Is Beachbody a pyramid scheme? If you’re asking this question, that’s good. It’s important to do your research. As a former active Beachbody coach, I’m going to give you the full download on Beachbody coaching and what it’s all about (including my personal experience and how I am still getting paid weekly all these years later).
Is Beachbody a pyramid scheme?
Before I get into all the details about my personal experience as a team Beachbody coach, let’s cut to the chase on answering this question. The simple answer is no. Beachbody is not a pyramid scheme.
Many people think that any multi-level marketing company (MLM company) is a pyramid scheme, and that’s simply not the case. Are there pyramid schemes out there, absolutely. That is why it’s important to do your research, just like it seems you are right now.
I am going to give you my personal experience with multi level marketing, specifically the Beachbody company, below. But first, let’s understand what an illegal pyramid scheme actually is and how it differs from most legit MLM companies.
What is a pyramid scheme?
A pyramid scheme is a type of investment or business model that is often considered fraudulent and unsustainable. In a pyramid scheme, participants are promised high returns on their investment or participation, usually in the form of profits from recruiting others into the scheme, rather than from legitimate product sales or services.
Here’s how a pyramid scheme typically works:
- Recruitment Focus: Pyramid schemes primarily focus on recruiting new participants into the scheme. Each participant is encouraged to recruit more people beneath them, forming a hierarchical structure resembling a pyramid.
- Investment Requirement: Participants are usually required to make an initial investment or payment to join the scheme. This investment is often referred to as a membership fee, starter kit, or product purchase.
- Promised Returns: Participants are promised significant financial rewards or profits for recruiting new members. These rewards are often emphasized as the main attraction for joining the scheme.
- Lack of Legitimate Product or Service: Pyramid schemes typically lack a legitimate product or service to sell to customers who are not part of the scheme. The focus is on recruiting, not on the sale of actual products or services.
- Unsustainability: The structure of a pyramid scheme is inherently unsustainable because it requires an ever-increasing number of participants to sustain the promised returns. As the scheme grows, it becomes difficult to recruit enough new participants to support the upper levels of the pyramid.
- Collapse: Eventually, the pyramid scheme collapses when it becomes impossible to recruit enough new participants to pay returns to existing members. This leaves the majority of participants at the bottom of the pyramid with financial losses.
Pyramid schemes are illegal in many countries due to their fraudulent nature and the harm they cause to participants. They often prey on individuals’ desire for quick and easy wealth. It’s important to be cautious and skeptical of any investment opportunity that promises high returns solely based on recruiting new members, rather than through the sale of legitimate products or services. Always conduct thorough research and seek advice from reputable financial experts before investing in any opportunity.
What is the difference in a ponzi scheme and a pyramid scheme?
Both Ponzi schemes and pyramid schemes are forms of financial fraud, but they operate differently and have distinct characteristics. Here’s a breakdown of a ponzi scheme:
- Founder: In a Ponzi scheme, there’s typically a single individual or entity at the top who orchestrates the scheme.
- Promised Returns: The scheme promises high returns on investments or contributions. These returns are often paid to earlier investors using the money obtained from newer investors, creating the illusion of profitability.
- Investment Pool: There’s usually a single pool of funds that investors contribute to. The organizer falsely claims to invest the money in legitimate ventures, but in reality, little to no actual investment takes place.
- No Legitimate Business: Ponzi schemes do not involve legitimate business or revenue-generating activities. The returns are entirely dependent on the continuous recruitment of new investors.
- Sustainability: Ponzi schemes are unsustainable by nature, as they rely on new investments to pay returns to earlier investors. When recruitment slows down or stops, the scheme collapses, and most participants lose their money.
In summary, both Ponzi schemes and pyramid schemes deceive participants by promising high returns or rewards through recruitment. The main differences lie in their structures, investment approaches, and product offerings. Both are illegal in many jurisdictions due to their fraudulent nature and the harm they cause to individuals and the economy. It’s crucial to be cautious and skeptical of any investment opportunity that seems too good to be true and to seek advice from reputable financial experts before getting involved in any scheme.
How does Beachbody differ in operation versus a pyramid scheme?
Beachbody is a company that offers fitness programs, nutritional products, and coaching services to help people achieve their health and fitness goals. While there has been some controversy and debate about whether Beachbody’s business model resembles a pyramid scheme, there are important distinctions between the two. It’s important to note that my information is based on the state of knowledge while I was active and working as a fitness coach with Beachbody.
Here are some key differences between Beachbody’s operation, as I experienced it, and a pyramid scheme:
- Product Focus: Pyramid schemes often lack a legitimate product or service to sell to customers who are not part of the scheme. In contrast, Beachbody offers a range of fitness programs, nutritional products, and related services that customers can purchase and use to improve their health and fitness.
- Income Sources: In a pyramid scheme, the primary source of income is often derived from recruiting new participants. In Beachbody, while there is an option for individuals to become coaches and earn commissions by promoting Beachbody products and recruiting others, a significant portion of revenue comes from the sale of actual products to customers who are not involved in the coaching aspect.
- Emphasis on Product Sales: Beachbody places a strong emphasis on product sales to customers. Coaches are encouraged to promote the benefits of Beachbody programs and products to help customers achieve their fitness goals.
- Retail Profits: Beachbody coaches can earn retail profits by selling products to customers at a markup from their wholesale price. This encourages a focus on product sales rather than solely recruitment.
- Legal Compliance: Beachbody operates within legal frameworks and regulations in various countries. Pyramid schemes, on the other hand, are typically illegal due to their fraudulent nature.
- Sustainability: While there have been criticisms and controversies surrounding the effectiveness and financial viability of the coaching aspect of Beachbody’s business model, it’s not structured in the same unsustainable way as pyramid schemes. Pyramid schemes rely on endless recruitment to sustain returns, while Beachbody’s revenue comes from product sales.
My personal experience with Beachbody Coaching and Why I’m Still Technically a Coach
You read that right, I am still technically a Beachbody coach. That is because it’s still a profitable income stream for me after all of these years, so until I start losing money, I’ll pay my business fee monthly to stay active. But let’s back up to the beginning of my Beachbody story.
Several years ago, when I had two very little children (probably around 1 and 3 at the time and they are now 10 and 8 with a 4 year old little brother), I had gotten very into fitness and was quite passionate about what exercise had done for me, mostly on a mental level. I was looking for something I could do with this passion of mine, while also working full-time from home in a salaried position and having freelance work on the side back then.
Through my own research, I came across Beachbody. I was mildly familiar with it already, because I had done Shaun T’s T-25 workout program after I had my first child. At that time, however, I wasn’t really aware of or interested in the MLM leg of its company.
Once I realized that Beachbody was a legitimate business opportunity, I decided to find an existing coach that I really aligned with who was doing things right, who I could learn from. Most coaches end up signing up through someone they know or someone they connected with on social media. While this works great for lots of people, I wanted to seek out someone specific that I saw approaching it as a true professional business. So I found someone I thought was doing that, and ended up signing up “under her”.
My Experience and Beachbody MLM Review
For at least a few years after I first signed up, being a Beachbody coach was such a highlight of my life. Honestly, another reason I’ve always stayed active and paid my business fee monthly is because I’ve never felt ready to fully let it go, and often times thought I may one day return to active coaching again.
I loved using this lane of the fitness industry to genuinely connect with other women who could relate to my own experiences as a young mom at the time, and to use my natural passions like writing and helping people to really and truly change lives. I 100% believed in and cared about what I was doing, and I think that is what made me pretty successful as a coach.
On the other hand, I know there are a lot of people, with any network marketing companies, who just sign up as a side hustle or a way to make extra cash and they don’t necessarily care about what they’re doing. I’m not saying there is anything wrong with a having a side hustle (I mean, I’m basically the queen of side hustles), but I do believe it makes a difference as a coach because you’re not only selling a product but also your own personal commitment to encourage and guide another person towards positive change.
Specifics on My Beachbody Coaching Experience
I’m a little rusty since I haven’t actively coached in several years, but here are some of my core memories:
- Selling challenge packs: Back then, we heavily promoted what was called a challenge pack which incorporated specific workout programs (like 21-Day Fix) and Shakeology. The combination set you up for success in nutrition and exercise. I don’t even know if challenge packs are still “the thing”.
- Recruiting: We did have a heavy focus on recruiting coaches to our teams I always encouraged people to just try the programs and if they naturally loved it and felt passionate about it like I did, then they may want to consider coaching. I found that if people didn’t feel connected personally, they wouldn’t last long as a coach.
- Challenge groups: Most coaches had their own way of doing these, but we all ran a challenge group that typically restarted monthly, or might start on a certain date and run the length of a specific fitness program. For example, if it was only for 21 Day Fix participants, it would likely be 28 days (one prep week plus the length of the program). However, a coach could get creative and had full flexibility to do groups any way they wanted. I did a variety of on-going, one-time, free groups, mixed groups, tons of different things! These were either run in a private Facebook group or eventually in the Challenge Tracker app that Beachbody developed for this exact purpose.
- Free leads: I am speaking in past tense because I am not current on how things work now and I assume they’re always evolving, but back when I was an active coach, once you reached a certain level you received “free leads”. These came from places where Beachbody spent their marketing dollars but attributed the sale to active coaches. This was really nice because not all MLMs do this. For example, if someone came from the internet directly to the Beachbody website and purchased a fitness program, or even just a free trial of Beachbody OnDemand, they would be assigned to a qualifying coach. From that point forward, that coach received the commission for all of that customer’s product purchases. I remember I would always reach out via email to all of my free leads to offer support, encouragement, an invite to my current running challenge group, etc. I only heard back from a few but wanted to offer the support.
- Travel and events: I did go on a few different trips, and really loved the annual Beachbody Summit. I got to see so many amazing keynote speakers, meet awesome people, and have made friends that I still stay in contact with.
Why I Stopped Beachbody Coaching
So why if I loved Beachbody coaching so much, and I was making money, and had lots of positive experiences and connections, did I quit coaching? Well, as I mentioned, I still have never technically quit. Many people, when they quit multi-level marketing companies, they go out with a bang proclaiming their hatred for this flawed system that failed them and did not deliver on it’s promises of making a lot of money with zero effort. That is not my story.
I made very decent side hustle level money and had amazing experiences with Beachbody, and then life happened. When my mom committed suicide I tried to keep going like normal, but life was just slowly crumbling from the inside out. Pair that with a surprise pregnancy that became a really rough one, and I just gradually found myself withdrawing more and more from my coaching business. I felt like there just wasn’t any more of me to give, no more to go around. I was just trying to survive mentally, and didn’t feel like I had enough of me left to encourage and support other women in making positive changes in their lives while I was basically scotch taping mine together.
Over time, I just gradually withdrew until I just wasn’t running any groups, wasn’t talking to anyone, wasn’t inviting anyone… and that is where my coaching business has stayed since then. Still technically “active” by registration, but not actually active.
How I am Still Making Passive Income from Beachbody
Now I haven’t worked on anything Beachbody related since I honestly can’t remember when. I would say about 4 years, give or take. Yet, every week (maybe a week here and there is missed), I get a direct deposit. Sometimes it’s very small, sometimes it’s a little larger.
So how am I still getting paid when I’m not working anymore? Well to start, I worked really hard during the years I was active. The customer base that I built still loves Beachbody products! I mean, they are really good! So every time those customers, even the free leads I was assigned, order their products or renew their subscriptions, I still make a commission. I still pay a $15.95 per month business fee to stay active, but I always make more than that, so it’s still profitable even 4 years later.
Beachbody is not a Pyramid Scheme
While I haven’t been actively participating in Beachbody for years and I can’t speak to how the coaching world currently works, I can only say I’ve only ever had an extremely positive experience with Beachbody. It brought so much positivity to my life, so many amazing people and experiences, and made me a better person. That’s all aside from the additional income stream. So no, Beachbody is not a pyramid scheme. I’m happy to answer any other questions you may have, and hey, if you want to sign up to coach, I am still able to sign you up (wink, wink).
Hi, I’m Jessica! I am wife to Chris, and mom to Kaiper, Alana and Koa. I am a graphic designer, website developer and aspiring author. In this space, I share about everything from parenting, working from home, food we cook, and lots of things for kids! Learn more about me here.