Multi-level marketing companies, or MLMs as they’re commonly known, have been around since the days of Avon and Tupperware. Today, there are hundreds of companies that recruit consultants to sell everything from health products to cosmetics to clothing. But despite how the industry has evolved, one thing’s remained the same: They’re a nightmare for almost everyone involved.
MLMs all follow a pyramid structure in which the people at the top (known as uplines) make tons of money off the sales commissions of the people they’ve recruited to work underneath them (their downlines). In fact, these businesses rely heavily on recruiting new members, who are mostly women, targeting stay-at-home moms, military wives and others under the guise of financial empowerment.
Success rates are minuscule. It’s estimated between 73% and 99% of participants either don’t make any money or lose money. Some wise up and quit while they’re ahead. But thanks to the cult-like nature of MLMs, many remain convinced that they’ll be successful someday and relentlessly pursue friends, family and acquaintances with pitches for their products. Ultimately, these “huns,” as they’re known, lose money, relationships and their dignity thanks to MLM companies.
Not convinced MLMs aren’t straight-up predatory? Here are 10 horror stories that might change your mind.
“Touting Female Empowerment”
“I used to own a gym. I am also a full-time teacher and have two children, so I had a lot going on, to say the least. I was constantly stressed and overwhelmed. At that particular time, I had just moved from one building to another and my rent nearly doubled.
“A Beachbody coach, who was constantly posting about female empowerment, was a member of my gym for a couple of months. She eventually quit, which was fine, but she proceeded to use all of my correspondence to reach out to all of my female clients relentlessly via email and Facebook ― you name it ― to try and tell them they didn’t need me as a coach and they could just do Beachbody with her (I coach weightlifting ― NOT the same thing).
“Fortunately, none of my clients actually left. But here I was, a woman with a full time job, kids, and the owner of an actual business, and this lady was touting female empowerment while trying to steal all my hard-earned clients.” ―Laura
“I joined Revital U ― which sells ‘smart coffee’ and CBD oil to help you sleep ― in June 2019 and have not yet made any money. Not a dime. I was hoping I would at least get back the amount I spent to join, which was $99, but that has not happened.
“Everyone I sent a sample to since I started has not been interested. I know I’m supposed to keep in contact and send out emails, but that feels like borderline harassment to me. I did it a few times, but I know when someone just isn’t interested!
“I have no idea how people are convinced they can get rich with this company. You would have to have thousands of repeat customers or a ton of ambassadors under you, which seems so sleazy to me.” ―Bea
“The Allergic Reaction Was Over The Top”
“I fell for it: non-toxic cleaning and no chemicals, right? Well no, not exactly. My kids got into a spray bottle fight and my oldest got sprayed with diluted Blue Diamond from Norwex. The allergic reaction was over the top.
“My upline had to give me detailed directions how to find the ingredients to share with the doctor; I reminded my upline that this was supposed to be chemical-free. Their answer? ‘Well, every person reacts differently.’ That was it. That was how I found out they were all liars. And now I can’t get off their spammy email list. I’m preparing to report them to the Better Business Bureau.” ―Teresa
“It Nearly Caused Me To Get Divorced”
“LuLaRoe markets their products to customers like a garage sale ― you had better buy it when you see it, because it will be gone before you know! It’s addictive and creates a culture of ‘friends’ that you buy from. I’m not well off, but spent in excess of $5,000 to $8,000 over the last three to four years buying this shoddy clothing. I bought right into their BS story that I was helping a small business succeed.
“My first purchase was a pair of leggings. They were really soft, and I was hooked. I bought items, won items, traded, sold and searched for my ‘unicorn’ skirt for weeks. I’ve spent so much time and money on LuLaRoe, it nearly caused me to get divorced.
“I finally quit buying as of earlier this year, as the quality and sizing variability was just too much. Not to mention the wasted money, and the fact that you can’t return but only can exchange items, is overwhelming.” ―Rachel
“I Didn’t Even Really Like The Lipstick”
“I was with SeneGence/LipSense for a year and a half. I originally joined to buy the lip color for my daughters that dance at a discount. A few people found out I was a distributor and wanted to buy it. I did pretty well and hit some impressive sales goals, got some ‘free’ products and had an amazing ‘sisterhood’ that was always supporting, encouraging, etc.
“But then I had a moment of clarity: Selling a firming lotion for $90? Skin care for $85? Mascara for $28? I didn’t even really like the lipstick. The discount structure wasn’t even very impressive when you pay sales tax on the retail value, plus shipping, plus your shipping costs (like mailers, cute bags, etc.). Plus, there are payment processing fees through services like Square and PayPal. You’re also supposed to get business cards, pay for booth rentals ― hell, they even wanted me to be contracted with David’s Bridal and it was going to be around $200 per month out of my pocket.
“They’d release so-called limited editions that would sell out, so you had to grab them before actual sales were lined up. They would be temporarily out of stock to build hype and then go out again. And the distributors were the lucky ones to pay $55 a year to be able to do this!” ―Stephanie
“I had a strange experience with MLMs many years ago when I was a makeup artist. Very frequently over a period of time, I would be hired for makeup lessons only to be confronted with a full sales pitch about Arbonne. In the space of three months, I had about a dozen bookings that tried to recruit me and use my established and trusting network to make sales.
“Also, many years ago, I had a boyfriend whose best friend was part of Kyani. This guy’s wife had left a full-time job to become a Kyani distributor and they were inundating us with their stories about being self-employed. I went overseas by myself for a week, and returned home only to find that my boyfriend had decided to sign up to Kyani. He and his friend wanted me to sign up, too, because I’m ‘well connected.’ I told him that if he wants to embarrass himself in an MLM that’s one thing, but if so, our relationship would be over immediately because I didn’t spend years building my own businesses from scratch, with a loyal and trusting client base, only to be associated with this type of predatory trash.
“He didn’t continue, but I still dumped him soon after.” ―Che
“She Hadn’t Made Any Money”
“A co-worker of mine started a new job and was so excited to tell me about it. She went on and on about the ability to earn $5,000 a month, attend luxury dinners and go on trips. Apparently, it was so easy because she was selling something that everyone needed. She hadn’t made any money, but spent about $1,000 on certifications and classes.
“She refused to tell me the name of the company and asked if she could practice her pitch at my place later that day. I said sure.
“Once at my house, my coworker and her sister revealed that the company was Primerica, a financial services MLM that sells life insurance. Mary went on about life’s what-ifs and the cost of burying family members. I told her I wasn’t interested in purchasing life insurance and my family isn’t in the U.S., so it didn’t matter anyway. Then she asked if I wanted to make an extra $5,000 a month by selling. I said no. She talked for at least an hour about how I’m financially irresponsible and ignorant for not wanting to make extra money and live a more lavish lifestyle.
“The worst part was her explaining how it’s not a pyramid scheme because ‘those are illegal.’ She ended up selling policies to some of the poorer kids’ parents and hooked the kids to sell once they turned 18.” ―KS
“They Suggested We Sell Our Car”
“My husband and I were enticed into joining Amway. We had three kids, low-paying jobs and one car. We did all the stuff, attended meetings and tried our best. Then there was some major event happening in Detroit. Our upline said we needed to be there (we lived near Buffalo). We explained that we had no money for a trip. So they suggested we SELL OUR CAR to make it ― our only car, despite having three kids and two jobs. It’s interesting to note that the upline guy owned a used car lot and offered to sell it there. We bailed when this happened.” ―Jennifer
“When I had announced to my friends and family on Facebook that I had been diagnosed with thyroid cancer, I received friend requests from a friend from high school’s two sisters (I had not talked with this friend since high school and her sisters were people I had never met). I immediately thought ‘Oh no, they’re in a pyramid scheme and they want me to join.’ And I was correct.
“I added them to be courteous, and also out of morbid curiosity about how long it would take for them to descend upon me. One wrote immediately asking if I had seen her posts about Plexus’ pink drink. The other waited a month and wrote me to introduce herself and immediately launched into asking if I’d tried Plexus and if I’d want the info on it.
“Their sister said nothing to me about my cancer diagnosis, but clearly told her sisters about it so they could circle around me like vultures looking for a potential ‘cancer success story’ they could take credit for (instead of the world-renowned hospital and doctors treating me). It was all so gross and I wanted to call them out on their predatory behavior (acting like they weren’t aware of my situation but clearly trying to take advantage of it), but I just didn’t want to engage at all so I ignored it completely.” ―Chelsea
“It’s Siphoning What Little Money We Have”
“MLMs have torn through my small, rural and very poor community. I’ve seen friends, schoolmates, even my mother-in-law get sucked into these predatory companies because there are simply no opportunities for people in my community.
“Unless you get out early, you end up stuck here, poor, on welfare and normally with a lot of kids. These companies have really targeted these low-income, bored and very sheltered women to the point where most people in my town are involved in some sort of MLM. It’s siphoning what little money we have here away from the families who need it because they’ve been sucked into these scams. It’s actually bothered me so much that I started a semi-popular satire account, @bossbabe_mascara, simply so I can direct my frustration with these companies somewhere productive.” ―Bossbabe
HuffPost reached out to the companies mentioned above. In response to Jennifer’s story, Amway stated the company only charges “a $62 registration or annual renewal fee, which covers Amway’s costs related to supporting Independent Business Owners,” adding that purchasing other materials or event tickets sold be third parties is “optional and voluntary. Amway does not produce or profit from these materials or events.” None of the other businesses immediately responded for comment.
Responses have been edited slightly for length and clarity. Only first names were used to protect the privacy of respondents.
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