Why 98% of New Businesses Fail


Why do 98% of all new businesses fail within their
first 2 years? (That is ALL businesses, not just MLM.)

Hill gives us a thorough lesson in economics in Chapter

There’s an old saying… “If a man will not work, he
shall not eat.”
(2 Thessalonians 3:10)

As civilizations grew, the demand for the Services of
specialized skills increased. As we entered the
Industrial Age and now, the Information Age, it became
impossible for any one person to be proficient in every
skill needed by the community.

So we bartered our Services and developed currency to
make trading Services easier.

Yet somehow, since the dawn of the Information Age, an
entire generation of Internet users have been
conditioned to believe they can earn money without
productive work or performing wanted Services!


98% of businesses are started by lazy people driven by
a Fear-based need to make money. (Fear is the root of
all Negative Emotions including Greed, Jealousy, Anger,
Hatred and Revenge.)

Our friend Jim’s uncle passed away and left Jim a nice
corner lot downtown.

When Jim was a teenager he enjoyed working on cars with
his buddies. So Jim figures a lot of folks need auto
repairs and maintenance and decides to open an auto
repair shop.

In the beginning Jim services some cars, does a good
job, and business picks up.

But Jim also like to take time off to go fishing. He
does not want the hassle of hiring, training and
supervising other mechanics.

So Jim takes cars across the street to Bob’s Auto
Repair to has them do the work. When the work is
complete he brings the cars back and bills his
customers what Bob’s charged him, plus 30% for his
profit – without any value-added services.

How long do You think Jim will stay in business?

With an MLM distributorship – You don’t invent or
develop the products; You don’t manufacture, package
and label them; You don’t process payments or ship the

So, what value-added Services will You provide to
warrant the earnings You expect to receive?

Leadership is not about awards and recognition.
Leadership is a willingness to get one’s hands dirty
and bloodied while blazing a trail to make the
followers’ journey easier.

In other words, a Leader SERVES the Followers. Service
is the engine of success and leadership.

The 98% who fail do so because their driving motivation
is Fear.

The 2% who succeed thrive and endure due to a
Love-driven desire to SERVE.

Your Friend and Servant,

Ken Klemm

P.S. “Be a Mentor with a Servant’s HEART.”
~ Michael Dlouhy

Inspired by Chapter 7 – Organized Planning
of Think and Grow Rich by Napoleon Hill

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2 Little Words That Scream, “Network Marketing Scam!”


2 Words that Scream SCAMWord #1: probably the biggest scam ever run on people in MLM network marketing is the powerline.


The worst thing you can ever do building your business is to create fear of loss. It’s the worst way to build your business. Oh, yes, it definitely works – to get people in. But you have a totally false business, because you’ve got a bunch of people, and none of them ever does anything.


Word #2: Many companies that do a powerline – or even a binary or a matrix – focus their promotion talk on spillover. Now, I have met people who have gotten spillover, definitely. BUT – none of the people that were spilled over on them ever did anything! Why?


Because the promise of “spillover” creates a welfare mentality. What happens when you tell people, “Oh, get in NOW, and you are going to get spillover!”


They’re afraid of losing something for nothing. So they do get in now – and then they sit and wait for all that spillover to make them rich.


Isn’t That A Wonderful Business Plan?


It’s like joining a binary because you can get a position that already has $1 million volume in the strong leg. The reality is, you don’t make a dime, unless you build the weak leg, But people get so worked up about losing that “$1 million position”, they join – and never do anything, and never earn any income.


So never forget those words, powerline & spillover. Anytime you see them, their purpose is to promote the welfare mentality. Something for nothing, something for nothing, something for nothing.


The fact is, you are in network marketing. Network marketing is a business that takes work. It’s net-work marketing, ok? it’s not net-free marketing. It’s not net-spillover marketing. It’s not net-zero marketing, it takes work. Anything you do that promotes the “something for nothing” mindset will not work. End of story.


But you will draw in a bunch of couch potatoes who are convinced that you are going to build it for them. Matter of fact, you can even give them your bank account number, and you’ll just pass the money directly to their account. They don’t have to leave the couch. They can stay on the couch, drink their beer and watch a football game. No problem.


Use Those Two Words As A Tip


Whatever company or whatever distributor is saying them to you, that is not the company or the person you want to depend on long-term. They will not be successful. Keep on looking. There are lots of good companies & MLMers out there. Keep looking, and you’ll find the right mentor.

In MLM, The Marketing Will Build Your Empire


On page 14 of “Success In 10 Steps” by Michael Dlouhy, you can read about “the monk in the white lab coat.” I don’t think it’s just the people I’ve talked to recently. I can definitely remember when I used to think this way.

There are just a LOT of people who believe that far and away THE #1 reason to choose a network marketing company is the product. And even after talking with them a bit, it is a very tough idea to dislodge.

MLM companies must have a great product to compete in today’s market. But it is effective marketing, not a product, that will either build an empire or not. Specifically, you should be searching for a group with an effective, results-producing marketing program in place. So it’s important to give prospects as much evidence as you possibly can that product focus is not what will build them a great income from home.

To have any hope for building a successful MLM business, they have to get this concept. If all they want is a great product, that’s fine. If they don’t care about the money, no problem. They can do whatever the heck they want to do.

But most people … and certainly most of the people your prospect will be talking to about the business … are looking to make money at it. And if you ask even this product-focused prospect, you can pretty much be 100% sure they’ll say, “Well, yeah – I want the money!”

And to do that, you’ve got to have those other 4 Pillars in place – not just the product. So page 14 is a very good place to point your prospect to, to make that point and get them headed in the right direction.

Richard Dennis
Big MLM Lies