13 Investigations before you start a home based business

Internet Due Diligence Defense Program 2007™
13 SIMPLE INVESTIGATIONS TO AVOID GRIEF BEFORE YOU
START A HOME BASED BUSINESS!
- this article reprinted from www.mlmwatchdog.com as a precaution

1. SIMPLEST PUSH BUTTON INVESTIGATION: Look at the supposed MLM or Affiliate Company’s Website. First suspect clue would be no street or city address! Worse yet, only an email address, no phone number. Then look for the pictures + names of the owners/operators of the company. Not having these pictures andnames on a company Website is very suspicious and a good reason not to join.

2. HIGH - HIGH TECH PUSH BUTTONS: Some wise, seasoned Internet distributors use “http://earth.google.com/” to look at satellite pictures of the size and location of a supposed Affiliate/MLM Company office. If the Company address is a trailer house or home? Run!

3. LOW TECH CHECK ON ANY HOME BASED BUSINESS OFFERING: If the Address is PMB that means it is one of "rent a mailbox" at a commercial mail box place. They do not have the legal protections of a U.S. Post office for you! Get suspicious when you see PMB! Very, very suspicious!

4. PUSH BUTTON INVESTIGATION HOME BUSINESS AFFILIATE OR MLM: Go to the Internet and enter the following into one or two of the major search engines: A. The MLM Company's name (owners too) and the word "scam". Go through two pages! Look for forum - message comments for legitimate complaints (see D below).
B. Then do the same for "complaints, lawsuits, and news articles archived on search engines.
C. Also check the name of who registered the Website domain of any new company claiming: exciting, amazing, incredible, proprietary, never seen before in the universe, revolutionary, products, services or technologies! Check http://www.whois.net/ for the domain lookup. Companies with wonderful offerings would work on a project for more than 3 months. Smart legit executives register domain names first!
D. A warning on MLM due diligence for Affiliate OR MLM Researchers! There are sad sites and forums that are unfairly negative toward all Affiliate - MLM - Network Marketing companies. Ignore these "Affiliate MLM Bashers" and only look for appropriate information.

5. PUSH BUTTON MLM, PARTY PLAN, AFFILIATE, NETWORK MARKETING DUE DILIGENCE = CHECKING WEBSITE TRAFFIC: A. The next time someone approaches you about a “Hot Opportunity” download the tool bar from http://www.alexa.com/ and look at the Alexa rating which shows web traffic. This is a great web tool
B. If you look at Quixtar or Mary Kay, two of the largest older MLM companies, you will see they rank 6,000 and 7,000 those are top rankings. If you look at Xango.net which is a booming 3 year old new company they rank 26,000 which is excellent. This MLM Watch Dog site ranks around 45,000 which is considered real good. Affiliate marketing follow the same pattern with Amazon king of Affiliate programs a at 2. If you look at Linksurge.net an affiliate program I just put up online I am very happy with Alexa rating of 340,000 after just 45 days and we are at about 150 working members.
C. A lady asked me to look at a 5 year old company that she said was “Hot”.... the ranking was 386,000. That my friends, is down in the mud for a 5 year company! I put the lady down as deluded or hyped! If she had told me it was 45 days old I would have said 386,000 = ok. The lower the number the more traffic to the site. This isn’t a perfect measurement but one that can quickly and usefully sort out hype vs. truth. Basically if I have a rating on Linksurge.net of 340,000 with 150 members after 45 days, the 5 year old MLM Company with a 386,000 rating is dead,dying or done!

6. RUN FROM A COMPANY TAKING ONLY MONEY ORDERS OR CHECKS: Only use a credit card that will accept charge backs. Returns? Honest companies allow refunds within 60-90 days (6 states require a year)!

7. AFFILIATE, MLM, PARTY PLANS & NETWORK MARKETING COMMON SENSE: Don’t let the money over-excite you! Use the products or services being sold first! If they excite you, then look at the money. You should try sharing and selling the products/services to test them out. Spending some money to test a company and their offerings is a wise thing to do.

8. NEXT HOME BUSINESS AFFILIATE OR MLM DUE DILLIGENGE RESEARCH: Go to the Better Business Bureau (new window) Website for the city where the MLM-Network Marketing Company is located. Some are free, some charge $2! You are looking for the number of complaints the BBB has NOT resolved. If there are over 3-5, hold off joining, it very well could mean problems.

9. FOLLOW UP HOME BUSINESS RESEARCH: Check with the Attorney General in the state where the company is located. Be very brief with your email or phone call and stick with asking, “Affiliate or MLM Company XXX is located in city in your state, do you have complaints against Company XXX?” A complete list of Attorney Generals is in MLM WatchDog DUE DILIGENCE & COMPLAINTS Library.

10. HOME BUSINESS "WATCHOUT": An email solicits you to a "HOT" Affiliate, MLM, Party Plan or Network Marketing Company!
A. Look for exclamation marks and capital letters used to lend legitimacy or urgency! Beware of disclaimers such as “this is not a pyramid selling scheme or scam” (legitimate offers don't contain such claims). Don't believe promises of fast wealth.
B. If you feel, see or hear "Get Rich Quick!” Run! If it sounds too good to be true, it usually is! MLM - Network Marketing takes some work, like any good Home Based Business.

11. DON'T SPEND OVER $500 TO START: See the FTC Warning below this article. There are also approximately 21 states that say this should be the maximum to get started in any business opportunity (not just MLM). Two states say it must be kept under $200. Following the advice in #6 should not cost over $500. See the LATEST Federal Trade Commission (FTC) warning below.

12. READ THE FINE PRINT IN THE AFFILIATE OR MLM CONTRACT: These are the Enrollment Agreement or Terms of Agreement plus Policies and Procedures. These all together are a business contracts, enforceable in a court of law. The Distributor Rights Association says they shouldn't be over 15 pages long. Don't sign if you don't feel comfortable about the contract. See http://www.mlm-dra.org/ for warnings about companies violating contracts.

13. COPY THE PAY PLAN AND ASK QUESTIONS: Then find an expert to analyze it.
A. If it only pays for signing up new people and not sales of products/services - run!
B. There's a copy of my MLM Compensation Pay Plans Book on Amazon. Search for my name by author - Rod Cook. No, this is not a shameless promotion for my book. My book is the only one with big pictures, diagrams and detailed to help both the new person and expert. MLM Watchdog ethics let me say it's a good book! Plus my book has a whole chapter on avoiding Pyramid Schemes.

Rod Cook
MLM WatchDog