My MLM Escape

Most people going through their entrepreneurial journey will encounter an MLM (Multi-Level Marketing) company at some point. 

It usually starts with a friend presenting a new exciting opportunity. And it usually ends in disappointment and a drained bank account. 

I joined an MLM early on in my pursuit of financial independence. 

For a couple of years, I had wanted to start a business and live the laptop lifestyle. I had read “The 4-hour Work Week” by Tim Ferriss and felt inspired. My dream of working for myself and being independent of location seemed like a real possibility.

I tried a few business models but none of them worked out. After my 4th attempt at starting my own business (an eCommerce business), I felt pretty defeated. 

Getting a business off the ground was more challenging than I expected.

During this time I was taking a course on self-development. There were a lot of cool people on this course with entrepreneurial aspirations. In this course, I meet a guy I really get along with. Let’s call him Fred. We had a lot in common and we soon became friends.

One day Fred casually mentions how he sells multivitamin supplements online. He shows me his website. It looks very professional and I was pretty impressed. 

When I asked him how his business was doing he would avoid giving straightforward answers. This seemed strange to me at the time. It was almost as if he didn’t really want to give me any information about his business.

Time passed and the course finished. One day out of the blue I got a text from Fred. He said he had an opportunity that he thought would be perfect for me. 

He asked me to come to an event at a fancy hotel downtown in a couple of days. 

Being curious about this opportunity I accepted the invitation.

The day came and I showed up. I immediately felt a bit out of place. Most people at the event were dressed up in suits or shirts. I was wearing a t-shirt and jeans. 

I looked around and saw a few other people who were not dressed up which made me feel a little bit better. 

A few of the people organizing the event went around and made small talk with the guests. They all seem very friendly and I got a very good impression talking to them. 

Then the presentation started.

They start by introducing the company that was organizing the event. They talked a bit about the history of the company.

They then introduced the products they were selling. They talked about how amazing these products were. I immediately recognized the branding of the products. It was the same products Fred was selling on his website.

During the presentation, they explained how you can make money from selling these products. 
They showed how other people had made good money from doing this. They also showed how was possible to do this from anywhere in the world. All you needed was a laptop. 

This sounded amazing to me at the time. Here I had a well-established brand with a great product. All I needed to do was sell their products and collect commissions. All the hard work had already been done for me. 

The whole proposition was very tempting. Especially after spending a couple of years trying different businesses and failing. 

Then they introduced a concept called Multi-level marketing (MLM). They showed people like Bill Gates and Tony Robbins endorsing MLMs as a lifetime business opportunity. 

I’ve never heard of it before.

They explained, that if you recruited other people to also sell the same products as you, in addition to your own sales commissions, you would also collect a small percentage of their commission.

And it didn't stop there. When your recruits recruited someone you would also get a small percentage of their sales commissions and so on. 

I was a bit skeptical about this part of the presentation. But I did like the fact that I had the ability to decide my own work schedule and work from anywhere I’d like. 

I decided to give it a try and sign up. 

They informed me that to get started I needed to buy a small stock of selected products. I chose the cheapest option.

They gave instructions on how to best sell their products. They advised that I should start selling to friends and family since it would be easier to sell to people that know already knew and trusted me.

I then got to work and started to contact friends and family. Most of them were not interested. My family was supportive and tried to help me out. However, they pointed out something very strange about the MLM sales page. 

The sales page seemed more focused on recruiting the customer to the MLM than actually selling the product. I checked it out, and they were right. The sales page looked very complex and insisted that you sign up for the MLM scheme to get a discounted price. 

This caused me to feel a bit uneasy, but I shook it off and keep reaching out to people.

A few days later I talked to a friend about selling these products. He wasn't interested and asked in a concerned tone: “You are not part of one of those pyramid schemes, are you?”. 

I replied: “Of course not”.

But in the back of my mind, I had the feeling something was not right. 

Another week went by without any new sales. 

I got invited to a business meetup by an entrepreneur friend. During the networking portion of the meetup, the inevitable question of what I did came up. 

I explained what I did and I was met with skeptical looks. They were not saying it straight out but I could tell they didn’t like the fact that I was part of an MLM. One guy at the event eventually said what was on most people’s minds: “Isn’t that like a scam? A pyramid scheme?”

I tried to defend the MLM. But as I did, I realized how weak my arguments were. I had been too emotionally invested to think this whole thing through. 

That night when I got home I had a nagging feeling that something was wrong with this whole MLM venture. 

I decided to look up supplements with similar ingredients online just to see how they were priced. A lot of people I had tried to sell to were shocked over how expensive the products were.

What I found shocked me. Products on Amazon with the exact same ingredients only costed a fraction of the price compared to what I was selling. I got furious! What was actually going on started to dawn on me. 

I decided there and then it was time to drop out.

I had been invited to a presentation for new recruits. My plan was to tell the recruiters at the event that I was out.

When I showed up I think the recruiters could sense that I was not happy. They kept avoiding me and acted busy. Instead, I started to talk to some of the other people there. 

I spotted a guy sitting down further back in the room. I went to sit next to him and introduced myself. It turns out this guy had been with this MLM company for over a year. 

I asked him how things were going. He avoided answering any questions about how his business was doing.

But just by looking at the guy, I could tell he was not doing very well. 

He told me that he had no friends or family. He said he even quit his job to pursue this MLM venture full-time. I was horrified by what I heard. This man was clearly broken in many ways and he had been sold a dream by this MLM company that his life would turn out great if he just hung in there. 

This was now really starting to piss me off. They were taking advantage of people in vulnerable positions, knowing full well that they are most likely not going to make any good money. 

Something I also noticed was that a lot of the people that joined the MLMs were not really your typical entrepreneurial types. Most people at the event looked more like they are there to earn a quick buck. 

I left the event furious and texted one of my contacts at the MLM company. I told him that I want to meet at the soonest possible time he had available. 

We scheduled to meet a couple of days later. We met in a Hilton hotel lobby.

As I was sitting there waiting for him I could feel my anger build up. He was late. Time went by and I could feel my anger build up even more as the minutes went by. 

Eventually, he showed up. He sat down in front of me and shook my hand. I tried to compose myself but I could tell he was sensing something was up. 

I cut straight to the chase and I told him I was out. I told him to immediately close my account with them. 

I explained why I was not interested anymore. He looked shocked, but he didn't argue with me. He said he would close my account and refund any money I had spent with the company. 

Things went smoothly and I got my money back. Luckily for me, I didn’t sink too deep into the MLM trap. Unfortunately, a lot of people spend years in MLMs before they realize what is going on. 

By then they have usually lost a lot of money and probably some good relationships with friends and in some cases family members. 

However, I did get a new perspective on business after my experience in an MLM. 

• I realized business is about serving others first. Business should be about providing value to its customers. MLMs are often only focused on earning as much money as possible without providing real value to customers or the people joining the MLM.

• Your business should reflect you, the entrepreneur. We are all unique individuals and can put our own unique spin on a business in a way no one else can. That way competition won’t matter as much. In an MLM you are easily replaceable and are in constant competition with others. This makes it extremely hard “to make it”.

• An MLM is not an entrepreneurial venture. You are working for a company, but you are worse off than an employee. You have no salary and are paid strictly on commissions. You have no job security. If the MLM company goes under (which they often do), you are screwed. 

• Finally, building on the previous point. Since MLMs are not entrepreneurial ventures they attract opportunists who are only looking to get rich quickly. Since most of the people you recruit don’t have the entrepreneurial spirit you are left babysitting people who have no real interest in business and thus waste a lot of time. 

These are the lessons I learned from joining an MLM.

Have you ever joined an MLM? What was your experience? Let me know in the comments below.