December 17th, 2006
After several calls from one of my friends, I visited this meet conducted by some GoldQuest representatives. After hearing through one and a half hrs explanation(rather clever brainwash), critically questioning the credibility often and observing their answers, and later thinking over it, I’m blogging about it here.
Ask yourself these questions
- Would you like to be paid for helping someone cheat someone else?
- Are you prepared to accept the risk of losing your money?
The most important question here is the first. The second question isn’t much important here, as the probability of that happening is infinitesimal as of now(the time I’m writing this).
The gold coin that they offer is worth not more than 11k(the 10g one) owing to all the reputation of the Mint where they say it is manufactured. They may say that our focus is just the referral money and not the coin, and that the coin is just a way to get the customer id that is needed to get into the business. Taking it that way, you pay 30k and buy a product worth less than 11k to enter the business. To recover the 19k you lost, you need to bring in atleast(best case, where your tree is balanced) 6 people on each side(12 total) of your binary tree(11.5k per 3 on each side, ie., 6 total for the best case where your tree is balanced). For every person who joins the tree, 6 ppl(at the max) in the tree get benefited(each benefited person would get 2k approx. 11.5 for 6 ppl=~2k per person). So, the company’s bare minimum profit here is 7k per referral. Think of it again. The person who joins, starts off with a loss of 19k, some unrelated 6 ppl get 11.5k total, and the company earns 7k making fool of all others. This might not seem an issue if everything works out the way they claim things to work, as you get back the money within 3 fortnights(worst case as they claim).
But think of one more thing. When a person should join the tree, he should buy a coin from the company, and they claim that the coin’s cost is for its rarity, and that each kind of coin is manufactured in limited numbers, which means that for the tree to be growing at the same pace, the throughput of the coin must be increasing exponentially(1 refers 2. These 2 refer 2 each, and so on). The company can keep this going only upto a certain extent(no company can have infinite manufacturing capability, especially, given that the business runs around gold). When this saturation occurs, the people who have atleast 3 levels of referrals below them would have earned their money back, and the others up the ladder would have earned a lot. But what about the people at the bottom who joined recently? They lose 11.5-19k, depending on which of the last 3 levels of the tree they are in. Imagine the number of such people who would lose. Right now they claim that around 8000 customers are there in India, which means that 4000-6000 are there in the last 3 levels(those who haven’t yet got back their money). At the next step it would be 8000-12000 and this number would increase as time goes on. Once the growth of the tree stops, nobody gets anymore money and the job is done for the company. Gold Quest International would have earned billions by then, which would be nothing but the money lost by the people at the last 2 levels of the tree.
Think over the above points in a rationale way. Doesn’t it look like the people at the higher levels of the tree are being paid to get a large amount of victims for the company to cheat? What else is the work that those people do for the company to pay them? Would someone pay money for nothing? All the concepts that they explain saying that “the money that goes to brand-stars comes to all of us” is all catchy words to establish the credibility of the company.
There is a board to control multilevel marketing and referral marketing, which approves companies to do such business, and Gold Quest isn’t approved by the board(Check this fact for yourself. Exercise your RTI). The ISO9001/2000 guarantees the quality of the product(which is the gold coin) alone, and not the pricing(if i’m right) or it doesn’t cover this referral process(Fix me, if i’m wrong. Am not very confident about my TQM concepts).
To wind up, Yes! You are very likely to get back your money and earn a little more if you join at this time, but think of it in ethical viewpoint, as you are instrumental in the company cheating a lot lot more people later. If making money is all that you are interested in, its a good investment to make, but if you are bothered about ethics even to the slightest extent, think about it. This looks like the old chit fund cheat business in a new bottle, framed by a very talented Marketing team.
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