Speaker 1: Hello. My name's Santasha Nabananga Bamblet. I'm a proud yr
Speaker 1: the Order KERNI Whoaltbury and a waddery woman. And before
Speaker 1: we get started on She's on the Money podcast, I
Speaker 1: would like to acknowledge the traditional custodians of the land
Speaker 1: of which this podcast is recorded on a wondery country,
Speaker 1: acknowledging the elders, the ancestors and the next generation coming
Speaker 1: through as this podcast is about connecting, empowering, knowledge sharing
Speaker 1: and the storytelling of you to make a difference for
Speaker 1: today and lasting impact for tomorrow. Let's get into it.
Speaker 2: She's on the Money, She's on the Money.
Speaker 3: Hello, and welcome to She's on the Money, the podcast
Speaker 3: that's all about real strategies for growing your finances, not
Speaker 3: fake ones for growing a down line. I'm Victoria Devine,
Speaker 3: finance expert, MLM exposer and full time skeptic of Get
Speaker 3: Rich Quick Schemes. If you've been following our series on MLMs,
Speaker 3: you know we've been peeling back the layers on this
Speaker 3: literary yet gritty world. But today I have something extra
Speaker 3: special for you. An MLM million dollar earner. Yep, you
Speaker 3: heard that right, a genuine unicorn level success story in
Speaker 3: the world of MLMs, the kind of story that the
Speaker 3: brochures promise and the hashtags romanticize. But he's the twist.
Speaker 3: She's left it all behind, and not only that, she's
Speaker 3: turned her energy towards exposing the truth about the system
Speaker 3: that she once thrived in. Joining me is none other
Speaker 3: than Emily Lynn Paulson. She's the author of Hayhun Sales,
Speaker 3: Sisterhood and Supremacy, and the Other Lies behind Multi level Marketing.
Speaker 3: Emily isn't just a rare success story, She's also the
Speaker 3: sharpest critic of the industry's predatory practices. Emily, I'm so
Speaker 3: excited for this episode. Welcome to She's on the Money
Speaker 3: from the other side of the world.
Speaker 4: Yeah, thanks for having me. It's my favorite topic to
Speaker 4: talk about.
Speaker 3: Really, It's almost like you wrote an entire book about it,
Speaker 3: you know, I adore it. I also just low key
Speaker 3: the name of your book, heyhun Oh, it makes me
Speaker 3: so excited. You just know it's going to be a
Speaker 3: good book, full of all of the juiciest details, and
Speaker 3: it is. So can we dive straight in?
Speaker 4: Sure? Do you want to know? First?
Speaker 3: With my background as a financial advisor and having just
Speaker 3: written a business book, I have so many thoughts and
Speaker 3: feelings about the I guess flaws in the MLM business model,
Speaker 3: and as someone who has a background in psychology, I
Speaker 3: also take a major issue with I guess what you
Speaker 3: would call the manipulation tactics that these companies use. And
Speaker 3: that's why I want to break this chat into two parts. First,
Speaker 3: we're going to talk about the business side, and then
Speaker 3: we're going to talk about the psychological side of MLMs, because,
Speaker 3: like I feel like the business side, yeah, pervy, but
Speaker 3: like the manipulation, we all just get so frustrated with Emily.
Speaker 3: First off, I have to say the book was a
Speaker 3: very fun read. It is spot on. I feel like
Speaker 3: it captures the like slightly too friendly vibe that we
Speaker 3: all experience in our inboxes. Had you had many of
Speaker 3: those messages before you'd actually joined an MLM yourself, did you,
Speaker 3: I guess, know much about them at the time or
Speaker 3: was it a bit of a mystery?
Speaker 4: I would say I was blissfully ignorant, and that kind
Speaker 4: of made me the best target because I had been
Speaker 4: to tupperware parties and legging parties and different things. I
Speaker 4: bought the jewelry but I didn't really understand. It was
Speaker 4: just kind of like you go to your friend's house,
Speaker 4: you drink wine, you buy a few things, and you leave.
Speaker 4: I didn't really know it was a hierarchical structure.
Speaker 3: Why would you You don't ask about the business model.
Speaker 3: You're like, hey, these leggings are cute.
Speaker 4: Yeah, and even if they do, you know, talk about like, oh, yeah,
Speaker 4: this is something you can do. Also, it isn't until
Speaker 4: like the one on one or after you sign the
Speaker 4: dotted line that you realize what's involved. And I think
Speaker 4: that's why I was such good prey, because I knew enough,
Speaker 4: Like I knew enough to know that Okay, yeah I
Speaker 4: can throw parties, Yeah, I can work a website. I
Speaker 4: can you know, I like to buy stuff, Like those
Speaker 4: are the qualifications.
Speaker 3: And that's fun.
Speaker 4: Yeah, and it's and it sounded fun. It was like
Speaker 4: something to do money. It was you know, going out
Speaker 4: drinking and like it was all the things I wanted
Speaker 4: to do. But I didn't really know what was behind it.
Speaker 4: So I would say, you know, yes, and no, I
Speaker 4: knew some I'd been targeted a little bit, but I
Speaker 4: didn't realize how predatory it was.
Speaker 3: Yeah, No, that makes absolute sense, And I feel like
Speaker 3: that's the story I'm hearing in my damns from basically
Speaker 3: everybody who's joined and is either considering leaving or has left.
Speaker 3: They're like, I didn't know, Like I was blissfully unaware.
Speaker 3: Seems to be the tagline here of these We'll get
Speaker 3: onto it later, but I feel like you were right.
Speaker 3: You are the perfect target. Oh no, know, what was
Speaker 3: your life like before MLM. Paint us a little bit
Speaker 3: of a picture. What was going on in your world
Speaker 3: before MLMs became part of the story.
Speaker 4: Yeah. So it was twenty fourteen and my youngest child
Speaker 4: was two, So I had five kids under nine years old.
Speaker 3: Oh my god. So I was just you were having fun.
Speaker 4: Yeah, it was so much fun. So you know, I
Speaker 4: was sleeping a ton, and you know, I was just
Speaker 4: kind of run ragged. Like from the outside, I had
Speaker 4: a very good life. I loved being a mom, and
Speaker 4: yet at the same time, I also felt a little
Speaker 4: bit trapped, and I was at the point where I
Speaker 4: knew we weren't having any more kids. But the thought
Speaker 4: of going back to the workforce suddenly was like, well, shoot, like,
Speaker 4: how am I going to do this? Childcare for five kids?
Speaker 4: Would be ridiculous, Like my husband's job not flexible. We've
Speaker 4: kind of followed his career, and now like what am
Speaker 4: I going to do? So I had this desire to
Speaker 4: like escape and get out and get a break and
Speaker 4: also figure out some way to earn money. So I think,
Speaker 4: you know, I was feeling a little bit lost at
Speaker 4: that time.
Speaker 3: That feels really reasonable and also something that I'm sure
Speaker 3: a lot of mums can resonate with. You kind of
Speaker 3: sometimes lose yourself a little bit. You're like, oh wait,
Speaker 3: I've you know, prioritized my husband's career, and now what
Speaker 3: am I going to do? You write childcare. I don't
Speaker 3: know what it costs in the US, but in Australia,
Speaker 3: childcare is astronomically expensive. Like to give you a little
Speaker 3: bit of context, I have a child in daycare and
Speaker 3: we pay one hundred and ninety two dollars a day
Speaker 3: and for that there are rebates and stuff available, but
Speaker 3: it really it doesn't come close to making it reasonable,
Speaker 3: especially if you had five kids like you just it
Speaker 3: would be more than a full time salary worth of
Speaker 3: day care.
Speaker 4: Yeah, And I think that's why you know mL can
Speaker 4: thrive that it's because there is no safety net. I
Speaker 4: never fault anyone for taking that as an option, because
Speaker 4: you know, we don't have affordable childcare and we don't
Speaker 4: have you know, flexible paid leave or you know, jobs
Speaker 4: are really hard for moms to have because moms are
Speaker 4: generally the ones who have to take off for sick
Speaker 4: days and all of that, and so we don't have
Speaker 4: safety nets. So I get it, and that's why I
Speaker 4: joined one because that was the option available to me at.
Speaker 3: The time and it sounds really attractive, right. And this
Speaker 3: is why when we have been doing our MLM series,
Speaker 3: I haven't named names of people in MLMs because I
Speaker 3: just honestly I feel sorry for them because they've been
Speaker 3: taken down this beautiful garden path and I feel like
Speaker 3: they've drunk the kool aid and they think that this
Speaker 3: is all sunshine and roses, when in reality, they've been
Speaker 3: taken advantage of. And that breaks my heart. And it's
Speaker 3: not my job to call them out. It's my job
Speaker 3: to call the system out and help I guess illuminate
Speaker 3: what that looks like and why you might be taken
Speaker 3: advantage of, because I kind of want to stay a
Speaker 3: safe place if you go, oh hey, they I've been
Speaker 3: watching your content and it's been a bit confronting because
Speaker 3: I've just realized that I have drunk the kool aid
Speaker 3: and I am actually victim to this system. I want
Speaker 3: to be that safe place for people to turn and
Speaker 3: you would get this all the time. I'm absolutely certain
Speaker 3: of it. But it's wild. The more I talk about it,
Speaker 3: the more people are sliding into my dms, going hey,
Speaker 3: they have you got any advice for leaving? Because I've
Speaker 3: just realized that's me and that's really heartbreaking. And I
Speaker 3: mean we've been talking about it a lot. In She's
Speaker 3: on the Money, so on the podcast and in that
Speaker 3: she's on the Money community, but also on my personal Instagram,
Speaker 3: which is where I go a little bit more rogue.
Speaker 3: You've probably seen the difference, like nobody stops me from
Speaker 3: posting on my personal Instagram. But there's a vetting process
Speaker 3: on the more serious business side. But we know legally
Speaker 3: the difference between a multi level marketing business and a
Speaker 3: pyramid scheme is but from an insider's point of view,
Speaker 3: talk me through it. How does the business actually work?
Speaker 4: So there is no difference. In fact, pyramid schemes are
Speaker 4: actually more lucrative.
Speaker 3: Yeah, you'd make more money bybe don't join an MLM,
Speaker 3: just go straight for the pyramid schemes.
Speaker 4: Great pyramid and that's a sad reality. And you know
Speaker 4: the idea of a pyramid, you know, everyone thinks so
Speaker 4: like the little triangle, but like in reality, the pyramid
Speaker 4: would be like so flat because there's like very few
Speaker 4: people a top the people at the bottom. It would
Speaker 4: go out past the earth, you know, it's so wide.
Speaker 4: So pyramids not even the right you know shape. But
Speaker 4: just for our intensive purposes, a pyramid scheme and an
Speaker 4: MLM are the same in the sense that it's all
Speaker 4: about recruiting into the system, and it has nothing to
Speaker 4: do with what you're selling or how you're doing it.
Speaker 4: It's just about collecting people. And so when the messaging is, oh,
Speaker 4: I've got these great products, but you know you should
Speaker 4: buy in to get the biggest discount, or you should
Speaker 4: join because this is a great opportunity. You know, you
Speaker 4: got to ask yourself, like what would be the difference
Speaker 4: between just giving you one hundred dollars and asking five
Speaker 4: people for one hundred dollars? You know what is so
Speaker 4: great about this product?
Speaker 3: Yeah, it's true, it's scary.
Speaker 4: And The reality is the products aren't special different. There's
Speaker 4: nothing necessarily wrong with some of them. Some are problematic,
Speaker 4: but for the most part they're just run of the
Speaker 4: mill skincare, you know, diet pills, shakes, whatever, they're selling, leggings.
Speaker 4: But it isn't about the products at all. It is
Speaker 4: about the mission, the system and this bigger thing. It's about,
Speaker 4: you know, this mission to fulfill whatever. It's this like
Speaker 4: self fulfilling prophecy of nothing really, you know, it's yeah,
Speaker 4: prosperity gospel, all of that.
Speaker 3: Yeah, from all my research, it seems that I guess
Speaker 3: at mL structure. You know, obviously we need to stipulate
Speaker 3: that here in Australia, and I'm pretty sure in the
Speaker 3: US a pyramid scheme is illegal. But we're just talking
Speaker 3: context and comparison. We're not saying go and do a
Speaker 3: pyramid scheme. But it seems from all of my research
Speaker 3: that an MLM is actually more harmful than a pyramid
Speaker 3: scheme because in a pyramid scheme you kind of have
Speaker 3: that once off investment, like you invest and then you know,
Speaker 3: the pyramid does its thing, whereas with MLM, you invest
Speaker 3: over time through like I guess, product purchases and you know,
Speaker 3: needing to meet your quota every month. Like I feel
Speaker 3: like that seems to be a consistent thing. How much
Speaker 3: pressure did you feel to invest your own money into
Speaker 3: I guess, your product or your business.
Speaker 4: Yeah. I mean that's where no matter what, even if
Speaker 4: it's not a product that you want, you become a
Speaker 4: consumer because there is a minimum requirement and there's always
Speaker 4: a caveat. And this is how they stayed legal. They
Speaker 4: make so okay, you don't have to buy the product,
Speaker 4: you can join, you know, you can join and not
Speaker 4: have to buy the product. But if you don't buy
Speaker 4: the product, then you're not getting commission. And then what's
Speaker 4: the point of joining in the scheme?
Speaker 3: Oh, that's so snaky.
Speaker 4: It's talked around and it's always little bits. Like you said,
Speaker 4: it's like death buy a thousand paper cuts, right, it's like, well,
Speaker 4: you've got this twenty five dollars website fee and you're like, oh,
Speaker 4: twenty five dollars, No big deal, that's not much. Yeah,
Speaker 4: actually yeah. And when it's compared to a business, and
Speaker 4: this is another place where kind of I'll even say
Speaker 4: for myself, business illiteracy, Like I wasn't a business person.
Speaker 4: I don't have a degree in business. You know, I
Speaker 4: was a chemist before kids, like so for me running
Speaker 4: a business lots of air quotes. It's not a business.
Speaker 4: You know, you're a ten ninety nine contractor. But they
Speaker 4: use all these comparisons, like, you know, if you started
Speaker 4: your own brick and mortar store, you'd have to pay
Speaker 4: for rent, you'd have to pay for products, you'd have
Speaker 4: to pay for and so these little purchases seem very
Speaker 4: nominal when they're compared to an actual business, right, But
Speaker 4: they're not related. So it's a ridiculous comparison. It's comparing
Speaker 4: apples and oranges. But it's easy to get in that mindset. Well, okay,
Speaker 4: I guess if I spend twenty five dollars and then
Speaker 4: another hundred, I'm going to use those products anyway, and
Speaker 4: if I can make money off it, I can earn
Speaker 4: my money back. I mean, you just start talking yourself
Speaker 4: into this. And you know, a payramid scheme, you don't
Speaker 4: have people on the sideline saying just stay just stay in,
Speaker 4: just keep working. It works if you work it just
Speaker 4: one more month. You know, you have people cheering you
Speaker 4: along and also doing the same thing. So it's like, Oh,
Speaker 4: do you think it's weird that you know, I have
Speaker 4: to buy another serum even though I haven't used the
Speaker 4: last one. Oh yeah, but you know you can gift it.
Speaker 4: You can. You're surrounded by people doing the same thing,
Speaker 4: and so I know that gets into the psychology that
Speaker 4: we'll talk about later. But it's that group thing.
Speaker 3: We'll talk about it, we'll talk about it. Yeah, Oh
Speaker 3: my gosh. I feel like that's the pervioust part for me,
Speaker 3: having like I've done a couple of psych degrees and
Speaker 3: I adore or the psychology of money. I adore the
Speaker 3: psychology of literally why people make the decisions that they make,
Speaker 3: And this just marries the two together so perfectly, which
Speaker 3: is why it's probably I don't know, a hyperfixation of
Speaker 3: mine at the moment, but I have had a lot
Speaker 3: of people in my DMS and messaging and emailing me
Speaker 3: saying what's the difference between like a multi level marketing
Speaker 3: business and a franchise, Because lots of people, if you're
Speaker 3: inside an MLM will say, oh, it's like having your
Speaker 3: own franchise, but you don't have to pay for the
Speaker 3: bricks and mortar store. And having read your book, you've
Speaker 3: talked a lot about this in your book. Can you
Speaker 3: explain how they are different?
Speaker 4: Yes? And it's so interesting once you're on the other
Speaker 4: side of it, because this was like a talking point
Speaker 4: when I talked at presentations of why people should join, like, oh,
Speaker 4: it's a virtual franchise, but it's less than one thousand dollars,
Speaker 4: and you can't open a taco bell for less than
Speaker 4: a million dollars. I mean, I would use this language.
Speaker 4: So it's just it's funny that that became part of
Speaker 4: the normal vernacular. But it's different in every way. You know.
Speaker 4: I can go down town and there's a Starbucks in
Speaker 4: a grocery store and then there's Starbucks next door, and
Speaker 4: you think, oh, well, gosh, if the Starbucks can be
Speaker 4: in every corner, right, it's so saturated. But they do
Speaker 4: so much research. Starbucks figures out like what are people
Speaker 4: shopping habits. The people who are buying the coffee while
Speaker 4: they're shopping, you're totally different than the people driving through
Speaker 4: and getting one. So you need both. And it's a
Speaker 4: location that's accessible. Any Starbucks store that opens has a purpose,
Speaker 4: and that's why sometimes they close and sometimes new ones
Speaker 4: open because they have so dialed in to how they're
Speaker 4: going to make money back. That's just one aspect of
Speaker 4: a franchise. There's many, many more. There's also rules with
Speaker 4: franchises that you have to do a certain amount of
Speaker 4: a waiting period before you can actually get the McDonald's
Speaker 4: or whatever franchise you're purchasing, so that you can have
Speaker 4: time to think about it, which shouldn't be built into
Speaker 4: any purchase, any big decision, any big financial decision. With
Speaker 4: an MLM, it's completely the opposite. You are encouraged to
Speaker 4: have as much competition and as small of an area
Speaker 4: as possible.
Speaker 3: Which is insane to me. It's like recruit your mom
Speaker 3: and you're like, hold on, wouldn't you both have the
Speaker 3: same customer?
Speaker 4: You would? Yeah, So your recruiting competition in an already
Speaker 4: saturated market, and not only within your own. You know,
Speaker 4: I was in Rhodana Fields, for example. I also was
Speaker 4: competing with Beauty Counter and Monate and you know all
Speaker 4: these other products that maybe had overlapping portfolios. Nobody needs
Speaker 4: that much serum, right, So it was way more than
Speaker 4: the area I lived could contain could purchase from. And
Speaker 4: then not only that, but you could buy stuff online.
Speaker 4: So just the idea that it's a franchise is so
Speaker 4: out there because there's zero research done and it's encouraged
Speaker 4: to be more saturated than not. And you're also encouraged
Speaker 4: not to have a waiting period but to sign up
Speaker 4: as quickly as possible. There's always these like sign up
Speaker 4: this week and you get this free, or you know,
Speaker 4: you can get a refund. That was a big thing.
Speaker 4: It's like there's no commitment. If you join, you can
Speaker 4: pay this business kit fee and you'll get your thousand
Speaker 4: dollars back after sixty days. If you're not interested, well
Speaker 4: that's a load of crap, because guess what, you're going
Speaker 4: to have a thousand boss babes, you know, on your
Speaker 4: ass telling you not to return it and telling you
Speaker 4: you just need to work harder. So, I mean, it
Speaker 4: could not be less like a franchise. It's it's much
Speaker 4: more like a pyramid scheme than a franchise, that's for sure.
Speaker 3: And I feel like these questions come because we don't
Speaker 3: know what we don't know. Hold that thought, because after
Speaker 3: the break, we're going to dig into how MLMs legally
Speaker 3: separate themselves from pyramid schemes and whether those comparisons to
Speaker 3: franchises hold up spoiler alert, they don't stick around all right,
Speaker 3: we are back. And something else that I find interesting
Speaker 3: and I kind of want to like put here as
Speaker 3: maybe like just a conversation market you could say, is
Speaker 3: there are lots of differences right economically between Australia and
Speaker 3: the US. And I think a lot of the time
Speaker 3: as we live in our little island away from most things,
Speaker 3: and like everything's bigger in America, and so I think
Speaker 3: that when Australians look at multi level marketing businesses, we go, well,
Speaker 3: it's nothing like what happens in the US. Like it's
Speaker 3: not like that because you know, we don't have the
Speaker 3: aggressive religion overlays and we don't have, you know, the
Speaker 3: scale that they have, when in reality we do. Like
Speaker 3: the reality is the businesses that you're talking about, Emily
Speaker 3: are actually the identical businesses here in Australia. So like
Speaker 3: we are talking and like it's been a few years,
Speaker 3: so like it took a while for like Monet to
Speaker 3: get to Australia and we got Rodin and Fields recently
Speaker 3: as well, and like we actually have all of them
Speaker 3: and they are not different. They have been cut and
Speaker 3: paced from the US for an Australian market, and I think,
Speaker 3: what you know, and we'll get into the psychology of
Speaker 3: it soon. I'm just like, I guess, chumping at the
Speaker 3: bit and trying to get there. But when you talk
Speaker 3: about the psychology of it, we actually do have the
Speaker 3: religious overlays as well in play, it's just not as obvious.
Speaker 3: I feel like Americans are a lot more like open
Speaker 3: about their religion and open about posting it and going,
Speaker 3: oh my gosh, I'm so glad that God helped me
Speaker 3: do x y Z on their Instagram posts. But I
Speaker 3: think in Australia we're a little bit more nuanced because
Speaker 3: we know that religion isn't so big here, so we
Speaker 3: don't want to turn away a consumer that might go, oh,
Speaker 3: if that's religious, I'm not interested. So it's a little
Speaker 3: bit more hidden, but it absolutely is here. And I
Speaker 3: think that, you know, That's why I was like, I
Speaker 3: just want to pop this here and say no, no, no,
Speaker 3: what Emily is talking about, because I think it's so
Speaker 3: easy sometimes to go she's in the US, it must
Speaker 3: be a little bit different.
Speaker 4: It's not.
Speaker 3: It's identical, and I think that's what is so frustrating
Speaker 3: because again back to my history, I was a financial
Speaker 3: advisor and I now have this podcast that thankfully takes
Speaker 3: me all over the world, and I have been lucky
Speaker 3: enough to go to the US a number of times
Speaker 3: to go to finance conferences. And one thing that I
Speaker 3: find different about the Australian market versus the US market
Speaker 3: is in Australia, it is the expert's job to protect
Speaker 3: the consumer. So here in Australia I have to always say,
Speaker 3: you know, if I was working as a financial advisor,
Speaker 3: I'd have to be like, okay, Emily, sit down. I
Speaker 3: need to take you through all of the risks and
Speaker 3: what's going on here and how this works so that
Speaker 3: you're making the right decision, and like, you know, we've
Speaker 3: got laws. So if I was recommending a financial services product,
Speaker 3: I would have to give you three products to compare.
Speaker 3: Like I am as the expert, the I guess security.
Speaker 3: Whereas in the US it's actually the consumer's responsibility to
Speaker 3: do their own research, and a financial advisor can say
Speaker 3: whatever they would like to say. They can go out
Speaker 3: to market and go hey, hey, Victoria, I think that
Speaker 3: product A is the best. Go there, and it's not
Speaker 3: a good or a bad thing. It's just the difference
Speaker 3: in responsibility. But I think in Australia it's become quite
Speaker 3: dangerous because we live in this society where we expect
Speaker 3: our experts to have our best interests at heart, because
Speaker 3: we are legally bound by that. Like I was bound
Speaker 3: by that. Every single service provider in Australia has to
Speaker 3: make sure that the consumer's in the right position. We
Speaker 3: now have this American model coming into Australia and you
Speaker 3: expect those people telling you that that serum is the
Speaker 3: best serum to actually be putting you in the best
Speaker 3: possible position. And it's not the case because they are
Speaker 3: assuming that you will do your own research when we
Speaker 3: haven't been brought up that way, if that makes sense,
Speaker 3: And that's really scary it is.
Speaker 4: And when you are you sign the dotted line and
Speaker 4: you give yourself a security number and you become a
Speaker 4: boss babe. You are told to be the expert. You're
Speaker 4: told to act like the expert. Take it till you
Speaker 4: make it, you know, use whatever company materials you have
Speaker 4: to sell whatever. Like I was the skincare expert, I
Speaker 4: wasn't a scared care expert. Like I knew a lot
Speaker 4: about the products we had. I could give you talking
Speaker 4: points for the products we had. I was not a dermatologist,
Speaker 4: I wasn't an esthetician, and so you can only do
Speaker 4: so much damage, I guess with skincare, hair care. But
Speaker 4: when you're talking about products like man, there's this Amari company.
Speaker 4: I don't know if you guys have that in Australia yet,
Speaker 4: but it's a mental wellness company where they're telling people,
Speaker 4: you know, use this in place of your antidepressants. And
Speaker 4: when you're getting to this place where okay, this person
Speaker 4: selling themselves as an expert without credentials, I mean, yeah,
Speaker 4: it gets really scary. And I was going to say
Speaker 4: too with the infiltrating Australia with this business model that
Speaker 4: is done so on purpose, like it is so intentional.
Speaker 4: They start in the US and then they say, oh gosh, yay,
Speaker 4: we're doing so well, We're going to go to Canada.
Speaker 4: It's not that they're doing well, it is that it's
Speaker 4: become so saturated and the people at the bottom are getting,
Speaker 4: you know, consistently turned and crushed, and there's fewer people
Speaker 4: now to buy in. So they go to Canada and
Speaker 4: then yay, we're doing so well, now we're going to
Speaker 4: go to Australia. I mean it's like with every company.
Speaker 4: You will see this, sometimes Japan and then you know Japan,
Speaker 4: they don't do so well there, so they leave. Sometimes
Speaker 4: they don't do so well in Australia they leave. So
Speaker 4: it's this constant expansion and people think, wow, a company's growing,
Speaker 4: they must be doing well. That's what we think, is
Speaker 4: non experts, right, But the reality is you're just running
Speaker 4: out of people a scam in one country and you've
Speaker 4: got to go to another one.
Speaker 3: So that's terrifying. And I mean I trust literally what
Speaker 3: you're saying, because you made it to a level that
Speaker 3: many aspire to but rarely achieve, right wild And do
Speaker 3: you talk in your book about the perfect storm of
Speaker 3: circumstances and qualities that made you so successful in a
Speaker 3: system that was designed, honestly for most people to fail in.
Speaker 3: So I want to know how did you become so
Speaker 3: successful in the pyramid scheme?
Speaker 4: Yeah? It really was just lightning striking at the right time.
Speaker 4: I happened to join this company that wasn't you know,
Speaker 4: really well known in the area I was living. I
Speaker 4: was in Seattle, Washington at the time. And so I
Speaker 4: was kind of the first to bring it to that market.
Speaker 4: And I had a lot of friends because I had
Speaker 4: a lot of kids, right, all those kids have friends,
Speaker 4: they have parents, Like I was in so many social circles.
Speaker 4: I was very social and most of the people I
Speaker 4: knew were kind of the same circumstances as me. Where
Speaker 4: you know, we had money to buy things. It's not
Speaker 4: like we were, you know, swimming in cash or anything.
Speaker 4: But if I wanted something, if I wanted to try
Speaker 4: a haircare product, I could My friend was selling jewelry,
Speaker 4: I could buy it. Right, I had these people all
Speaker 4: around me. And with that, people are like, oh, hey,
Speaker 4: I'm bored too, or you know, I can't get a
Speaker 4: job either because I also have kids, and I also
Speaker 4: am in the same circumstances that you were in, and
Speaker 4: so heck, I'll join too. So I very quickly assembled
Speaker 4: this team of people who joined with me, who then
Speaker 4: got their own teams of people to join with them.
Speaker 4: And so it really was the pyramid got assembled very quickly.
Speaker 4: And again the products were an inn like, people liked
Speaker 4: it and they were cool whatever, But the products were
Speaker 4: just away in to build the.
Speaker 3: Team into the system, into the game. It's insane how
Speaker 3: that works because obviously you had the perfect storm. But
Speaker 3: then on the flip side you talk about Hannah and
Speaker 3: why she was actually never going to succeed in a
Speaker 3: multi level marketing structure. Can you tell me a little
Speaker 3: bit more about why the Hannahs of the world will
Speaker 3: always fail in an MLM structure.
Speaker 4: Yes, So someone who comes in, you know, say a
Speaker 4: couple of years after a company has really taken over
Speaker 4: an area. And this is when people tend to come
Speaker 4: in because they see it a lot on their social
Speaker 4: media feeds. They're like, Wow, so and so is getting
Speaker 4: a paycheck, and soone says getting a paycheck and gosh,
Speaker 4: they look they're having so much fun. I'll host a party,
Speaker 4: you know, you come over, I'll bring my friends. They
Speaker 4: join right. Well, at that point, again, the area has
Speaker 4: become so saturated, and maybe that person who joined had
Speaker 4: to wait a while to join because they had to
Speaker 4: save up the money. You know, they don't necessarily have
Speaker 4: the network of people who have extra money. They don't
Speaker 4: have a ton of relatives, and so if you have
Speaker 4: any of those things stacked against you, which most people
Speaker 4: have one or two. Like most people, they either had
Speaker 4: don't have a huge network, or maybe they don't have
Speaker 4: a ton of extra money laying around or they you
Speaker 4: know whatever, they don't they can't use the products that
Speaker 4: are being sold. There's lots of reasons why someone wouldn't
Speaker 4: be successful at this, but the biggest thing is the
Speaker 4: saturated market. And so it really just takes a couple
Speaker 4: of levels. In fact, when I joined, nobody who joined
Speaker 4: after me ever achieved near the level of success that
Speaker 4: I did. And I always use air quotes because you know,
Speaker 4: the success came at, you know, the victimization of other people.
Speaker 4: You know, my upline brought me in thinking she was
Speaker 4: helping me. I brought people and thinking I was helping
Speaker 4: them until I realized, oh, I am making money because
Speaker 4: they're all paying monthly for their website, for their products,
Speaker 4: for these conventions, for all of these things, these trainings,
Speaker 4: these things that I'm making them go to, and the
Speaker 4: new product that comes out and they have to buy it, well,
Speaker 4: all that is going up to me and booying me,
Speaker 4: and they're treading water. And you know, that was the
Speaker 4: point where I was like okay, and you know, there
Speaker 4: was some guilt and like trying to help other people
Speaker 4: and it really was the realization that, oh, this is
Speaker 4: designed so that a few people make money off the
Speaker 4: many of people who are not.
Speaker 3: And that must be a really hard realization to come
Speaker 3: to because you are earning really good money and I'm
Speaker 3: seeing it a lot here where the top dogs, you
Speaker 3: could say, are going No, absolutely not stop saying I'm
Speaker 3: victimizing women. I absolutely am not doing that. I'm giving
Speaker 3: them this opportunity and if they can't make the most
Speaker 3: of it, that's on them, not on me. At what
Speaker 3: point do you stop drinking that kool aid and flip
Speaker 3: to hold on. I actually feel a little bit uncomfortable
Speaker 3: with this, and is that I don't know. I feel
Speaker 3: like that would be a jarring realization for you to
Speaker 3: have gone through, to go hold on, hold on, hold on,
Speaker 3: I've led all of these people down the garden path,
Speaker 3: and now I'm realizing that this garden path is actually
Speaker 3: fraught with danger. Yeah, what did that feel like?
Speaker 4: And that was also by design, because you know, you're
Speaker 4: never told, like you would be in a traditional business
Speaker 4: to do a profit loss statement or keep track of expenses.
Speaker 4: You know, you're never told to do that. It's just
Speaker 4: like buying your products sign people up bloody DA and
Speaker 4: the rest is like just you know, shove it out
Speaker 4: of the rug, don't talk about it. You know, look
Speaker 4: at the income disclosure if you want any financial information.
Speaker 4: So you're kind of in this place where by the
Speaker 4: time you are able to figure that out, you're in
Speaker 4: so deep. You've recruited so many people into this system.
Speaker 4: So it really wasn't matter of me. My rise in
Speaker 4: the MLM really followed my journey with alcohol, and you know,
Speaker 4: I got sober, and you know, the beer goggles came off,
Speaker 4: and I realized, you know, the lot of the tactics
Speaker 4: I was using I wasn't comfortable using anymore. I realized, like, oh,
Speaker 4: I really saw it for what it was. I saw
Speaker 4: that the people who I had been telling, well, you're
Speaker 4: not successful because you're not doing X, Y and Z,
Speaker 4: they were doing those things. And I always assumed, you know,
Speaker 4: I did what my upline told me, and it worked.
Speaker 4: If I tell people to do what I'm doing, it'll
Speaker 4: work for them too. And it wasn't. It wasn't until
Speaker 4: I actually you know, stopped gaslighting people right, looked at
Speaker 4: what they were actually doing, had them do like their
Speaker 4: own profit loss statements. And so that they could see
Speaker 4: the riding on the wall. It kind of took that.
Speaker 4: You know, I could say to someone like, Okay, this
Speaker 4: is how much money I'm making, and that's whatever. But
Speaker 4: to someone when you tell them like, okay, you're spending
Speaker 4: this much time and this much money and this this
Speaker 4: is how much you're really taking home. Oh, then the
Speaker 4: work they're doing is not They're not going to keep grinding, right.
Speaker 4: So it was at that point when I really tried
Speaker 4: to help people see that they kind of needed to
Speaker 4: leave before I was ready to leave. You know. It's
Speaker 4: like I had to slowly dismantle what I had built,
Speaker 4: if that makes sense. Yeah. Yeah, it's a hard realization.
Speaker 4: And like those women you're saying who are like, no,
Speaker 4: I'm not manipulating people, they might not actually realize it
Speaker 4: yet because they've never been.
Speaker 3: Told no, and that's what hurts.
Speaker 4: Yeah, yeah, it is. It's hard.
Speaker 3: It's a really challenging realization. And I mean, you're sould
Speaker 3: the dream, right, I mean when it comes to the
Speaker 3: lure of joining a multi level marketing business, A really
Speaker 3: big one for women in particular is this freedom push.
Speaker 3: So they're always talking about have freedom, like you know,
Speaker 3: you'll have the freedom to do whatever you want. You
Speaker 3: can work from wherever you want. Look, I am in
Speaker 3: Mexico and I am at work, and it just it
Speaker 3: blows my mind. So how did this so called freedom
Speaker 3: manifesting your day to day life as a really successful
Speaker 3: multi level marketing quay?
Speaker 4: There is nothing less free than being required to work
Speaker 4: from the hospital, or being required to work at month
Speaker 4: end every month, and being required to go on these trips.
Speaker 4: Like that's not freedom, Like I want to go on
Speaker 4: a vacation and put my phone away, not sit with
Speaker 4: my face in it and text it. That's what you
Speaker 4: see on social media, right, I can work from it anywhere.
Speaker 4: Why do you want to work from anywhere? Like? Why
Speaker 4: is no one questioning this?
Speaker 3: Yes, it's true.
Speaker 4: Right, I sold some lips erum while I was in
Speaker 4: the hospital having a baby. Why are you doing that?
Speaker 4: Like nobody's questioning this. So the idea of freedom being
Speaker 4: able to work more places is what's so screwed up?
Speaker 4: Like what is freedom to use that freedom? Though? I mean,
Speaker 4: there is nothing less free than being glued to your
Speaker 4: phone all day. I can't tell you that when I
Speaker 4: find decided to step away and not go to the
Speaker 4: conventions anymore and not send dms anymore and do all
Speaker 4: of that stuff like that was true freedom. And that's
Speaker 4: when I could not wait to cut the cord and
Speaker 4: be done with it. I was in a prison of
Speaker 4: my own making.
Speaker 3: Oh my gosh. Yeah, And that's exactly from I think.
Speaker 3: I'm in a very privileged position looking in like I've
Speaker 3: got the education on my side, thankfully, but I'm also
Speaker 3: a business owner, and like you are saying all the
Speaker 3: stuff that I am thinking, I'm like, I don't want
Speaker 3: to work from anywhere. If I go on a holiday
Speaker 3: with my baby and my husband, I don't want to
Speaker 3: take my phone out of the room. I want to
Speaker 3: be present. What are you guys doing? What is this
Speaker 3: freedom thing you speak of? And I guess the other
Speaker 3: thing you've touched on before is about like doing a
Speaker 3: profit and loss and talking about you know, how much
Speaker 3: you're actually taking home and you know, tracking your expenses,
Speaker 3: which is they don't talk about that. They absolutely don't
Speaker 3: talk about it. You've described running the business as exhausting,
Speaker 3: and obviously it sounds it if you're selling serum while
Speaker 3: giving birth. Absolutely not. And there's I guess, so much
Speaker 3: unpaid labor involved, which is something that makes me so
Speaker 3: angry because women are already doing so much unpaid labor.
Speaker 3: Can you talk, I guess a little bit more about
Speaker 3: these tasks and how much time you were spending on
Speaker 3: them that I guess you weren't being directly compensated for.
Speaker 3: And another question, did you ever work out your hourly wage?
Speaker 4: Yes? And by the time I did that, mine was okay.
Speaker 4: But I had like my team do that as well,
Speaker 4: and it was eye opening and we were not told
Speaker 4: to ever do that. And I'm sure that's why.
Speaker 3: Yeah, because it's dismal.
Speaker 4: It was dismal. I mean, yes, you could make more
Speaker 4: money doing anything. The unpaid labor thing that it is
Speaker 4: really sad because just like the freedom thing when you
Speaker 4: are at home, and I'll use me for an example,
Speaker 4: like I was home with five kids. I was pretty
Speaker 4: much the sole caregiver. My husband traveled a lot, you know.
Speaker 4: I craved thetion so for me to have to get
Speaker 4: a babysitter, to have to pay for a babysitter, to
Speaker 4: go on a free trip that wasn't free, and to
Speaker 4: be on a beach looking at my phone, that sounds
Speaker 4: like freedom, right, So that even though in practice it
Speaker 4: ends up not being freedom. It felt like it. So
Speaker 4: you're given these goals to strive for that end up
Speaker 4: not being very good goals. And you are used to
Speaker 4: doing so much unpaid labor, like our whole country and
Speaker 4: probably yours too, is held on the unpaid labor of women. Right,
Speaker 4: So when you're told, hey, you're already doing this, like
Speaker 4: you're already sitting at pick up with your kids, why
Speaker 4: not send a couple of texts and make some money? Again,
Speaker 4: it sounds good in practice until then it becomes something
Speaker 4: you have to do and you're not necessarily making money.
Speaker 4: You're not making money until you sell something or recruit someone, right,
Speaker 4: so the act of sending a text isn't making money.
Speaker 4: But again, it sounds nice.
Speaker 3: Yet sounds so kind. Yeah, oh, it drives me insane.
Speaker 3: And when you start to look at the monetary side
Speaker 3: of things, like obviously I love deep diving into it.
Speaker 3: And legally they have to share their income disclosure statements,
Speaker 3: so MLMs will put on their website the income disclosure
Speaker 3: statements and they'll often be relatively proud of these things
Speaker 3: because they use them as marketing tools as well. And
Speaker 3: I have been in the background doing some maths on
Speaker 3: a number of these MLMs and taking the information on
Speaker 3: their income disclosure statements versus every other statement I can
Speaker 3: find on their website, and they don't always add up.
Speaker 3: So do you think that these income disclosure statements are
Speaker 3: a fair depiction of I guess the state of affairs
Speaker 3: so to speak.
Speaker 4: Oh, absolutely not. You know, they user mean as opposed
Speaker 4: to a median, which they should use a median because
Speaker 4: you know, if you have a bunch of people who
Speaker 4: make two dollars and you have one person who makes
Speaker 4: five thousand dollars for some reason at that level, well,
Speaker 4: the average then it's going to be twenty five hundred dollars.
Speaker 4: I mean, we all know how averages work. But the
Speaker 4: median would be maybe five dollars. Yeah, that's a big difference.
Speaker 4: So it doesn't show what the majority of people make
Speaker 4: at each level. And even when you look at it,
Speaker 4: it's pretty abysmal. But when you look at like, okay,
Speaker 4: eighty percent of people make this much, and when you
Speaker 4: look at it and realize it's before expenses, like it
Speaker 4: doesn't include expenses, it doesn't include taxes, it includes nothing,
Speaker 4: So you can basically cut that in half, maybe in
Speaker 4: half again, it's already abysmal, and it's much worse than that,
Speaker 4: So no, they're not accurate. It's much worse than than
Speaker 4: it shows, and they tell you that's why they don't
Speaker 4: really reference it that often. It's like, oh, if you
Speaker 4: want more questions, just go check out the income disclosure.
Speaker 4: Well you might, and then sometimes it's super confusing. It's
Speaker 4: written strangely. You don't necessarily know the levels when you join,
Speaker 4: so you're like, oh, maybe I will be a level superior,
Speaker 4: princess or whatever the hell. The top one is maybe
Speaker 4: I want to get to the point one percent. And
Speaker 4: then that income you're like, oh, that looks really good.
Speaker 3: Yeah, wow, Premiere Penguin Pro. I love it.
Speaker 4: Yeah, but everyone else is making very little or the
Speaker 4: majority of people are actually losing money.
Speaker 3: Well, yeah, I did the maths and I worked out
Speaker 3: that to you know how they say you don't have
Speaker 3: to buy in, but you definitely have to buy the
Speaker 3: product packed to otherwise you're not going to get commissions
Speaker 3: the product pack. Divide that by the amount that someone
Speaker 3: would make over a year. I did it in Australia,
Speaker 3: so our product pack averages for monet about three hundred
Speaker 3: and fifty dollars and the average monet sales persons making
Speaker 3: nine dollars a month, So like immediately you are in
Speaker 3: the red, which is really really scary. I want to
Speaker 3: know a little bit more about the pressure to make sales,
Speaker 3: to reach each rank by the end of each month.
Speaker 3: So what I guess is the worst thing that you
Speaker 3: think you did to try and make or close a sale,
Speaker 3: because that's a little bit pervy.
Speaker 4: Oh god, the worst thing. Oh, I don't know what
Speaker 4: the worst thing is. I think the fake accounts. I
Speaker 4: don't know if they're the worst thing, but they're the
Speaker 4: most prolific. Like that's what everyone does, and you're taught
Speaker 4: to do.
Speaker 3: You're taught to make fake accounts.
Speaker 4: Make fake accounts, and whether that's your husband, you know,
Speaker 4: you use their number. You know, I had an account
Speaker 4: for a hamster. Oh good?
Speaker 3: Oh good? Did they enjoy their serrus?
Speaker 4: I loved them. And there's rules baked into like the
Speaker 4: policies and procedures that you can have certain amount per customer,
Speaker 4: right if they live in your house, because you know,
Speaker 4: theoretically I could have a daughter who uses skincare too, right,
Speaker 4: and she I stuffed through her account. Yeah, that makes sense.
Speaker 3: She might only be two, but that's perfect.
Speaker 4: Yeah. So the fake accounts, and it's really it's trained
Speaker 4: into you, and that's one of those things you look
Speaker 4: back on you're like, I can't believe I believed that,
Speaker 4: but then I did it, and then I taught it,
Speaker 4: and you see why. It just continues to expand, like
Speaker 4: down every level. You know, Gosh, if you've got to
Speaker 4: make this quota per month, you know, buy the new
Speaker 4: product under a fake account, and then that will booing
Speaker 4: your sales and then you can use that product later
Speaker 4: for giveaways, basically buy more stuff than use it for
Speaker 4: bribes later. Like that's the long and short of it, right, Yeah,
Speaker 4: So the amount that you are spending for your own
Speaker 4: quote unquote business, it's astronomical.
Speaker 3: Which is insane. And I've called them up. I have
Speaker 3: literally called their head office to ask questions, and they
Speaker 3: are incredibly evasive. It is a lot of fun to
Speaker 3: call them as somebody who you know, it gets a
Speaker 3: little bit of a kick out of being like, hold on,
Speaker 3: but didn't you say x y Z did just before?
Speaker 3: I want to know where that came from. Because when
Speaker 3: I ask them about these practices, they say, no, absolutely
Speaker 3: not that is illegal. It's actually in our terms and
Speaker 3: conditions that you don't create that. Like, if we ever
Speaker 3: found out that somebody in our business was creating fake profiles,
Speaker 3: we would absolutely you know, crucify them. Absolutely not. So
Speaker 3: when they say one thing and then you guys are
Speaker 3: doing another. They know that you're doing it. I know
Speaker 3: that they know that you're doing it, but like, how
Speaker 3: are you quite getting away with it? And like who
Speaker 3: is teaching you this? Like it's clearly coming from the top,
Speaker 3: but then they're denying that it came from the top.
Speaker 4: Yeah, I mean your upline trains you, and you train
Speaker 4: your downline and you know everyone does it. And the
Speaker 4: verbiage in the policies and procedures is you know, it's
Speaker 4: loose enough, you know, like it'll say you can have
Speaker 4: unlimited number of accounts in your own home if people
Speaker 4: are using the product, Well, nobody is coming to your
Speaker 4: house to verify that anyone's using it, Like how do
Speaker 4: you so they make these rules that nobody can can
Speaker 4: really fact check, right, so you can have an unlimited
Speaker 4: number of accounts, purchase product underneath them, and then who's
Speaker 4: going to check it? So they do write these things
Speaker 4: in a way. While they'll say, oh, no, that's illegal,
Speaker 4: we never allow that, but in practice it happens all
Speaker 4: of the time, and they're not going to enforce anything
Speaker 4: that brings money into their bottom line. They are never
Speaker 4: going to get rid of accounts where product is being
Speaker 4: purchased that's flowing up to them, and so they encourage it.
Speaker 4: It's never frowned upon. I never had anyone ever anywhere
Speaker 4: in the company that I knew of, who got terminated
Speaker 4: or kicked out for making fake accounts. Ever, because if
Speaker 4: you on paper wanted to say, oh, yeah, that's my sister,
Speaker 4: that's my daughter who's going to come to your house
Speaker 4: in fact.
Speaker 3: Check, yeah, it's not actually like a legal ramification for that,
Speaker 3: right Like, it's just them saying don't do that and
Speaker 3: then turning a blind eye. All right, Tam, That's why
Speaker 3: we're going to leave it for today. I mean, we've
Speaker 3: covered so much ground already, haven't we, From the questionable
Speaker 3: business models to the financial pressures of maintaining a rank.
Speaker 3: MLMs is starting to sound less like opportunities. I'm all, like, well,
Speaker 3: expensive hobbies. But my friend, he's the thing. Understanding the
Speaker 3: numbers is just one part of the story.
Speaker 5: What's really wild is how these businesses keep people coming
Speaker 5: back despite the red flags waving inarguably neon signs.
Speaker 3: It's not just about the dollars. It's about the psychology,
Speaker 3: the manipulation, and the promises of freedom and community that
Speaker 3: hook so many people in and keep them there. And
Speaker 3: that's exactly where we're going to pick up next time.
Speaker 3: We're diving into the psychological side of MLMs, how they
Speaker 3: pull you in, how they keep you there, and why
Speaker 3: leaving can feel so hard even when it's costing you
Speaker 3: more than it's worth. You're not going to want to
Speaker 3: miss this, so don't forget to follow and subscribe so
Speaker 3: you don't miss part two. My friends, It's going to
Speaker 3: be juicy. I'll see you soon.
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