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Pyramid Schemes

January 15th, 2014

There are many dangerous things on the Internet and it is important to be prepared for everything. This time I would like to warn you about the danger of pyramid schemes on the Internet.

Pyramid scheme is a type of a business model that is doomed to fail. It involves the exchange of money mainly for referring other people into the scheme. Very often no products or services are actually being delivered. It has been known to come under many different forms in order to trick people. The reason why it is doomed to fail is that for people to earn money out of it, you would actually have to enroll more and more people in the scheme without an end. But there will be an end, because at some point the number of people necessary to be involved for anyone to make money would exceed the population of Earth. Usually, only those who have many referrals make money with such programs. The problem is that once news spreads that a particular program is a pyramid scheme, then it is very hard to acquire new referrals. That is why all of the other people are going to lose money.

Of course, there is nothing wrong with making money by obtaining referrals in case of programs that are not pyramid schemes. If you refer others to join services that are actually useful, then everyone involved is going to benefit from it. Nonetheless, it is important to be aware of the existence of pyramid schemes.

Biz, Web

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