AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
MLM income depends on a downline that keeps growing, and growth that multiplies runs out of people fast: if each person recruits six, the 13th level alone needs 13,060,694,016 people, more than live on Earth. In a worked example with a ₦20,000 monthly purchase requirement and 10% commission, five active recruits leave you ₦10,000 a month worse off, and you need ten just to break even.
Multi-level marketing (MLM) companies sell products through members who earn from their own sales and from purchases by people they recruit, their "downline". The pitch shows the people at the top. The maths shows why there can only be a few of them.
The exponential problem
Suppose a plan works best when each member recruits six people, and each of those recruits six more.
| Level | People at that level (6 to the power of level) |
|---|---|
| 1 | 6 |
| 3 | 216 |
| 5 | 7,776 |
| 7 | 279,936 |
| 9 | 10,077,696 |
| 10 | 60,466,176 |
| 13 | 13,060,694,016 |
By level 10 the plan needs over 60 million people at that level alone; by level 13 it needs more people than exist. Real downlines are never that neat, but the direction is fixed. Each level must be larger than the one above it, so most members are always near the bottom, where there is nobody below them to earn from.
Worked example: the first year in naira
Example plan, with invented figures. Joining pack ₦50,000. To stay "active" and earn commission, you must buy ₦20,000 of product each month. You earn 10% on purchases by your direct recruits and 5% on their recruits.
| Your downline | Monthly commission | Your own purchase | Net per month |
|---|---|---|---|
| None | ₦0 | ₦20,000 | −₦20,000 |
| 5 active direct recruits | 5 × ₦20,000 × 10% = ₦10,000 | ₦20,000 | −₦10,000 |
| 10 active direct recruits | ₦20,000 | ₦20,000 | ₦0 |
| 5 direct + 25 second level | ₦10,000 + (25 × ₦20,000 × 5%) = ₦35,000 | ₦20,000 | ₦15,000 |
In the first year, with five recruits, you pay ₦50,000 plus 12 × ₦10,000 net = ₦170,000 more than you receive, unless you resell the product at a profit. To earn ₦15,000 a month you need 30 active people below you, and each of your 5 recruits needs 5 of their own, who then face the same maths.
Why "just sell the product" rarely fixes it
Members are often told they can ignore recruitment and simply retail the product. Run the numbers for the example plan. If you must buy ₦20,000 a month at member price and resell it to customers at a 25% markup, an assumed figure, you earn ₦5,000 a month before transport, data and the time spent selling. To make ₦100,000 a month from retail alone you would need to buy ₦400,000 of stock at member price and resell all of it at that markup every month, to people outside the network who could often buy similar goods elsewhere. That is a trading business, and it is worth judging as one: margin, customers and competition, not rank and bonuses.
What income disclosures show
Some MLM companies publish income disclosure statements. The US Federal Trade Commission's staff guidance (April 2024) says what an honest one must do and what to watch for:
- Claims should reflect "what the typical person" is "likely to achieve", not the top earners.
- Typical expenses must be disclosed alongside earnings: joining fees, monthly purchases, events, travel.
- It is misleading to leave out participants who "lost money or earned no money".
- The FTC cites a case in which a single $100 cheque was multiplied by 24 pay periods to present a $2,400 "annual average income".
- In its words, "a substantial majority of pyramid scheme participants lose money and time".
When reading a disclosure, look for the median (middle) participant, whether inactive members are counted, and whether figures are gross commission or profit after purchases.
Time matters too. Meetings, events, travel and social media posting are unpaid hours. Divide any net income by the hours spent and compare it with what the same time would earn in paid work or a small trade of your own.
Questions to work out before joining
- What must I buy each month to stay eligible for commission?
- How many active recruits do I need to cover that, using the plan's own percentages?
- What do people at the bottom level earn after their purchases?
- What share of members earned more than they spent last year?
- Can I return stock, and on what terms?
For the legal line between MLM and pyramid schemes, read MLM vs pyramid scheme. Paid courses using the same model are covered in how to vet them.
When the product is only a token and the real "product" is a promised return on money paid in, the scheme is closer to a Ponzi scheme; see how to spot Ponzi and investment scams.
Where Pryme fits
If you run a side business selling products, keep its money apart from household money so you can see whether it is profitable. A Pryme Business Account gives you a separate account and statements, and invoicing tracks what customers owe.
Questions people ask
Can you make money from MLM in Nigeria?
A few people near the top can. The maths of recruitment means most members are near the bottom, where commissions rarely cover the purchases required to stay active.
Why do most MLM members lose money?
Required monthly purchases and joining fees often exceed commissions unless you recruit many active people, and each level must be larger than the one above.
What is an MLM income disclosure statement?
A company's summary of what members earned. FTC guidance says it should show typical results and expenses and include those who earned nothing.
How many recruits do I need to profit in MLM?
It depends on the plan. In our example with a ₦20,000 monthly purchase and 10% commission, ten active direct recruits only break even.
Sources
- FTC: Business Guidance Concerning Multi-Level Marketing (Apr 2024) · accessed Oct 2026
- Mondaq (The Trusted Advisors): Review of the Investments and Securities Act 2025 (7 May 2025) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.