Going by some of the responses we got when we talked about E-creator being a scam, we might need to get back to defining what pyramid and Ponzi schemes are.
Oh, and we might also need to touch on multi-level marketing and microwork, both of which can be utilised by legit businesses, complicating the issue.
It’s a lot, but if scammers are taking the time, so should we. Scammers often mix and match the above, coming up with new and novel scams.
I think if we were all on the same page about the above, we would see eye to eye on E-creator. We would have to concede that some will benefit but that it’s not going to end well for many, hazvipere mushe.
Recap of what E-creator is
You can read about how E-creator is structured here. Here is a summary of how it works though:
- If you deposit $15-100, you get up to 4% in return (commission) each day after you post 10 fake reviews. They call these fake reviews ‘jobs’. With this deposit, you are considered a VIP 1 member.
- If you deposit $100-$500 and also recruit 5 other people to join as active VIP 1 members you are upgraded to VIP 2. This upgrade comes with a bump to 4.5% in commission.
- You have to deposit over $500, up to a maximum of $2000 and have 5 VIP 2 recruits to be upgraded to VIP 3. Your commission rate bumps up to 5%.
- And so on..
- They also say if you recruit at least 50 people at any level, you qualify to be a manager which comes with a $400 bonus every month, on top of your own commissions.
- Do remember that to remain in the program, you have to maintain your level’s minimum balance. If you’re a VIP 3 member, you have to maintain at least $500 and your recruits have to remain active for you to remain a VIP 3 member.
- E-creator says one can withdraw both the principal and the earned commission at any time and exit the program.
Ponzi schemes
Investors are promised high returns with little or no risk. The scheme works by using money from new investors to pay off old investors.
A classic example would be Bitcoin super-traders that cropped up a few years ago in Zimbabwe. They asked you to invest your money with them and they would double it every month whilst you sat at home. According to them, there was virtually no risk you could lose your investment.
- An investment – ✅
- High (unrealistic) returns – ✅
- Little to no risk – ✅
What about E-creator?
E-creator is not a classic Ponzi scheme. E-creator is not saying, ‘Invest with us.’ They are saying, ‘Here’s your chance to work and earn high returns.’
However, you are definitely investing with them, they just don’t call the investment an investment. You have to deposit money with them to be able to earn commissions. So think of the commission as a return on investment or interest and you will see that E-creator is a Ponzi.
- An investment (deposit) – ✅❓
- High (unrealistic) returns – ✅
- Little to no risk – ✅
They masked the investment as some kind of deposit and introduced some service you have to provide to make it seem like it’s not a Ponzi scheme.
The 4%+ in return that you get every day comes from the monies deposited by new recruits. Not from posting 10 fake reviews, which can hardly be considered work. Still, E-creator is not a classic Ponzi scheme.
Pyramid schemes
Participants are promised money for recruiting new participants. The scheme works by paying out early participants with money from later participants.
Now, for a pyramid scheme to work there needs to be something that the organisation says it does – usually it’s selling some product, sometimes it’s a service. Without this service or product that’s on sale, there would be no guise to recruit participants.
Recruitment is the main differentiator for pyramid schemes. If you find that most of your income from a scheme comes from recruiting new members then you’re in a pyramid scheme.
You need to ask yourself how it’s possible that most people earn most of their income from recruiting new members rather than from selling whatever the organisation purports to sell.
It’s not really about the product/service, one makes the big bucks by recruiting as many people as possible. For every member you recruit, you get a reward every week/month for a while. For every person the person you recruited recruits, you get a reward too. And so on.
How does E-creator compare?
The more you recruit, the more you earn with E-creator. Your commission goes up as you increase your investment and recruit more members.
Since E-creator promises a fixed commission (interest) rate every month, the amount you are able to earn is dependent on the amount you deposit (invest) with them.
To increase your deposit you have to recruit more members. So, in that regard, the number of people you recruit determines how much you earn.
However, even at VIP level 5, you still won’t be making most of your income from recruitments, even when you get to 50 recruits and get $400 for that every month. That’s even if we consider the bump in commission that comes from recruiting and maintaining new members.
The bulk of your income is still mostly from the interest on the deposit you placed with them. So, in the end, it doesn’t matter if we can call posting 10 fake reviews a day a focus on service.
- Reward for recruiting new members – ✅
- Bulk of income from recruitment – ❌
- No focus on selling products/service – 🤷🏾♂️✅
They muddied it up so it’s not exactly a pyramid scheme. I would say E-creator is a Ponzi scheme with pyramid elements.
Multi-level marketing (MLM)
In a legitimate MLM business, distributors earn income from selling products or services to consumers. They may also earn commissions on the sales of their recruits, but the majority of their income comes from selling products or services.
For most people, it is difficult to differentiate pyramid schemes from MLM schemes. The main differentiator as we discussed above is what the major income driver is. If it’s recruitment then it’s a pyramid scheme, if it is the sale of products/services, then it could be an MLM.
This is where the likes of Avon, Forever Living, Angel and the like fall. You do get rewards for recruiting new members, however, even if you don’t recruit a single person you could still earn a lot if you manage to push the product. You’re better off recruiting though.
What of E-creator?
If you don’t recruit anyone for E-creator, the best you can do is deposit $100 and earn $120 in commission per month. No more.
It’s still an unrealistic return for posting 10 fake reviews but that’s the ceiling if you don’t recruit anyone.
You can see that to earn more with E-creator, you don’t have to do more work. In fact, it is not possible to work more than any other person. Everyone is limited to 10 reviews a day.
What determines your income is the number of recruits and most importantly, the money invested (deposited) with E-creator. This is not how MLM models work.
- Focus on selling products/services – ❌
- Bulk of income from sales – ❌
- Focus on recruiting new members – ✅
E-creator is not an MLM model.
Microwork
Microwork is a type of work that is typically done online and is characterized by its small tasks and short duration. It is used by businesses to complete tasks that are time-consuming or require a large number of workers.
Micro jobs are small, easy tasks that can be completed in a short amount of time and generally don’t pay much.
You could be asked to transcribe audio/video, write product descriptions, enter data, answer surveys etc.
Could we call E-creator’s 10 fake reviews a day microwork?
- Small, easy tasks – ✅
- Requires large number of workers – 🤷🏾♂️ (How many fake reviews do online sellers really need?)
- Time-consuming – 🤷🏾♂️ (If the online sellers utilised bots it wouldn’t be time-consuming to post fake reviews on all their products)
E-creator’s so-called employers are the online sellers that need fake positive reviews on their products. Setting aside the ethics of this, they really could need a large number of people posting reviews.
So, I think we can say E-creator has a microwork element to it.
The reality of Ponzis/Pyramids
I’ll stick by my classification of E-creator as a Ponzi scheme with pyramid and microwork elements. I’m sure you will agree with this classification.
Ponzi schemes only survive until they are no longer able to recruit more members. However, the reality is that it can take a few years before a Ponzi starts struggling to recruit new members.
This means that those that join early on can really make a killing before it all goes to the dogs. By the time the masses join in, the early adopters would have built houses with proceeds from Ponzi schemes. That’s not to mention how lucrative it all is to the founders themselves.
I know people in my own circles that made thousands from the Bitcoin super traders before the programs went belly-up. Yes, when the schemes folded, the investments they still had in there were lost but they had withdrawn much more than they had invested by the time that happened.
Many people know this. They can spot a Ponzi/Pyramid from miles away but will still join in the hopes that they are early enough to turn a profit before it all crumbles.
Then some see how so-and-so that they know has been making a killing and how they themselves are turning a neat little profit and end up confused as to what the organisation is really about. These are the people that reinvest all their proceeds into the scheme and lose everything at the end.
Know what E-creator is
So, to argue that you are making money from E-creator and so it’s not a Ponzi scheme is stupid. You’ll make money until you don’t, that’s how Ponzis work. I guess that’s how all business ventures work, so carry the hell on.
However, with Ponzis like E-creator you can be sure that your profit today is on the backs of people joining the program, many of whom will lose everything in the end. If you’re comfortable with that then by all means, do your thing.
The time will come when E-creator reaches everyone who would be interested in such a program and the whole house of cards will tumble on that day.
There would be no new chumps depositing money to use to pay 4% commissions and E-creator will start defaulting on withdrawals and within a few months, or even weeks, they will be nowhere to be seen.
Also read:
E-creator – this criminal enterprise is running a scam, stay away
Zimbabwean wants to take 1 mil traders online and raise US$5 billion, hmmm
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