WorldVentures & DreamTrips are 2 facets of a MLM (multi-level marketing) company that operates in the travel industry. Maybe you’ve heard of them. If so, you’re probably wondering about all the bad press and whether WorldVentures is really a scam, a pyramid scheme, a get rich quick scheme, or if it’s a legitimate business that’s just poorly understood like so many Nigerian princes nowadays.
Back when I lived in Kuala Lumpur I often frequented a Hindu temple not far from home in Chinatown.
It was one of my favorite places to hang out, and with my favorite restaurant next door, a perfect place to chat with locals and explore some of the cultural melting pot that is KL.
So I thought nothing of it when, one day, a friendly, middle-aged Chinese-Malaysian lady started chatting with me. In fact, I was excited to hear that she and her husband were entrepreneurs working on their business and that maybe they’d have need for me as a native English speaker to help with marketing.
Meeting entrepreneurs was a rare thing living in a budget backpackers hostel, so I didn’t hesitate to take her up on lunch at some fancy-pants private club and talk shop.
The free lunch was awesome. The club wasn’t overly pretentious. Not a single freak thunderstorm interrupted a decidedly pleasant afternoon. However, no matter how much I pressed for information regarding the business, I couldn’t get anything concrete out of my host. There were vague musings about traveling and her husband having the juicy details.
Now, I’ve been around the block enough times to sense when hijinks are afoot, and there was something a little too evasive about the answers I was getting to my questions, so when she upped the ante to invite me to meet her husband and really get into things, I was all in.
Several days later I get to the office with several others I recognized from the temple. One of the ladies was an enthusiastic supporter of the Chinese woman’s business, and the very presense of the young, slightly-confused Malaysians could only mean 1 of 2 things: Time share presentation or multi level marketing.
I only had to wait for the enigmatic husband to fire up his laptop to prove me correct: After some basic slides of cliche tropical destinations you might see in a 90s infomercial for ab-machines, we were introduced to
Multi Level Marketing hell WorldVentures & DreamTrips.
For a total of about 5 minutes I was regaled with all the luxery vacation packages I could buy at a discount by becoming a member of their travel club – for a meager $199 signup fee + $54.95 a month. In terms of the discounts, they were hardly inspiring – in the sense that adding the word “discount” to a price tag doesn’t suddenly make it a good deal.
But that was fine, because the travel part is really a thin veneer for the glorious business opportunity beneath.
And I have to admit, the business model sounded great! After all, it was inspired by one of my favorite architectural wonders of all time:
Now, of course, I signed up for this meeting voluntarily, so I was more or less prepared for the coming psychological onslaught. But I started to feel badly for the others who were about to be launched into an hour long sales presentation.
I’ll give credit where it is due, WorldVentures does marketing effectively. We see this same sort of effectiveness with the Kim Jong line of succession in North Korea.
WorldVentures pitches the whole “Hate your job? Then become your own boss and travel the world” schtick as well as anyone, and they have a brilliant setup in offering both the tantalizing business and travel opportunities in one sexy package.
One of their marketing campaigns involves random travelers in idyllic locations holding blue “you should be here” signs. It’s admittedly very clever.
They tell us that we can: “Make a living while living.” Shit, if only I had thought of that before deciding to become a self-employed world traveller! I was almost tempted to sign up right there.
But seriously, who doesn’t want that? And it seems like those who sell this dream best win the big cash prize. Hell, you could argue this blog toes that same line if you only looked at my banner image and never bothered to read any of my material.
Anyway, the whole premise here is as appealing as it is unoriginal: a luxurious way to make easy money and do whatever you want.
Buuut it ain’t so easy. In order to start living the dream, you’ve got to become a sales representative. And that means an additional $99.95 sign up fee plus $10.99 a month.
Sales people receive mystical superpowers in exchange for their cash. They can, in turn, recruit salespeople and receive a cut of any sales these new salepeople make.
You’re probably thinking “haha Andrew, very funny. If every salesperson is just recruiting other salespeople and nobody is making any sales, then how does anyone make money?”
Clearly, you need a lesson in Pyramid-nomics. For that, we need to return to ancient Egypt:
One day a poor pharaoh was deep in thought. His kingdom was the laughing stock of the ancient world, and he was determined to show the other great powers of the era that Egypt was a force to be rekoned with. So he came up with an ingenious plan.
He went to a group of common folk and told them, “for 1 small signup fee – your freedom, plus monthly installments of hard labour, you too can experience the great wonders of our kingdom. Even better, if you recruit other peasants, you too can reach ‘pharaoh’ status and have naked beauties feed you grapes and fan you with palm leaves.”
In a few short decades, the first pyramids had arisen in the midst of the Egyptian desert, and the first world superpower was born.
In short: The peasants do all the work, the pharaohs reap the rewards. And if you know your Egyptian history, then you know that not many peasants ever became pharaoh.
But there is a pharaoh, which helps the peasants believe that if they just work hard enough they too can become one. This is important, as we’ll see later.
As you can see, Pyramid-nomics is great for pharaohs, but not so good for peasants.
To drive this point home with the power of modern statistics, here is Dr. Taylor’s findings of the profitibility of participating in various MLM opportunities based on data publically provided by these selfsame MLM companies.
You’ll notice that WorldVentures isn’t on this list.
Don’t worry, they’ve publicly released their data too. Here’s the truth straight from the horses mouth – 2009 edition (my brackets for clarity):
72.3% [of sales reps] did not [earn a commission]. The average annual commission or override earnings of all IRs, including those who did not earn a commission or override, was $344.28.
Yes. You read correctly. $344.28 per year.
Let me put this in perspective for you:
According to WorldBank, the poorest 2.2 billion people in the world lived on less than US $2 a day in 2011.
$2 a day = $730.
In other words, peasant farmers in the poorest countries on Earth make about 2x more than the average WorldVentures sales representative’s $344.28.
Obviously, there’s more to wealth and a high standard of living than money, but this still essentialy shakes down to the fact that WorldVentures sales reps would be financially better off finding jobs in Somalia, Central African Republic, or DR Congo, because somehow, these lawless, war-torn, and/or disease-burdened countries are still kicking ass when you compare them to the potential of a career with WV.
And it gets better: These numbers don’t even take into account the fact that you have to “pay to play.” We should technically still subtract the signup fees, monthly fees, and all the extra fees for monthly “business trainings” ($99-500) and marketing tools (like $30/mo for an autoresponder).
Can I get a “hahaha” please?
By 2012 these numbers, as if by some miracle, got worse. The Better Business Bureau even has an warning posted on their page for WV, stating:
Forty bucks. Per year. When we only consider the group of people who did earn and ignore the 77.51% who made squat.
I’ve run out of superlatives.
The great argument cited by WorldVenture proponents is that “some people succeed” at making a profit.
This is true. Of course, it’s also necessary. If nobody made a profit, prospects would have no reason to listen to the pharaohs and the whole pyramid would come crashing down.
Here’s the problem: Every success requires, a-priori, that more than 30 other people fail.
Allow me to elucidate:
For starters, sales reps in WorldVentures don’t start earning commission until they manage to recruit 30 customers or salespeople below them.
(This also helps them sidestep the FTC’s definition of a pyramid scheme, since they’re not technically paying members to recruit other members. Norway, however, disagrees.)
So let’s consider the absolute friendliest scenario, where a mere 30 recruits gives a sales rep instant “set for life” status. No recruits ever leave, and the commissions from said recruits are enough that no further work ever has to be done.
This is, of course, absolutely laughable – but I want to give WorldVentures every benefit of the doubt here, because WV nation is currently ranked last in GDP per capita worldwide, and that’s sad.
If we took an isolated group of 31 people, we could have 1 sales rep and 30 recruits, or 1 money-making pharaoh and 30 money and time-losing peasants. If we increase the size of the group and this 1 salesperson were to recruit more reps, the numbers simply get more skewed.
But let’s say all 30 reps recruited 30 of their own reps. Now we have 31 money makers (1 original, and 30 on the “second floor” of our pyramid) and a whopping 900 losers.
One more iteration totals 931 pharaohs to 27,000 peasants. Ouch. Again, this is assuming that the minimum 30 recruits cover all a sales rep’s expenses, the new recruits never drop out, and all provide exorbitant commissions that allow the sales rep to make easy money forever after.
The actual numbers are going to be much worse. In fact, I predict the average member will earn less than the average Nigerian farmer. Now how did I figure that out again?
Continue this process for as long as you want. Watch the peasant count stack up until we turn the entire Sahara into a pyramid-filled theme park. WorldVentures adds on fancy bells and whistles like “right arms” and “left arms” to confuse the model, but the math is clear – eventually there will be no more people to recruit, and everyone on the uber-massive bottom layer will be supporting the people above.
And that, my friends, is the best case scenario.
Let’s not forget all the fees and other expenses and simple reality that 30 recruits aren’t going to supply a lifetime of prophets ultimately shake down to the average member making below poverty level wages in the poorest nations on Earth, yeah?
So if you make a profit with WorldVentures, yes you probably hustled a lot and really earned your income, just like a real business person would.
That effort is commendable.
Actually, given the odds, it’s pretty damn impressive.
Too bad it comes at the pain and suffering of hundreds of other people, many of whom are themselves facing tough financial times and trying to make a better lives for themselves. Many of these people were probably family and [now former] friends – since these are the easiest targets for recruitment purposes.
This is the crux of the matter. The slogan that “you get out of it what you put into it” is demonstrably false. It is blaming the victims instead of the perpetrators. Only uneducated and/or monsterous people would blame a women for dressing too provocatively in a rape case. The exact same logic must be applied here. You, by natural law, cannot get out of it what you put into it.
This is another common retort when all the facts, statistics, and logic stack up against a WV supporter. Everyone who is a detractor must just be jealous that they were one of the losers who made no money while everyone around them made buckets of cash.
“Hahaha” I hear you thinking, “but Andrew, the average sales rep makes $40* a year”
The jealousy argument is almost as rational as the “gayness causes hurricanes” argument.
Understand this. It doesn’t matter how hard you work. It’s undeniable, irrevocable, mathematical fact. Each success necessitates countless failures. Sorry, but that is exactly the fault of the company and nobody else. Over 96% of people are precluded from succeeding at the time they signup. Nobody knows who will end up in what group, but in sum it makes no difference.
If a person has so much drive and talent that they can beat these miserable odds long term, they should be building their own business, one where success doesn’t hinge on the failure of others.
That’s bad business, not to mention downright immoral.
And that’s the reason I’ve written all this.
I’ve never been involved with WorldVentures, I don’t have a vendetta, nobody is paying me for saying these words.
I’m just a world traveler trying to make our sparkeling blue-green orb a little brighter place to live. Every day I meet people who have a much lower standard of living than I do because of a cosmic roll of the dice – a different native tongue, a different passport, gender – or whatever. And I want to help these people achieve the same standards of living I’ve been born into, not push them down in the muck so I can have a better view of the sights.
If there’s one thing I hate – one thing I think we’re morally obligated to oppose at all cost, it’s the various power structures that oppress people.
So if you are in a position of power, of influence, where others trust you and believe in you – you owe it to them not to sell them on companies like WorldVentures, as well as to vocally oppose and possibly ridicule (ridicule is often the more powerful option) those who support them.
World Ventures is not a business opportunity. It is not a travel opportunity. It is legally recognized as a pyramid scheme in Norway. It had it’s B- rating by the Better Business Bureau revoked and now has no standing, and a bunch of my fellow bloggers openly call it a scam or a scheme.
Fellow travel blogger and totally awesome human being Stephanie from Twenty-Something Travel wrote her own negative review and had WV lawers demand $1 million in damages for using their own, self reported profit numbers in her arguments. Ken at PopeHat rallied his community to her defense.
In short, WorldVentures totally sucks. You can put that on the record.
I’d go so far as to call it the worst way to travel the world.
If you really want a life of travel then know this: There’s no easy button. It doesn’t just happen. You don’t have to be rich to do it, as I have hopefully made abundantly clear by now, but you do have to have the confidence and resourcefulness to work things out along the way.
I’ve compiled a huge list of resources you can use to get started. You can download for free my list of 101 Ways to Make Money While Traveling – none of which cost you anything or are morally ambiguous. Then, there are a ton of fantastic and incredibly good-looking travel bloggers who you can follow who won’t charge a cent for their wisdom.
And if you’re in a tough financial situation, your first priority should likely be resolving these difficulties in a methodical, measured way. Start by reading Ramit Sethi’s blog – which is also free by the way. He doesn’t even let you buy his products if you’ve got debt. That’s the way business should be done.
At the end of the meeting in Kuala Lumpur, none of the other prospects were interested in becoming a travel club member or a sales rep, so I went home satisfied.
Ever since that day I’ve continued traveling, with all the comfort and security of knowing that I don’t need to be a pharaoh to make it happen.
Brave enough to share your own thoughts about WorldVentures below? Leave an intelligent, sexy comment below: