Question
Can I lose money in an MLM?
Short answer: Yes. A participant can lose money if fees, product, tools, events, travel, taxes, or other costs exceed money received.
Why this matters
Gross payments do not show whether a participant made a profit.
Costs may be described as optional while still being common among people trying to build the opportunity.
Questions to ask before joining
- How many participants earned less than their expenses?
- Does the disclosure subtract ordinary business costs?
- What recurring costs are common for active participants?
Related recruiting phrases
Helpful next pages
Sources
- Multi-level Marketing Businesses and Pyramid Schemes, Federal Trade Commission . Accessed 2026-06-14. Support type: Regulator guidance.
- Business Guidance Concerning Multi-Level Marketing, Federal Trade Commission , 2024 . Accessed 2026-06-14. Support type: Regulator guidance.