Web hosting Custom Email SiteBuilder

Pyramid scheme
n.

A fraudulent money-making scheme in which people are recruited to make payments to others above them in a hierarchy while expecting to receive payments from people recruited below them. Eventually the number of new recruits fails to sustain the payment structure, and the scheme collapses with most people losing the money they paid in.

In a simple overview, this company wants an up front one-time "membership" payment of $250 and then monthly payments of $39.95. This entitles the payer to their own world ventures web site that consumers can use to look for vacation/travel deals using the world ventures software (basically, a search engine that looks for travel deals on many web sites at once - as it was explained to me). Also, the member gets a chance to take monthly travel trips to selected destinations at a discount price. A several day vacation paid for just a couple hundred dollars. Plus, when people book with world ventures through you, you make a small kickback.

Wow, sounds like a great deal, doesn't it. Well, at first I was fairly intrigued I must admit. Then, I began to run this whole thing through my head. After all, $250 and $40/month is no small change for a full-time scholarship less college student. Firstly, a new member must recruit six people to "place beneath them" in their "network" of agents. Of course, these six new recruits also pay the same fees. Okay, so $250 and $40 a month more to get some sweet deals on vacations - awesome. Except one thing, on top of this initial "membership" cost I have to scrounge up extra dough just to capitalize on the cheaper travel packages to which I now have access. Honestly, I'd rather throw a free all weekend three-kegger at my house with the $250 start up cost. And what about that $40 a month? Why not spend it on a 24-pack of Bud Light each week and drink up?

Ok, maybe all these words muddle it up and make it less clear. Anticipating this, I went ahead and made a few graphics to help depict my beef with this company's scam. In this example, I made a few preliminary guesses to further the point - it will follow one "recruit" and the six people he/she recruits through six months as a member of this company's agent pool. Also, I will be presuming the tree of six to each only get one recruit themselves in the first six months. The original recruit will be quite the traveler (to take fairly good advantage of the 'perks') and take a "discounted" vacation once a month. The following table is from the company's point of view:

Now for a little explanation of this nifty table. The rows starting with green are an income to the company, the rows in red are debits, and the orange is a sum of the incomes minus the debits. Any assumptions used to make and complete the table are explained in the column on the right in the table itself. From this table, it should be fairly obvious how profitable this can be for the company. Especially considering this is a very "member-friendly" estimation.

I also took the liberty to do this same thing from the "travel agent member" point of view. The following is a similar table looking at the situation from the member's point of view:

This table was done with a "VERY active and successfully recruiting" member in mind. And the bottom line still comes out having lost money! That doesn't sound like the sort of thing a person should be getting into. Unless you travel a LOT, which if this is the case, why don't you just save yourself the humiliation of presenting this to your friends and asking to sign up for a scheme of this sort. You could do this by going to maybe let's say Travelocity or priceline or just finding an airline with a good frequent flyer program instead of losing money while trying to save some.

After even just a little examination of these two tables, an astute reader might compare the final tab of each viewpoint. A common initial assumption would probably be that the two total tabs' should be equal and opposite. They are not. Simple answer though is calculation error. I did not know how much the trips initially cost the company that they sold at a discount to the customer, so I had to only use the discount amount. Also, the member never sees directly any of the money the people they recruit pay into the company.

A somewhat simplified way of determining how "for real" this offer really is follows:

How much $$$ the company sees from an "average" member in six months:

And then from that member's six "tree recruits" made in six months:

Also assuming only half of that tree can get themselves one new member under them before the end of six months:

Eighteen-hundred twenty-eight dollars and 65 cents. That is how much World Ventures could spend on this one member and still break even - and the only perks or ways of making money from the company involve more recruits and having people buy travel packages through you from World Ventures. And from the member's standpoint, they have come out $129.70 in the red after working on getting SIX new people to commit and getting savings on several hundred dollar trips ONCE A MONTH for half a year.

Is World Ventures really going to spend $1800+ dollars minus profit every six months on each member? I dare to say not. That however, remains to be determined.

Something I can say for sure is this: If each member has to get six new people to join under them to start getting the "real" benefits from this endeavor, it doesn't take to many levels deep to realize how much money the company will make. A little calculation for an example:

From just the original member's six recruits the company scoops in $12,600.00 in six months of membership. This is also assuming that each of these members is traveling EVERY month and using the benefits to the maximum reasonable potential. Let's expand only one more time through, with each of these six recruited members wishing to get the perks I just accounted for in the table above.

X 6 members

Gives a Grand Total of: $75,600.00

Of course, one could look at it this way too - at some point there will be a saturation point where more people becoming member's of World Venture no longer becomes feasible b/because there has to be non-members to use the members pages to search for vacations. Also, after a certain number of people have heard the presentation and either joined or declined, World Ventures would not be making money enough to make it worth staying open. At this point, they would just close their doors, shut down the site, and cut ties with all members. No one can guarantee what point they will value as the maximum profit they can pull of the general public with this scam.

Bottom line: AVOID THIS COMPANY/SCHEME COMPLETELY!brb

UPDATE: I recently found - in the mess of papers on the dining table at my house - the following sheet of notes from that presentation:

Any educated person care to tell me how this ISN'T a pyramid scheme? If so, please email me here EMAIL and I'll be happy to call you a moron.

That is all.