Avoid pyramid schemes Most people involved in the issues discussed here, including those claiming to be experienced, can not or will not distinguish between a fair system PP / MLM from the pyramids and Ponzi schemes.
Pyramids are in the traditional sense, financial systems, consisting in the fact that the person entering into the fund, based on a specified schedule, payments for those who came before.
Why do I write about this in the guide for Affiliate Programs?
As the internet has (unfortunately) significantly activate this type of action, including in Poland. But suppose that everything we have yet to come.
Internet is a great tool for organizers of such activities and, over time, a number of modifications to systems and financial plans, making a very blurred the boundaries between programs type of network marketing, partner programs and systems which are called MLM, de facto, forming a pyramid.
With the Internet, very easy to offer a "product". The word is in quotes, because it supposedly exists, but is only a cover for a pyramid scheme. In fact, the "product" does not play a special role. It is often freely available or quickly created ebook, report, course or software nieprzedstawiający greater value. Sometimes it is offered at a much greater rate than is actually worth.
company stating it has to offer such a "product" creates a "financial plan", "investment program", a "virtual stock exchange", the matrix or some other mechanism yielding a profit mainly to the organizers.
is not always easy to recognize right away that this is a cover for a pyramid. To this end, we follow the suggestions given in the chapter "How to choose an affiliate program?"
Personally, despite the many proposals do not take part in this type of projects and their NOT recommend.
happens that affiliate programs are created and MLMy to push the residual product and take the form of pyramid, to encourage quick profits to participate in the project.
Ponzi
named after an Italian immigrant working in America in the early twentieth century. In 1919, he offered to investors for every $ 150 invested $ 100 within 90 days (then $ 100 was a large amount). After 45 days, began to pay investors the promised amount, which meant that they started gaining confidence and re-invested even greater amount. Where did the profit?
contributions from new investors. However, as the rumor that a Ponzi promised money and pay it before the deadline, was spread very quickly, the new investors are not lacking. This is precisely based on the idea of \u200b\u200ba Ponzi-type system.
What is the problem? Well, in that order to be able to add to the capital investor's 50% - the number of new investors must grow into a square. When the amount of money coming from new investors is smaller - getting low cash to pay earlier investors. Each type of Ponzi scheme is doomed to fall, because when they cross a certain critical mass, the cashier is empty. Any person participating in such a program has a limited number of friends (or strangers), which can recommend it.
How does it differ from a Ponzi pyramid?
Although, like in the pyramid, the money for early investors come from the contributions of later investors, but in a Ponzi-type system everything is organized and controlled by one person company or organization.
Ponzi-type systems usually have a hierarchical structure, as is the case in the pyramids, and all funds (minus reasonable profit for the organizers) shall be distributed among previous investors.
Initially investors / partycypujący replaced quickly and on time promised money, which results in gaining the confidence of the program and advertise it. Ago are also used in most programs, reference systems - to pay a certain percentage or certain amount to the person who persuaded another investor the "insertion" of money in this program.
Depending on the speed of the spread of information and publicize the extent, such a program starts to increase the number of members, but only until the number of new investors / participating is growing faster than the amount returned to investors prior to the square (in the case of a 50% profit over investment). Since then, the amount of cash is less than is needed for the payment and the program disappears, along with the money of those who did not come early enough. Appear shortly in another name and a slightly modified conditions ...
To extend the operation of such programs, the organizers will use various tricks, such as modifying 'compensation plan. "
are also often used much more sophisticated methods for different types of scams and manipulation, and the Internet is an excellent tool for this type of action.
also meets the upcoming programs to the limits of decency, which put the matter clearly and indicate that this is a game where you can win those early leap into the subject. There is no guarantee of profits, and at some point in the payment of money simply runs out, which means that "umoczyłeś" his investment. Many of the programs of this type requires the prior purchase of the product ...
