This blog post is actually a tribute to one of my beloved friend who lost friendship with most of his friends since he joined a famous MLM(Multi Level Marketing) scheme. Looking back on his experience, I can see how heightened expectations of easy money can lead to suspension of common sense. All economic instincts are turned off and to join the pyramid scheme fewer questions are asked than one would ask before buying a television.

As a typical MLM would work, he had to exploit personal friendship, also known as “network” in MLM parlance, motivate (read: coerce) friends to hear the pitch and plant dreams.

Most MLM discussions start with slick videotapes, motivational pep-talks and promises of incredible business opportunity and how they will have to work for a few months or a year at the most and then be free from worries of earning for rest of your life. A sheer blatant appeal to greed of gullible people.

Most MLM schemes are failures, others are miserable failures. In fact, by sheer design, these schemes are unstable. While these MLMs promise larger income than conventional business models, the fact is that the average income of an Amway distributor is about $45 a month before taxes and expenses. It is true some people make money in MLM schemes, but most part of such income is made from losses of people lower in the pyramid. Ever since Away cult gripped Indians, many would agree that Diamond and Emerald distributors make more money selling their membership kits than on their Amway products business. Success lies in profiting from failures of others. Exaggerated claims are made about its success.

These MLM structures degenerate in such exploitative nature that a person becomes more interested in recruiting people in his down line than selling the products. MLMs work by geometric expansion and where a person is supposed to enroll even four members down line, at just tenth level, total strength grows to 1048576, which would be more than earning population of most cities. You may be interested to know that at 18th level, total membership grows to 68719476736 (68719 millions). God only knows to whom they would make members and to whom would they sell. The kind of projections of income, that are made at Amway, 18 months down the time line, would exceed GNP of USA. Surely a case of generating unbridled greed that would suspend good judgment.

Advocates of MLMs boast that it is emerging new way to sell, while the fact is that despite being in vogue since 1960’s, it represents less than one percent of US retail sales. It is also said that Success in MLM is easy. Friends and relatives are the natural prospects, while the fact is that it leads to the commercialization of relations and friendship and becomes a destructive element in the community for individuals involved.

These advocates further argue that MLM can be done in your spare time but fact is that it does require extraordinary time and ability besides, wiliness, persistence. Typically at least in India, Amway products are at least twice as expensive as for a similar product in neighborhood supermarket.

Let’s face it. There are no honest shortcuts in life to earn big money. Would you like to be known in your circle of friends as one who is going to bore you with same repetitive lectures and coerce you into joining a scheme absolutely against your will? Friend, also known as “Network” in MLM parlance, is just your another prospect. Obviously, relationships are tampered with. Your neighborhood would never be same again.