Is MLM a Pyramid scheme?
Sometimes uninformed people think the shape (polygonal base or triangle) of an MLM company makes it an illegal pyramid scheme. This is false. Many organizations are pyramid-shaped without being a pyramid scheme: for example: Your family tree is shaped like a pyramid. The US government’s organizational chart is also in the shape of a pyramid. It is called the chain of command. Even traditional business organization is pyramid-shaped – it’s called management. The reason almost ALL organizations are organized in a pyramid shape is that a single person can only manage a finite number of people before they become overwhelmed and need other people to do some of the work. For example, if you run a daycare center, how many kids can you keep track of before you become overwhelmed and need to hire an assistant? In fact, how many kids can you watch before it’s actually a violation of state law? If you hire two assistants, that becomes the shape of a pyramid. In MLM, a person enrolls a few people
