You probably heard of countless negative claims about network marketing. Most of it pertains to a system called “ponzi scheme” or more commonly known as a pyramiding scam. This is perhaps due to the several network marketing companies who eventually folded up after several years or those negative claims from distributors who did not recoup their investments.

Let’s talk about the issue of pyramiding. In every organization, there is always a ‘pyramid’ as evidenced in the organization chart where the people at the top make more money than those beneath them. Having said that, every conventional company is a pyramid. Why?  In a conventional company, there exists a structure whereby the CEO generates income from the efforts of each person below, but those workers do not have the opportunity to earn as much as, or more than, the CEO.

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Have you ever heard of a general worker who makes more than the CEO or the General Manager, given that their source of income is solely dependent on their work? Does middle management ever make more than the company’s senior management does? The old model just isn’t fair for those underneath. No matter what their effort, they can never make more than those above them can. The pyramid then is not equitable.



However, in network marketing, you are building an income from the production of everyone in your organization whether you directly sponsored them or not. Each person in your organization can do the same, so now you have created a situation where everyone has the same amount to gain. It’s the fairest structure available because everyone can create exactly the same situation. And in fact, due to the nature of network marketing, people under you can and do in some cases, earn more than you simply because they can access levels that you cannot.



So if this is the set up, why doesn’t everyone go out and start their own network marketing business? Kiyosaki tells something about fear. “I have a coward inside of me, I know that person very well. This is the battle we all face. And I think often times, cowards ask other cowards, and they get talk out of it, or they go, ‘Why would you do that’, and they get bullied into being a coward.”