Virtually everyday I get an email that promises to make me rich. Sometimes I read it to amuse myself, but it always goes in the bin. These emails normally come from a stranger. Today I got one from a friend. I was surprised; doesn't everyone know these things are always rubbish?
The email I received had the subject 'seems viable??' and after my friends greeting spoke of the wealth I would receive if I would give the scheme a go. It claimed to be a Multi Level Marketing scheme, but was really just a Pyramid Scheme.
This email had five names on it. The one at the bottom was my friend's. All I needed to do was send the top person £3 via PayPal, take their name off the list, add my own to the bottom and convince at least 5 more of my friends to do the same by sending the email out to as many people as possible. If each of my five recruits get 5 more recruits and each of those recruits get 5 more, and so on, by the time I'm number one I will get £9,375.
These schemes are called Pyramid Schemes because under each person who joins, there need to be a greater number of people willing to join. The problem with these schemes is that you eventually run out of people willing to join and then the scheme collapses. This actually happens a lot quicker than you might think and the only person likely to benefit is the person who started the scheme.
The email partly acknowledges this and says:
The problem with these types of scheme is that usually they run out of people to pass onto - but with 78 million [PayPal] users and more joining every day, how likely is that?
As the number of new recruits needed goes up exponentially, it is very likely indeed. If I was to join the scheme I would need 3,905 more people to join the scheme. All of these people would need 3,905 new members for them to benefit.
The following list shows how the number of people in the pyramid increases as the number of levels goes up.
According to PayPal's website they actually have 100 million users. So, even if they were all willing to join, it would only support a Pyramid with 12 levels and the bottom 5 levels would not receive any money.
If 100 million people weren't willing to join this scheme and only 2.5 million did then you'd have to be on level 5 of the pyramid to profit. So unless my friend is the mastermind behind this scheme I don't think she'll get rich from it. I don't think she expects to. It was only £3 and I guess she thought it was worth a try. I suppose she might get a bit. I'll ask next time I see her, but I think I'll give this get rich scheme a miss.