Debunking the Claim that 99% of People Lose Money in Direct Selling

Debunking an Old Myth Based on Misinformation

I came across an interesting discussion recently, more specifically, a bold claim about direct selling and MLMs that has resurfaced: “99% of participants fail and lose money.” I can't believe that we are decades into this and we're still having to deal with misinformation about the industry. Well, actually I can. Misinformation and lack of education go hand in hand. It's interesting how those making this type of claims are those who have only heard about it and never really tried it. I mean, really tried it. Either that or they speak only from other people's negative experience. While this statistic may seem damning, it is misleading and oversimplified. Here’s why.

Understanding Participation in MLMs

A significant portion of MLM participants—over 60%—join for personal use or discounts, not to create a full-time business. These individuals are customers, not business builders, and labeling them as “failures” distorts reality. By this logic, anyone who buys a new vehicle who is a bad money manager, a financial failure, because they lose money immediately the moment the drive away.

ROI and Success Stories

ROI is an arbitrary measure unless you can talk to each individual and gauge whether they feel their involvement yielded satisfactory results. Many MLM participants achieve ROI quickly and even turn a profit. Testimonials from people who leveraged direct selling for income and personal growth contradict the narrative of inevitable loss. However, you have to do what the business requires. It takes what it takes. For those who treat it like a business—investing time, energy, and strategy—success is attainable.

Value Beyond Financial Returns

Success in MLMs isn’t always measured by finances alone. Participants often cite personal growth, community, and skill-building as invaluable outcomes. These benefits are similar to those gained in traditional entrepreneurial ventures. There are people who lead better lives because they were involved in a Direct Sales business. They came out of their shell, learned a new skill, became more confident, etc. Perhaps all they got out of it is that they started learning and studying about how to take better care of their health and because of that they are living better than before. Put a price on that! Are you going to tell them that they lost money on that deal? That they wasted money by joining?

Performance-Based Models and Accountability

The MLM model shares traits with other performance-based industries, such as insurance and real estate. Everyone knows these are commission based ventures so while there is no guarantees for your work they also can't fire you for not selling enough. These fields of work demand effort, resilience, and the ability to navigate rejection. Again, it's nothing new! No one is ever surprised that they didn't get paid when they didn't make any sales. Blaming the model for individual shortcomings ignores a crucial element of success: personal accountability.

A Thriving Industry

The direct selling industry generates over $60 billion annually in North America, distributing 45%+ of revenue back to participants. Compared to traditional businesses, this compensation structure offers a higher reward for effort. It’s clear the model works when approached correctly. That's nearly $30B in commissions going back to everyday people. That's a lot of money and no one is making $1B so yes, lots of people are getting paid.

The Real Conversation

MLMs are not perfect—bad actors and unethical practices exist. However, the narrative that MLMs are inherently flawed or guaranteed to fail doesn’t hold up. The key is empowering individuals to make informed decisions, approach opportunities with realistic expectations, and hold companies accountable for ethical practices.

Direct selling isn’t for everyone, but for many, it’s a path to personal and professional growth. Instead of dismissing it with misleading statistics, let’s focus on education, transparency, and accountability to ensure participants maximize the potential benefits.

Network Marketing Raw | Ep. 39

Hit Your Goals in 2025

Don’t Rely on Motivation—Create Systems

In 2025, this is how you'll achieve anything you want! Here’s the deal: motivation is overrated. Sure, it feels amazing in the moment, but the moment doesn’t last. What lasts are systems —habits and routines that keep you moving forward when you’re too tired, busy, or overwhelmed to feel inspired.If you’re ready to stop wishing and start doing, let’s talk about how to make it happen:

1?? Know Your Why: Think about your goal for a second. Now ask yourself, “Why does this matter to me?” If your answer doesn’t make your heart race or your eyes tear up, dig deeper. Your “why” should be your North Star, guiding you no matter how rough the journey gets.

2?? Start Small: Rome wasn’t built in a day, and neither is a better version of you. Break your big dreams into tiny, manageable steps. Focus on the daily wins—because big wins are just the result of showing up every day.

3?? Be Accountable: The road to success gets lonely, and loneliness can make you quit. Bring people along for the ride—mentors, friends, or even online communities. They’ll celebrate your highs and pull you through your lows.

4?? Prepare for the Tough Days: Life has a way of throwing curveballs. But here’s the thing: You’re not powerless. When you anticipate roadblocks, they can’t knock you off course. Have a plan, and stick to it.

You don’t need to wait for the stars to align. You don’t need more motivation. You need a system, a plan, and the determination to make this year the one you’ll look back on and say, “That’s when it all changed.” The only thing standing between you and your dreams is the first step. Take it.