Better Than Owning Your Own Lottery

I was at a meeting recently where a startup was discussing its roll-out. Curiously enough, I thought, the subject was philately. Stamp collecting. That's something a great uncle of mine was really into but I haven't thought of since I was a kid, looking over his shoulder at the funny little pictures. At first, I thought the meeting would be a sleeper. I was wrong. The stamps are actually pretty cool. Digital collectibles. But that's not what really got me. It's their launch promotion plan that made me wake up.

I can see you shifting in your seat reaching to check out TikTok. Don't.

To Earn, You Gotta Sell

It's a business, not magic. If you can't make a few $10 sales, move on and do something more fun. Seriously. This will be a waste of your time. If you can make a few sales, and by "few" I mean like 3 or 5, read on and learn how they can turn into an average monthly income of $100's or $1,000's. If you can hit 10 or 20 you're rockin'. If you do more you're a star. Seriously. And no one cares if it takes you a week to hit your number or a year. Obviously you'll make more sooner the faster you can make those sales but no one else will care.

Not Your Mom's Multilevel

I nearly walked out at one point so I'm gonna mention it right off. Walk if you will. I'll talk to those who stay. It's sort of a multi-level thing. A pyramid. I hate those. My mother lost a bunch of money and most of her friends doing that. Despite my distaste... I'm writing this. So if you want to argue about that - just save us both the time and stop reading. Go do something that's more worthwhile for you.

Still with me?

OK - the deal is that you sell digital stamps, one for about $4 or a sheet of 9 for about $10 (the prices can vary but not too much). I can see you shifting in your seat reaching to check out TikTok. Don't. You got this far, don't miss out by just not reading the rest (like 10 minutes worth?). I don't care any more about the stamps than you do. This is about making some money. Bear with me.

Surprisingly Simple and Powerful: Laziness & Greed in a Good Way

The stamps have sweepstakes (like a lottery but way better - and free) attached. Buy some stamps and if you're lucky, you'll win a cash prize. The secret sauce, what got me all hot & bothered is that everyone who buys some stamps gets to also sell stamps (no extra cost - it's p[art of the $10). 

If a stamp you buy wins, you get the Big Hootie Grand Prize - yipeee! If a stamp you sell wins... you get the Big Hootie Grand Prize - yippieee!. That's not a typo, read it again. There are two Big Hooties, one for the buyer and one for the seller of the winning stamp. And if the person you sell to sells stamps and one them wins... you get a Lesser Hootie Prize and if one of them sells the winning stamp you get a Lesser Yet Prize. Without spending any more money you can get dozens, hundreds or even thousands of chances to win with very little effort. And, every stamp sold increases the size of the prizes. That's the product promo - the company is using the sweepstakes to advertise their digital, collectible stamps. We are hacking the promo to make money. 

The Nuts & Bolts

The stamps are issued as part of a Series. The Series can look like paper stamp, one with birds another with cars another with The Queen... whatever. These stamps, however, are cryptographically unique (this is what helps make them collectible - no 2 stamps can ever be identical). Most important to us, each series has a closing date when two things happen:

1. Sales of that series stop.

2. One of the stamps is drawn at random and becomes The Winner. The Winner wins a cash prize - 25% of the total sales of that Series.

If one of your stamps is drawn, yippee! You win. But if you sell a stamp, let's say to your buddy Fred and it is chosen, you win too and so does Fred (that's the multi-level bit). How much? The very same amount, 25%. And it doesn't stop (warning, more multi-level stuff). If Fred sells a stamp to Karen and it is drawn, you win 10% while both Fred and Karen get 25% each. If that person sells a stamp and it wins, you get 5%. This continues for 8 levels, you +7. And remember, every sale increases the amount of the prizes.

There's a cherry on top. Sell 5 or more sheets and get a 10% commission on all your sales, including those first 5. That means if you sell 10 sheets you have earned back your money. In effect, everything on offer here is now free.

Two Steps: Spend $10 & Make 5 $10 Sales

1. Buy a sheet of stamps for around $10. You get a re-seller kit when you do.

2. Use the kit to sell stamps. Sell a sheet and double your odds of winning. Sell 2 or 3 and you're doing pretty well. Sell 10 you're a star. Sell 20 or 100... there's no limit.

3. (Optional) Encourage your customers to sell stamps (they have the very same reason to do so as you do).

That's it.

Ok, so far this sounds like an advert for Making Money At Home or something. This is what I listened to, though I admit, the enthusiasm is what I, my little self grew too. The concept was presented in a dry, grey suit sort of way. I went home and played with spreadsheets.

Here's what I discovered.

It Gets SO MUCH Better

I guess it's obvious but every level, mathematically, is a multiplier. So...

You buy a 1 sheet. You sell one to Fred. Then you sell 2 more to two other "Freds". So now it looks like this, 1(you)+3(Freds)=4. You now have 4 chances to win. If your Freds sell an average of 3 each to their "Karens" and they sell...it looks like this.

Sales Examples

Ok, yes, this is a "what if" table. First, I know it's not going to look like this in the real world. But I assume that people who are happy to make a couple sales are involved. I also realize that getting 8 levels deep isn't likely to happen overnight. So let's make 2 changes. First, Alice is hyped and will sell 10. Second, her enthusiasm helps increase sales at L2, The Freds. So they make 5 each. No huge deal. Now let's look at only the first few levels.

Income Examples

Sales are all well and good but what about the cash? Unless you can really sell a lot the commission per sale isn't going to be very interesting. If you make those 10 sales you'll get your 10 bucks back. The profit is in the prizes, maybe in a not completely obvious way. Check it out.

The odds of winning the random draw are equal for every stamp sold. They are simple: 1 in x where x= total stamps sold in the series. Each sheet costs about $10 so in the second sales example above the total revenue would be $6,610.

So... If your stamp is chosen you win $1,652.50. If one of your Freds has the winning stamp then he gets that and so do you. If one of your Karens has it then she and Fred win the big $1,652.50 and you win $661. The whole table looks like this:

L1 $1,652.50

L2 $1,652.50

L3 $661.00

L4 $330.50

L5 $165.25

But that's only if you are the very top of the pyramid and every stamp sold is in your downline. There will be other sellers in real life which will increase the prize amounts. Remember, the prizes are a percentage of sales. So if there are 5 or 10 or 100 times more sales then the prizes are 5 or 10 or 100 times bigger.

It also means your odds of having the winner in your downline get worse by the same factor. But that actually doesn't really matter.

For the sake of an easy example, let's say the 661 sheets in your pyramid are 10% of the total sales in that series. In that case the key numbers would:

Total Cash sales: 6610 * $10= $66,100

Your odds of winning are:

L1 Random Draw Prize ($16,525) 1:6,610

L2 Prize ($16,525) 1:661

L3 Prize ($6,610) 1:132.2

L4 Prize ($3,305) 1:44.1

L5 Prize ($1,652.50) 1:14.7

Any Prize 1:10

In this scenario, Alice has already broken even because of the commission, but it's a bad business that has a 1 in 10 chance of making a profit. It may not be entirely obvious at this point, but there's no reason to do all this just once. Imagine that the series closes, sales stop, the random stamp is chosen and all the payouts are made. Our Alice isn't among the lucky. So what?

She buys a sheet in a new series with the commission she earned. She then sells to her 10 Freds and they sell to their Karens. For the sake of this example let's say Alice's pyramid all buy in again. Alice now has another go at her 1:10 chance. Win or lose this happens again and again. In our world of Karens and Freds, this is a weekly thing. So every year there are 52 rounds in which Alice has a 1:10 chance of winning at least $1,652.50. Ask anyone who understands probability, they'll tell you that she is likely to win that about 5 times every year. Since she earns that 10% commission every time - she has invested $10 made 10 sales, just once since they stayed with her and is earning around $8,262.50 a year. This assumes that she only wins the lowest amount. She should, of course, win higher amounts every once in a while.

Also, there's no reason she can't sell more and those in her pyramid can't sell more.

I'm pretty excited about this. I might not make 10 sales in the first series but I think I can do it in a couple - and I set myself a goal of 25 L2s in a month and to help them hit an average of 5 each (L3s for me) within the next month. Here is where the "modular" bit in the title comes in.

If I find a way to make my goal, 25 L2s, I can help each of them copy the method. If they can do it, they can help their L2s copy the method. Imagine the pyramid that was 25*25*25*25... The whole thing would be over 6 billion people :-) I don't expect that. But it goes to show the power of this approach. Everyone, from their own point of view, is their own L1 and she can build a team by making 3 or 5 or 25 sales. Sure, if she's in a position like a shop owner or an influencer who can make 100's or 1,000's of sales then cool (I'm not but I'm trying to find some for my L2). But you don't have to be. If I can reach my 25 and I can help them hit 10 each on average and everyone else makes 3 sales each I'll have over 90,000 people in my pyramid (I told you I was playing with the spreadsheets).

OK- that's enough for now.