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Is Plexus a Scam?

June 14, 2020 by Lazy Man 264 Comments

Just a few days after Thanksgiving this year, I got an email from a reader who I will call Xander. He noticed his friend network is getting drawn into an MLM called Plexus.

He asked me to write about it, because like many MLMs out there, they aren’t well-covered by the media. Even when they are, such as Nerium, the companies fight hard to push such coverage out of site for those using search engines to find unbiased, reliable information.

I give this explanation for the reader who has probably read a dozen fake reviews by MLM distributors that generally go like this:

“Is [insert MLM product] for real? We have the truth. [Insert a bunch of misleading claims about said MLM product.] Yes [insert MLM product] ‘works.’ Now go buy it from me here! [Or alternatively, join my system to build your MLM here]”

So let’s dig in:

Plexus Products

The first thing that I saw about the products was this warning letter from the FDA. A company has to do some very bad things for the FDA to smack them down like this. In this case the warning letter dated 6/30/14 points out:

“Your Fast Relief, ProBio5 and BioCleanse are not generally recognized as safe and effective for the above referenced uses and, therefore, the products are “new drugs” under section 201(p) of the Act [21 U.S.C. § 321(p)]. New drugs may not be legally introduced or delivered for introduction into interstate commerce without prior approval from FDA, as described in section 505(a) of the Act [21 U.S.C. § 355(a)]; see also section 301(d) of the Act [21 U.S.C. § 331(d)]. The FDA approves a new drug on the basis of scientific data submitted by a drug sponsor to demonstrate that the drug is safe and effective.

Furthermore, your Fast Relief, ProBio5 and BioCleanse are offered for conditions that are not amenable to self-diagnosis and treatment by individuals who are not medical practitioners; therefore, adequate directions for use cannot be written so that a layperson can use these drugs safely for their intended purposes. Thus, these drugs are misbranded under section 502(f)(1) of the Act [21 U.S.C. § 352(f)(1)] in that their labeling fails to bear adequate directions for use. The introduction of a misbranded drug into interstate commerce is a violation of section 301(a) of the Act [21 U.S.C. § 331(a)].

The violations cited in this letter are not intended to be an all-inclusive list of violations that exist in connection with your products. You are responsible for investigating and determining the causes of the violations identified above and for preventing their recurrence or the occurrence of other violations. It is your responsibility to ensure that all products marketed by your firm comply with all requirements of federal law and FDA regulations.”

I’ll attempt to translate. Three products were illegally marketed as drugs. They also had inadequate directions for safety. There might be other problems as well, so get your act together.

This is a level worse than what DoTerra received that was about the marketing on their distributor websites. Plexus Worldwide was cited for the claims on their own website, not just their Ambassadors.

To make matters worse for Plexus, The Australian Government says, “Plexus Slim Accelerator capsules and Plexus Slim Accelerator 3 Day Trial pack pose a serious risk to your health and should not be taken.” I have added emphasis on my own.

This has lead to Australia banning the product. That should speak volumes.

Plexus Slim Reviews

I found a great website Plexus Point, that has one of the unbiased reviews that I wanted to write. I’m happy she already did for me. You can read her Plexus Slim Review here. I find it particularly refreshing that she starts off by saying all the glowing Plexus Slim reviews are Plexus ambassadors trying to get you to buy the product. My favorite part overall, was the part where it was banned from Amazon.

The Plexus Slim product review on Plexus’ website itself is especially confusing. A bullet point on the front page says, “Fast and easy.” Presumably this about the weight loss and not the product as the next bullet is, “Saves you time” which covers the supplement taking process. Yet the FAQ says: “A: It is a very subtle yet effective product. Most people begin to recognize benefits approximately 2 weeks after starting the product.” Hmmm, “subtle”, “takes 2 weeks…”

A quick look at Plexus’s website shows that every product has an asterisk beside it. It’s not clear what that goes to, but at the bottom of the page there is text that says, “Disclaimer: These statements have not been evaluated by the Food and Drug Administration. These products are not intended to diagnose, treat, cure, or prevent any disease.”

We can simply review the FDA notice above about how products have to show their safety and effectiveness and Plexus Slim hasn’t done that.

It is important to understand why MLM testimonials are pointless. It’s also important to understand that there are many psychology tricks employed to make you think MLM products work, when they don’t… and yes that article has been validated by unbiased, unpaid scientists acting as consumer advocates.

We don’t have to look too far to see that Plexus isn’t in compliance with the FTC guidelines of weight loss advertising. I found testimonials that didn’t have any disclosures at all on the page. In the FAQs, I read many “your results will vary” type disclosures, which the FTC points out is not enough.

At nearly a thousand words, I feel this is pretty sufficient information on the products and the advertising of the products. I encourage you to go read the links cited, because in many cases, there’s much, much more information there. If I tried to cut and paste that here, this page would be as long as a book. I don’t think anyone wants that.

What About Plexus Company?

Plexus and Inc. 5000 rankings

I noticed that Plexus’ website was quick to point out that it was Inc. Magazine’s #8 company. It’s no lie, you see it here. The problem is that few understand what that means.

I first encountered this claim in MLM companies in 2010, when I saw it with MonaVie… a company that imploded soon after the claim. I wrote about the ridiculous of the claim here: MonaVie and Inc. Magazine’s 500.

It turns out that methodology for the rankings is not what you might think it is. It relates to growth of revenue… which makes it ideally suited for pyramid schemes which exhibit “pop and drop” growth. Notice how MonaVie imploded soon after getting highlighted for the “pop.”

Furthermore, the revenue itself isn’t independently verified. It includes only privately held companies… which is why when you scroll through all the companies, you immediately think, “I haven’t heard of any of these!”

The methodology back in 2010 only takes companies that submitted their data to Inc. 500/5000. It noted that “A number of companies had growth high enough to make the Inc. 500, the top 500 of the Inc. 5000, but did not complete the revenue verification portion of the application process in time for Inc. magazine’s deadline.” There are companies left out of this list. It wasn’t a priority for them to get a badge from Inc. Magazine, because they were too busy actually doing real work.

The Project Manager for Inc. 500/5000 wrote a comment saying that my criticisms were fair.

The point is that the badge is there to try to convince people that it is reputable, but even my article in 2010 pointed out several companies which had won Inc. badges were found to be fraudulent.

If you really want to read about Inc. Magazine and MLM (Plexus’s business model), this is the article for you, Multilevel Mischief.

In summary, Inc. Magazine has not validated Plexus and it has actually condemned MLM.

What About the Business of Plexus?

Before you get into MLM, you should understand the basic problems with the business model. There’s also a great article with more information here. In case you are too lazy to click. Some of the problems include:

  • No Moat To Protect Your Business – Anyone can be a Plexus Ambassador. You are literally competing against everyone. If it was a good path to financial freedom everyone would be doing it.
  • You Don’t Control Your Business – If the FDA or the FTC shuts down Plexus for the claims they made, you are left holding the bag. If Plexus decides to change pricing, you are left trying to sell even more absurdly priced products. They may claim you are an independent distributor so that they don’t have to pay you benefits such as vacation or health care, but you are beholden to them as any employee would be. In fact, their policies and procedures even has a section on termination.
  • No Supply and Demand – There’s no control to pair supply with demand. You won’t see a McDonalds on every block, because there isn’t demand for it. They know enough to not create unnecessary supply that would lead to few sales and them going out of business. The MLM companies don’t care about this. They’ll create as many suppliers as they can, even if there’s no demand for the products. This is why most MLMers find it difficult or impossible to sell their overpriced products. They then turn towards a pyramid scheme model of recruiting people into the business.

At the end of the day, it is really hard to even call MLM a business. The MLM companies like to because starting a business is a great thing that I highly recommend. However, you want to start a GOOD business not a TERRIBLE, FLAWED one.

As Mark Cuban says,

“There are no shortcuts. NONE. With all of this craziness in the stock and financial markets, there will be scams popping up left and right. The less money you have, the more likely someone will come at you with some scheme. The schemes will guarantee returns, use multi level marketing, or be something crazy that is now ‘backed by the US Government’. Please ignore them. Always remember this. If a deal is a great deal, they aren’t going to share it with you.”

That reminds me of the last point. Recruiting people into MLM is a self-defeating purpose. You are creating more salesmen, which compete against you in selling products. Typically they call this “building a team”, but if you study pyramid schemes, it’s also called, “growing my pyramid.”

Is Plexus a Pyramid Scheme?

I’ve read the Plexus compensation plan (PDF) and it looks like one to me in my opinion.

Let’s take the example that they give:

“If you sponsored 3 Ambassadors and everyone in your organization duplicated your efforts, your organization would look like the one below:… [image not included]… This example is just a made-up scenario to show you how the Plexus Points would accumulate if everyone who came into your organization sponsored 3 new Ambassadors. In this example, if you were receiving Plexus Points 7 levels down, you would have a total of 4,893 Plexus Points. If the Plexus Points that month were valued at $3.25, you would earn $15,902.25 from your Plexus Points.”

I didn’t include the image, but I’ve been working on this for hours now and I gave you the direct link to the compensation plan to see it yourself. The image is the usual diagram of a pyramid scheme of 3 people, who recruit 3 people, who recruit people… for seven levels. It shows that if you build a pyramid of 3,279 people, you too can earn $15,902.25.

I presume that is per month, which is a nice annual income of nearly $200,000… for 1 of the 3,279 people in the group.

Of course if those 3279 are “AutoQualified” at $100 Personal Volume, they’ve paid $327,900 for the month or nearly $4 million dollars for that one person to get that $200,000 in annual income. Now the person earning $200,000 a year doesn’t complain, and may even show off his fancy check to say how successful he is. What he did is create a financial loss for the vast majority of people who followed him.

And of course this example is very unrealistic, because it presumes that one person is going to be able to build a pyramid/team of 3279 people. For a medium sized city of 100,000 to be able to do that they’d have to recruit nearly the rest of the United States… 327 million people. It is unrealistic and unsustainable.

But don’t take my word for it. Let’s see what the FTC has to say:

“Not all multilevel marketing plans are legitimate. If the money you make is based on your sales to the public, it may be a legitimate multilevel marketing plan. If the money you make is based on the number of people you recruit and your sales to them, it’s not. It’s a pyramid scheme. Pyramid schemes are illegal, and the vast majority of participants lose money… Avoid any plan where the reward for recruiting new distributors is more than it is for selling products to the public… One sign of a pyramid scheme is if distributors sell more product to other distributors than to the public — or if they make more money from recruiting than they do from selling.”

That’s three separate places in the same document that the FTC makes it clear… the majority of the money can’t be made from a downline or it is an illegal pyramid scheme… not a legitimate MLM.

So why is Plexus giving us an example in their compensation where a great amount of money is made from a downline? Why aren’t they giving examples of someone buying 1000 units of product from them and selling them each for a $15 gain to the public (people who are not affiliated with Plexus), and making $15,000 a month that way?

Plexus appears giving an example of someone running a pyramid scheme according to the FTC’s guidelines.

Many distributors say, “How can this be? Law enforcement would shut them down!”

It turns out that the FTC doesn’t have the budget to prosecute all the pyramid schemes out there. Years after USA Today asked if Fortune Hi-Tech Marketing was a pyramid scheme, the FTC was able to shut them down. The company called itself a legitimate MLM for 10 years! Millions of consumers dollars were lost and not recovered in the scam. It took a lot of states Attorney Generals offices, a leading national publication (USA Today), and the FTC to finally get it done.

That’s just one of probably a thousand MLM companies that seem to fit the FTC’s guidelines for being a pyramid scheme.

It’s up to the consumers to be smart and avoid pyramid schemes. It’s also why I’m here to help give you this information. Here’s a video with some more good information on that:

Plexus Conclusions

Between the FDA warnings on the product marketing, the testimonials that violate the FTC guidelines, and what appears to be an illegal pyramid scheme (according to my interpretation of the FTC’s guidelines), I think you know where I’m going with this review.

Save your time and money and move on.

Looking for another opinion? The unbiased Cooper Clinic explains why you should be cautious of Plexus products on WFAA ABC TV channel 8 on April 19, 2016

Hat tip on this: A Woman Scammed

Filed Under: MLM Tagged With: Plexus, scam

US Airlines Scam

February 6, 2015 by Lazy Man Leave a Comment

Last November, I got an interesting letter in the mail. It had no return address, which I always consider a little fishy.

I opened it up to find that US Airlines has given me two free tickets to fly anywhere in the United States. You can see the letter here, but I’ll quote it for those not interest in the click:

Note: You must respond no later than December 1st, 2014

Dear Brian,

I am pleased to inform you that you have qualified for an award of 2 round-trip airline tickets. Congratulations! These tickets are valid for travel anywhere in the continental U.S. from any major international airport. The retail value of this award is $1,375.00. Certain restrictions apply.

We have attempted to contact you several times without success. This is our final attempt. If we do not hear from you soon, we may need to issue the ticket vouchers to the alternate.

Please call me today at 1-877-741-7882.

Regards,
Michelle Jackson
Customer Relations Manager

I have to give credit to my wife who knew it was a scam, even before I did. She pointed out that US Airlines doesn’t exist. It’s a mash-up of US Air and American Airlines.

It turns out that this is actually well-covered territory in the scam world. Even US Air warns about it at the bottom here.

I found one local news team who followed up on it. Here are a few excerpts from their story:

No one had actually called the number on the letter, so News 8’s Brian Roche did. He spoke to a woman named Dusty who would only tell me she worked for a marketing firm in Arizona…

She told him the tickets were not free, they were complimentary, as long as he went to a presentation for a travel agency…

Dusty made an appointment for Roche to attend the presentation at 52 Grumbacher Road in York. So News 8 went to the address and found an empty parking lot and an unmarked building…

News 8 learned that anyone responding to this would get the same sales pitch to attend a presentation at the address in York. One viewer who did attend told News 8 that she and her husband were asked to join a travel club and pay more than $11,000. As they tried to leave, the price dropped below $1,500…

While it may be easy to call this a scam, News 8 is going to stop just short of that. What it really seems to be is a promotional campaign designed to get people to join a travel club….

The most surprising thing of the article is how News 8 stops short at calling this a scam. I’m sure their lawyers told them that they should play it safe.

Seriously though… they invented an airline that doesn’t exist! They are wording the letter like a prize announcement (“Congratulations!”) They neglect any mention of a required sales pitch or a vacation club! They push you to act right away for fear that you’ll miss out on the (non-existent) “prize.” They send people to an empty parking lot and an unmarked building and ask people to pay $11,000 for something only to drop it to below $1,500.

It is a scam according to every definition of scam that I’ve ever read. Usually the definition centers around a confidence game, and that is clearly what “US Airlines” is using here. It’s sad that I have to refer to them as US Airlines, because there isn’t information on what the real vacation club name is.

P.S. I have to give credit to this guy on YouTube who called up the company to call them out on the scam:

Filed Under: scams Tagged With: scam, US Airlines

Is Beachbody’s Shakeology a Scam?

June 14, 2020 by Lazy Man 666 Comments

We’re in the world of COVID-19 and I’m homeschooling two kids on two curricula at the same time. My military wife is deployed helping with the COVID-19 response.

However, the FTC has warned many MLM companies about COVID-19 claims about health and investment claims. I thought it may be useful to refresh (not republish) this article with this message. It may give you a flavor for how MLMs work in general.

Is Beachbody's Shakeology A Scam?
Is Beachbody’s Shakeology A Scam?

Happy Halloween everyone. I’ve got a tale of a scary MLM to share. It’s my first attempt using a new writing tool, Scrivener and a new writing shorthand called Markdown. Normally, I’d put more time into proofreading the article and formatting, but having spent dozens of hours on it as it is, I need to bite the bullet and publish.

Regular readers know that I have a hobby of analyzing MLMs and showing consumers how they deceive you. Last week, I noticed that Nick Loper of Side Hustle Nation had highlighted a friend who has grown a $4k a month business in an hour a day. Kellie Gimenez is doing it with an MLM called Beachbody. You may know of Beachbody’s workouts: P90X and Insanity are two of the most popular ones.

Truth is, I’ve been meaning to write about Beachbody for a couple of years now. I noticed a good high school friend of mine promoting it on Facebook. I pushed it to the back-burner because I wanted to believe it was legit for his sake. Also, I see nothing wrong with P90X. From what I’ve heard it is a great workout.

With Nick’s podcast and what Kellie said, I couldn’t ignore Beachbody any longer. Oh well, this could make for an awkward 20th reunion in a few weeks if we both go.

This is a long article so if you want the “TL;DR” version, it’s:

“Get the hell away from Beachbody’s Shakeology and its ‘business opportunity.’ You are wasting your time and money. Every piece of information seems to show it is an illegal pyramid scheme according to the FTC’s guidelines. A former Beachbody Coach also gives good details into the pyramid scheme nature of the company. According to her, the focus is not on nutrition or fitness, but classes instead include: “How to never take no for an answer when trying to sign on new coaches” or “How to not take no for an answer when selling Shakeology.”

You can pick up Vega One available on Amazon which is extremely similar (and better in some ways) for half the price. A former Beachbody Coach mentioned Nature’s Plus Spiru-Tein High Protein Energy Meal is a great choice at about a single dollar per serving, 1/4th price of Shakeology.

There’s no reason to be a Coach to get a discount as you can get the Shakeology discount price on Ebay without paying coaching fees.”

The Products

As I said in the introduction, I don’t mind the workouts. They seem legit.

What is extremely fishy is the Shakeology product. The product itself isn’t particularly, but the pricing. Before I cover it allow me to explain why pricing matters in an MLM.

Why Does Pricing Matter in an MLM?

This is a good question and few people seem to grasp it initially. One of the best explanations I’ve seen is by a commenter on FatWallet using an analogy:

”Say Mr Pyramid buys pens in bulk from Staples and sells them for $100 each. Who’s gonna pay $100 for a pen? But tell them that they can also sell pens for $100, and we’ll pay you $30 for every pen you sell, plus you can recruit people to sell pens as well, and you’ll get $10 for every pen they sell, and $5 for every pen their recruits sell. Three levels, $45 commissions total on a $100 sale. Everyone has to buy 10 pens a month for personal use to participate in the program. Just find three people who find three people who find three people…. In the end, yeah, you are buying 10 pens a month for $1000, but you are getting $3150 in commissions, so don’t sweat it. Why wouldn’t you join?

Product is moving. The pens get used. No recruitment revenue, only product commissions. Absolutely 100% a pyramid scheme. The only real reason people are paying $100 for a pen is for the opportunity to make money off the sale of pens. Completely unsustainable as eventually, you run out of people to sell to and those at the bottom get hosed buying $1000 pens but not being able to sell them. This is an extreme example, but if you look at the world of MLM, there are some pretty big name companies out there that somewhat fit this mold on a less cut and dry basis.”

[I go into this analogy in more detail here.]

This is why The Verge and The Atlantic are writing about Herbalife which is being investigated by the FTC for being an MLM that is a pyramid scheme.

Back to Shakeology

Anyone who has read my ViSalus article knows this is a red flag. There I showed that ViSalus was charging $1.50 for a shake that any consumer could make with 3 simple ingredients for under 50 cents: whey protein, Fibersure, and a multivitamin. I know saving a dollar doesn’t seem like much, but in 10 minutes of time, you could save your $300 or more each year. Unless you are the CEO of company making millions this is exception use of your time.

Unfortunately Shakeology isn’t quite as easy to break apart. There are many ingredients. I found a nutritional label here, which is worth looking at.

There’s a pretty good product comparison of many shakes including Shakeology here. It criticizes Shakeology in quite a few places, but gives it an overall thumbs up for ingredient choices. His conclusion is interesting:

”Drinking shakes as meal replacements is not, in my opinion, a sustainable long term health plan. No liquid meal replacement satisfies the need to eat and chew solid food, which also stimulates the release of digestive enzymes in saliva… I do not recommend any of these products as a route to supreme good health. However, if you are going to drink a meal replacement, opt for Shakeology by Team Beachbody, it seems to be way better than the others in terms of the quality of the ingredients.”

So in fairness, Shakeology may have decent ingredients, but it isn’t necessarily a good health choice (according to this extensive review).

As we covered earlier, pricing does matter in MLM. According to Gimenez’ description on the Side Hustle Nation podcast, the meal replacement shake is around $4 or $120-130 a month. We’ll dig into pricing in a minute, but we are going to take a quick detour.

At the 11:50 mark of the podcast, Nick Loper politely says, “ummm, it didn’t really do it for me” while laughing (Translation: You don’t want to put this in your mouth.) Kellie says that some shakes “you can just shake in a shaker and go for it.” With Shakeology you need to “find your mix” and “you need to blend it.” She mixes the chocolate flavor with peanut butter, a banana, almond milk, ice.

This is where Shakeology starts to fall apart.

If you go back to the nutritional facts, it only has 140 calories a serving, not a good value for $4. It’s marketed a meal replacement, but I’ve never seen 140 qualify as a meal. The US RDA for calories in a day is around 2000 calories. (It varies with age/gender, but that is an average.) People typically eat three meals a day. Allowing for some snacks, a typical “meal replacement” should have between 400-500 calories.

Thus to get a true “meal replacement” you’d have to drink 3 shakes at a cost of $12. However, as Ms. Gimenez points out you need to “find your mix” and “blend it”, so it isn’t meant to be a “meal replacement” on its own. Let’s just say that for $4 and an additional dollar of mix ingredients, you can make yourself a $5 shake. That’s in your own home, not at a swanky restaurant as you might in Pulp Fiction (Note: adult language). If you are going to pay restaurant prices for a shake mix at home, you might as well buy $40/lb. steaks at your grocery store.

Wait, there aren’t any $40/lb. steaks at your grocery store? Are there any shake mixes that are $4 for 140 calories? The closest thing you can find is Carnation Breakfast Essentials, No Sugar Added, which has similar calories, protein, fiber, vitamins and minerals for $0.62 a serving (nutrition label: http://www.nestlehealthscience.us/asset-library/PublishingImages/8.0PRODUCTSLocalLandingPage/Nutritional%20Panels/CBE-Powder-NSA.jpg). If you use the Subscribe and Save option, the price comes down to 50 cents a serving. Yes, I know Shakeology Coaches are going to try to rip me apart for the comparison saying that Carnation is full of bad ingredients. However, as long as shakes aren’t a good health choice (according to the review referenced above) to begin with, quibbling over the differences here doesn’t make sense. What’s vastly more important is that the nutrition label is very, very similar, but at around 1/6th or 1/8th the price of Shakeology. If you are looking to get into shape the important things are calories, protein, carbs, fiber, etc., not whether it has apple pectin powder or wheatgrass in it.

Update 1: I found a similar product, Vega One available on Amazon, that is $53.48 (as I write this) or $2.43 per serving. Looks like it almost identical with digestive blends, antioxidant blends, probiotic blend, tons of vitamins and minerals, similar calories/protein. Vega One has double the fiber and an Omega 3 blend, which arguable makes it better at a much lower cost. Oh and Amazon’s autoship (Subscribe and Save) saves me an additional 20% off the $53.48 price making it $42.78.

Update 2: A former Beachbody Coach mentioned Nature’s Plus Spiru-Tein High Protein Energy Meal as a great choice in the comments. It is about a $1.15 a serving or nearly 1/4th the price of Shakeology. The comment also gives good details into the pyramid scheme nature of the company. According to her, the focus is not on nutrition or fitness, but classes instead include: “How to never take no for an answer when trying to sign on new coaches” or “How to not take no for an answer when selling Shakeology.”

In a year, you would spend over $1200 a year drinking Shakeology, but save a thousand dollars going with Carnation Breakfast at $225. That buys a lot of Beachbody workouts, time with a personal trainer, or other things that will help you get in shape.

And let’s take a minute to mention how terribly inconvenient it is blend a shake if competing products have an option to “shake in a shaker.” You certainly aren’t paying for convenience with Shakeology… you are paying for inconvenience.

However, if you are going to go with blending route anyway, I suggest that you get a Nutribullet (here’s my review) and make this mix at home for around 50 cents a serving. I combine frozen fruit (around a cup), whey protein (1/2 scoop), Greek yogurt (a tablespoon), and some spinach (you’ll never know it is there) and blend away. Sometimes I get crazy and add flax seed. It tastes great and costs probably around 50 cents a serving… again a fraction of Shakeology. So for the health nuts that have a problem with the Carnation Breakfast option, this is another option that should eliminate all health questions.

Finally here are some other cheaper alternatives to look into:

To summarize, it seems like Shakeology tastes so terrible that you need to mask it with a plethora of other ingredients. It is so expensive that the pricing at a restaurant is famous in a movie for being outrageous. Shakeology may be healthy for a shake, but shakes aren’t healthy to begin with. It misrepresents itself as a meal replacement when it is really nothing of the sort at only 140 calories. In only becomes a meal replacement when you add the other ingredients… at which point you might as well just had the meal.

Beachbody Bummer has a great chart about how absurd Shakeology pricing is… Pricing for 200 calories: Slimfast is $0.63, Ensure is $1.03, GNC Total Lean is 2.36, Shakeology is $6.66. Yikes!

Given all the problems with Shakeology, a natural question to ask is, “Who is going to pay $4 a serving for Shakeology?” If that sounds like the “Who’s gonna pay $100 for a pen?” from the Pen Pyramid Scheme, you are starting to get the idea.

What Can you Expect to Earn as Beachbody Coach

When someone presents you with a business opportunity it is always wise to crunch the numbers. Beachbody has posted an their income disclosure statement (PDF) on its website. You’ll want to click on that.

The first thing you’ll notice is that the document is from 2010-2011. Hmmm, that’s not a good sign. Giving Beachbody the benefit of the doubt, I dug deeper and found a Beachbody income disclosure statement from 2011-2012 at an obscure URL (see the link when you mouse over it).

I was unable to find information from 2012-2013. Maybe it exists, but I think Beachbody just gave up and didn’t release one. You’ll find out why I presumed they gave up as we analyze it.

To make things easy, these income disclosure statements are commonly referred to as an IDS in the MLM world, and I’ll keep the same convention. Also since they go from the end of December to the end of December, I’ll just use the year that encompasses 99% of the data. So I’ll refer to the 2010-2011 as simply the 2011 IDS and the 2011-2012 as the 2012 IDS.

I’ve evaluated IDSs from dozens of MLMs, and the first place to look is always the fine print. In footnote 2 of the 2011 IDS you’ll find that only 49.3 of Coaches earned a check from Beachbody… 50.7% earned nothing, nada, zilch. In the 2012 IDS it gets worse as footnote 3 says that only 45.9% earned checks… 54.1% earned nothing, nada, zilch.

Thus the chart that you see in each of the IDS’ is automatically missing half the data. It’s like analyzing hitter’s performance in baseball, by only looking at the hits and ignoring the outs he makes. Or it’s like evaluating a QB in football by looking at only the completed passes he makes and ignoring the incomplete passes.

It doesn’t make sense to sweep the failure of 50+% of the workforce under the rug in a footnote…

…but it gets worse.

In each IDS footnote 1 says that it includes Coaches who were with Beachbody the entire period. Thus the data includes only experienced coaches who have been with Beachbody for a year. The growing pains of people new to Beachbody are excluded. This means that those who have put in a year in the business had a less than 50% chance of receiving a check of any kind.

Churn Rate in MLM

I Interrupt this analysis to talk about churn rate in MLM.

It’s important to note that there is a huge churn rate in MLM. It ranges from 60-90% from the few companies that have accidentally disclose it at one time or another. (It is never regularly reported by any MLM that I am aware of.) It’s not often that people will stick around in business when they aren’t earning a check. In fact, I go out on a limb and say that it is dumb to put a year in a business that isn’t paying you a check. It’s a crazy limb to go out on, I know.

There is a great article on Seeking Alpha that explains that the people at the top of the pyramid stay year after year while the people at the bottom quit when they make no money and are replaced by new people (i.e. churn).

Back to Beachbody IDS analysis

Getting back to the IDS analysis, all the people who got churned in under a year or were members from June to July (not qualifying for either IDS), are excluded from this analysis.

Here’s what I would consider a more accurate representation of the Beachbody Income Opportunity. This chart has four “cases” depending on the churn rate that I don’t believe is disclosed by Beachbody. It assumes 100,000 Coaches – I had to pick a number since I didn’t see one disclosed. This is a nice round number to get an idea of the percentages… and in my experience it probably isn’t too far off from the actual number of Beachbody Coaches in the United States.

From my experience with MLMs, “Case C” or “Case D” are the most likely cases accounting for the churn. So when you read this chart you’ll see that somewhere between 4.59% (4,590 of 100,000 in Case D) and 18.36% (18,360 of 100,000 in Case C) of Coaches earn checks after accounting for typical churn for IDS 2012. From there you’ll most of those (71%) are “Retail Seller” Coaches.

Beachbody Income Analysis
Beachbody Income Analysis (Click for Larger)

Beachbody Expenses

While Beachbody provides an Income Disclosure Statement, like all MLMs, it avoids any attempt to estimate expenses. Thus we are at a loss to figure out how much money a Beachbody Coach actually brings home.

The excuse they give is that the expenses vary with each person. They do, but many of them are consistent. Here are a few to think about:

  • Conference Fees – The Beachbody Coach Summit ranges from $99 to $295 depending on when you buy it. As I write this, 10/24/14, the price for the event on 7/16/15 (still nearly 9 months away) is $195. The early pricing was expired months ago (7/31/14).

The people who benefit from this early pricing are the people who are already in and already making good money… the people in the diamond ranks. It doesn’t seem right to me that the people who are making the most are going to end up paying the least. The new person who joins in 2015 is going to pay $245 or more.

This doesn’t count hotel, car, airfare, and food (restaurants are expensive), which reasonably add another $1500 in costs. Some will argue that conferences are optional. No doubt about it, they are.

However, the same people will talk out of the other side of their mouth saying that if you are serious about the business, you need to go. They’ll also say that the people who aren’t making money aren’t putting in the effort in doing stuff like this.

To those people, I’d say, “You can’t have it both ways.” Either going to the conference is a critical ingredient AND COST of doing the business or it is not. If it is not, then not going is not an example of something “not trying.”

  • Monthly Coach Fees – There is a monthly $15.95 fee to be a Coach. That pays for a website and a subscription to “Success.” I’ve covered this already when I wrote about the ViSalus scam, a similar MLM shake company, but it is worth mentioning here.

The “Success Magazine” is brainwashing material, more commonly known as propaganda, directed at the MLM business. If you look at the company that distributes it, they make it clear that their business is partnering with MLMs. Just go through all the partners at the bottom of the screen and you can see that they work (it appears 100% exclusively) with pyramid selling companies. If you’ve ever seen a copy of Success Magazine, you’d see that 90% of it is sound business advice designed to gain trust… but the other 10% of it is about legitimizing MLM. In contrast, pick up any other business magazine, Fortune, Entrepreneur, Inc. Fast Company, BusinessWeek, and you’ll see nothing about MLM being a legitimate business. In fact, Inc will tell you quite the opposite.

The problem is that most people buying into MLM are too brainwashed to see that “Success Magazine” is essentially an infomercial. You shouldn’t pay a monthly fee for propaganda… especially propaganda that sells advertisements. It is a combination of paying for the Metro and your company newsletter.

The website is another area where the company shouldn’t be charging money. Facebook, Tumblr, and other similar websites don’t charge money. They make their websites available to you for free and you don’t even work for them. Why would you pay Beachbody money for a website to sell their products? Does your current office job charge you for the use of the company’s email system? Of course not.

The website that Beachbody provides has almost no incremental cost to add coaches. It is similar to the cost that iTunes incurs when you buy music there: it is fractions of a penny to send the music. The real costs are in producing the product the first time. Same thing with the Beachbody website. I don’t know how often they roll out new tools on the website, but for the most part it should be very basic, something with minimal costs to produce the first time and very few ongoing costs to update pricing and policies.

It may not seem like the monthly $15.95 fee is outrageous, but it’s a huge deal when Netflix raises rates from $7.99 to $8.99. Netflix is a good example of a company that provides product in unlimited quantities that is extremely expensive to produce… and it’s priced at nearly half of Beachbody Coach fees. It is interesting to see how the $190 in annual Coach Fees stacks up add up to the income that is being earned.

  • Weekly Club Fees – I’ll let this Beachbody Coach explain this: “There is also an option to be Club Member that costs $2.99 a week and is billed quarterly. I consider the Club Membership as a cost of doing business, because in order to qualify for the customer lead program, one of the requirements is for a Coach be a Club Member. Some Coaches don’t like this, but to me $2.99 a week is a small price to have customer placed in my business.”

This is Mindbloggling. It is an annual fee of over $155 a year. It is almost as much as the Coach Fees themselves, but it can be overlooked since it is such a small number. It’s billed more often though. I realize this is “optional”, but many, like the Coach above, consider “a cost of doing business”, simply because the Beachbody created a policy to makes this fee a requirement for the customer lead program.

The customer lead program is a hairy best of complexity. Good luck wrapping your head around this 5 part series. The gist of it is that if someone signs up at Beachbody who wasn’t referred by a Coach, Beachbody will place that customer with a Coach who has paid this $155 annual membership.

Breaking it down, Coaches make money by either selling product or recruiting people to be Coaches who buy product… but this system allows Coaches to make money for doing neither. Essentially Beachbody’s website is doing the Coach’s job. Sounds like a nice free lunch, until you realize that it isn’t free.

It should be obvious that it is a strange game Beachbody is playing. They charge Coaches for websites, but when the Beachbody.com website makes money they disperse the commission to Coaches.

Shouldn’t Beachbody keep those commissions that they earned without any Coach’s help and use it to pay for the websites? That would make sense. The only reason I can see to NOT do it this logical way is that there are very few leads, and it is more profitable for Beachbody to collect the annual $155 in Club Membership fees from Coaches to qualify to get one.

Profit Analysis

It’s business 101 that income minus expenses equal profits. Making money is earning profits, not income. Here’s some analysis from Beachbody’s own information.

The easy expense is coaching fees. The $15.95 monthly fee comes is rounded down to $190 a year. The “cost of doing business” weekly fee to qualify for leads is another $155 a year. That’s $345 and you haven’t gone to a conference. You didn’t put gas into your car to go a meeting. You didn’t buy any sample product to give away. This is pretty close to the bare bones minimum.

When you fall into the 50% that didn’t earn a check after a year, the Beachbody people are going to say, “It’s because you weren’t committed.” However, by “committing” yourself, you are guaranteeing yourself of only one thing: greater expenses. As we see, the odds of greater income are extremely slim and there are certainly no guarantees.

If you start adding some of the expenses I listed it isn’t trivial. It can be thousands of dollars.

Using “Case C” of the 2012 IDS in the above chart, we see that only 18% (18,360 of 100,000) earned any income at all… 82% (rounded) earned nothing. Of those lucky enough to make a check, 71.4% had an average income of $467 Combine those two stats and 95% of Coaches are below Emerald who either lose money or maybe break even… earning no real profit for their time spent.

Using “Case D” of the 2012 IDS in the above chart, it gets worse with only 1% of Coaches making it to Emerald or above… around 99% either lose money or break even.

And remember these expenses are incurred from the start of the business, while the income is measured of those who have been there for a minimum of a year.

Is Beachbody a Pyramid Scheme?

That’s the question that people are going to ask when looking at MLM. Many people just jump to the conclusion that it is a pyramid scheme. That’s not a bad instinct and let’s look at why:

The Federal Trade Commission (FTC) is the authority on pyramid schemes and put together this document to help consumer tell whether an MLM is legit or if it is an illegal pyramid scheme. I’ll quote some important lines, but it is worth reading the whole document:

”Not all multilevel marketing plans are legitimate. If the money you make is based on your sales to the public, it may be a legitimate multilevel marketing plan. If the money you make is based on the number of people you recruit and your sales to them, it’s not. It’s a pyramid scheme. Pyramid schemes are illegal, and the vast majority of participants lose money…

… Avoid any plan where the reward for recruiting new distributors is more than it is for selling products to the public. That’s a time-tested and traditional tip-off to a pyramid scheme…

One sign of a pyramid scheme is if distributors sell more product to other distributors than to the public — or if they make more money from recruiting than they do from selling.”

In three separate places in one small document they’ve made it very, very clear… selling product to the public (people not in the MLM) is legit, making money recruiting people is a pyramid scheme. That’s consistent with every legal definition of a pyramid scheme that focuses on endless chain recruiting.

To summarize in caveman language: “recruiting hierarchy (”building a team”/pyramiding/[call it what you want]) is very bad. Selling to public (friends, family, etc.) is good.”

So with the FTC guidelines in place, I have to conclude that Beachbody is indeed an illegal pyramid scheme. I’m sure Beachbody’s lawyers are drafting their cease and desist letters now. To them I’d say, this is my constitutionally protected opinion based on the FTC’s guidelines and the information that I am going to (and have already) presented. While you may choose to conclude differently, I think your opinion would not be based on any evidence, so you might as well conclude the world is flat.

Before we Get started. Let’s debunk the pyramid scheme myths

To start I have to debunk the three pyramid scheme myths that MLMers always come to me with:

  1. A pyramid scheme doesn’t have a product or service. It seems this is part of a definition on Wikipedia. It simply isn’t true. Otherwise the FTC wouldn’t have put out the document on MLMs that I referenced above. MLMs clearly have products and services yet they can be pyramid schemes. Also, the FTC wouldn’t have shut down this MLM which was selling Dish Network products for being an illegal pyramid scheme.
  2. You can earn more than the person who recruited you, so it can’t be a pyramid scheme. That’s another common myth. Go through the FTC guidelines again and tell me where you see that. It’s a story that MLMers tell each other to convince themselves that they are legal. It’s not based on any case law or regulatory body that I’ve ever seen.
  3. Your company is a pyramid. This is the most common one. These people are confusing legal hierarchical organizations not based on recruiting with pyramid schemes that are based on endless chain recruiting. Think of it this way… A software engineer at Microsoft can make 6 figures a year without ever recruiting a single person. Typically zero percent of his annual salary is based on him recruiting others. If we go back to the FTC guidelines, this income is not based on recruiting, and clearly it is very legal. So no, Microsoft, nor your typical company, is not a pyramid scheme.

Here are some Beachbody Coaches spreading these myths (and a couple of others):

Coach 1 – Spreads “doesn’t have a product” and “a company is a pyramid” myths.
Coach 2 – This Coach doesn’t use any of the above pyramid scheme myths, but instead uses Donald Trump who licenses his name to MLM companies and sells books to MLMers. Of course Trump isn’t a distributor or Coach with any MLM company.
Coach 3 – Spreads the trifecta: “doesn’t have a product”, “a company is a pyramid”, and “you can earn more than the person above you” myths.
Lindsay Matway via YouTube video – Says a pyramid scheme is “making money not by selling product, but signing up people below them”, which is an accurate definition of Beachbody, at least in the Gimenez case study above. She spreads, “no real product being consumed” myth. The example of the FTC shutting down a company used Dish Network TV service, which is certainly a real product and consumed by viewers. The rest of the video is fluff unrelated to definition of pyramid schemes.
Coach 5 – Spreads “You can earn more than the person who recruited you” myth. Doesn’t address any of the key things that may make an MLM a pyramid scheme.
Coach 6 – Spreads “doesn’t have a product” and “a company is a pyramid” myths. Documents the money that Beachbody pays him, despite misleading people with these myths.
Coach 7 – Spreads “bogus product” myth.
Coach 8 – Spreads “doesn’t have a product” and “a company is a pyramid” myths. Creates a whole chart of misinformation such as legal MLM is generated ONLY by product sales which ignores the key difference of selling to recruits vs. selling to the public. Chart has a myth about the presence of a training program making a difference. Chart makes up a “get rich scheme” vs. “true work” myth. The only thing really accurate about the chart is the overpriced product being a sign of a pyramid scheme. As covered earlier, this points to Beachbody being a pyramid scheme. Spreads a myth about the BBB not accepting Beachbody as a member if it were a pyramid scheme, but the BBB page clearly says, “BBB accreditation does not mean that the business’ products or services have been evaluated or endorsed by BBB.” Spreads a myth about the DSA not accepting companies that pyramid schemes, but the DSA spreads a definition of pyramid schemes that doesn’t match federal regulators.
Coach 9 – Spreads “doesn’t have a product” myth. Doesn’t cover any of the points brought up by the FDA.
Coach 10 – Spreads “a company is a pyramid” (via image), and “you can earn more than the person above you” myths.

That’s 10 Beachbody Coaches I found in just a few minutes simply by going to Google and searching “Beachbody Scam” and “Beachbody Pyramid scheme.” Not one of them had a legitimate reason that I could see why Beachbody is not a pyramid scheme. Not one of the coaches addressed the point about making more sales to the public than through its downline of distributors.

Some of them are making significant money. It is gross negligence on Beachbody’s part to not sufficiently police the misleading of consumers. At a very minimum, Beachbody could put an official page on its site and tell distributors to not address the topic at all simply point to the website.

I just solved Beachbody’s massive compliance issue in under an hour. This stuff isn’t rocket science and any reputable company would have been all over it.

So How is the Money being Made in Beachbody?

The Kellie Gimenez case

Kellie made it clear in the Side Hustle Nation podcast that she makes $4000-4500 a month and that $500 comes from direct sales. The rest comes from commissions from her downline. Here is what she says at the 17 minute market of the podcast:

”A majority of your income isn’t going to be coming from the products. The majority of your income, as you grow a team, is going come from your Coaches and the volume they sell. Because you can only sell so many workouts a month… If they aren’t drinking Shakeology every month, I mean, they can buy one workout and never buy anything else from you.

… When I first started as a coach and didn’t have a team underneath me, I was making about $500 selling products. That’s not bad. It paid for our groceries. It paid for gas. It was a good income, but it’s definitely not something that could be a successful side hustle.

She’s clearly making more from recruiting than from sales to the public. Kellie is essentially saying this is how it is designed. She even is negative on making sales to public.

This fits the FTC’s definition of an illegal pyramid scheme exactly. Any reasonable person would have to conclude that using the FTC’s guidelines and definition, Gimenez is running a pyramid scheme. She may not even realize it, because of the myths of pyramid schemes that I presented above. She might be a fantastic person… certainly sounds like it on the podcast.

As a reminder Kellie is a Diamond level Coach in Beachbody. This is in the 0.4% or 0.1% of Coaches depending on “Case C” or “Case D” of the my IDS analysis chart above. If anyone in the organization should know the rules and is abiding by them, it should be diamond Coaches. Beachbody corporate should be “coaching” their distributors about the FTC’s guidelines regarding pyramid schemes and at the very least look at its top distributors and see if they are making their money from the downline vs. selling to the public.

Let’s Look Back at Shakeology’s Pricing again

Ms. Gimenez’ quote in the previous section about which products are being bought is significant. If someone buys a workout, the commission is earned one time and then maybe never again. However, Shakeology is different as a customer spends consistently on it month after month. It seemed like Nick cut her off before she could say it, but it certainly sounded like she was ready to say that the emphasis is on selling the shakes.

In fact, if you go back and listen to the podcast, at the 11:30 mark, Kellie says that she tries to get everyone to buy the shakes.

Given what we saw with the Pen Pyramid Scheme analogy in the section about Shakeology, it fits the mold to be a pyramid scheme. Get people using vastly overpriced pens/shakes regularly and reward a fraction of the money back to the people at the top pyramid.

It might not be a smoking gun of a pyramid scheme, but it is another major piece of evidence against Beachbody. They could very easily offer an affiliate program that rewards Coaches for selling product without the pyramid of rewards for recruiting more Coaches. Such an affiliate program would quickly end any questions as to whether it is a pyramid scheme.

Beachbody’s own words on their Income Disclosure Statements

I thought that Beachbody’s own words in its Income Disclosure Statement interesting.

”Many of our Coaches have chosen not to build a business, but rather join for the opportunity to purchase our programs at wholesale and to be able to earn extra income by helping their friends and family purchase our programs. For this period, 33% of our Coaches decided to take advantage of the bonuses available for those who help the company recruit and enroll other Coaches and retail Beachbody® products to customers. This activity is rewarded through a binary compensation plan which pays bonuses at the Development and Leadership Ranks of Emerald Coach and above.”

First Beachbody makes the fundamental mistake that most MLMs make and have Coaches “join the [business] opportunity” to earn a discount. Many MLMers describe it like being a member of Costco. There’s fine, but Costco conflate a business opportunity with a discount.

The discount earned by joining is 25% according to Kellie in the podcast. That is a hefty chunk on the monthly price of Shakeology. The question becomes, who is left to buy the products at a retail price… the “public” mentioned in the FTC guidelines?

Next, the Coaches who join “to be able to earn extra income by helping their friends and family purchase our programs” are building a business contrary to the opening sentence of that quote. If selling product to family and friends doesn’t count, then it looks even more like a pyramid scheme when evaluated through the FTC’s guidelines.

The final two sentences of that quote are confusing at best. It makes it sound like earning a bonus is a decision that someone makes such as ordering a cheeseburger at McDonalds. It then bonuses are earned by recruiting and enrolling other coaches as well as retailing Beachbody products to customers. However, according to the first sentence retailing Beachbody products to friends and family are not running a business. So unless there’s some distinction of what a friend/family/customer is (and the FTC doesn’t seem to make this) apparently we can exclude retailing Beachbody products in the later part.

That leaves us with earning bonuses for recruiting and enrolling. As you can see, this is where the majority of money is earned. That’s hits the FTC’s guidelines for being a pyramid scheme on the nose.

Beachbody Bummer is a great resource

I stumbled upon Beachbody Bummer which lists federal warnings about pyramid schemes and MLMs. I would have like him/her to link to the SEC’s guidelines, but nonetheless she/he does a great job at highlighting some of the important things like inappropriate pricing (as mentioned earlier).

The Beachbody Scam

As we’ve seen actual profits are very, very rare in Beachbody. Yet it doesn’t distributors from recruiting. They can’t see the “business opportunity” for what it is… a wolf in sheep’s clothing.

Here’s a great quote from Harper’s Magazine on Mary Kay and MLM schemes:

“The women I interviewed for ‘The Pink Pyramid Scheme’ told me stories about struggling to patch together daycare or to survive high-risk pregnancies while working long hours scouting prospects and hosting parties without any guarantee of a sale. Debts mounted, marriages failed. They couldn’t have it all because Mary Kay’s business model (like that of any multilevel-marketing enterprise) is designed primarily to profit from, rather than enrich, its workforce.“

Think about those recurring expenses in relation to the average income. Suddenly the Coaches fees and Club Membership fees make sense.

Think about the high margins the company is earning on distributors buying Shakeology… even when distributors buy it wholesale Beachbody makes a substantial profit. It’s essentially the Pen Pyramid Scheme, but with (slightly) less exaggerated margins and purchased much more regularly. The Pen Pyramid Scheme doesn’t become less of pyramid scheme if they give distributors the right to buy pens for $80 instead of $100. A 20% savings looks good, but it is minimal when the pricing is so absurd.

Do the Ends Justify the Means?

Beachbody Coaches may argue that in the end people are getting healthy, so who cares about all the scammy stuff that goes along with it. If you are really interested in people’s health, then I suggest you simply coach them without Beachbody. Form a buddy system and keep each other in check.

There are countless other tools available. The free website SparkPeople is a health community. Additionally you could also use another site StickK.com (my article on it: StickK to Your Goals) is a way to keep people motivated.

I have no problem with Beachbody workouts, but there are numerous options available. Workout videos have been around for decades.

Just a few minutes of research can give you all the value of the “ends” without all the problems associated with the “means.”

I STRONGLY IMPORE everyone to petition the government with your feelings about this as I have done. The official FTC Twitter account has instructions about how you can communicate your opinion of scams and help others avoid being scammed:

If you think you see a scam, talk with someone. Your story could help someone avoid that scam. Then report it to the FTC at https://t.co/gtPxXAxsek: https://t.co/PWFawyXejS

— FTC (@FTC) May 20, 2020

This article was originally published on October 31, 2014. It contains the best information I found at the time of publication. If anyone has factual information where I may be incorrect in my OPINION above, they are welcome to leave a comment for my own and public review. Readers with different opinions are always free to publicize those opinions elsewhere.

I strive to update this article, and all my articles, with the best information available to help consumers make an informed decision. I may not always achieve that goal due my other career and family obligations, but I do my best. If I’ve been informed publicly (such as Twitter) multiple times over 1-3 months it will probably get my attention. One easier way is to leave a comment.

Just to make it extremely clear to readers and MLM lawyers looking to sue me, the article above is my constitutionally protected opinion. It’s strange that I have to say it and cite the FTC above, but some lawyers act badly when they are offered a bunch of money by a company looking to bully a military family.

Filed Under: MLM Tagged With: Beachbody, scam, Shakeology

Is Visi a Scam?

October 7, 2018 by Lazy Man 92 Comments

I’ve heard a lot of chatter that many ViSalus distributors have moved their entire downlines to another company called Visi. I first heard it from a high ranking ViSalus distributor and this has been confirmed in a comment on my ViSalus post. It wouldn’t be a surprise if the ViSalus people jumped shipped for another MLM. Historically that’s how it goes with MLMs. Once the Titanic hits the iceberg (the MLM starts to collapse) they get on the lifeboats and see what they can do at another MLM. Many of the MonaVie distributors came from Amway.

When ViSalus was at its peak, it had distributors getting cars with obnoxious license plates that said, “Told U so!” In writing about how ViSalus was a scam, I warned them that the business plan of recruiting was an unsustainable pyramid scheme. With 75% of their distributors having left, and their parent company’s stock going from $45 a share to $8.50 a share (as of this writing) I can confidently respond, “Told U so!”

In any case, this article is about Visi. Visi is one of the life boats that ViSalus distributors are getting on. Are they jumping from the frying pan into the fire? Let’s find out!

An Introduction to Visi

There are so many places to start with Visi, but I found a distributor embedding this official Visi video on their website. Since it is meant to be an introduction to Visi, it seems as good a place to start as any.

Let’s break it down.

Dreams

The first minute is about pitching the “dream”, citing that people have lose the ability because of responsibility. At the 50 second mark, they voice-over specifically mentions “hope.” The words and images (ballerina, rocket blasting into space [astronaut]) are carefully used to focus you on what’s “possible”, not what’s “probable.” In fact, the company doesn’t offer the ability to fulfill the dream of being a ballerina or an astronaut. And no one ever said, I want to sell supplement chews when I grow up.

Testimonials

At the 1 minute mark, you see a rapid succession of testimonials from Visi distributors. They come quick with Robert Klutts claiming that he lost 25 pounds over 5 weeks, Michelle Reiser claiming to be debt free, and Mike and Alexis McClenaghan pitching increased free time. Who want to lose weight, be debt free, and have tons of free time? See how seductive this pitch is? It’s powerful and just about every MLM I’ve used has some variation of it… even if well over 99% of participants lose money.

It is worth noting that Bob Klutts was a professional MLMer before joining Visi. That’s not to say that his weight loss claim isn’t true, but we know better to take weight loss testimonials from paid endorsers don’t we?

On Michelle’s Reiser’s LinkedIn page she claims to be a “Founding Partner” and a “CEO Advisory Council” member (In case she changes it, I’ve archived a screenshot of Michelle Reiser’s LinkedIn here). It’s no secret that in pyramid schemes those who get in early make the big money. Later recruits are left with loses after feeding the money up the line.

This may be a good time to point people to the FTC’s guidelines of MLMs and pyramid schemes, while noting that the FTC doesn’t actively protect consumers from MLMs that are pyramid schemes.

In any case, Michelle Reiser’s is misleading consumers into thinking that because she got debt-free the opportunity exists for everyone. Maybe it does for everyone who is a founding partner at in such a scheme. She lives in Canada, so the law might be different there, but in the United States the FTC is clear about such endorsements misleading people are illegal.

Finally we have Mike and Alexis McClenaghan. Mike McClenaghan admitted on his in this Business For Home article that he has I “been in this industry for over 22 yrs.” He also claims that he’s a “Arctic Emerald Founder Advisory Board Member.” (and in case he deletes it, I’ve archived it as well.) “Arctic Emerald” is the highest level of distributor in Visi’s scheme.

Yes the two people making income claims (Mike McClenaghan indirectly through a “free time” claim) are founders. That is convenient isn’t it?

Dreams Part 2

Founder and CEO Kent Lewis comes in at around the 1:15 mark with quotes “achieving their dreams” and “dream big again” in a span of less than 10 seconds.

Visi is a Cult now

At the 1:25 mark a creepy voice comes in saying that “Visi a culture, built and inspired, by the belief that boundless possibilities and abundant wellness are good for every body.” Everyone who loves limited possibilities and illnesses raise their hand!

Bring on the Paid “Doctors”

As I’ve found with MonaVie, and even ViSalus these companies love to bring on a paid doctor to lend credibility to the product. At the 1:37 mark we meet Charles Rouse, a member of the Scientific Advisor Board. On his website The Medicine Man, he admits that he’s a “creation scientist.” As Wikipedia cites from reputable literature on Creation Science, “The overwhelming consensus of the scientific community is that creation science is a religious, not a scientific view, and that creation science does not qualify as science because it lacks empirical support, supplies no tentative hypotheses, and resolves to describe natural history in terms of scientifically untestable supernatural causes. Creation science has been characterized as a pseudo-scientific attempt to map the Bible into scientific facts. According to a popular introductory philosophy of science text, ‘virtually all professional biologists regard creation science as a sham.'”

I’m all for theological belief, but my point is that Charles Rouse is closer to being a witch doctor than a medical doctor.

Next up is Steve Rallis at the 1:43 mark. He says, “Our products are really the first of their kind to be developed specifically to help patients overcome the challenges associated with lifestyle diseases.” We can add Visi to the list of MLMs illegally pitching their products as medicine suggest that they help with “diseases” and are “developed specifically” for “patients.” At the 1:52 mark, Charles Rouse joins in saying that the products will help with headaches. He even implies it psychological medication as it will help if you are feeling “distraught.”

Rick Hagar makes a comment about how “in a short amount of time, people feel the results and know that the product is working for them.” This is the typical line all MLM miracle cures. The idea is to be very vague about what the product does and give subjective terms such as more energy, more alertness or fewer aches. Then claim that this product “works” which is purposely left undefined so that it can apply to anyone’s condition. The truth is that whatever anyone feels can be explained by this by this article, which was so popular that a group of doctors, scientists and researchers have asked to republish it. What people feel is best explained by the placebo effect.

If we look back at Mike McClenaghan’s posting on Business for Home above we find that Rick Hagar is a Visi Master Distributor. A great site, Amthrax writes about Master Distributors explain that these people are paid to pitch an MLM and bring in distributors through a downline they’ve recruited. They aren’t faithful to the products and bounce amongst MLMs.

At the 2:08 mark, Steve Rallis is back to say the products “change how they age, changes their risks.” This is a subtle way at claiming that the products can prevent disease which would be an illegal claim of the supplements.

At the 2:15 mark, we briefly switch back to testimonial mode where Mike McClenaghan is back claiming that he’s lost over 31 pounds. Once again, as a paid endorser, he doesn’t disclose that these results are not typical, which is another Visi-sponsored violation of the FTC’s Guidelines on Endorsements. In fact the FTC has a Reference Guide for Media on Spotting False Weight Loss Claims. The guide specifically states:

“It’s the law – and it’s always been the law – that before companies can run ads for weight loss products, they need scientific proof to support objective claims their ads make…

False or misleading claims can be conveyed in words and in images. Some brazen scammers just flat-out lie. Others use eye-catching before-and-after pictures. A word about consumer endorsements (sometimes called testimonials): Endorsements from supposedly satisfied customers – “D.G. lost 38 pounds in just 3 weeks” or “Jane from Springfield dropped 4 dress sizes in 30 days!’ – are a staple of weight loss ads. Too often, advertisers cherry-pick their best cases or even make up bogus endorsements, deceptively conveying to consumers that they’ll get similar results. Under the law, advertisers that choose to use endorsements have two choices: Either the results in the ad must be typical of what other consumers can expect to achieve or the ad must clearly and conspicuously disclose what the typical results are.”

The results are not shown to be typical and the Visi advertisement does not disclose what the typical results are.

Arctic Cloudberry: The Magical Ingredient

At the 2:25 mark, we are introduced to Visi’s “secret sauce”: Arctic Cloudberry. Many MLM health companies have some rare, exotic fruit and leads you to believe it is magical. For example, Vemma has mangosteen and MonaVie has acai. Visi has settled on the arctic cloudberry. The video explains that it is ripened under “the midnight sun of Scandinavia” as if the berry somehow gets some magical properties from the time of day the sun shines on it.

At the 2:48 mark, Charles Rouse is back to say that is the “perfect nutrition to keep the body purified.” I’m all for berries being great nutritionally, but there’s no berry that is “perfect nutrition”, we need a more balanced diet, perhaps with something called “protein.” And “keep the body purified” sounds a lot like the detox scam.

At the 2:55, the Arctic Cloudberry now has “life-changing benefits.”

10/2 and a Chew

At the 2:57 mark they introduce the “10/2 and a Chew” product. It fuels, “body, mind, and soul.” Yes, this product is supposed to work on the soul. There’s a word for this and it is called Quackery.

At the 3:20 mark, Jaime Dulaney makes an appearance. Ms. Dulaney’s LinkedIn page shows that she’s still a distributor with isXpera:

“isXperia, Florida based 7 year old company, is hitting massive growth right now. Wide range of superior products in the health/wellness, weight loss & energy, and anti-aging skincare industries. Company is unique because it is built by distributors, for distributors and has the most lucrative and exciting comp plan you’ll ever see.”

Sounds a lot like what Visi is pitching right? I’ve archived Jaime Dulaney’s LinkedIn page as well, as I’m sure she’ll want to change it when see reads this. Ms. Dulaney’s company, with Brian Bailey, is called the Bailey-Dulaney Partnership, LLC and “is a founding member of Visi Global”… surprise! The page also states: “After many years of working together successfully in the network marketing industry, Brian Bailey of Florida and Jamie Dulaney of Louisiana, formed The Bailey Dulaney Partnership, LLC.” Once again, Visi is promoting the people it poached from other MLMs… not people who were pitched the business and had success with it.

Ms. Dulaney’s pitch in the video is: “I can not think of one reason why you would not try 10/2 and a chew”. This is almost a word-for-word “Just try it! Mind Game”, where they know that more than 30% of people will experience a placebo effect and think it helped them. Cigarette companies used the same ‘just try it’ marketing in the 50’s when it was shown that their products weren’t healthy.

Instead of the “just try it” marketing message, I challenge Visi to “just prove it” with the FDA via clinical trials. I’ll make it easy and accept whatever condition they think any of their products “work” for.

It’s a good thing that “two” rhymes with “chew.” If it were “one” the Visi marketing team might say that you have to eat a “bun.”

Creepy Voice is Back

At the 3:27 mark, the creepy voice is back. This time it’s focused on Neuro-linguistic programming (NLP). It says, “Visi has a range of products that you will love.” Really? After this crazy pitch, I’m very sure that I do not love the products. It continues, “Introduce others to Visi…” Thanks cult-voice, I’m not buying it. Continuing more, “and teach others how to dream big again…” Still trying to drill the “dream big” message into my head. My website does that… without the scam.

Share Your Visi Story

At the 3:35 mark, the creepy voice segues us to “sharing your personal Visi story.” The Founder and CEO Kent Lewis invites people to credit a compliment of “you look great” to pitch Visi products. By this logic, Dove should be marketing its famous “beauty patches” via MLM. They people in the video didn’t realize they were getting a placebo and they were very convinced the product helped them.

Dreams Part 4?

At the 3:50 mark Michelle Reiser is back saying that the company gave her “the opportunity to dream bigger than she’s ever dreamed” We are averaging close to a “dream big” mention every minute. She follows it up with a pitch of “make a decision and just go for it.” It seems like she’s advocating that you skip the FTC’s recommendation to carefully review the company as I’ve done here.

Cue Creepy Neuro-linguistic Programming Voice

At the 4:00 minute mark, the voice is back saying, “Visi is home…” It is difficult to come up with a more obvious “We are a cult” message than implying that this organization should be your “home.” It continues with “… where you can finally celebrate the benefits of optimal wellness and abundant lifestyle.” Wow, putting together, “finally”, “celebrate”, “benefits”, “optimal wellness” and “abundant lifestyle” in the same sentence… good job Mr. Creepy. Above it was “abundant wellness”, but it graduated to “optimal wellness”, with “abundant” being used to describe the “lifestyle” now.

It doesn’t stope there suggesting that we “embrace success by fulfilling and realizing your fullest potential.”

I wish I could “finally celebrate the benefits” of reaching the end of the video. It is a “dream” that wwould fill me with a feeling of “abundant” and “optimal” “success”.

Alas I’m only slightly more than halfway through this one video and I’ve written enough words for five of my typical posts.

Bring in the Co-founder

At the 4:19 mark, we have Ryan Lewis (not to be confused with the awesome Ryan Lewis who has partnered with Macklemore), making his entrance. He’s a co-founder and COO of Visi. He throw out the “life-changing products” (second time we’ve heard that) and suggests that they’ll “help you make healthy choices throughout the day.” He doesn’t explain how they do this. He quickly moves on to push a message that you can “succeed”, by “sharing” and “be rewarded” for doing it.

Mr. Creepy Voice is Back Again

At the 4:27 mark, Mr. Creepy Voice is back. I’m starting to looking forward to his choice of brainwashing adjectives and verbs. This time “Visi encourages you to build life as you dream.” Another mention of “dream”, gettting tired of it? I hope not.

It’s followed up with “dictate your lifestyle by design not by default.” Another mention of lifesytle, this time in the context of “taking control” Fortunately, Visi is “here to you achieve just that.” Good use of “achieve”, Mr. Creepy.

The “You are the Boss” Myth.

At the 4:39 mark we have Mike McClenaghan back saying that it is a fun business. However, I’d like to focus on the “I’m the Boss and I’m making the decisions.” As I covered in the business of MLM, a popular book notes:

“I was involved in four MLM companies. Not once do I remember dictating product decisions, research and marketing, marketing restriction, rules, cost analysis or any other activity fundamental to owning a business… As a network marketer, you don’t own a business – you own a job managing and creating a sales organization… MLM distributors are commissioned employees disguised as entrepreneurs…”

If you read the distributor contract well, you’ll see that Visi can terminate your distributorship for almost any reason. That means they can fire you… which means you are not the boss, they are. Not only that, but you have to agree to mandatory binding arbritration, which limits your ability to sue them. As that article says the policy is “A Raw Deal for Consumers.” Put simply, consumer protection experts suggest you don’t do business with any company with such a policy.

The Visi Lifestyle

At the 4:45 mark, we are treated to Mike McClenaghan, Jaime Dulaney, and Michele Reisler pitching the “Visi lifestyle” as one involving travel, snow mobiling, and going on cruises. What they don’t say is that these events are only for the top ranking distributors like themselves. The reason why these events is motivate distributors or lower rank. There’s a quick mention by Ms. Reisler about charity in Honduras, which I will get to later.

Bring out the Car Scam!

At the 5:00 mark, were introduced to Visi’s car program, Dream Drivers. As with nearly every MLM, there’s a motivating car incentive for top recruiters. And of course the program’s name has “dream” in it. As Mr. Creepy says, “Whatever you can dream to drive is possible with Visi.” The program appears to be exactly the same as ViSalus’ terrible Bimmer program, except that you aren’t locked into a specific make of car.

How the Visi car program works is that you can either take $300 monthly in cash or $600 monthly towards the purchase of a car. It seems like a no-brainer to take the $600 towards the car. However, as many ViSalus distributors found out, it is a horrible mistake. First the car has to be in your name, which seems like a good thing, but it means you have the responsiblity to make the payments, not Visi. Visi only gives you the $600 if you maintain the rank. If the scheme collapses as ViSalus’ did, through no fault of your own, you won’t qualify for the $600.

That means that you’d not only have to come up with the $600/month extra for your car, but you’d have to do with a drastically smaller income than you are used to.

It is very similar to 2008 when mortgage brokers convinced people they could afford more house than they could. It lead to a huge financial crisis and foreclosurers. ViSalus distributors have seen that happen with their BMWs. If a distributor can’t make payments it ruins their credit and can cause a decade of financial pain.

Why would Visi put distributors in this devilish position? My guess is that they believe everyone will take the car as it seems to be the obvious choice. Then as the scheme implodes they’ll be extremely motivated by their impending financial ruin to recruit even harder.

The Ultimate Lifestyle

At the 5:15 mark, we have Rick Hagar back saying that “Visi offers people an opportunity to get what they consider to be the ultimate lifestyle.” What he doesn’t say is that the “opportunity” that Visi has available is similar to the “opportunity” the lottery has available. It’s there, but it is infinitesimal. Many of the top positions clearly belong to “founders” in this video. At this point Visi has many distributors that are competing against you, which is something the founders didn’t have to face.

More Mr. Creepy Voice

I’m convinced going to hear this guy’s voice in my sleep tonight. At the 5:24 mark he’s back saying, “Visi is a place you can finally call home.” Again with the “finally” and “home”? Laying on the cult talk a little think there, you think? Are they trying to target homeless people here? He continues, “A home where one can build a business if there was a dream to drive it.” I’ve lost track of the “dream” count in this video. We surely must be well into the double-digits now. And as mentioned above, this isn’t really building a business as they can fire you… it is a commissioned sales job.

Health and Wealth

At the 5:45 mark, they make the combination of health and wealth that I first saw with MonaVie’s Scam. With a pitch of health and wealth, how can you go wrong? Well, you can when it offers neither and you were just brainwashed into “dreaming” it were the case by this video.

At the 5:52 mark, Michelle Reisler re-emphasisizes the brainwashing that “Visi is home and it will be home for a long time.” That’s the third time they’ve tried to brainwash you with that li

More Mr. Creepy

I’m fairly convinced I could write a Mr. Creepy computer program at this point. His vocabulary seems limited. At the 5:58 mark, we get more “life-changing results that come with Visi.” “Dreams” is still the winner, but “life-changing” is making a good showing. Dulaney

Outside the Box

I thought they got the cliche’s covered, but Jaime Dulaney brings an “outside this box” to the game at the 6:05 mark of the video. She throws in a “reach your goals” for good measure.

More Life-Changing

Ryan Lewis is back to say that Visi’s “success” and “legacy” will be “measured by how many lives we’ve been able to impact and change.” I’m going to call that another mention of “life-changing”, I’m pulling for the underdog to make a comeback.

More Mr. Creepy

At the 6:25 mark, we have Mr. Creepy giving the “first step in the transformation journey.” He then commands you to “feel the astounding results” (again using the purposely vague language). Finally, you are directed to “share your personal story with anyone who seeks an enhanced lifestyle.” Maybe it’s just me, but I haven’t really come across anyone who said, my lifestyle isn’t what I want it to be… let’s enhance it!

The CEO Kent Lewis is back at 6:40 saying Visi is “a company that believes being a little bit better every day.” Fortunately they set the bar so astoundingly low with this video that it wouldn’t very difficult.

He continues, “Our greatest product is what you become.” If their best product is turning you into a brainwashed minion, it certainly doesn’t bode well for “10/2 and a chew.”

At the 6:48 mark, Mr. Creepy is back saying that “Visi partners build better lives…” (almost another hit for “life-changing”, but not quite). Just when I think Mr. Creepy has lost his touch, he continues, “… and dream big again.” I think the race is over and “dream” is a clear winner.

The video closes suggesting that you “imagine” flying to Scandinavia to pick “arctic cloudberries.” If I go to Scandinavia, it’s not going to be work in the fields. Sorry Visi.

Getting to those “Dream Big” messages

The “dream” is an MLM standby going back to the Amway days in the 1980s. In fact, it is very much ingrained in MLM. It’s so common that anyone who tries to use logic and reason to prevent this brainwashing has been called a “Dream Stealer.” I’ve even been called one myself, despite the fact that I help people pursue their dreams via sound personal finance principles. There are many articles on Google about dream stealing and MLM.

Unfortunately the “dream” is also ingrained in the Nigerian Prince (also known as 419) scams that you may received in your email. As Snopes writes:

“In a nutshell, the con works by blinding the victim with promises of an unimaginable fortune. Once the sucker is sufficiently glittery-eyed over the prospect of becoming fabulously rich, he is squeezed for however much money he has. This he parts with willingly, thinking ‘What’s $5,000 here or $10,000 there when I’m going to end up with $2 million when this is all done?’ He fails to realize during the sting that he’s never going to get the promised fortune; all of this messing around is designed to part him from his money.”

This is a very accurate description of the MLM con game. They get you in for a very low initial fee, but keep you paying month after month while you chase the “dream.” That dream exists for the people at the top like the founders here. As Inc Magazine wrote others are “just MLM cannon fodder”. The products are purposely expensive, because they are required purchases for admission into the “dream opportunity.” Also, more expensive products tend to make people think they are or higher quality through the price placebo effect. For example, there are numerous studies that show people will think wine is of higher quality if it has a higher price.

Final Thoughts

After more than 4000 words, I was only able to cover one of Visi’s marketing videos. I didn’t get a chance to dig into the products like I would have liked, but the video put very little focus on them, especially in comparison to selling the “dream.”

I hope to carve out a little more time to look at the products themselves. Considering the brainwashing video, the non-disclosure that the founders are not typical income earners, and Visi’s scientific advisory expert’s connection to quack science, it certainly doesn’t look good.

Filed Under: MLM Tagged With: scam, Visi

Is FlexKom a Scam?

March 8, 2014 by Lazy Man 64 Comments

[Today’s blog post will be a little quicker than the norm, especially for one where I analyze an MLM company. I originally had it planned to go live while I was at FinCon 2013, a conference of personal finance bloggers. It’s good networking and I learn a lot about how to make this site better. (I’m always looking to give you the best blog for your dollar. Wait, you aren’t contributing dollars? Oh well, too late now, enjoy the free show.)

Unfortunately, I came back to my car breaking down and my pregnant wife getting hospitalized (briefly) and she’s okay now. (The two were unrelated.) It’s taken some time to get everything together. Did I mention that the Red Sox are in the World Series too? Busiest of weeks!]

As I mentioned in the beginning, I usually put in dozens of hours of research into these articles. Having done this many times before, I’ve found that MLM companies typically have distributors who are… well… “nut jobs” (for lack of a better term) that like to harp on one minor irrelevant aspect of the write-up and use that as a plea that the whole article must be completely off-base because it was so poorly researched. However, we’re smart enough not to throw out the baby with the bathwater, right? Today, due to the time-constraints above, I’m going to try something a little different. I’m going to use my previous extensive experience to thin slice and show why you’d probably want to steer clear from the FlexKom business.

First, here’s why I’m writing about FlexKom… Several weeks ago, I got an email from Lynne:

“Just curious about what you may know about a new MLM (they say it really isn’t) called FlexKom. Supposed to be up and running in Europe and breaking into the US market now. Any thoughts?”

Short and sweet! At the time, I was available to do a little research. I watched a video (more on that later) and instantly thought it sounded like Lyoness another MLM using a loyalty card system. I’m not alone as this website seems to think the same. I had looked into Lyoness a couple of times before and though I haven’t published an article on it, there are some pretty big problems. (If you want to know more about that BehindMLM has a very good review).

My response to Lynne was that if FlexKom claims that it isn’t an MLM, they are being completely dishonest with you. Their compensation looks like any other MLM with the bonuses for recruiting people. The video at that website even showed the pictures of car bonuses at the bottom, one of the time-tested lures of an MLM. The other give away is the recruiting of people, who recruit people, etc. (clearly this is the more obvious direct one, but I thought I’d have a little fun with pointing out the car bonus first).

I’m conflicted about presenting this video as I don’t like to help market scams, but it so complex it is worth watching the video. The video even makes a point that it is complicated. I’ll presume that you are watching the video or have some understanding of FlexKom because trying to explain it here would take many, many words. While the video is a little on the long side, I believe you really only need to watch the first 3 minutes to see enough to run away.

The video starts off with a lot of hype that it is changing the economy of a country. Which country? It doesn’t say. How revolutionary? Again all numbers are left out. It then says that this isn’t hype and that you will “believe by understanding” and “you won’t need anyone else to convince you”… essentially hitting you over the head with Neuro-linguistic programming (NLP).

The video goes on to explain that you can buy a FlexKom franchise license, similar to buying a McDonalds, but it has no overhead or staff. How much does this franchise cost? According to the video it’s $4,000. Yes, you are a buying a $4,000 ID card that gives you permission to sell their system. I can sell you a LazyManKom card for much, much less and let you use my system.

To vastly oversimplify this $4,000 license gives you the ability to recruit local shopkeepers to the program and earn a profit (if you recruit enough).

The video makes a poor comparison to a McDonalds’ franchise. This is a classic poor MLM analogy that I’ve written about years ago. McDonalds don’t make their money recruiting other McDonalds and owning a McDonalds franchise typically brings you thousands of customers. My local McDonalds doesn’t have to go around and advertise, nor does it have to build a business by recruiting people. It sets up shop and people flock to it. My McDonalds’ business isn’t predicated on showing others a complex video to explain how it works.

In addition, and this is the big one that I wanted to write about today. McDonalds adheres to the laws of supply and demand. If I want to put another McDonalds next to where one already exists, McDonalds tells me to go stuff myself (I spent some time at FinCon talking with English bloggers and am stealing this phrase for my own). McDonalds franchises are very controlled and their locations are carefully figured out.

With MLM, anyone can join… the parent company doesn’t care. In fact, FlexKom would seem to have no problem if everyone in the world were paying a $4,000 license. Essentially there’s a basic disconnect between supply and demand. They can be supply many licensees where there are no shopkeepers interested. FlexKom licensees can recruit other FlexKom licensees, but that is like McDonalds recruiting another McDonalds, it simply doesn’t make sense as you are creating more competition.

There’s a very good article about What’s Wrong with MLM. I’ve written articles showing other things wrong with MLM, but this does a great job of highlighting the supply and demand issues. It shows that MLMs have no problem pitching a sales opportunity even if there’s no demand for it… which means it’s not really an opportunity. That’s exactly what I see in this FlexKom sales pitch.

What’s particularly deceptive about the video I watched above that the person used catch-phrases like unlimited income, claimed that it was all “facts” and that it was happening with thousands right now. He didn’t mention that “unlimited income” doesn’t exist on the planet Earth, that the facts leave out details such as the scenario I outlined above of people buying a license and not being able to get shopkeepers on board, and that there are likely hundreds of thousands of people losing money for the few that are making it.

Again this is just basic thin-slicing, but take a moment and think about it: Is FlexKom setting you with success by limiting competition as a typical franchise does or are they just trying to encourage everyone and anyone to pay them money for a business opportunity that may not exist?

Updates

Flexkom POS 4S Scam

A commenter, Wouter Hol, has put together a revealing review of a very, very overpriced Android tablet (480 Euros) that Flexkom is selling as a Point of Sale device.

As you can see the Flexkom tablet is “not that bad” according to the software that Hol used. The specifications are horrible compared to current Nexus 7 that can be had for at least 250 fewer Euros. The video also shows that the Flexkom software works just fine on an Android tablet that is available on Amazon for just 60 Euros.

Flexkom reps may claim that the value is in some included cards that come with the system, but Wouter Hol shows there really is no value in the cards in another video.

Filed Under: MLM Tagged With: FlexKom, scam

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