Re Markuz-

> My latest one was a thing called Kanosis,

It isn’t hard to predict how much cash is needed to run a virtual business. It isn’t hard to budget for those expenses. Yet Kanosis appeared to be unable to either predict how much cash it needed, and budget for that amount of cash.

The most surprising thing about Kanosis is that it failed right at the point that most MLMs fail. As a concept, it should have lasted longer. That its non-MLM competitors have outlasted it by several years, is an indictment of the MLM business model.

> I’m surprised by the number of people in the group who have had bad experiences with MLMs.

What happened with Kanosis is par for MLMs. The first critical point is the three months after launch — if they get that far. The second big drop off period for MLMs is between twelve and eighteen months after launch.

95% of all MLMs that launch, are out of business within five years. By way of comparison, only 70% of startups are out of business within five years. Since MLMs are a subset of “new business startups”, there are some industries with a much lower mortality rate than MLMs.

>2) think I’ll know what to do to mitigate or avoid those MLM pitfalls

Look at why Kanosis failed:
* Bad financials;
* A product that was available gratis from vendors that were much better known;
* A product that offered no advantages when compared to its competitors;

>for myself and the people I introduce to the business, if it’s within my control to do so.

The first pitfall in an MLM business is not having a sphere of influence. The second pitfall in an MLM business is making your customer your competition.