Many MLM opportunity seekers come from a direct sales environment where income depends on house parties, fundraising, and retail sales. While this is a great source of cash, here’s a bigger picture: the residual income model.

Most MLM opportunity seekers don’t quite understand how the residual income model works, so here’s a little story to demonstrate the concept.

Imagine, if you will, an election. A genie pops out of a bottle and offers $10,000 in cash, today, this very second, with no strings attached. You can take it and walk away, happy, forever. Or, she says, you can only have a penny, but not today. The genie will take that penny and double it, every day for 30 days, and at the end of 30 days, you will be able to have the final amount. You have 5 seconds to decide.

Now, most people would, in fact, just take the $10,000 in cash and walk away happily, especially with so little time to decide. They would instinctively feel that the folded penny represented some kind of trick. But they would be wrong. Let’s see what would happen if the doubled penny scenario were followed:

Day 1: 1c

Day 2: 2c

Day 3: 4c

Day 4: 8c

Day 5: 16c

Day 6: 32c

Day 7: 64c

By the end of the first week, those who took the $10,000 are laughing and those MLM opportunity seekers who opted for the doubled penny are probably a little embarrassed.

Day 8: $1.28

Day 9: $2.56

Day 10: $5.02

Day 11: $10.04

Day 12: $20.08

Day 13: $40.16

Day 14: $80.32

It’s been two weeks and our doubled penny hasn’t even reached $100. Halfway there and it doesn’t look very good.

Day 15: $160.64

Day 16: $361.28

Day 17: $722.56

Day 18: $1,445.12

Day 19: $2,890.24

Day 20: $5,780.48

Day 21: $11,560.96

Ha! After three weeks, we caught up! I wonder what next week will bring.

Day 22: $23,121.92

Day 23: $46,243.84

Day 24: $92,487.68

Day 25: $184,975.36

Day 26: $369,950.72

Day 27: $739,901.44

Day 28: $1,479,802.88

At the end of four weeks, you can see that the total is far from 1c or even $10,000. Those MLM opportunity seekers who initially took the $10,000 are no longer laughing.

Day 29: $2,959,605.76

Day 30: $5,919,211.52

At the end of the month, the doubled penny is worth almost $6 million. It is difficult to contemplate that. But that’s the concept behind how the residual income model works. No, you don’t make $6 million in a month; This example really has nothing to do with an MLM company’s compensation plan.

But what happens is that you work longer, for what appears to be a very small income, only to take home a much larger prize in the end. And that prize is not a one-time thing. After you have worked to establish your long-term residual income model, you receive your income month after month.

This example is what initially drew me to the concept of network marketing. Of course, I chose a company that is not a one-size-fits-all company, and I suggest you research companies and do that too. MLM opportunity seekers want to go with a company where they can build residual income through recruiting and at the same time make a quick buck through sales. Find a company that offers both.

There really is no genius who gives money. It would be nice if it worked that way, but following a residual income model takes a lot of work and time. But for those MLM opportunity seekers willing to put in the work, the rewards can be worth it.