Quick answer: Wealthy Affiliate is not a pyramid scheme and it is not an MLM. Rather, Wealthy Affiliate is a real and legitimate affiliate marketing course and community that shows students how to earn commissions online in any niche, by promoting any type of products they want.
Wealthy Affiliate is like Marmite – you either love it or you hate it:
In one corner you have a very loyal fanbase who will defend it to the death and at the opposite end, you’ve got people who call Wealthy Affiliate a scummy scam and pyramid scheme.
And that can leave people somewhat confuzzled…
Especially if you’ve decided to build an online business and you want a legit affiliate marketing course that’s gonna show you how to do it.
The truth is there is no perfect course and Wealthy Affiliate has its pros as well as cons – check out our SUPER in-depth Wealthy Affiliate review to see exactly what they are.
But for now, let’s focus on the question: “Is Wealthy Affiliate a pyramid scheme or MLM?”
Let’s start by defining what a pyramid scheme is and take a closer look at what Wealthy Affiliate is so you can make up your own mind.
What Is A Pyramid Scheme?
A pyramid scheme is a business where the main source of income comes from recruitment (rather than the sale of any actual products or services) which is why members are always pushed to recruit new members.
Pyramid schemes get their name from their triangular-shaped commission structure:
According to Cornell:
“Pyramid schemes operate under the guise of selling a product, though the profit from the scheme is based on number of recruits rather than strength of sales.”
And the Oxford Dictionary defines a pyramid scheme as:
“An illegal way of making money, in which people are persuaded to invest money or sell a product and to persuade others to do the same, with the later investors paying money to the earlier investors, until the payment structure collapses and most people lose their money.”
A pyramid scheme needs to constantly chase new recruits because without them, it becomes unsustainable and the pyramid ultimately collapses.
And the main difference between a pyramid scheme and an MLM (multi-level marketing company) is that pyramid schemes rely solely on recruitment with no real products or services and MLMs often have both products and recruitment. MLMs become illegal when the lion’s share of income comes from new recruits.
Pyramid schemes are illegal in most countries (and should be avoided!) because:
- You have to recruit others to make money
- It’s not sustainable in the long term
- 99% of members lose everything they invest
Here’s a short 5-min video on how to spot a pyramid scheme:
Now you know exactly what a pyramid scheme looks like, let’s now see what Wealthy Affiliate is and how it works so you can see the difference.
What Is Wealthy Affiliate?
Wealthy Affiliate is a training platform that teaches you how to make money with affiliate marketing.
They have two Core Training Courses – the Online Entrepreneurship Certification Course and the Affiliate Bootcamp Course – as well as a number of tools designed to help aspiring affiliate marketers succeed.
- Beginner-friendly website builder
- Domains and web hosting
- Keyword research tool
- Affiliate program finder
And so much more. You can read our Wealthy Affiliate review to get all the juicy details.
What Wealthy Affiliate teach is straight-up affiliate marketing. Nothing more and nothing less.
And affiliate marketing is not some shady scam, pyramid scheme or MLM, but a very real and legitimate business model many use to replace their income online.
Investopedia describes affiliate marketing this way:
“Affiliate marketing is an advertising model in which a company compensates third-party publishers to generate traffic or leads to the company’s products and services. The third-party publishers are affiliates, and the commission fee incentivizes them to find ways to promote the company.”
In other words, become an affiliate marketer and you make money promoting other people’s products. You get paid every time you generate a sale for online retailers like Amazon, Etsy and eBay (to name just a few) and many of the big-name brands have affiliate programs you can join for free and all of them offer set commission rates.
With affiliate marketing there are:
- No complex compensation plans
- No pyramid-shaped compensation structures
- No recruiting
- And you only earn commissions when actual products or services are sold
If you’d like to learn more differences between pyramid schemes and affiliate marketing, watch this video:
Is Wealthy Affiliate A Pyramid Scheme?
No, Wealthy Affiliate is not a pyramid scheme, multi-level marketing scheme or anything like that. Wealthy Affiliate is an affiliate marketing training platform with an affiliate program where you can earn commissions from direct referrals only. There are no pyramid-style commission structures or downlines of any kind.
Yes, members can promote Wealthy Affiliate if they want, but you absolutely do NOT have to.
I see new Wealthy Affiliate success stories being posted every single day and the vast majority of them are from people who have gone through the training and built strong and profitable online businesses for themselves in a niche they’re passionate about by promoting products they truly believe in.
And that’s what this is all about – YOU taking the first step to make your online dream business a reality, smashing your income goals and securing a solid financial future for you and your family for many years to come.
The best advice I can give you?
If you’re still not sure about Wealthy Affiliate then join as a free Starter member – you’ve got nothing to lose and possibly everything to gain.
Then go through the Online Entrepreneur Certification Course. You’ll learn how to create a website based on any topic of your choice where you can promote whatever products and services you like to earn BIG commissions.
Here’s a sneak peek at Lesson 1:
Why Some Think Wealthy Affiliate Is A Pyramid Scheme
I hope I’ve done enough to show you Wealthy Affiliate is 100% legit. The training is top-notch, the business building tools are state-of-the-art and the community is amazing. I’ve been with them for 8 years now and I wouldn’t still be a member if they were a scammy pyramid scheme.
That being said, there are some that still say Wealthy Affiliate “smells of a pyramid scheme” or has “MLM vibes” and I think it’s only right that I walk you through some of the reasons why.
Reason #1: Affiliate Bootcamp
If Wealthy Affiliate was a course solely aimed around promoting Wealthy Affiliate then yes, it would totally match the description of a pyramid scheme but, as I mentioned just now, there two ways to make money with Wealthy Affiliate and two core training courses:
The first course will show you how to make money with affiliate marketing by recommending any products in any niche (this is the route I always recommend for beginners!)
And the Affiliate Bootcamp course shows you how to make money with the Wealthy Affiliate affiliate program.
One of the first big decisions you have to make when you’re starting out is deciding on what niche to go into, and one of my biggest complaints about Wealthy Affiliate is that students struggling to come up with a niche idea are pushed towards taking the Affiliate Bootcamp course.
You can definitely make good money promoting Wealthy Affiliate but if this is your first go at building an affiliate marketing business, the affiliate marketing niche is the most competitive niche there is. You’ll be competing with the best of the best and you’ve just made your journey to success a whole lot harder.
I’m not the only one saying this:
“I’m not sure there’s anything more confusing, intimidating, and stressful than picking a niche. It’s a big decision, and it influences your internet business for at least the next several months significantly. That’s why a lot of people default to Bootcamp – it’s kind of handed to them on a platter in one of the most frustrating stages of becoming an internet marketer.
Don’t default to WA Affiliate Bootcamp just because you’re overwhelmed by picking a niche.”
And choosing a niche you have little to no interest in is a major newbie mistake – so don’t do it!
Instead, give yourself the greatest chance of affiliate marketing success, go through the Online Entrepreneurship Certification Course and build a business around a niche you are interested in and have experience in.
And if you struggle to pick a niche, follow our simple 3-step formula to find the right niche for you.
Reason #2: Go Premium To Double Commissions
Some brand Wealthy Affiliate a “pay-to-play“ pyramid scheme because you earn double commissions on each of your Wealthy Affiliate referrals when you upgrade to Premium.
As well as the free membership, Wealthy Affiliate has two pricing plans:
- Premium – $19 the first month then $49 a month or $495 a year
- Premium Plus – $49 the first month then $99 a month or $995 a year
And as a Starter member, you’ll earn 25% commissions and as a Premium member, you’ll earn 50%.
Check out my full breakdown of Wealthy Affiliate’s affiliate program for more info.
Wealthy Affiliate Isn’t A Pyramid Scheme, BUT…
“Is Wealthy Affiliate a pyramid scheme” was the question you wanted the answer to and hopefully now you know that it’s not. Wealthy Affiliate is a great option if you’re looking for practical step-by-step training that’s gonna get you results and incredible round-the-clock support.
Whether you’re a complete beginner with zero experience looking to start your first money-making website, or you’ve tried and failed with other courses and don’t yet have a site generating at least $1,000 per month, Wealthy Affiliate can give you the proven roadmap you need to make it happen.
Just remember what I said – build your business around a passion or interest you have. You’ll thank me for it! 😉
And the best part?
You can start Wealthy Affiliate for free and try it out for yourself.
Either way, follow the training, put in the work and you absolutely can go on to earn 6 figures+ and who knows where it’ll take you. All the big online success stories started where you are right now.