Tuesday, July 15, 2008

How do you spot a scam?

I've been getting a lot of calls from people offering opportunities for business. The first step is always either free or very cheap, and the information comes in small book form or an initial seminar.

The next step: when you got said seminar (often free) you get pitched high-priced offers to do other programs.

At the other programs they will present some information, but pitch still higher priced things.

The activities tend to be semi-legit things...

Tax-liens/Tax Deeds, real-estate education, stocks, options, commodities, legal advice, grant writing help, auction web-sites, whole-sale drop-shipping, cash-flows, various MLM programs, and many more...

I am sure some of them actually worked. I've indeed used one of the stock tools to good effect. I have recovered the money I spent many times over, and their tools are very rich and powerful. But I wonder if the stock tool was a fluke, and if maybe that experience has primed me as a sucker for other such deals.

If you think about it, these aren't very different from the exercise equipment, and fad kitchen devices. If you are actually going to use it and make it work, then it may not be a rip-off, but we know that most of that crap will barely make it out of the box. I wager, this fact is known also to those selling the products.

Are they scams though? There are so many reports on Sears, Disney, and other such companies on Rip-Off report. There will always be unsatisfied customers.

I am unfortunately a sucker for such things (kind-of soft-spoken, and seeking a better life), but I managed to say no this time. Eventually, I would like to string some of these schemes to the point that I have replaced my regular income, and eventually to be financially free.

I'm thinking it may actually be easier to pitch my idea to VCs and get rejected 100s of times till I get an idea that sticks. It somehow feels more legit.

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