Comment by theblackbox | Hacker News Reader

Comment by theblackbox | Hacker News Reader

Parent Full thread

I got (similar to) this as a first impression too (didn't catch the recently bankrupt founder, so thanks for that), but I just thought it was worth putting to the community. I'm still wet behind the ears as an "entrepreneur" and thought there might be someone here who knew of this and/or had some personal experience with them.

One thing that confuses me: when does multilevel marketing become something to avoid? For instance, we recently had contact with whitedotbox.com who have partnered with Yahoo! to offer a pay-per-click search box that can drive revenue for charity and third-sector organisations. This seems all well and good, but it's highly tiered and has affiliate/referal incentives built in. What is the line between a "pyramid scheme" (so to speak) to be avoided, and a method to build in growth?

Might just be being very naive so feel free to kick me into gear ;)

There's nothing wrong with getting a referral fee for signing up people. It's when most of your income comes from signing up new people instead of the product you're supposed to be selling that it becomes fishy.

I don't get whitedotbox. Why would someone give up 50% of potential revenue when they can use adsense for search and keep 100% of the payout.

"Why would someone give up 50% of potential revenue when they can use adsense for search and keep 100% of the payout."

Is it just some type of "modular business tactic"?

So instead of being an entrepreneur for years and building up links based on hard won personal experience, one would prefer to plug into a ready made solution? Just as one might prefer the ready made whitedotbox affiliate scheme to learning the innards of the adsense system?

I wonder if it is simply profiteering on the lack of skills/knowledge outside of "industry hubs". For instance I am based in an isolated rural community. What business networks exist are difficult to break into and often don't have the vision/drive/momentum that comes as standard for more metro/cosmopolitan communities. (although this seems like a gross over-generalisation, and my networking skills might just be a lot worse than I like to think!)

Reply on news.ycombinator.com