Interesting news development today. Blyth, Inc., a publicly traded company has just completed the 3rd of 4 phases in the acquisition of Visalus.
Here’s the news article talking about the acquisition: PR Newswire.
So this brings up some interesting questions for the Distributors. And just to be clear, this is not an article to bash Visalus, it’s owners, nor Blyth, Inc. It’s just to point out some observations I’ve had and ask some questions that came to my mind.
As you know, with a publicly traded company, the shareholders call the shots. When times get lean (and they will for Visalus, no company is immune to that), who is going to get paid first? The Shareholders or the Distributors? You got it, the Shareholders. And where will that money come from? The checks of the Distributors!
One of the paragraphs from the article that I found very telling was this one:
All three company co-founders, Ryan Blair, Chief Executive Officer; Blake Mallen, Chief Marketing Officer; and Nick Sarnicola, top sales leader, have agreed to stay on with ViSalus in their current roles. The founders personally invested $14.6 million from the proceeds of the acquisition in restricted stock of parent company Blyth, Inc., making them the largest inside shareholders after the Goergen family.
Now that Ryan Blair, Blake Mallen and Nick Sarnicola are shareholders of Blyth, Inc. (and I might add, the 2nd largest shareholders), who do they answer to? Where do their best interests lie?
Don’t get me wrong here, in my opinion I think that Ryan, Blake and Nick are brilliant, upstanding guys, but I think the stakes have changed for Visalus. To me it appears that those three are not the final decision makers any longer and can no longer can put the distributors first in any financial decisions.
That brings me to another point that I’m concerned about. Visalus has had tremendous growth the last year. That growth is both a blessing and a potential caution for the distributors. What happens when Visalus becomes a household name? Will Visalus need the distributors any longer? It’s happened before… A company with a word-of-mouth distributor based business model gets big enough that 
they don’t need the distributors any longer and convert to a retail sales business model.
Now, I know you are probably saying that they wouldn’t do that or even that they can’t do that. Unfortunately, they can. You should take a look at the Policies and Procedures of Visalus, which is the binding agreement between the Distributors and the company. It’s all spelled out there in black and white what they can do.
If you’re a Distributor with Visalus and need help going through your policies, I can certainly help you with that. You should know what you’ve signed and how it binds you to the agreement.
Last but certainly not least, in the Policies and Procedures of Visalus, Distributors are forbid to be in any other Network Marketing company. Here’s the clause:
24. During the term of this agreement (and any renewals) I will not participate in any other network marketing companies. In addition, during the terms of the Agreement and for (1) one year thereafter, I will not solicit or recruit, ViSalus employees or Promoters, whether active or inactive, to participate in any network marketing program. I acknowledge that my violation of this provision will result in immediate termination of my Promotorship and payments of any kind.
What’s interesting about this in my mind, is that Blyth, Inc. with the acquisition of Visalus, now owns 2 Network Marketing companies. Visalus and PartyLite, a direct seller of candles, fragrance accessories and home ambiance products. So that sounds like what’s good for the Goose is not good for the Gander. It’s all about Integrity folks.
Again, please don’t get me wrong. I think Visalus is a great company and boy do they know how to market. I’m just concerned about some things I’m seeing. And just to be clear here, this article is just MY personal opinion and questions I would ask if I were in Visalus or considering joining them as a Distributor.
Something that my personal Mentor Michael Dlouhy has taught me is to learn HOW to think, not WHAT to think. He taught me to become a critical thinker. Personally, I wouldn’t want to build something for a few years only to see it taken out from under me. I’d hate to have to start all over. Something to think about.
With that said, I hope you have a blessed day and find success wherever you seek it!
Take care,
David Haines
(215) 268-6696 Anytime!
P.S. If you want to learn how to be a critical thinker, enter your info in the form on the top right of this page.
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David,
I have had a few conversations with people about the importance of being with a company where your best interests are at heart as a human being and as a businessperson. The challenge I keep coming across is that people feel so committed to their companies that they won’t just make a good business decision.
I had NO idea that Visalus is being acquired, and I admire what they have been able to do in a short period of time to help change the financial lives of so many people. I hope that people are aware of what’s coming. Great article, friend!
cj
Christi Johnson´s last [type] ..How To NOT Handle Your Finances And The Grace Of God – Pt 2
Hi David,
thanks for sharing this. I have never been aware of the problems that come along with companies being publicly traded. It sounds good in the first place, but hardly anybody realizes what it actually means…so thanks again for this eye-opener for many.
Be blessed
Oliver
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Great article! Illuminates interesting points. I wouldn’t be too alarmed but it’s definitely nice to know.
Distributors are the sales force so aside from the company simply deciding to change models to a traditional business (I would think unlikely), doing something to hurt a strong sales force is foolish for any business.
In any company, sales people are the life force and it’s no wonder why in any business, network marketing or traditional, the top earners are generally in sales.
It would also be a bad business decision to change models. The distributors are your most loyal customers and have tremendous influence on regular customers (they sold the customers).
If you look at traditional companies selling similar products (see Right Size Smoothies who recently launched a “Challenge”) they don’t seem to be doing as well as ViSalus. I recently saw the Nightline special on Mary Kay and how they are thriving during a recession. That’s a testament to the INDUSTRY of network marketing. It would be just as foolish for ViSalus to change models as it would be for Mary Kay to go traditional or McDonalds to stop franchising and simply own all of their restaurants. Seems unlikely. Would be a HORRIBLE decision for the shareholders.
Again, great read!
Hey James, thanks for the comment! I’ve been analyzing companies and working with Network Marketers for the last 3 years and I’ve seen it happen to at least 2 companies during that time. They’ve changed business models mid-stream. Like I said, it don’t mean that Visalus would do something like that, and it seems illogical, but anything is possible, so I just wanted the warning out there as a heads up.
Thanks again for the comment!! I appreciate the insights!!
Take care,
David
This has been an eye opener for me David. Thank you for sharing this post. With these decisions companies are making, often the result would confuse both employees and customers, don’t you think?
Thanks for the very informative post,
Barrington
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Thanks for sharing this news. This sounds a bit shocking but I would just say good luck to the biggest stock holders for that company. Who do you think deserves to received the biggest stock?
Interesting post!
-Ralph
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Hey Dave,
Well thanks for the heads up. I appreciate your effort in writing this article. It’s quite an eye-opener.
Thanks again.
Very good article my friend. Only Graduates of Mentoring For Free learn the cautions signs before joining any MLM company…
Hello, and thanks for the post. I am a ViSalus distributor (90 days in) and just earned my first commission check! It totaled $21.90.
While that certainly doesn’t seem like a lot of money, and definitely isn’t, I earned it from telling people that I care for about a great company. Its true, the supplement industry in the US isn’t regulated, but i feel that ViSalus puts out an exceptional line of products and did a great job with designing their Challenge program.
If they pull the products from people like me, I wouldn’t use their stuff anymore. There is just too much out there to stay loyal to a company that had such little respect for the folks that put them on the map. I’m sure I’m not alone in feeling this way and Im confident that Blyth, the Vi-Trio, AND the investors will leave things the way they are!
Plus, who would like to live their life being hunted by an angry mob of former business associates. If they’re from Texas, theyre probably armed too so not advisable.
The suppliers are your greatest loyal customers and have incredible encouragement on regular customers .
what do you think? such a great article and very informative.
Very interesting article.
Agreed. Something to consider before joining, that’s fore sure. It’s obvious they are doing big things, currently, but it definitely isn’t my choice of company.
To pull the rug out on all of the distributors would be horrible. I couldn’t imagine. The shear fact that ViSalus would pay the shareholders first, is a turnoff – as the distributors are the lifeline to the company. Strange.
Thanks for sharing.
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