Network Marketing company Vemma has been targeted by the FTC. Currently, there are very few facts available for this story. I reached out to Vemma CEO, B.K. Boreyko but have not heard back from him at this point.
Today’s post will be broken down into three parts. What I know, What I Hear and some commentary.
Here is what I know:
- Access to brand partner back office and ordering of products has been cut off.
- There has been no official announcement from B.K. Boreyko, Vemma or the FTC.
So where does that leave us, information wise?
The rumor mill.
So, where is what I have heard:
- The Federal Trade Commision shut down Vemma.
- Vemma will be back open at 8am today (8/25/15) – that did not happen which is why you can’t trust rumors.
- Vemma’s autoship program is at the center of the controversy.
Here is my commentary:
Take everything you hear with a grain of salt. I would not make life decisions based on what is being said on Facebook or based on what your “upline” is telling you right now. Be cool and let the facts come out.
If the FTC has indeed come in and shut down Vemma, it’s not good news and it won’t be business as usual for a while. That said, I am a fan of Vemma. I like the products and I like B.K. Boreyko.
If you are a leader/upline in Vemma, realize that people are not stupid. I saw a Facebook post from someone in Vemma that said that following:
“Vemma ain’t going no where lol. If anything it’ll grow because of this problem haha. Billions with or without anybody.”
While I appreciate the enthusiasm, I know for a fact that there is no Kool-Aid in Vemma’s products, so stop drinking it!
I believe that B.K. Boreyko is a competent leader and my hope is that Vemma comes through this unscathed. But I don’t believe that getting shut down by the FTC is a growth strategy.
Lastly, I’m not sure that I believe that Vemma’s Autoship program is the complete reason for the shut down, at least not the way it is being described. Plenty of companies have autoship programs.
My best guess is that the FTC received an excessive number of complaints about Vemma. My next guess is that most of those complaints came from the parents of college students who signed up as brand partners.
These student age brand partners got excited about becoming an energy drink millionaire so that sign up for Vemma with a product package and check a box to be on autoship.
Two months later, the student (who is not a millionaire yet) get’s a call from his parents asking about these charges on their debit card from “Vemma”.
And the explanation does not go very well, because college students might have already quit building their business by then and moved on to other things or the explanation does not include all of the important facts that college students are known to leave out in order to protect themselves.
So parents go to “The Google” and see some articles about Vemma that do not paint Vemma in good light and the parents end up complaining to the FTC. Partially because the parents did not pay for college thinking that Billy was going to sign up for a business selling energy drinks and partially because they read a biased and slanted article on a web site (Truth In Advertising).
Sometimes companies are scams. Vemma is not one of them. When a company like Vemma get’s in trouble, it’s usually not the company that is behaving badly. It’s usually the distributors, reps, brand partners, etc. that are causing the problems.
I’ll post more as the story unfolds.
Wow unbelievable. and just today the FTC have announced that they’re forcing an injunction on Vemma for $200 million! they’re targeting the wrong company in my opinion.
I hope Vemma fight back to keep their reps safe and to defend this industry, daft investigation!!
Hard to believe that something you have potentially been building for YEARS can be taken away from you in a heartbeat. reps need to desperately start branding themselves in order to create continuity for their business ASAP.
the biggest lesson we can take from this is to brand YOU in your own biz not something you don’t own or control!
Seb,
It’s so unfair that they are losing everything that they spent years building on the backs of broke and gullible college students who never had a chance of making any money. It’s so sad that the FTC won’t allow them to make money at their expense.
Sincerely,
A Guy who worked in the dorms where 5 students got recruited and never heard from Vemma again.
Couldn’t have said it better myself Seb Brantigan. The absolute BEST thing I ever did was get away from branding a company and started branding me, my message and mission which aligns with the company I represent.
Having said that, this kind of travesty will shake the ground we all walk on in this industry but those true leaders will find a home for their teams and press on to become better leaders and stronger tribes with even more passion for who they are, what they do and why.
Stay strong and know that we are here in support and empathize with this difficult situation.
Its always a bummer for the whole industry. Yes, most people fail to stick with it and succeed. But so do most businesses. It’s crazy that FTC can come in and take away from all the people worked for years buildng
Their business
I never distributed, but I am a loyal customer. I have a good stockpile of a few products, but not enough vitamin to make it through an extended shutdown. I’m really hoping things sort out soon. This is the first thing that ever worked for me!
I’m one of the parents that filed an FTC complaint; I can easily find my complaint in the online paperwork. I can also easily find the FTC court papers.
Vemma targeted college kids, specifically freshmen. These kids are able to easily get a credit card and to go into debt. They like the idea of making money just as easily, perhaps even while they sleep as often is stated to them. All they have to do is buy the energy drink and have a few friends over – the drinks will sell themselves! And they will make a fortune but really only if they create a downline team of affliates.
In reality, they are selling a business opportunity and not an energy drink. And that is why this is a pyramid scheme. Do you see thousands of college students drinking this? No, because it really is expensive. And the health claims are thinly backed up with inclusive studies the company commissioned. A bottle of multi-vitamins taken daily would provide more benefits in a less costly fashion.
I have seen Vemma’s own compensation disclosure and it sure doesn’t look like the path to wealth. That’s not a biased or slanted article. I read it and yet my own child insisted that somehow she was going to make a fortune. Meanwhile she had been brainwashed to believe that actually working for a wage was slavery.
I’m not saying that all MLM companies are pyramid schemes but Vemma was exploiting a segment of the population unable or unwilling to make an assssment of a business model. And the reps were encouraged to make it seem like easy money with the biggest problem being to decide between a Benz and a Bimmer.