It started out innocently enough. I was minding my own business, drinking sweet tea and reading a book on the textual criticism of the writings of Jane Austen  while sitting at the bar of a local restaurant when a stranger wished to speak to me. Being at least moderately friendly to strangers, I exchanged some information with him and spoke with him about a business opportunity he wished to communicate . Over the course of a couple more meetings and the reading of a book he loaned me, it became obvious that something else was going on here, something of a decidedly sinister nature, namely, an effort at recruitment into a multi-level marketing scheme, which the person claimed to be nearly done with so that he could leave his job at Intel and make a good living off of his downline involved in some sort of monthly purchasing system that was dependent on drop shipping with various companies. In the course of my dealings, I was polite but also deeply attuned to the sort of pitch that was being made.
Such an experience is not likely to be an uncommon one. Since childhood at least I have been involved in or at least surrounded by people who had something they wanted to sell. Whether it was selling candy, donuts, or various other snacks as a child for one fundraiser after another, or selling cherries for one’s congregations or helping a friend sell program guides at a bowl game for her synagogue, or dealing with people who are involved in various marketing of essential oils and other products, having friends and roommates involved in buying products at estate sales and reselling them, or even my involvement in the world of book publishing as a prolific reviewer of books, I am used to being around people who have something they want to sell me. I don’t think that is illegitimate, but much depends on whether or not I am interested in buying it. While I have never considered myself to be a particularly skilled salesman, I do not believe that those who have that skill are necessarily wrong in using their gifts of persuasion at encouraging commercial transactions that are mutually beneficial. Moreover, if there is something I want or need, I do not consider it improper to buy from someone simply because they want to sell it–I have no personal hostility to capitalism and fair and free markets in that sort, even if I do not consider myself to be an obvious market for most of what people want to sell.
Nevertheless, I do consider there being something essentially problematic about multi-level marketing, and I think it is worthwhile to explain why. One of my problems is simply one of mathematics. Multi-level marketing schemes depend on there being many more people in one’s downline whose spending helps to subsidize one’s own desire to escape the rat race and leave one’s 9-to-5. That said, there are only so many people who can make a living in this fashion. If it takes 75 or more people to replace a good income for someone, then it takes 5,625 for those people to make a living, and 421,875 people in the next level for those in the third level to replace their livings, and 31,640,625 people for those in the fourth level to replace their income. There are simply not enough people at that point for even the fourth, much less the fifth, level of any MLM scheme to make a living in that fashion. If you think of all the various pyramid schemes that are popular, one can understand that thanks to the design of the system, there are only so many people who can make a living with the requirement of $35 a month of purchasing of something if one’s motivation is to leave one’s job and travel the world off of the sales that one has made to other people. It takes a lot of suckers for you to live off of the residual income of their commitment. I don’t plan on being one of those suckers.
It is little surprise given the mathematics of the matter that MLM schemes have such an ugly reputation. There are the frequent meetings and the purchasing or borrowing of books to psyche oneself up in the self-delusion that is doing something for other people even when the whole appeal is to do the best for oneself. The fact that the pitch to people to be involved is income replacement despite the low odds of that happening based on the sheer numbers involved suggests that there is something illegitimate about the scheme as a whole, for that which was above board could be admitted at the outset. For example, if someone was selling a loyalty membership where someone had to purchase a certain amount of books that reasonably priced based on there being a mass market, every month, I would without a doubt happily join such a program in the knowledge that I would be spending enough on books anyway to make it worth my while. The main pitch would be to spend a bit less on something that I was spending money on anyway. The same would apply to a service that allowed for less expensive eating at restaurants or the purchasing of my favorite snack items or lunch items for food at work. I am already spending money on these things, and I would be motivated to spend a bit less to buy what I was already spending money on as a result of being in a larger group rather than an individual consumer. That is an appeal that would work on me, and that is one I could with a high degree of confidence encourage others in as well.
After all, if one’s primary goal is savings on what one is already spending while also receiving some benefit from referral bonsues with others, there is nothing illegitimate going on here, no pitching of a greed-based appeal to random strangers one meets around, but rather something that a great many people would likely be interested in doing because the joining together into a larger group with a shared interest in eating out or buying certain snacks or reading books would itself serve the interests of spending less money that one was going to spend already based on one’s current patterns of behavior, with no need for frequent meetings to practice pitches or engage in cult-like manipulations to consider oneself to be a stellar salesman, or tactics that blame people for a lack of self-motivation because they are unable or unwilling to find enough suckers to live well themselves. If you find a particular plan that helps provide you with products that you already like, and you know enough like-minded people that you can earn something because you connected these people to something you all genuinely enjoy, there is no need to feel guilt about being a node because one’s motivations were not only for one’s own self-interest. If something has to be sold based on a motivation to greed, what you are selling is not something anyone should be interested in buying. Otherwise, a praiseworthy motivation could easily be found that did not require self-deception and a mercenarial interest in the people one met in order to keep going.
 See, for example: