Climb to the Top
Emily Lambert and Klaus Kneale07.17.08, 6:00 PM ETForbes Magazine dated August 11, 2008
Pyramid selling schemes are a dime a dozen. Orrin Woodward'sorganization is one step ahead of them all.
Near midnight on a recent June evening Orrin Woodward, cofounder of acompany called Team, took the stage at the Nationwide Arena inColumbus, Ohio. Music blared. Lights flashed. Seven thousand people,who'd paid $90 each to get in, cheered wildly."Struggle is a part of every great victory," intoned Woodward. "Leaders,"he went on, "are dealers in hope."Hope, for most of Woodward's audience, is a fruit juice gussied up in awine bottle labeled MonaVie and sold for $39. Unload enough of this stuffon friends, recruit them to do the same, and you can be rich.Woodward, by contrast, doesn't have to sell a drop of the concoction tomake a killing. Team, rather, sells things that help people sell things likeMonaVie. Team sells "tools"--$258 sets of motivational compact discs, $69
Team shirts and books like Woodward's
Launching a Leadership Revolution
, all of which filled the Nationwide Arena's hockey rink. Outside,a black Mercedes-Benz gleamed next to a sign saying "Work hard, goblack diamond, get one of these!""Team is truth," declared Andrew Mey, who had traveled from GrandRapids, Mich. for the Ohio event.In the distributional art form known euphemistically as "multilevelmarketing" and more crassly as a pyramid, a seller attempts to recruitother sellers, who recruit still others, and so on. Members get apercentage of revenues hauled in at some or all points below them in thepyramid, so those close to the top can do very well for themselves. The Direct Selling Association, a tradegroup, pegs the collective revenues of multilevel vendors at $30 billion in the U.S. and $111 billionworldwide. Exotic juices, nutritional supplements and cosmetics are among the favorites of the pyramidcrowd.Team is one step ahead of all these juice selling schemes. It is a pyramid atop a pyramid. It is sellingmotivational aids to help MonaVie vendors move the juice. But wait. If you can't earn back the $258you've spent on the motivational lectures by selling $39 juice bottles, you could earn it back in anotherway--getting people to buy $258 motivational lectures. If you're good, you flog the lectures to otherpeople, who sell them to yet others. Everybody gets rich. Everybody, that is, except the last round ofbuyers. That's the theory, anyway. The reality is that a mere 1% of Team members make any money frominvolvement with the firm.Sounds rather like a chain letter, doesn't it? Woodward insists it's not. He says he's selling hope andsales skills.Team hauled in $42 million last year and boasts 60,000 mostly middle-class members. Last winter 15,000of them braved an ice storm to assemble in St. Louis for speeches on "Overcoming Obstacles." About90% of Team's sales tool revenues come from people who also sell MonaVie juice.