Episode 17: Get Rich Quick
“The uncomfortable truth about “multi-level marketing” and other Ponzi schemes.“
Transcript:
How’d you like to get rich quick? Here’s the uncomfortable truth: you can’t. Yet, we’re surrounded by get rich quick schemes and infomercials that probably cost around $400,000 to shoot and to produce. People aren’t throwing $400,000 into a well. They’re expecting people to respond and attend all these free workshops and seminars. Now there’s some guy here in Providence, Rhode Island. He said to come to his free seminar as there is limited participation. Learn how to flip houses. Learn how to make a fortune in real estate without any of your own money. Imagine that. 300 people will turn up and they’ll all wind up getting rich just like that while the rest of us sit back and just work.
Of course, they’ve all got testimonials from who knows who, swearing that this has happened. You’re reminded of people putting their hand on your forehead and yelling “You’re healed!” My goodness. These are Ponzi schemes, they’re pyramid schemes, multi-level marketing, network marketing. I don’t care what you call it, it’s unethical and it’s no way to get rich quick. The only people who make money are the founders, and they’re all the same. Ponzi started this scheme 100 years ago, and now they have all kinds of fancy names for it. I’ll tell you friends, it is nothing but criminal, because people who get in the system later are cheated.
There’s no value produced for the environment. There’s just people making money off the membership of future people trying to make money, who themselves cannot make money because you run out of people. Peter Drucker said once that “an organization is not like a plant or an animal. It is successful merely by perpetuating the species. It must make a contribution to the environment.” He didn’t mean the green movement. He meant you had to improve society, and there’s nothing about multi-level marketing, Ponzi schemes or network marketing that improves society. They cheat subsequent tiers.
I wrote a book many, many years ago and showed that by the time you got to about the sixth level in most of these schemes, you would need a population about the size of Cincinnati, all of whom were willing to participate to start making money for people who got in at that level. What happens? The detergent, the phone cards, whatever the hell they’re selling, they disappear and the perpetrators move on and they create something else. My goodness, it’s just not right.
I remember once running into some guy I had graduated college with while we were waiting for a seat in a Polynesian restaurant. His name was Joe. Joe says, “Alan, I’m making more money part time than I am in my regular job as an accountant. You want to come to a meeting?” I went to this motel, whatever it was, a Hilton Garden or a crappy Marriott. There’s 50 or 60 people in the room, all eager to get rich quick. Up comes the guy in the Cadillac at the time. He drives into the caddy. You can see him at the window and it’s strategically placed. He walks in. He’s got a pinky ring with what looks like a diamond, but it might’ve been a piece of glass, and he does his dance, talks about the detergent, but then he talks about how you can get rich quick by getting your neighbors to join.
You know, you have to take a shower after this stuff. Today, it’s also often internet based. I know a guy who just fell in love with these get rich quick schemes on the internet, a technology guy who lost his mind. They produce these promo videos and you can watch the videos for free. Then you start to have to pay for them. Then you go to a meeting and the seminar is free, but if you want to go to lunch you have to pay to be at lunch in a special coaching program. What are they teaching you to do? Are they teaching you rocket science or computer engineering? Are they teaching you how to do brain surgery? No. They’re teaching you how to create your own videos so other people can watch them for free and then begin to pay, and then come to a free seminar, and then pay to have lunch and join the club. It goes on and on.
It doesn’t matter what they’re selling. What they’re selling eventually disappears because it’s all just a fraud to get people to pay for what? Just the membership. Amway has probably been the greatest example of this ever. They’ve been sued a hundred times. I remember seeing a 60 Minutes program once that showed the average Amway distributor. That is, the person actually selling the darn Amway products makes about $88 a year. Now, even if it’s $588 a year, who cares.
Generally speaking, you need to beware of the fact that get rich quick schemes are just schemes. You know, it’s how you think, not what you do. That’s what they want to tell you. It’s not the hard work you put in, think and grow rich. You can do anything you want if you just think about it. That’s “the secret.” All of these people have best sellers, except they really aren’t best sellers. Sometimes they trot out these ancient war horses. There will be some kind of rally and it’ll be Colin Powell or George Bush or who knows up there, delivering 15 minutes of pep talk and selling cassettes at the back of the room. Zig Ziglar was famous for this near the end of his life and it’s too bad.
These people are all in shape to try to give you some kind of benefit in the media. They want you to do your own cable show, and for only $15,000 or $20,000, they’ll prop up somebody like Alexander Haig, who many of you probably don’t even remember, who will endorse your product if he can speak that long. Suddenly you have this big endorsement on a cable TV show and it’s ridiculous.
Flip houses with no money. Imagine! Why aren’t all of us doing that? It doesn’t work. The person making money flipping houses with no money is the person telling you to do it, not the people actually doing it. Why do people invest in this nonsense? People are looking for a shortcut to riches, because of sheer gullibility that somehow there’s this shortcut to riches. How do you really get rich? Well don’t try to be somebody who is already successful. Emulate their best habits.
I tell the people I coach all the time, “Don’t try to be me. You can’t be me and I can’t be you.” We each have behaviors and traits and skills that we can emulate, that we know work because we see it working for the other party. Look to the value you provide that’s substantial and long lived. That’s not some quick scheme where somebody signs up for something, but long term value where you’re improving the condition of other people, whether they’re individuals or organizations full of them.
Create clear content. Show people how to do things, and give then pragmatic techniques and solid support. If you can do that, people will improve and they’ll pay you for that. There’s no comparison between Million Dollar Consulting and The Secret. The Secret says, “Hey, just think and you’ll get it.” Million Dollar Consulting says, “Here’s a clear and precise methodology. Value based fees, here’s how you form them. Options, here’s how you provide them to clients. Proposals, here’s the components for a winning proposal.”
Now I’m not making a pitch for Million Dollar Consulting. You’ll probably get it for free on one of these stupid rip off downloads on the internet, but then again, these are unethical people. Valuable approaches don’t disappear. Valuable approaches stick around because people appreciate them. The other approaches do disappear.
Free workshops that then upsell you, really? Is that what you want to be involved in, not just as a participant, but as a perpetrator? You might as well go to one of those tent revival meetings where the fraud, the huckster, the charlatan at the front is curing people or predicting where they’ve been or where they’ll go because he’s listening to something on an earpiece after his minions have been talking to people in the audience. People who are on his payroll pretend to be cured. A huckster is a huckster no matter how convincing his testimonials may sound.
Now, I know this particular podcast is going to upset a lot of people. There are people on social media who brag about being in multi-level marketing, but it’s crap. That’s the uncomfortable truth. Get a real job. Larry Winget put out a book a while ago. He said something like, “there’s a reason they call it work. You have to work to make money. You have to have talent to make money. If you have talent and you work, you’ll make money and you don’t have to cheat or fool anybody else.”
Sorry, but that’s the uncomfortable truth.
