itself, or feel that you can use some of the content in an intervention of your own, please feel free to copy/paste and modify it to your suiting.
Subject: IBO Business
My friend,
I took the time to write this because a) I usually write much better than I talk (trust me on this one… just ask my wife if you don’t believe me), and b) because I love you and see great things in your future. Be forewarned, I’m going to use some language you probably wouldn’t expect to hear from a “good Christian man” in this message; and I’m completely comfortable with that because frankly, I will stop at nothing to make sure the core impact of this message gets nailed so far down in your skull that you wake the hell up.
This is an intervention. I thought long and hard about whether or not to write this message. I even spoke to your father about it last night and recommended he discuss this issue with you. You may have already spoken with him. I originally thought it would sound better and carry more weight coming from him, but then I changed my mind. I realized that at your age I didn’t care much for what my parents told me. I was king of the world and at the top of my game. Well, guess what? I’m here to knock you off your game before you dig yourself neck deep in bullshit. You need to be brought back down to Earth, and I decided to just go ahead and do it out of love and concern. Me and my extra years of experience I have on you have seen it, tried it, done it, been there and bought the T-shirt; so trust me when I say I’m giving you solid, sound advice based on experience. I’m not giving it out of jealousy nor envy of your desire and passion for success. I carry no ill will whatsoever towards you or your business efforts. Like I said last night, I’m willing to do anything and everything to help you and your business succeed (including be a customer, employee, or consultant), but I would be remiss if I were to sit idly on the sidelines and watch you make such a huge, monumental mistake.
So here it is… in a nutshell: get out of your Multi-Level Marketing business now.
I admire your goal to build wealth. You are an amazing young man, and I know you will put your riches to good use. There is nothing wrong with money. Money is amoral, neither good nor bad. Money is not “the root of all evil.” Rather, 1 Timothy 6:10 says “For the love of money is the root of all evil.” Building wealth is hard work, but you will do it. Unfortunately, there are no shortcuts. Owning a business is an amazing way to build wealth, but like I said last night, you don’t own a business. Quite the contrary… you’re participating in a fraudulent misrepresentation. I was not joking when I re-read you my notes last night. You’re caught in a multi-level marketing (MLM) scam and you need to get out. Let’s dig a little deeper…
Peter gave a great sales presentation. Notice I didn’t say “business class”, I said “sales presentation.” There is no “opportunity” to be had by being an IBO in an MLM scam. It is simply a variation on the centuries-old concept of a pyramid scheme. When you hear “buy from your own store” and “time compounding”, hit the door running and never look back. You may have heard of a variation on pyramid scams devised by a man named Charles Ponzi. If you don’t know what a “Ponzi scheme” is, feel free to research it and then research the name Bernard Madoff. Plenty of news about him recently. The only difference between pyramid scams like the one you’re in and Ponzi schemes is that Mr. Ponzi was smart enough to keep ALL the money at the top and not dish any out to the victims at various tiers (what you’re calling “legs”) below him.
In short, the pyramid scheme business model is not sustainable. As someone who is close to finishing his business degree and gets A’s in almost every business course by practically sleeping through them, I can assure you that the system they’re preaching and trying to brainwash you with will not work. They will tell you not to listen to me. That’s fine. They will tell you that I’m a naysayer. That’s fine. They will tell you that I’m a negative influence. That’s fine too as long as you realize that they’re telling you to not listen to reason and experience. They’re acting like a bunch of lowlife Cult Leaders. Yes, I will make that correlation and say that you are now involved in cult-like activities (hence the term intervention). Not exactly something I saw down the road when I first met you and said to myself, “that guy is something else! He’s amazing!!”
That “business plan” you gave me last night? It is a worthless piece of crap that doesn’t even deserve to be in the same room with any other document that someone may at some time in the future consider referring to as anything remotely resembling a business plan. I hope that ridiculously wordy sentence drove the point home. Walk into any capital or VC firm with it and they’ll laugh so hard you’ll probably grow permanently red from embarrassment. Why? Because they know it’s a scam. The only good thing I can see coming out of that piece of paper is that a) it gives my kids something to scribble on, and b) if we hit really hard times it can substitute as toilet paper. You may have noticed that my notes from Peter’s sales pitch were very critical and negative. There just so happens to be a good reason for that: he’s lying to you and was lying to that entire audience last night. He may be able to explain why volcanos erupt, but it sounded like he wouldn’t know a balance sheet from an income statement if you slapped him upside the head with both. He has been fed the lines of what to say and took the bait, hook, line, and sinker. He is completely clueless when it comes to business. For starters, let’s take a look at that wonderful 6-4-2 business model Peter was so excited about:
Level 1: You
Level 2: 6 IBO’s under you
Level 3: 24 IBO’s (4 each under those 6)
Level 4: 48 IBO’s (2 each under those 24)Pretty nice!!! That’s 78 people working underneath you. Or.. no… wait a minute. That’s 78 businesses competing for your consumer retail business…. in the same market? Wait, but Peter said that it’s like a franchise!? Franchises have (with good reason) assigned geographical areas. Then again, he said we can use the INTERNET!!!! Social media to the rescue!! Unfortunately, that won’t work either. First off, social media is just another means of communication. It’s nothing revolutionary from the standpoint of the fundamental level of expressing thoughts and ideas between people. It just facilitates it in a more efficient and expedient manner. What does that mean for the Quixtar gang? Simple… that it’s easier than ever for them to pull off their pyramid scam. Never mind that little logic flaw about the franchises… and don’t worry about the social media thing. We have more important fish to fry. Let’s take a look at what Peter should have learned in high school (much less part of his college education): simple math.
Peter sucks at math. Yes, this college-educated high school teacher is a moron when it comes to multiplication. As a result, he will either fail miserably (from stupidity) or compromise his integrity on his path towards that lifestyle he covets. Chances are, he may try to do both. That would mean he actually made the choice to be a stupid liar. Pretty sad, eh? Even if he is actually doing ok with it right now, his house of cards will eventually crumble, and crumble hard. It’s only a matter of time due to the fact that the model is not sustainable. Therefore he has only those choices: 1) failure 2) lowdown, son-of-a-bitch, scum of the earth, good-for-nothing, scam artist liar, or 3) both. Coincidentally, these are the only options you have to choose from should you choose to proceed the way they’re trying to teach you to proceed. It sounds like Peter may have already made his choice, but I’ll continue praying for him nonetheless out of respect for his in-laws.Let’s continue on and take a closer look at the 6-4-2 business “plan.” This business system (it’s not really a plan) is a farce. Why? Simply because your initial six will be encouraged to bring in six people each… not four. Was I pegged to possibly become one of your six? If so, please recall what Peter told me last night: that my business plan would include recruiting 6 people, not four. I was fed the same 6-4-2 lies you were. See my point? The next level down? Same thing. My six and all of the rest of the thirty-six will be encouraged to bring in six each, not two. It’s not a 6-4-2 business system. It’s a 6-6-6 business scam. Sign of the… WTF? Forget about the biblical implications for now, and let’s look at the 6-6-6 scam more closely. There’s a great visual aid for this available at the Wikipedia page for Pyramid Schemes, but I’ll just type it out for you:
You’re level zero, and the format is [level] - [number of victims] (comment)
(Note: I use the term “victims” here instead of IBO’s because pyramid schemes are illegal in the United States. Yes, you are now involved in activity that borders the line of being criminal. Congratulations.)
0 - 1
1 - 6 (Your family… awesome)
2 - 36 (getting bigger!)
3 - 216 (You can fill a small church sanctuary now)
4 - 1,296 (Your entire high school graduating class)
5 - 7,776 (Entire freshman class at Virginia Tech?)
6 - 46,656 (All of Blacksburg thanks you for their new jobs)
7 - 279,936 (The City and County of Roanoke plus Salem)
8 - 1,679,616 (Entire population of San Diego. You just passed Wal Mart. Gratz!)
9 - 10,077,696 (All of Michigan… yay, no need for the auto industry bailouts!)
10 - 60,466,176 (Every man, woman and child in CA and NY)
11 - 362,797,056 (No more recession in the US!!! Awesome. The entire country is employed)
12 - 2,176,782,336 (All of Africa + Latin America + Europe. World poverty and hunger? Solved!)
13 - 13,060,694,016 (Need more babies on the planet to sustain this… this is getting ridiculous)
Well, let’s set logic aside for a bit and look at reality. The perpetrators at the top of this great fraud are very good at business. They’re making millions selling starter kits, motivational tapes, etc. The people at the far end of the totem pole like yourself? Not so much so. Why? Because… again… it’s not a business. Let’s take a look at what Amway/Quixtar is really all about:Text version: http://www.msnbc.msn.com/id/4375477/
Video: http://tinyurl.com/92qrqe (You can find it at the bottom of the page, embedded as two YouTube videos)
Crack cocaine!?! NICE!!!! Good money in the illicit drug business (so I hear). Pretty astounding stuff if you ask me. Maybe they’ve “changed” and are “different” now? I don’t think so. LTD is obviously not the same word as Quixtar nor Amway. Nevertheless, it’s the same old song and dance and all I know is that you have so much more potential than these scumbags could ever offer. The fact that you intend to jeopardize your career with your company to participate in this pile of crap? That’s down right disgusting. I would love to have your job at your company. I would give my left nut and give up all of my business opportunities in a heartbeat just to have the chance to transform an existing business like yours and share in the success. If you’re not excited about it, then plain and simple it’s because they’re not compensating you well enough. I don’t know what they pay you and I don’t want to know, but I can tell you with all certainty that if you’re doing what you told me you’re doing with them, they better be paying you well over six figures. It doesn’t all have to be salary. Benefits, tuition assistance, and other perks can really add up; but I can definitely tell you this: jobs are a factor of microeconomics and subject to supply and demand. The relationship between an employer and employee is a direct reference to supply and demand. They’re like the scales of justice. If the marginal benefit of working at your company does not equal or outweigh the cost of working there, then leave. Go find something else. Work somewhere else. Otherwise, do not risk your career for a scam. Mark my words, your IBO, this so-called leadership training that is anything but leadership training, will never, ever amount to anything the likes of which you could accomplish if you were to stick to your guns and devote your focus, time and energy towards helping your company be a better company. Then you can start a business once you’re financially secure. Not a scam, a real business.
How do I know about this stuff? First off, I wasn’t lying last night. When people asked me what I do for a living, what did I say? “I’m a genius.” That’s no bullshit. Am I a rich genius? No. I’m a lazy genius, so I’m not very rich. From a business standpoint? I make problems into ex-problems. That’s what I do for a living, plain and simple. Whether it’s complete the decade-long strategy for the Fortune 500 company or “this pizza needs to go to 5713 Main St.”, it’s what I do. Those completely unrealistic income figures Peter was throwing up on the board last night… well.. let’s just say he’ll be lucky if he sustains even half of that through scAmway. Me? I looked at them and said “yah, that’s about what I make.” He will fail… you and I will succeed. He’s trying to take the shortcut. We know the real deal… get the point? Wealth building takes hard work, not a downline of IBO’s.
Second… do not be embarrassed over this situation. I fell for the same trap in my twenties. I thought I could beat the MLM system of lies and move the product. Even then, I was smart enough to know that the recruiting scam is just that, a scam. The product? It doesn’t move. You can’t sell it. Like I said last night, if you really want to run with this thing I will help you run with it. Get some retail space and let’s make this thing pop. Will it fail? Probably. Nine out of ten businesses do. Is that OK? Yes. It’s fine. When nine out of ten businesses fail, smart people like us know that we just need to start up eight more until we find the one that doesn’t fail. Welcome to the real world. While you’re here, I encourage you to pick up a copy of Rich Dad/Poor Dad from that Barne’s and Noble store you run. It will show you the true ESBI quadrants and that the “Business Owner” block was erroneously represented by the words “Business System” in Peter’s screwed up version. There is a difference, and trust me… you’re nowhere near being a business owner yet. You’ll get there, but never by using their “system”.
In closing, the sky is the limit with a degree from Virginia Tech and experience you’re getting with your company under your belt. You have the open door in front of you. If you take the proper steps now, you can live the life you want for the rest of your days. Don’t let a bunch of scam artists like Quixtar/scAmway stand in your way. Their false promises will only result in disappointment, heartache, pain, suffering, and regret. Finish your degree. Pour your heart into your work. Live below your means and save and invest money NOW. If you can put aside $300 / month for the next 6 years and then never invest again in your life, you will be a millionaire at age 65. It’s that simple. Do the math or ask me and I’ll show you. Better yet, buy a copy of Dave Ramsey’s Total Money Makeover and enroll in his Financial Peace University course. It will change your life.
If you’ve read this far, you now have three choices:
1) Toss my comments aside and continue down the road towards oblivion
2) Politely part ways with LTD and get on with your life
3) Get with me and lets talk this over. I’m more than happy to take time out of my day to ensure your questions are answered by someone other than the morons who have been trained to respond with scAmway’s canned responses.
Whatever choice you make, just know that I’m praying for you right now… hard. You need it. I suggest you do the same. Pray your ass off for wisdom and guidance on this one. Most of all, remember this… I love you very much. If not, I wouldn’t have taken the time to put this together for you.
Best regards and God bless,
– Stuart

