Sunday, November 20, 2016

13 shocking truths about WakeUpNow

#WUNlife was truly a way of life that, for a while, promised to start a revolution. WakeUpNow shot up into the sky, its founders becoming MLM stars in no time.

But what looked like a shooting star turned out to be a meteor, and it came crashing down only a few years later, leaving nothing but burning wreckage…and stranded distributors. Does this mean I was involved?

This video explains everything:

Make sense? Either way, here’s 13 shocking truths about WakeUpNow.

#14. The epitome of the flash and burn arc in MLM

For a brief moment, the company, and their distributors, were on top of the world. They tanked, quite dramatically.

#13. 6 years in business

A lot of new MLMs don’t make it past the 5 year mark, but the real struggle is getting past a decade.

WakeUpNow shot up and plummeted all within a mere 6 years. They started in 2009 and officially shut down in February of 2016.

#12. Health and financial management products

It’s an odd combination, but the stuff they sold wasn’t any different from 100 other MLMs. Their products included:

  • WUN Fit Thunder (energy drink)
  • WUN MD (telemedicine)
  • Awaken drinks
  • WUN Finance (personal finance management)
  • Taxbot (tax software)
  • WUN Protect (identity theft software)
  • Vacation Club (travel discount program)

#11. A smorgasborg of other offerings

They started out with financial services, but continued to branch out into just about everything imaginable – beverages, vacations, mobile services, car rentals, even groceries…

Most of what they offer was discounts on these products and services rather than products they actually created themselves.

#10. They didn’t offer anything of value

I can see why they failed.

Health products are a dime a dozen in MLM, and while they are popular, a lot of health and wellness MLMs tank because they make wild claims about their products that just aren’t true, or their products don’t do a thing.

As for financial management and travel service products, MLMs that offer these rarely last, because their products are usually available for free elsewhere.

Taxbot is a tax software that’s bundled into other financial MLMs, but it’s available directly from the company for $9.99 while MLMs charge way more by claiming to offer other vague services. Time and time again, travel portals sold through MLMs don’t end up saving travelers anything.

Like so many other MLMs, you’re paying ridiculous prices for stuff that should be free or much cheaper just for the opportunity to turn around and resell that stuff.

#9. Distributors didn’t make any money. At all.

Usually I warn about the fact that most MLM opportunities won’t net you much money, definitely not enough to live on.

But with WakeUpNow, the vast majority of people didn’t make any money. At all.

In 2013, 95% of their distributors failed to make a single dollar in profit. That’s just crazy. [1]

#8. They lost $3.3 million in 2012

Despite a meteoric rise to the top that had them reeling in 2012, their profits were tanking.

In 2012 they lost $3.3 million. Wow. [2]

#7. They lost another $4.5 million in 2013

Somehow their 2012 losses didn’t bring them back to reality, because the next year,  they went even further into the red losing a whopping $4.5 million. [3]

#6. CEO Kirby Cochran blamed

The CEO of WakeUpNow, Kirby Cochran, was blamed for the company’s failure.

He stepped down in October 2014, and the new CEO, Phil Polich, stated that “[Cochran’s] decisions for a privileged few outweighed the incredible heart and dedication of the many”. [4]

But they couldn’t recover. By the end of January, WakeUpNow was desperately searching for new investors and failing to pay their distributors. By February, they were out of business. [5]

#5. Cochran ran other failed companies

Their former CEO was used to his companies tanking, although perhaps not used to them doing as well as WakeUpNow did before they fell.

He’d been associated with over 2 dozen companies, a number of which had their registrations revoked.

A recent company he started filed for bankruptcy in 2011 with a whopping $40 million in debt. [6]

#4. Distributors photoshopped pictures to fake endorsements

In order to gain credibility for their products and services, the company and its distributors claimed on a number of occasions that they were endorsed by celebrities, often rappers (they loved to recruit people by drawing on hip-hop culture). Most of the time, these celebrities had nothing to do with WakeUpNow.

Members went so far as to doctor photographs of Drake, Bill Gates, and others suggesting that these people were offering WakeUpNow endorsements when they weren’t. [7]

#3. Top earners weren’t even paid

One of the reasons WakeUpNow started to crumble was that they didn’t pay the lucky few distributors who were make commissions earnings what they were owed.

Although WakeUpNow initially denied this, one of their top earners, Eric Turner, went public about his WUN experience on Facebook, with a lengthy story.

He talked about his years of devotion to WakeUpNow and how he’d grown to earn 6 figures a month and see some of his team members earn way more money than ever before. He clearly loved and believed in the company.

But in August of 2014, the company started experiencing “technical issues” with its commission payout system, and was therefore having trouble paying representatives the commissions they were owed. According to Eric, “Seemore Green”, he decided to forgo his commission that month to make sure his whole team got paid, faithful that he’d get paid eventually.

The next month, more technical difficulties. Same with the month after that, and the month after that.

For months Eric and his team and many other distributors waited to be paid commissions they’d already earned and never saw a dime. Then WakeUpNow finally shut down in February 2015, leaving them stranded.

“I’ve said for a year or so now that I was #‎WUNandDONE, and I really did mean it. I really did believe that WakeUpNow was going to be an iconic company that stood the test of time. There was not a doubt in my mind, but I guess sometimes there are things beyond your control, and for whatever reason this was one of them. I don’t know what that means for me now; I didn’t think I was going to be in this situation. I don’t know if I have it in me to do something else.” [8]

And this is what happens in MLM time and time again. The company shuts down and its distributors are left completely stranded.

#2. Vague product offerings

Like many failed MLMs (*cough, Vemma, cough*), WakeUpNow relied on the ability of its charismatic leaders to pump people up with vague promised rather than providing any real, valuable product.

This American Life, a wildly popular show on National Public Radio, went undercover as potential distributors while WakeUpNow was still in business to report on the company. After attending one of their conferences, reporters Bianca Giaever and Brian Reed were confused, to say the least.

Brian said, “Even after being at this conference for several hours, if you put a gun to my head and asked me what WakeUpNow is, what it does, I still don’t think I could’ve told you.” [9]

#1. WakeUpNow deemed a pyramid scheme

While most MLMs border pyramid scheme territory, WakeUpNow dove right in. They’ve got a lot of the tell-tale signs, including not having a real product, cult-like recruitment practices, and not paying their enrollees.

Pyramid Scheme expert Robert FitzPatrick said he would definitely call WakeUpNow a pyramid scheme, stating, “It’s not uncommon to see companies like this flash and crash,” FitzPatrick said in an interview with the Daily Herald. “What makes WakeUpNow significant is the wild enthusiasm that it generated among young people.” [10]

In fact, the Federal Trade Commission received a grand total of 160 complaints against WakeUpNow before they finally shut down.

While they seem like the classic story of another “has-been” MLM, WakeUpNow actually had a lot going for them. But like most MLMs, they ran into problems and couldn’t bounce back.

If you are looking for sustainable, long-term side business opportunities, MLM isn’t the way to go any more.

But if you like automated ways to build passive income, there are better ways.

(and you can trash those old MLM habits, too)


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