Exposing Multilevel Marketing (the Business of Using Friends for Profit) 

We did an MLM back in the late 90's. We went into it with the mindset that we would NOT sell/recruit friends and family. We're both hard-working, intelligent people who were doing well at our full-time jobs, and we applied a good effort toward the MLM for about two years. Bottom line, two smart people who don't slack and "invested" about $14K over the whole two-year period made about $12K...so we invested a lot of time and effort to lose about $2K. The only silver lining, we stayed true to the no family and friends commitment and didn't destroy any relationships. Never again and we poo-poo any MLM talk whenever it comes up with anyone.

LOVE THIS VIDEO!!! Over 20 years ago I joined Primerica, because a customer convinced me to go to a meeting and I loved personal finance. Huge mistake! After spending $200 on start up costs (on a credit card at that), I attended 3 meetings. All of the meetings focused on recruiting people. I still don't remember what products I was supposed to sell. After the third meeting ended, one of the top members came in fashionably late from their Hawaiian vacation. The lady shook my hand, never asked what my name was, but asked "Are you working on recruiting?". I left and NEVER looked back! Thankfully, it was only a $200 loss. Now, I'm debt free and a Ramsey Coach teaching people the right way to manage their finances.

Theology Tip: If there's an MLM table in your church foyer, John 2 justifies you in flipping the table over

First Ramsey personality that I've seen actually be so aggressive and honest about MLMs. Love it, but I have a feeling this video is gonna end up getting taken down lol

My college roommate messaged me a few years after he graduated, wanting me to attend a meeting in a nearby town for a "business opportunity". I asked him, repeatedly, what was the opportunity? He said I'd find out at the meeting, but I was like "Nah I'm not going without more info." I didn't go. Turns out the thing he was in was "Quixtar", a predatory MLM. Another example: One of my wife's friends hit her up about "grabbing coffee" randomly, and my MLM radar went off. I told her she should not go, but the guy convinced us he just wanted to "practice" his pitch on us. Only reason we went was because my wife told him we "100% would not buy anything". Sure enough, not only did he waste 1.5 hours of our time, but he seemed pissed when we politely declined. I don't remember what he was involved in, but it was some sort of MLM. I genuinely feel bad for these people - they get suckered in with promises of "early retirement" and making 5 figures a month from home, but it's all a sham.

Glad you touched on the social effects of MLMs. I feel like the true problem about MLMs is that they sell the dream of small business without ever going into the real requirements of small businesses (inventory, marketing, product knowledge). People who start traditional small businesses often know enough to research that sort of thing which increases their success rate; MLM consultants are just told both that it’s easy money (it’s not) and that all their failures in selling are just their not working hard enough (they probably weren’t cut out to be a salesperson or entrepreneur).

Friends pushing MLM’s caused me to reduce social media presence….thank you very much!

The people never ask why they have to BUY the product from the MLM first in order to sell it… I only buy things I’m keeping.

I hope this is the generation where mlm's die.

This is gonna ruffle a lot of feathers in the evangelical community

Thank you for making this. We need to get these things out of colleges and churches

The thing i hate mist about MLMs is how they so often target stay-at-home moms who are struggling to make ends meet. They make these huge, empty promises that they can earn so much money while still caring for their family. Sometimes it's through just slanting the truth, but often it's through blatant lies. But since the lies are told by the "independent contractors" the business itself can't be held accountable. It's so sad that these people could simply find a minimum wage paying job and they would be 10x (or more) better off.

This video is fire. Short, to the point, hits on all the downsides and important facts.

I have so many MLM stories of recruitment attempts. Never joined one. This one takes the cake. It was 1998-1999 first year of studying landscape architecture. I was walking on campus to go somewhere. A lady approaches me and tells me about a job opportunity. She tells me a place and time to be. Days later I get there and there are about a dozen of us seated on the floor. This guy comes in and proceeds to demonstrate knifes (cutco). Shows us how to use them etc. After 30-45 minutes he takes us each one by one into a room. He told me that he thought I would be great at this job. How he could just tell that I am a very motivated, hardworking person. I just had to spend a couple of grand (forgot how much) to buy the knifes etc. I told him that I did not have the cash so he suggested that I could borrow from my father. 😐 My father was already paying for college, so asking him to give me a couple of grand to buy knifes was never going to happen. Also at the time I was living on campus. Imagine having several grand worth of weapons oh I mean knifes in my room. 🤣

i’m in high school and this past week a bunch of my friends got sucked into the cutco mlm. i can’t help but laugh because this video came out at the perfect time. everytime i bring it up i tell them to “sell me this knife”

I had no idea what MLMs were, and ended up joining Arbonne. At the time (about 9 years ago) I actually loved the products but I felt SO uncomfortable in all social situations because of the pressure & 'training' provided by my upline to sell to and enlist people. Looking back, I feel frustrated that noone around me took the time to talk to me about these types of businesses in a respectful and loving way so that I might've ve avoided wasting a lot of time, money and stress. If only I'd found a video like this back then. I think part of the allure is the community it appears to create. People are desperate for community, but I dont think MLMs are the place to find your tribe.

My mom did The Pampered Chef for 17 years and sold over $700,000 worth of products. She traveled the world and even had dinner with my Dad in the Eiffel Tower on their 20th wedding anniversary because she earned a trip to Paris and it happened to be over their anniversary! She was very successful in her business and earned over 10 trips with the company. Our family went to Disney twice with the Pampered Chef. Their products are incredible and built to last. George, I definitely can understand why you don’t like MLMs, but for the 1% of people that are truly successful at them, they’re pretty great. My mom said she started in the company because she wanted to pay off her car, buy a computer, and stop babysitting. She did all 3 of those things within the first month with the Pampered Chef. Sometimes she brought in $10,000+ a month. I get MLMs are bad for most, but definitely not all!

So glad you put this out there George! I’m ashamed to say I’ve been involved with probably more like 9 mlm companies. It’s just not worth it, I lost so much money and time. I’m still trying to get over the brainwashing in their “trainings”, you are right they are so manipulative and prey on women and from what I’ve seen and experienced moms. They want you to feel unworthy of just being a mother or homemaker, it’s disgusting. So this not only derailed any financial progress for our family, it also consumed so much time for nothing, so many wasted hours and severed relationships and friendships over this nonsense pushing products and trying to recruit. It makes me sick to think what I did and what I was learning. I was told to reach goals by any means, sign people up and pay myself, to give up sleep and time with my family, to put off housework. Basically being a slave to the company. I think I most regret the time wasted, I had a hard time communicating with people once I left for good because of all the sales pitches I didn’t know how to talk to people anymore. It really goes much deeper than finances. So glad to say I will never fall for one again and we are on the baby steps working on a side job selling on eBay and Poshmark.

It’s Always Sunny in Philadelphia: “It’s not a Pyramid Scheme it’s a reverse funnel system” “Turn it upside down” “Aaahhhhh Dang it”

It needed to be said… way to go George! 🎉

I was a hair stylist for 15 years or so. Of course, a salon is not a pyramid scheme, but I still felt like everyone I knew was a potential customer, and when anyone chose someone else for their hair services, I felt bad. If I choose to have a small business again, it has to be one where my friends and family are not my target market!

LOVEEEEE you pointing out all of this. Most mlms claim not to be pyramid schemes but when you actually look at compensation plans they are!

Someone kept trying to get me to join Amway a few years back. Glad that I avoided that.

George Kamel is on a roll 💯🔥

I've been approached by a lot of MLMs, but I only actually signed up with one: Affordable Luxuries - of which they were neither "affordable" nor necessarily "luxurious." It was an MLM candle company that was a competitor to Party Lite. The candles were soy-based and *were* actually a nice product, but they were so expensive no one wanted to buy them. It was so long ago that I don't remember what I spent to maintain a decent inventory, but I ended up owning a lot of candles I couldn't sell.

"It's not a pyramid scheme, it's a reverse funnel system."

I got into one in college, convinced me to drop out to make better money to buy more products. 3 years later I’m in regret, I lost some money, but more importantly I lost a lot of friends. I wish I could go back and not meet that person, I wish I could have stayed in school, full ride and all.

This clinches George's spot as my favorite Ramsey personality. Thank you for making this video! I appreciate you holding yourself back a touch on the Smart Money Happy Hour podcast out of respect for Rachel, but I couldn't wait to get your full take.

Roughly £120k in my portfolio are in tech/TSLA stocks, can I get an advice on any other stocks that I can acquire to diversify my reserve across multiple markets while creating a comprehensive portfolio allocation that balances my concerns of risk aversion and returns that meet yearly inflation.

George, your MLM video was excellent. I would like to see you do a video on "Successful Side Hustles". Talk to people who have a successful side hustle and contrast that with things like MLMs and crypto. What are the characteristics of a good side hustle? How much money is needed to start one? How much work is needed per week? How many people have one? How much money do they make? Is it more common in middle-aged people than in young people or old people, more common in females than males, educated than uneducated, etc.?

I felt for this crap back a few years ago thank God I left really quickly before I lost all my friends lol.

Yo! Give the video guy a raise, 😁 this stuff is great.

I'm surprised not one mention of the big dog Amway. They are the biggest and have been around since 1958. Maybe because there is already millions of video's about it on RU-vid.

A few years back a friend's mom decided to bother me while I was working my small business and interrupted me taking to a customer to sell me a straight up honest pyramid scheme. I called her out several times, my customer called her out and we had to shame her out of my store with her yelling "it's not a pyramid, look" while drawing a pyramid

My best friend sells Paparazzi. I've bought from her to support her "business" but I never ever ever had any intentions of becoming a "consultant." I ran the math quickly in my head and there's no way she's making much, if any, money. I researched the company and the only ones making any moolah are the ones at the top. It's not about the jewelry. It's about recruiting more consultants under you and then you earn off their sales AND their purchased jewelry. Oh, and they HAVE to buy so much product to be "active." I wouldn't even consider this.

I admire and appreciate all the research and fact-finding George does to prepare for these presentations! So helpful to have the details and not simply generalizations.

Thank you for this! Having this video to share with a baby steps support group will prevent a lot of people from getting hurt!

Thank you for making this video. Many people who are considering joining an MLM look to Dave Ramsey and his personalities for advice. After watching your Smart Money Happy Hour segment on MLMs, I was hoping that you’d post a video regarding the sleazy business model. Well done, and keep spreading the word!

Love You George !!!!! Congratulations to and your wifey on your baby !!! I knew you were destined for greatness when I seen your Dave Ramsey country song, all of your Starbucks & Chipotle money hacks and your atrium visitor interviews hundreds of times !!! Great Job George !!!!

Ironically, Dave Ramsey loved promoting MLM’s like Amway on his programs.

I almost got into this MLM crap one time and so glad I didn’t. I had some friends do it and it fizzled FAST. They made no money and couldn’t convince ANYONE to sign up under them.

Another Snow White reference: the broke people I know from work come in singing "I owe, I owe, it's off to work I go..."

Somebody tried to recruit me for a MLM insurance company. 2 things I despise more than a used car salesman.

Thank you so much for sharing this! I wish more people would see this. I teach a personal finance class to teens and will be sharing your video.

I have a friend who has bought into Amway hook line and sinker and idk how to tell him he’s wasting his time.

Hello George, I doubt you will read this but you asked to comment. I love all your content by the way. I personally tried 2 MLMs and lost money. I joined Melaleuca 13 years ago and have not lost money, part of it is because it is not an MLM. Even according to the definition that you give in this video, Melaleuca does not fall within those guides. Sadly at times people join others who have no clue what they are doing and therefore fail. I believe you need to always have someone in your corner with the results you are looking for and follow their steps, that’s what I’ve done and thankfully I’m not part of the ones losing money. Thank you for sharing and have a blessed day brother.

Sure MLMs (sometimes) sell a legitimate product, but if you don’t pay your monthly dues, you don’t get a paycheck. What other job requires you to buy their product to get paid? If you applied to a grocery store and they required you to buy $50 of their inventory each week before you got paid, you would laugh in their face. So why do we let MLMs get away with the same thing?

As a Brit who now lives permanently in the US, I appreciated the random Cilla Black clip from Surprise Surprise. Distant childhood memory unlocked.

I was hoping he’d address how some folks out there accuse the Ramsey financial coaching thing as being an MLM…thought he’d at least touch on that to debunk it or explain it a bit, etc.?

I’ve had different experiences. Complete opposite of this video. Like anything in life it’s the person running the business. Do they have the skills? Are they willing to work hard. I’ve built my business to the top 3% and have found tax strategies to lower my liabilities. Setting things up properly and making your money flow through proper channels is incredible. It’s not for everyone but for me it’s given me so much.

5:04 "great-great-great-great-grand recruits" I burst out laughing at that 😂😂😂

Yaaaas thank you for saying this as a Ramsey personality!! I recently became anti-mlm when I learned of all the things you listed in this video. And I also love Dave Ramsey so I looked up his opinion on them. Unfortunately, most of what I found was pro-mlm from Dave bc he knows a couple millionaires from Amway or something. Disappointing when you think about how many people those millionaires had to scr*w over. Anyway. Still a Ramsey fan, definitely a Kamel fan! 🐫

How sad that we didn’t get a Edward Scissorhands Avon reference 😂

My BFF of 30 years has fallen for the travel MLM, I agreed to listen to the sell for her and left the Zoom meeting saying I have to do further research. I told her what I found out and its not for me and you will be spending time trying to recruit people and that is where you will be making money if you lucky enough to get someone to join.

The Mormons are gonna be so mad they might take a drink

5:00 This part was so funny, your great great,great,great grand recruits 😂😂😂

I've been in an MLM for about 3 months and haven't purchased a cent of pruduct but have made a couple of $100 in commissions with mostly customers and some associates. I have full-time work and have only spent a couple of hours on this per week. Only today i'm purchasing my first products with my earnings. What's more is im already making more than most people in my direct upline due to the effort i have put in and the structure of the compensation plan of the company(that rewards effort rather than position). George, MLM is fine as long as you have a high-quality product, well thought out compensation plan, and a reputable company. The criticisms MLMs apply to basically all companies, businesses, and work out there. They can scam, cheat, and exploit you in various ways. So, not everything is a hard rule of thumb.

I used to love Bodi formerly beachbody however if you try to post on socials it’s not long before someone DMs you about their “coaching” opportunity. Can’t stand it plus their supplements that they attempt to sell you are twice as much as products from 1st phorm or other reputable supplement companies

I have a friend who did well in two different MLMs (one after the other). She never reached out to me, even though I was an active friend on her page. She just sometimes shared what the products were doing for her. And she had a lot of friends, including a lot she’d never met, and she built a following of people who wanted to see if the products would help them the way they helped her. Eventually, she quit the second one to spend more time working on her coaching career (but still uses the products$. I am a member of a business network group that meets weekly. One of our members is into Doterra. She doesn’t push, just shares about this or that thing she’s doing, or how you can buy this blend she put together. So she focuses more on direct sales than on signing up customers. A few members do get monthly orders, and the chiropractor member of the group has some of her products in his office for resale. I have bought a few things from her directly, such as these cough drops that help keep my allergy-based asthma at bay (it’s peak allergy season here). She is strategic with her internet marketing and never pesters friends and family. So yeah, there are ways to do it and be successful without being a pain, but one has to be more like a social media influencer than a typical MLM-er.

got sucked into an mlm right when I turned 18 by a trusted person in my life. lost $800 I did not have. still salty about it 😤

Lol george ur videos are the best!! The whole show is so great! Much respect.

There are crypto and forex MLMs too. 💀

Great video George!

I lost one of my best friends for a few years over her involvement in MLM. We have reconnected, but it was a lot. I hate MLMs

I just found out what an MLM was yesterday from this week’s Ice Coffee Hour guest. He was hyping up MLMs saying he made so much money. And it definitely sounded like a pyramid scheme 😅

Probably ought to include time shares and vacation clubs. Better to save up and pay as you go!

Best video to date George!

RU-vid is the best MLM by having us having to subscribe, like, and comment for their algorithm 😂

Hey George, grumpy is good. I like being grumpy. Works well for Mr Ramsey too.

Keep up the good work! Lovin' these videos

No No No No Never Never Never Never

I want to hear your thoughts on PHP Agency

98% of MLMs give the rest a bad name

Thanks for letting us know about these.

I fell into this trap and was in debt. I then started a babysitting side hustle and my net worth is now close to a million. MLMs are the worst.

Yep. I fell for that scheme. I mean, I made SOME money but never enough to make it worth all the time and hassle it cost me. Much better to start my own business and make WAY more money and more satisfaction. Oh yeah, and I keep ym friends 😂

25 years ago, I sold Pampered Chef for about a year. I think my startup cost was $100. We didn't buy inventory, as all customer purchases were shipped directly from the company. As a mom of two small children, I did it primarily for the adult interaction. I did NOT recruit anyone for my "downline." I averaged $400/month. I really enjoyed doing it (I loved the products), but it started taking too much time. I got more bookings for parties than I wanted or had time for, so I stopped doing it. I referred everyone requesting to book a show to my upline manager.

Thank you for this!

YES! I knew I liked you, George. MLM's just need to go away. If any part of your income is based on recruiting people to do exactly what you do, it's a scam.

Everybody in the crew's gotta "kick up" to the Boss.

I did lose money with Amway, but it did open my eyes to “Financial freedom”. The individuals I was around sowed the seed of 100 Percent accountability in my actions and future. The money I lost was worth the positive changes I made in my life due to the people I met. Even if most people didn’t make money off of it, I hope y’all learned some things my friends.

Wish i had seen this videos years ago when i joined one, never again

Don't forget to mention MaryKay

I didn't know this was still around. I lost money doing MLM about 30 years ago.

Simply Earth is MLM FREE!!! Truly it is. AND we offer free Dave Ramsey courses to any employees who want to go through it!!! I'd love to send you some free oils and teach you use to use oils to make natural products you'll love.

thanks for the info. Yes you raise a lot of good points.

I appreciate how you pointed out the RU-vid pyramid scheme 😂

I'm so glad this video exists! But I would take it even a step farther. Even if you do have what it takes to make it into the top 1% who earn good money, I would still never recommend that anyone join (or buy products from) and MLM because in order for the top to earn money, the people at the bottom have to lose. That means any money that's being made is being made through exploitation, and as a Christian, I can't condone that morally or ethically. There are just so many better, more legitimate ways to make money. MLM companies with their current structures shouldn't exist, period.

someone reached out to me for NM , glad I found out what this BS really is

Sales are in everything.

I fell for this once. 😮

A Ramsey personality finally telling it like it is about mlms? Say it ain't so! I just always thought that some Ramsey family member was a boss babe and y'all didn't want to upset her. 😂

I worked an MLM years ago (they claim they aren’t, and they do put some safeguards in place that make them better than the average MLM, but they are one). Anyhow, I no longer run the business, but I love the products. I make about $9/month in commissions from the 3 or 4 people still under me, and I buy the products every month because I use them. For real. The cleaning products are cheap and work well. I take the vitamins. My son uses one of the drink powders in his water before breakfast every day (he doesn’t like plain water). I use their electrolyte powder when I work out on hot days. Sometimes I buy their makeup; my kids use their shampoo (I used to, but now I almost never shampoo-that’s a whole other story). I like their toothpaste and lip balm and other stuff. So I never have trouble making the minimum monthly order. Once I put it on hold for a month when I was gone for a while and couldn’t afford the order, but that is once in over a decade. All in all, I love the products, and if anyone wanted to sign up under me, I’d be happy to help them do it. But I do other stuff now that is guaranteed to make me money quickly (like sewing and Uber).

I am very happy to hear this 😊

No. The answer is no.

Has more do with manipulating people into a good old fashion scam.

George, love your channel, I have kids they play instruments wondering if you can investigate the rent to own instrument. Thanks

cover forex!

I got conned by a digital marketing MLM still hoping I get a refund as I will be down $400 I won’t get sucked into this again they pray on the weak and vulnerable people that makes me so mad!! Learnt a lot

You forgot Market America. The founder was the 2nd pyramid level of Amway so he started he own pyramid but says it’s a “pyramid spelled backwards”.