09/29/2024
I have a few random, unorganized thoughts about why the industry has really slowed down the past couple of years. Here they go.
Incompetent Owners: There's a lack of executives in the space with real business intelligence. Yes, there are some good ones (obviously). There are too many companies that are started up on shoe string budgets, they project an image of having it together, and then implode on the first signs of stress. And as an organization grows (if it grows), stress between the field and marketplace are inevitable.
Competition. In the old days, if people wanted extra income, they had limited options. It was either invest gobs of money for advanced training (education), or sell stuff. Now, they can deliver sandwiches and earn a few hundred dollars a month. The impact of the gig economy is real. There's always been a perennial debate in our business on what works better: selling part-time income or "the dream." It turns out there's an enormous market of people that just want to earn a little extra scratch. They could care less about big money.
Incompetent Owners (again). Too many owners cut deals to draw networkers from other companies only to turn around and sue networkers when they leave. This blows out real people that find the behavior disgusting. These people leave the market and do not return. The incestuous relationships between field and owners has turned into a terminal cancer, dragging the entire space down. See point #2 re. competition: think bigger.
Small Thinking: It's disappointing that whenever someone in our small bubble says something critical about a company, a cult shows up screaming to defend the company's honor. Does Apple do this? Coke? The premium brands just execute and focus on the broader market. The market is much larger than our small bubble. If me, Ted Nuyten or anyone else says something that pi**es people off, this means the networkers in that company are focused on our small audiences, not on the broader (MUCH LARGER) market. They're building cults, not stable networks, and they're focused on recruiting from a small pool of people. The mere thought of anyone in this small audience hearing something critical is an attack on their very livelihoods. This leads to in-fighting and people looking like idiots. It's embarrassing.
Incompetent Owners (again x2): Owners, in most cases, are not prepared financially. It typically costs $500,000 to launch a franchise store i.e. a cycling studio. It costs money to run a business. Yet owners in our industry rarely have more than $100k to their name. And if they lack $100k, how in the world are they competent enough to operate a platform where people can earn more? We have a lack of sophistication. Smart money (investors) seem to avoid our space, leaving founders to rely on personal finances. It's a massive limitation in the era of increasing technology costs and more competition.
Lack of Community: networkers should be great at building communities of like minded people, building environments that people want to be part of. In the pivot to virtual, I'm not seeing a lot of fun out there.
Lack of Creativity: Founders try to tailor their plans to attract the seasoned networkers. The problem with pay plans is that once it's out there, it's hard to adjust in the future. In some cases, these orgs launch with a cancer that is nearly impossible to cure. Simple plans might be unattractive for the big recruiters. But if the gig economy has taught us anything it's that there's an ocean of people that just want quick, modest incomes.
Zero Political Capital. I mean ZERO. When the Biden SEC took positions hostile to the crypto industry, the industry galvanized, got organized, raised money, and made so much noise that being "anti-crypto" was a political liability. Now, both presidential candidates are "pro-crypto" (so they say), which was unimaginable 4 years ago. In our industry, we have few friends in office. It's just not a big deal for voters. When the FTC loses against Neora, or even loses against Financial Education Services (you probably never heard of that one), there's zero political consequence. This means not enough people care. It's just an observation.
I might add more to the list later....
