Review of Business of the 21st Century and My Encounter with an Amway Recruiter

robert kiyosaki, robert kiyosaki

Why I Chose This Book

Why did I choose this book? It’s an interesting story, but only part of it is unique. I’ll start with Alaina Levine’s Networking for Nerds.

The book Networking for Nerds by Alaina Levine basically explains networking for those in STEM fields, why they should do it, and how they should do it. It’s a good read. I would recommend it for anyone interested in a career in STEM. Most of it, its core, is also useful for those not in STEM. After reading the book, I was enthusiastic about networking more, especially as I was getting closer to making a career transition.

An opportunity presented itself to meet up with a group of similar individuals, a networking event. It was a little bit inconvenient; it was scheduled during the workweek and at a location that was maybe an hour away, but I decided that I would give it a try. I even convinced a friend of mine who wasn’t exactly the target audience to go with me. The event was slow to start off, people trickled in, the coordinator had left because she thought no one was coming, but we eventually identified all of the attendees and met on our own. At this event, I met a woman who was also in a similar career phase and who expressed interest in entrepreneurship. We talked for a while and eventually exchanged numbers.

After texting and talking for a week or two, she told me that she was working with a couple who mentored for her business. I informed her that I had similar interests and she offered to introduce me to these entrepreneurs. This young woman was working in a science field, so naturally, I thought that these entrepreneurs had started a business based on their background in science. This networking stuff seemed to really be paying off.

As we talked some more, I believe I asked tried to get more information about what their business was and how they got started, but she seemed a little elusive and often said that her mentors could answer my questions better than she could. They were busy people though so she would have to check with them to see if they were willing to or had time to talk to me.

A week might have passed by before she told me that the couple was willing to meet me. They lived out of state so we would have to do a video conference call. This was serious. These two busy entrepreneurs were taking time out of their schedule to talk to me! I had to be prepared. I researched potential questions to ask them, printed out a copy and kept a copy on my computer. I opened an account, free of course, with the video conference website we were going to use. I wouldn’t have time to go home before the meeting so I committed to staying later at my workplace, which was fine because I would be the only one there anyway. I even wore a shirt with a collar and buttons. I can’t remember what type of pants I wore though. Anyway, I was ready.

Long story less long, the conversation was more like an interview rather than an informal informational meeting, but it was good overall. The conversation seemed positive though they stayed away from specifics. Towards the end of the call, they suggested that I read the book The Business of the 21st Century by Robert Kiyosaki and asked if I could accomplish that by next week before our next meeting. Sure I could! I was willing to purchase the book, but looked at different libraries and couldn’t find it. I eventually found the ebook version for free and downloaded it. I don’t remember if I noticed red flags before, but I definitely got a big warning when checking the reviews for the book. I might have even seen signs just putting the book title in Google.

That’s the unique part of the story. The rest pretty much went like an experience described on this website with a little overlap with mine, almost verbatim. Yeah, someone from Amway tried to recruit me. But, was the book good at least?

The Business of the 21st Century

Why You Should Own Your Own Business

The first part of the book basically summarizes Kiyosaki’s ideas in Rich Dad, Poor Dad. If you haven’t read that book, this gives a basic overview of the most important points. Chapter one addresses why you should own your own business. Kiyosaki states that you can’t rely on the company you work for, the government, or the stock market to give you a secure retirement. Owning your own business is the best way to ensure that you can live your post-working years comfortably. Is this true? Maybe.

True, your income is at the behest of someone else when you work for a company. True, government assistance (in the U.S. at least) doesn’t provide much to live on and presents many hoops to jump through to obtain it. Technically, though the stock market has historically always gone up, it does occasionally crash and this can be devastating to those whose main source of income comes from this avenue. That leaves your own business. On the plus side, owning your own business means that your success or failure is mostly dependent on you. Therefore, owning your business does provide one with more autonomy. One disadvantage though is that at least 50% of small businesses fail within the first five years. Kiyosaki’s first point has merit, but it might be overstated.

Next, Kiyosaki discusses what it means to be an employee and what are the different ways to earn income. Being an employee is a modern concept. During the agrarian age, people were “entrepreneurs” as in they ran their own farms (they probably had to). Now too is as good a time as any to start your own business. We’re trained through the educational system to become employees which most people do. There are four general modes of income generation: E-employee, S-Self-employed, B-Business owner, I-investor. Being an employee is limiting and provides relatively little money. Self-employment is a trap. You think you own your own business, but the business actually owns you. If you’re not working, the business isn’t working. B, your business(es) work for you similar to investing. Each quadrant (E, S, B, I) is associated with a different mindset. You can tell a person’s mindset based on their conversations.

It takes courage to be an entrepreneur. Many people talk about it, but few people do the groundwork. You must take control to become successful. You want to generate passive income, not income that only comes in when you’re working. This sounds good, right? Here comes the sale. Network marketing is a type of business that gives you an opportunity to build passive income (supposedly) and a lot of the groundwork has already been done. Now we’re getting to the real purpose of and the problem with this book.

Why You Should Join An MLM

Kiyosaki begins by stating that he has never actually had a network marketing business though he has been aware if it for some time. Suspicious. His friend and coauthor, John Fleming has been involved in MLM though. Some of the reasons to join an MLM include being an independent salesperson and earning money by multiple means such as selling products as well as earning residuals from the sales of those you recruit.

Harking back to Kiyosaki’s previous message, we should all build assets, which are entities that generate passive income. Kiyosaki states that network marketing isn’t about selling and generating income but building assets. Can’t we do both? If one were to start a business and have difficulty selling and generating income, one might consider quitting. With this statement in mind though one may say “I’m actually focused on building an asset” and stick with it longer. Suspicious.

In addition to building an asset, you gain a real-world business education with an MLM and you earn while you learn. As you build your business acumen, you also undergo personal development developing skills and may even learn to overcome your fears. Your circle of friends with similar values will also expand. Building your MLM business may cause you to lose friends and family, but at least you have your new network. Keep in mind that networks are what make a business successful. Networks to a business are like what software is to a computer.

“For a “born salesman” to succeed in network marketing, often

the first thing he or she has to do is forget everything they know about selling.

Many of the most successful network marketers I’ve ever seen have been

coaches, moms, pastors, teachers—people who really enjoy telling stories and

helping others. Network marketing is about sharing information and personal

stories, and not about hard selling. It is also about caring about the success of

those you bring into the business.

Which is a good thing, by the way, because only one person in twenty is a

natural-born salesman anyway.

The key to success in sales is what you can do.

The key to success in network marketing is what you can duplicate.”

 

To build your business, you need to be able to tell stories and engage others. The materials, the presentations will teach people specifics and train them. This is what helps make the business scalable and duplicable. You’ll want to bring people in from your network to look at the products and then into the business. Is this the network of friends and family you’ve lost or will lose or the new network of friends who are also trying to sell the same products?

Leadership is different from management. Leaders inspire others. They don’t necessarily do it by yelling or intimidation. Storytelling is a great tool to be an effective leader. The four pillars of leadership are mental, spiritual, emotion, and physical.

Similarly, four important aspects of wealth creation include 1. Build a business. 2. Reinvest money earned from business into business. Don’t take much out in the form of income. 3. Once business is sufficiently built, use income from business to purchase real estate. 4. Use your assets to buy your luxuries.

For many, creating wealth is only a dream, little do they know that dreaming is potentially an asset. There are different types of dreamers: 1. Small dreamers.  2. Those who dream, accomplish their dreams and then get bored. 3. Those who dream big, but never plan to accomplish those dreams. 4. Those who dream big, accomplish those dreams and dream bigger.

According to Kiyosaki, multi-level marketing is a business in which women who dream of succeeding do so. According to statistics, ~87% of network marketers are women. If I remember correctly, in the first season of the podcast The Dream, why women make up a large percentage of network marketers is addressed. I think, in past decades in the U.S. when a large percentage of women were stay-at-home moms, network marketing provided women with some independence and even helped them make connections outside of the home. Double check.

Starting Your Business

When choosing what “business” to start, it is important to choose wisely. Kiyosaki states that neither the products nor the compensation plan are the most important aspects of a network marketing business. Suspicious. The purpose of a business is to sell products or provide a service to make money, but here Kiyosaki is saying neither what you are selling nor how you get paid are the most important aspects of the business. Suspicious. According to Kiyosaki, the most important aspect is an MLM’s personal development opportunities and education. The company should focus on business education and development often provided in the forms of books, CDs, DVDs, podcasts, live conferences, etc. The products should still be good though. They should have something unique about them, their ingredients, or even their story.

The beauty of succeeding in sales is that you don’t have to be great at it or be good at numbers or make a large amount of money or have to quit your job. You don’t have to be great at sales? All you need is the right attitude and time. The recommended amount of time is five years for growth. This is about the average amount of time it takes to learn the business, unlearn old bad habits, and grow your business. Hopefully, you will have gained financial intelligence. You need to know how to make more money, how to protect your money, how to budget your money and how to leverage your money. Doing so will allow you to live in peace.

Network marketing is the business of the 21st Century. Network marketing provides a way to bring wealth to those of all backgrounds, which is especially important for overcoming unrest and discord due to wealth inequality. Income inequality often leads to wars. Therefore, network marketing is good not only for the individual, but for a nation as well.

Conclusion

Robert Kiyosaki published one of the most influential books of the 21st century, Rich Dad, Poor Dad in 2001. He explained some financial concepts in a way that many could understand and had never heard before. The book was inspirational. Often, on the podcast Bigger Pockets, even after copious criticisms of Kiyosaki and his first book, the real estate investment guests often point to Kiyosaki’s Rich Dad, Poor Dad as one of their favorite real estate investment books. Kiyosaki has gone on to write several more books and even publishes books by other authors under his umbrella related to real estate investing and business. His name and brand have garnered much respect and admiration.

Those who are familiar with Robert Kiyosaki are likely to trust that whatever business information he touts will be business friendly. He has taught millions of people the differences between an employee, self-employed, business owner, and an investor. In this book, Kiyosaki partners up with John Fleming and Kim Kiyosaki, Robert’s wife, to talk about network marketing.

Does Network Marketing Work?

There’s so much to be said, where do I begin?

So, one, if you do any amount of research on network marketing, you’ll likely come across multitudes of anecdotes and professional statements saying that network marketing DOES NOT WORK FOR MOST PEOPLE! People typically go into network marketing expecting an opportunity to run their own business and be successful entrepreneurs. Most direct marketing companies market their opportunity as a prepackaged system with ready to sell products and a support system that will put you on your way to becoming a wealthy business owner and escaping the rat race if you’re willing to put in the work. Americans are likely to know someone who has joined one of these organizations at some point, Mary Kay, Avon, Amway, and WakeupNow are just a few to name. How many of those individuals are now rich and successful? How many are rich because of their network marketing endeavors? Probably none.

To be clear, some people do make a profit from network marketing, and an even smaller minority make “good” money, but there’s more than meets the eye. To cut to the chase, Kiyosaki’s The Business of the 21st Century is often encouraged upon potential newcomers to the network marketing business Amway. Studies have shown abysmal results for those who enter Amway. 97% of new Amway “independent sellers” quit within the first year. The average “IO” makes $2,500 (U.S.) gross a year, before taxes, and accounting for expenses such as purchasing one’s inventory and purchasing education materials from the company. According to a report provided by Amway, after all expenses, the average “IO” has actually lost money. The 3% that are profitable are mostly so because they get paid selling motivational material and seminars to “IO” hopefuls. 

Amway, brochure, income

From Amway’s brochure. (link)

 You’re probably better off starting your own business separate from one of these MLM companies than joining one of theirs. On the positive side, some people have found Amway’s educational materials enlightening and motivational despite them not making any money.

Why would Robert Kiyosaki write this book? Part 1 starts out fine. He talks about the same principles he’s talked about before such as the EISB quadrant. Part 2 though, he begins by saying that he has never had a network marketing business! That seems like a red flag. Why is he speaking as if he knows for sure it’s a good idea? He hasn’t done it and the data don’t support the decision for anyone to try it.

I’ve seen it mentioned somewhere that it’s believed that Kiyosaki has some type of relationship with the MLM industry especially Amway. If you have ever followed one of their recruitment trails, you have inevitably encountered this book along the way. Overall, if you have never heard of Robert Kiyosaki or heard any of his advice, the first part of this book may be very enlightening. There is even some more good information in the rest of the book. If you could ignore the MLM promotion in the book, it might be worth a read.

Sidenote: I didn’t join Amway.

Sidenote: It’s been about a year since my encounter with both the Amway recruiter and when I started writing this. I put writing this on the backburner for awhile. Since then, I hadn’t encountered any other Amway recruiters. When I started writing this again, as I write this I’m almost certain I’ve come across another one. I smelled this one a mile away though.

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