Short YouTube clip by Vince Reed discussing multi-level marketing (MLM). Reed says MLMs can be valuable for personal development and as low-cost entry into entrepreneurship, teaching business skills, but they have limitations rooted in human nature—people avoid pain and seek pleasure—which can create incentives that favor recruiters getting paid when others join or sell.
What I think MLM companies do great is a couple things. They're amazing for personal development. It's a great place to get started as an entrepreneur, especially if you don't have a lot of money. It's a great place to learn business skills and entrepreneurship, but it has its limitations. Like every business, I think the problem with MLM is human nature. And human nature is people live their lives avoiding pain and seeking pleasure. With mlm, they give you the ability to build a team, right? So they're like, hey, Mike, I'm selling this team drink, this energy drink that will take 20 years off your life after one sip. So go out there and sell it. You're like, okay, cool. And the reason I want you to do it is one, I get paid when you join, and I get a percentage if you sell. So going back to people live their lives avoiding pain, seeking pleasure, and why it's so true is the reason I really want you is it means if you do well, I have to do less work.
