Pyramid schemes: Would you pay someone so you can work for him?
What you need to know:
- When one does the math of the money you have pumped into such a company and the cost of a holiday, I have no doubt the deficit is in one’s bank account.
- Kenyans lost millions to pyramid schemes and then expected the government to compensate them for this losses. I have no doubt that there are some people who make money from multilevel marketing, but these companies are designed to profit from, not enrich, their workforces.
Some four years ago, someone tried selling me an idea known as "dream trips". Do you want to travel the world — yes I do. Do you want to grow rich while having fun? Eeehhh! Maybe not, I said. What am I? A drug queen or what?
First forward, two bankers and a lawyer have tried to sell me the very same concept, which I now understand is called World Ventures. I gave one of the bankers my time — talk about a wasted hour of my life — to see if there was anything new in this particular scheme which is sold as a multilevel marketing business.
The first question I asked was, so what are you selling? Dream holidays. Now, from where I stand, no one can sell you a dream of any sort. Dreams belong to the infinite mind and anyone can dream. Hotels, travel agents and travel sites such as TripAdvisor, Expedia and others will sell you a holiday without any enrolment.
So my question was, why would I want to buy a holiday — my dreams belong to me and no one can purport to sell me a dream — from World Ventures?
MONEY FOR NOTHING
This is an exclusive members club and the holidays are at such discounted prices that you get a refund should you be able to find a cheaper holiday within seven days of booking with World Ventures. At that point I was still listening, but then I was sipping alcohol.
So when can I sign up for my first "dream" holiday? I asked. You have to be a member of the club, which requires you to pay $199. So where do I get to go for the equivalent of Sh20,000?
Nowhere! So at what time does this "dream" become a holiday? You need to pay monthly fees of $54, or enrol members to get a waiver on the monthly fee.
I decided that taking a gulp of alcohol was a better way to pass the time than asking any question. Meanwhile, the person went on frantically flipping through pictures of exotic-looking holiday destinations on an iPad and talking rapidly. To be able to enrol members you need to sign up as a representative of the company at $100.
I was trying not to laugh out loud. Not because I do not appreciate that multilevel marketing is the legally sanctioned cousin of pyramid schemes, but because here was someone asking the equivalent of Sh37,000 to sell me nothing.
DEFICIT IN YOUR ACCOUNT
In fact, for this amount, they expected me to work for them, by recruiting another four members (I cannot for the love of Pete think of where I can find four fools to part with Sh37,000). It is the only way I would be exempt from paying the monthly fees.
If they remain active, that means they recruit people as well. My reply, I will not sell, even one dream, to anyone. I am barely done with my own dreaming.
But the person now had my attention. So I round up the equivalent of Sh185,000 for some company that sells dream holidays and I still do not have any holiday, just dreams. The person now started telling me that there are people making half a million a week from these venture.
Good for them, I thought. She then went on to open a chart of two pyramid-shaped hierarchies and some down line. My eyes were swimming — I cannot be sure if it is from disbelief or from the drink.
When one does the math of the money you have pumped into such a company and the cost of a holiday, I have no doubt the deficit is in one’s bank account.
GREED OR GULLIBILITY?
World Ventures is a United States-based company. The Norwegian Gaming Board declared it a pyramid scheme because "revenues are from recruitment of members not sale of travel". World Ventures appealed this decision and lost.
Kenyans lost millions to pyramid schemes and then expected the government to compensate them for this losses. I have no doubt that there are some people who make money from multilevel marketing, but these companies are designed to profit from, not enrich, their workforces.
I have no idea why Kenyans expect to be millionaires from them. Are we that gullible, that greedy or that senseless?
I have no doubt that just like with the pyramid schemes, many Kenyans will enrol with World Ventures. According to an independent study by Jon Taylor, 99 per cent of World Ventures representatives lose money. For the one per cent that make money, congratulations. As for me and mine, "we cannot be there" because we are exactly where we planned to be.
