Pyramid scheme
A scheme that pays from recruitment rather than real sales, so most participants must lose.
A pyramid scheme makes its money from recruitment rather than from selling anything real. Each participant pays in and is promised returns for enrolling others, who must in turn enrol still more — a structure that can only pay those near the top while the widening base beneath keeps feeding it. Because the number of recruits needed doubles and redoubles, the maths guarantees that the great majority join too late to profit and lose their stake when recruitment inevitably stalls.
Schemes disguise this with a token product or 'membership', but the giveaway is that rewards flow chiefly from signing people up, not from genuine sales to real customers. It differs from a Ponzi scheme, where one operator secretly shuffles money and no recruiting is required. Watch for pitches promising quick riches from building a 'team', large upfront buy-ins, and pressure to bring in friends and family. If your earnings depend on recruiting rather than on a product people would buy on its own merits, the model is a pyramid — and it is built to fail for everyone below you.