The New MLM Company Lottery

New MLM Company? Here’s Why You’re Playing The MLM Lottery With Start-Ups…

Going with a new MLM company can be an enticing prospect for both new and experienced network marketers. We’ve all heard amazing stories of people who “got in on the ground floor” with well-known and established companies. Those stories inevitably start with, “And they got in at the top…” and end with, “…and now they’re mega-millionares.”

Certainly, the stories of network marketing luminaries who got into MLM companies like NuSkin, Amway, Herbalife, and Shaklee in the early days and who are now multi-millionaires inspire and motivate those just starting in the business. But is getting in with a start-up all it’s cracked up to be?

The Numbers Are Not In Your Favor With New MLM Companies

Let’s look at the industry statistics, shall we? Many network marketing experts estimate that 9 out of 10 new network marketing companies fail within the first two years. As author and long-time industry trainer Rod Nichols says in his book, Successful Network Marketing for the 21st Century:

“This means that if you choose a company that is under two years old, you only have a ten percent chance of success.”

When you look at the prospect of joining an MLM start up from that perspective, it certainly makes it much less attractive, doesn’t it? But, there are also other risks involved with joining new companies. Let’s examine a few to determine if joining a brand new company is really worth the risks.

Getting The Pre-Launch Blues

Another seemingly attractive way to riches in network marketing is to join a company that is in pre-launch. “Pre-launch” is when a new company allows prospective distributors to pay to join before they are even selling their products or services. As Mr. Nichols says in his book, they do this to raise capital for their official launch.

The problem with this is it points to the fact that the company is under-capitalized to begin with. And, chances are that they will run out of cash at the most inopportune times; for example, when they are experiencing their first big growth spurt and have to pay out big commission checks to distributors.

I’ve been involved in my share of start-ups, and I’ve seen this happen more than once. It’s not pretty, and it’s incredibly discouraging to pour your heart and soul into building a business with a company that doesn’t last.

Beware The Pre-Launch Draft…

Moreover, weird things can happen with downlines during pre-launch. I have an acquaintance who got in during pre-launch with a certain new company that shall remain nameless. She worked hard to build a downline before launch, even though all her sign-ups were only on paper.

As it turns out, she hooked a “big fish” by attracting a highly successful and experienced network marketer into her downline. This person had a history of building large downlines, so my friend was sure she would be set when the company launched…

Unfortunately, in order to make the opportunity more appealing to Mr. Big Fish, her upline leader decided to place him several levels OVER my friend! (This is actually a widespread practice among start-ups; they offer top placement in the organization during pre-launch to well-known network marketers who have a track record of building large organizations, all in order to attract them to their company to spur rapid growth.)

To say the least, my friend was devastated, and switched over to another new MLM which has since gone out of business. And to my knowledge, she has probably left the industry, perhaps for good.

Is It Worth The Risk?

So, is it worth it to join a new MLM? For me, no.

I’ve had my fill of playing the new MLM company lottery, and have found the right network marketing company to build my network marketing business with. It’s solid, stable, has been in business for years, and has a product line that I am ecstatic about sharing with others.

If you’re tired of taking your chances on new MLM companies and want to grow with a stable company and with one of the fastest growing teams around, click here to contact me immediately to get started today.

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