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I respect entrepreneurial spirit but my respect evaporates when people use their talents to knowingly peddle snake oil.

Why Are Hot Young Instagram Babes Using MLM to Sell Shady Personal Finance Products?

I’m used to pretty Insta-people hawking all sorts of things that will never, ever make my face more symmetrical—but what’s the deal with the recent trend of influencers selling financial products?

This week’s question comes from Patreon Donor Mara. Their question prompted a lot of deep thought about the aspirational nature of wealth, and our complicity in that paradigm. It’s self-recriminatory af, you’re gonna love it. 

Mara writes…

I’m writing to ask if you guys had any thoughts on all these Personal Finance Flavored MLMs that are popping up like crazy on social media.

I work in the entertainment industry. Recently I’ve noticed that a lot of young actors are selling “classes” and the like on their Instagram pages. It seems like they really target young artists/musicians/models and tell them that selling Forex or Bitcoin is the key to intergenerational wealth and stability.

It seems super sketchy and predatory to me, but I would love y’alls thoughts.

– Patron Mara

What’s an MLM?

Wait. Have we truly never talked about this?! How is this possible?

Okay, clearly we need to make that right—please expect a deeper dive on MLMs in the future. But for now, let’s keep it quick and dirty.

All you really need to know is that MLMs are life-ruining scams run by soulless, scum-sucking bottom feeders, kept alive on a steady diet of the misplaced hopes and dreams of sad dupes you went to high school with who suddenly wanna “reconnect” and get you involved in their exciting new “business opportunity.” UGH fml.

But here’s a moar properer definition: multi-level marketing (also called “network marketing,” “direct sales,” or “network sales”) is an unstable, predatory business model where a few people at the top of the company take money from a lot of people at the bottom of the company. They support themselves by pressuring their members to vampiristically infect new rubes for unsustainable, empty growth.

Like one of those good Christian gals who clings to the technicality of her virginity by limiting herself to premarital *anal* intercourse, these companies narrowly avoid the definition of an illegal pyramid scheme by throwing in some kind of actual merchandise. Shitty makeup (Avon), worthless nutritional supplements (Herbalife), and random overpriced knickknacks (Amway) are popular choices. It’s all crap, but it’s real crap! They sucker desperate people into buying the crap, but the real financial titty-twister is the host of expensive courses and classes and conferences and guides on how to resell the crap. It’s all centered on recruiting more and more people into the cult family!

John Oliver has an excellent longer overview, for any interested parties.

So what are these financial MLMs?

There are some big financial services companies that fit the textbook definition of an MLM. Primerica, Transamerica, World Financial Group, and Xifra are among them.

But overall, the more popular breed has become exactly what Mara describes: budding investment gurus selling financial education of dubious origin and quality. They’re pretty easy to spot.

  • Influencers are fresh-faced smoke shows.
  • Always seem to be lounging beside a pool, leaning against a nice car, or tapping thoughtfully at a laptop in the lobby of a very swanky hotel. (It is unclear how they got to those places, or if they actually own any of those things.)
  • They’re selling courses on vague topics involving personal finance, investing, and entrepreneurship.
  • They use a lot of the same aspirational, goal-oriented language employed by MLMs about “becoming your own boss” or “finally taking control of your life.”
  • They make it sound like whatever they’re doing is a wonderful, accessible secret shortcut to wealth.
  • Top comments are from clumsy, obviously inauthentic bot accounts citing insane ROIs and praising their amazing investment know-how.
  • The hashtags probably include some combination #bitcoin, #cryptocurrency, #forex, #daytrading, #digitalcurrency, #investor, and DEFINITELY #girlboss. (Also big fans of adding -life and -lifestyle to the end of all their hashtags.)

So what gives? What are these?

I’m actually pretty interested to know. Thanks to our Patreon donors, we have a small budget set aside for research. I considered using it to explore the upper warren of the rabbit hole. But I ultimately decided it wasn’t worth it to perpetuate the practice, and potentially invite a dog pile on just one influencer when it’s truly an endemic problem.

… Plus we recently used our research budget to buy the most expensive AND disgusting Oreo knock-offs known to mankind. Can’t do our Patrons dirty too often.

What I think is going on…

One of two things is likely happening.

  1. They’re selling someone else’s product, which makes them an affiliate. For every X people who sign up using their link, they get Y dollars (or Bitcoins) back.
  2. They’re selling their own product, which is likely to be some kind of program or course.

A lot of influencers make their bread by selling courses. And that’s fine! Low-cost, non-collegiate education rocks, and good teachers are worth their weight in precious gemstones.

But there’s definitely a dark side to the whole enterprise.

Piggy and I went to the same arts and communications-focused college. So we have an unusual number of close friends who are (or were) professional actors and models. Every single one of them—even the super successful ones—has to support themselves with a side hustle. Or three. Being beautiful people who know exactly how to ride the aspirationally-confident-yet-relatably-vulnerable line, they’re naturals at selling yoga instruction, skincare products, and the like. Blessings upon them for figuring out how to make a living in an industry that’s so unforgiving.

… But my respect for that hustle evaporates the second those people use their talents to knowingly peddle snake oil, or pretend at having expertise when their ignorance puts others at risk.

I’m fine with people selling courses that pertain to their areas of skill. Beyond fine, actually—I think it’s fantastic. But only the morally bankrupt would accept money to misrepresent themselves or mislead others. Which is exactly what I think is happening here.

The seedy underbelly of personal financial courses

Now, here’s where it gets tricky…

In some areas—including personal finance—you see people make and sell courses on *how to make and sell courses.* There’s a lot of popular bloggers who will charge you thousands of dollars to learn the secrets of blogging. Same goes for podcasters and social media influencers.

And that don’t sit right with me.

Something about it has a distinct skunky funk of MLMness without actually being an MLM.

We have subtweeted this practice extensively, but we haven’t spoken about it directly, because in this particular area, we’re kinda being big fucking cowards! A lot of people we really respect and like personally sell courses, and we don’t want them to think we’re dropping trou’ to take a big wet dump on them. We’re really not!

There’s a responsible way to frame, package, and price truly valuable, wanted entrepreneurial advice. Several of our best Judys in the industry do it! They have the original voices, unique perspectives, and deep expertise to actually connect learners with financial topics so dry they’re mummified. They work really hard to make their courses targeted and helpful, with a price tag that doesn’t ask too much of their audience.

But there’s an irresponsible way to do it, with advice that’s unoriginal, un-insightful, overpriced, and more aspirational than anything else. Our industry is full of ’em. That’s why we’ve avoided it. But Mara’s question inspired us to state our perspective more clearly.

Are there any good personal finance courses?

Yes. Absolutely. And we plug the good ones fairly frequently on the sosh meeds. (Hint hint, give us a follow!)

It’s pretty easy to tell if a course is gonna be good.

  • Does your educator have a large body of work you can read through to get a feel for their general philosophy and knowledge base?
  • Have they offered previews of the course, or a free introductory module?
  • Do they recommend practical, conservative approaches firmly grounded in the realities of this ugly world we live in?
  • Have they built your personal confidence in making independent choices, rather than blindly following one rigid system?
  • Do they encourage diversification at every opportunity?
  • Are there comments from satisfied customers? (And are those customers actual non-bot humans?)
  • Can you afford it? And is the price fair for the knowledge you expect to receive?
  • Do they offer low-cost or no-cost scholarships to deserving folks?

There are a lot of people who tick most or all of those boxes.

Are y’all ever going to offer courses?

Sure. We’ve considered it.

It’s likely something we will do, if Piggy remains self-employed and our Patreon donor base doesn’t grow as quickly as we need it to. Although so far y’all are COMING THROUUUUUGH! We can’t thank you enough for the support, donors!

Regardless, we’ve done a ton of thinking about how we would do it in a way that feels fair. After all: if our motive is to help poor people, doesn’t charging money work against that? Sure, our advice is good, and our time is valuable… but our passion burns brightest when we’re arming vulnerable people against financial ignorance and exploitation. And we’re wise enough to understand that unless you’re starving, true passion’s rarer and more valuable than money.

If we were to ever offer courses, we’ve decided it would be on topics that only interest people who already have pretty good financial stability, such as buying your first home, or making strategic late-career moves. With topics like that, the right piece of advice can save you tens of thousands of dollars and years of heartache, so we wouldn’t feel ashamed to attach an affordable price tag. And it would appeal to our more established fans only, so there wouldn’t be any pressure on The Young And The Broke to cough up money they don’t have.

We will never, ever put up a paywall between our most vulnerable readers and our best possible advice to them.

So as someone who’s thought A LOT about the ethics of a product we *haven’t made and don’t even sell yet,* I guess I have high expectations from others! I don’t understand how someone could not know they’re taking advantage of people—or know it, and be okay with it. Which is all I see with these cryptocurrency jabronis.

The secret is there is no secret

If someone you follow on social media is trying to sell you “one cool trick” to wealth, I urge you to smash that unsubscribe button. Especially if they’re weirdly focused on just one vehicle—like cryptocurrency, forex, or life insurance.

Because I haven’t taken any such “courses” myself, I cannot say with 100% certainty that these courses are worthless self-serving garbage only a morally bankrupt degenerate would leverage their beauty and popularity to sell. But feel free to read intent into my strategic use of bolded fonts!

Here’s what I do know: ain’t no Konami Code for making money. The whole point of wealth is that it’s hard to accumulate. There’s no easy mode, no exploitable glitch, no secret path hidden behind the waterfall.

You’re born with a set of randomly generated privileges that can make acquiring wealth easier: wealthy parents, access to a great education, an entrepreneurial spirit, white skin, being a very tall cisdude, and so on. But even so, it’s not easy for anyone! Our Dear Leader Donald Trump (long may he reign… in hell) had all of those advantages, and still managed to dig himself so deeply into debt that a baker’s gross of investigative journalists haven’t yet found the bottom.

The whole point of acquiring wealth is that it’s hard. If it were easy, it wouldn’t be such a singular obsession in our culture. We wouldn’t dedicate half our waking hours to it. There’s a reason there are thousands of personal finance blogs, and not many breathing, blinking, or chewing blogs. This shit is rough!

The easiest way to tell

Don’t trust anyone who says they have special secrets, foolproof systems, or proven processes to building wealth—especially when those people are also achingly beautiful, tastefully slutty 23-year-old artists.

Nothing against that demographic! After all, Piggy and I were once achingly beautiful, tastefully slutty 23-year-old artists—and we were pretty great with money then too! But it was all relevant to our experiences. Less “here’s a blueprint to decentralize currency,” more “here’s a cheap brand of toilet paper that won’t tear up your bunghole.”

If someone is selling ideas they didn’t create, you have to ask yourself why. There’s almost certainly someone standing outside the frame, using someone else’s good looks and compelling personality to sock-puppet a product that wouldn’t stand on its own merits.

Thanks again to Mara for asking this great question!

We’d love to write more about MLMs in the future. We’re curious to hear about what you would find helpful.

  • Do you wanna know how they work? “Work” being a loose term, of course.
  • How do you avoid them, or deflect uncomfortable invitations?
  • What can you say to a friend or family member who’s been sucked in?
  • Something else?

Tell us what you’d like to know in the comments below!

12 thoughts to “Why Are Hot Young Instagram Babes Using MLM to Sell Shady Personal Finance Products?”

  1. Another great article Bitches!
    I would really like to know how to talk to friends and family who have already bought in. I’m confident in turning pitches to myself down (“no” is a complete sentence 🙂 ), but have a hard time balancing “I support you no matter what!” with “you are being taken advantage of and need to get out ASAP”.
    Thanks again for your hard work!

  2. Podcast “the dream ” has an excellent and compelling series about MLM. It looks like they just dropped a second season about wellness, which I’m excited to listen to!

  3. I have a degree in finance and it’s actually a lot of math. Complicated math (not Physics or Engineering level but complicated by “normal person’s” standards). And Excel. And sometimes Python. There are a lot of courses online for “finance people” but they are not very mainstream because they are difficult to learn.

    There are some funds and people who come up with ways to “outperform the market” (although there is by definition always risk involved. It just turns into a game of “probability” and “expected returns” and “standard deviations” at that point). There are basically 3 things that can actually help you outperform the market (1 of them is illegal):

    1. You are smarter than everyone else: This one is very VERY hard to do. Like it’s a full-time job for those people. A lot of them have a Ph.D. in physics or math or finance. Most of them don’t have much of a social life. And they don’t have time or interest to post glamourous selfies of themselves on Instagram. They do sometimes have blogs or not popular YouTube channels, where they discuss fascinating topics such as “how best to include recent changes in interest rate tax deductions in your valuation models?” or “how to properly quantify “goodwill”? They also almost never give straight forward answers and never reveal their actual strategies. They just more teach you “how to think” then “what to think”.

    2. You are faster than everyone else: This one is impossible because you are a human being not an AI. People in this category invest millions of dollars into computers and other equipment that are a millisecond faster than their competition in order to make money. This goes without saying, they also know how to code and amazing at it. The actual strategies for this category aren’t too difficult to find in academic papers on quant finance (although they change every 3 months or so and they also involve a lot of math and numbers that you will then have to figure out the best way to code, which as far as I understand not what Instagram influencers are teaching. I’m sorry but I can’t imagine so many people on Instagram being in love with quant finance so much) but unless you have millions of dollars to invest in super-fast computers, you are going to be consistently losing money doing this.

    3. You have access to information that other people don’t have: this one is called insider trading and it is very illegal. With this said, there are people on Wall Street who do it and make a lot of money doing it so I had to include it on the list. So whenever I see an Instagram influencer posting about “insider tips”, I think either 1.) he/she is lying or 2.) he/she should be locked up in prison for insider trading.

    There are also people who talk about “being better at controlling your emotions” but IMO that’s BS. Most trading is done by AI NOT humans nowadays. As far as I can tell, they have 0 emotions.

    Unless an Influencer matches one of those 3 points, he/she has no idea what he/she is talking about when it comes to stock trading. And for the majority of people, stock trading in a profitable way (by profitable I mean getting returns that you would get larger than just passive investing) is either too difficult, too expensive, or illegal to do. And for most people, it’s not worth the time or effort to learn how to do it.

    1. Katy, just popping in to say how much I loved your comment. I would totally do your influencer course. Although seriously, this was a great explanation and it made me laugh (plus I’m imagining an influencer quant)

  4. “Are there comments from satisfied customers? (And are those customers actual non-bot humans?)”

    So I do have a course that I put together, and part of what motivated me to actually do it was seeing the bad courses out there. In one case, a course had a bunch of 5-star reviews on launch day, with the comments from real people who were friends of proprietor. Ok, I figured they got early access to review it, but then because they were real people with blogs and forum participation, I could see that in fact they had learned nothing (so likely just writing good reviews for a friend without actually doing the course, but with the possibly that it’s just a bad course). So in reading the reviews, also try to see if people are finding it “fun” or finding it useful.

    “Do they offer low-cost or no-cost scholarships to deserving folks?”

    So I’ve seen one or two other courses do this and it seemed gimmicky to me, esp. in the context of a course on investing. I’d even say it was a negative selection criteria — the courses that offered it were the ones that had more of a focus on marketing than education. But you two usually have good reasoning for your points so I’m open to having my mind changed on this. Do worthwhile online courses actually offer such “scholarships”? Should I be offering such scholarships on my course?

    “Can you afford it? And is the price fair for the knowledge you expect to receive?”

    Pricing knowledge can be hard, and in personal finance so much is already “free” or nearly so on the internet and in libraries, so an alternative is to think of the time savings a course can offer. If you can learn something in a X-hour course that you might otherwise have to spend Y hours scouring the net to find all the relevant articles (and read all the same basic information 50 times over as you look for specific bits), is that worth whatever the ticket price is? (And that answer will vary depending on how each person values their time)

    “If we were to ever offer courses, […] making strategic late-career moves…”

    That does sound like an interesting course, and also not something I’ve seen a much in the way of competition for yet.

    But don’t discount your ability to put together a top-notch “adulting” course — there might be a challenge to reconcile your desire to not charge people for it, but maybe that could be your next Patreon/kickstarter stretch goal? Pre-fund it from voluntary contributions from those who can afford it? (Though there can be a behavioural reason to charge people a nominal fee to access the course)

  5. I’ve never seen an article like this before. I love it. Things like this are why I support BGR.

    For follow-ups, I think John Oliver got point 1 covered, but 2 and 3 about dealing with MLM in your life would be really helpful.

  6. F*ck MLMs is all I got.

    I had a roommate in college who was in one, it was even more “cult-y” than some of the others I’ve experienced since. She practiced her pitch on me once, and I went to an event once. A mutual friend asked me about it once and I called it a pyramid scheme, which she chewed me out for when she heard it through the grapevine. I apologized for hurting her, but I stand by that term. MLMs were legal pyramid schemes then, and they’re legal pyramid schemes now, preying on people’s desire to make easy money on the side while social benefits and middle/low class incomes stagnate.

    1. I hope your roommate learned eventually… even if she didn’t apologize and admit you were right.
      We have a series on MLMs coming soon, and I know you won’t be surprised at all that we’re reading them for filth.

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