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That's not what makes MLM a "pyramid". Residuals are part of lots of legitimate business. What makes most MLM a pyramid scheme is the fact that growth is predic
by qeternity 9y ago
That's not what makes MLM a "pyramid". Residuals are part of lots of legitimate business. What makes most MLM a pyramid scheme is the fact that growth is predicated on bringing new members into the scheme, rather than existing members growing their business.
- arkades 9y agoNot growth, but revenues. All asset appreciation is predicated on increases in demand for an asset. Asset appreciation isn’t a pyramid. Pyramids have no source of value - even an ephemeral asset - just dues of new members being channeled into revenue for preceding members.
- xocyabencl 9y agoThey key thing about pyramids/MLM is that the growth is based entirely on getting more investors i.e. people who are putting money in with the intention of getting money out later (this also included MLM sellers who have to buy product upfront). Whereas a non-pyramid grows because it has more non-investor users, or some other source of revenue from people who don't plan to take that money out later.