<p>Yes, there are such schemes. They are called <a href="https://en.wikipedia.org/wiki/Pyramid_scheme" rel="nofollow noreferrer">pyramid schemes</a>, and the problem is that they are illegal in most countries.</p>

CC BY-SA 4.0
2022-08-30T23:34:46.693Z
The real problem is that it is inevitable that a large number of people lose 10 dollars
Henry
CC BY-SA 4.0
2022-08-30T12:54:38.647Z
2022-08-30T12:54:38.647Z
VARulle
<p>You already know the problem:</p>
<blockquote>
<p>Now, as there isn't an infinite amount of customers, somebody inevitably fails to recruit and they loses their invested amount.</p>
</blockquote>
<p>That's the problem.</p>
<blockquote>
<p>But, If they correctly plan, they can make a 50% profit.</p>
</blockquote>
<p>It's <em>not possible</em> to correctly plan. Before you pay your $10, how do you know whether you can find 2 people? You don't know, but smart people can see the odds are against them, and refuse to participate.</p>
<p>You can easily calculate that the average person loses money. More people lose money, than make money. So why would any smart person sign up? If they're at  the top, that's why. The people at the top make a lot of money. But there aren't very many of them, and you're probably not one of them.</p>
<p>This is basically a way for ten smart people at the top to get money from a million stupid people at the bottom.</p>
<p>What happens in reality is that the stupidest people (the ones who don't realize why this investment doesn't work) are the last ones who sign up, and then spam everyone everywhere trying to recruit them. Nobody likes this, and since the entire thing is just a scam anyway, they made it illegal.</p>

CC BY-SA 4.0
2022-08-30T14:28:46.587Z
2022-08-30T14:28:46.587Z
Criticize SE actions means ban
<p>Edit: I searched about Pyramid scheme but a site said that it is a marketing scheme recruiting more people to make profit.
Apparantly this site was wrong.
But, that's the reason that I asked this. So, apologies. Cant delete the question now.</p>
<p>Say someone invests 10 dollars in this scheme. If they recruit 2 customers to this scheme, they get 15 dollars. So,they get 5$, a profit of 50% the investment.
Now, I get 30-15= 15 dollars from this, which is a 150% their investment. And this profit increases exponentially with each step.</p>
<p>Now, as there isn't an infinite amount of customers, somebody inevitably fails  to recruit and they loses their invested amount.
But, If they correctly plan, they can make a 50% profit.</p>
<p>Is there already a scheme like this?
If no, why?</p>

CC BY-SA 4.0
2022-08-30T15:03:05.187Z
(-1) This question shows no research effort.
Giskard
CC BY-SA 4.0
2022-09-04T06:42:40.493Z
But, I searched about Pyramid scheme but a site said that it is a marketing scheme recruiting more people to make profit. Apparantly this site was wrong. But, that's the reason that I asked this. So, apologies. Cant delete the question now.
Sophile
<investment>
Is there any problem with this scheme?
Sophile
# Is there any problem with this scheme?

(Asked by: username_0 on 2022-08-30)

Edit: I searched about Pyramid scheme but a site said that it is a marketing scheme recruiting more people to make profit.
Apparantly this site was wrong.
But, that's the reason that I asked this. So, apologies. Cant delete the question now.

Say someone invests 10 dollars in this scheme. If they recruit 2 customers to this scheme, they get 15 dollars. So,they get 5$, a profit of 50% the investment.
Now, I get 30-15= 15 dollars from this, which is a 150% their investment. And this profit increases exponentially with each step.

Now, as there isn't an infinite amount of customers, somebody inevitably fails to recruit and they loses their invested amount.
But, If they correctly plan, they can make a 50% profit.

Is there already a scheme like this?
If no, why?

**Tags:** investment

> **Comments:**
> **username_1**: (-1) This question shows no research effort.  
> **username_0**: But, I searched about Pyramid scheme but a site said that it is a marketing scheme recruiting more people to make profit. Apparantly this site was wrong. But, that's the reason that I asked this. So, apologies. Cant delete the question now.  

---

## 2 answers

### Answer by username_4 on 2022-08-30. Score: 3 | Accepted answer

You already know the problem:

> Now, as there isn't an infinite amount of customers, somebody inevitably fails to recruit and they loses their invested amount.

That's the problem.

> But, If they correctly plan, they can make a 50% profit.

It's *not possible* to correctly plan. Before you pay your $10, how do you know whether you can find 2 people? You don't know, but smart people can see the odds are against them, and refuse to participate.

You can easily calculate that the average person loses money. More people lose money, than make money. So why would any smart person sign up? If they're at the top, that's why. The people at the top make a lot of money. But there aren't very many of them, and you're probably not one of them.

This is basically a way for ten smart people at the top to get money from a million stupid people at the bottom.

What happens in reality is that the stupidest people (the ones who don't realize why this investment doesn't work) are the last ones who sign up, and then spam everyone everywhere trying to recruit them. Nobody likes this, and since the entire thing is just a scam anyway, they made it illegal.


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### Answer by username_2 on 2022-08-30. Score: 4

Yes, there are such schemes. They are called [pyramid schemes](https://en.wikipedia.org/wiki/Pyramid_scheme), and the problem is that they are illegal in most countries.

> **Comments:**
> **username_3**: The real problem is that it is inevitable that a large number of people lose 10 dollars  

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