Absolutely not. Actually, the threshold investment cost for starting an MLM can be very low. The amount of capital, however, may impact the ramp up time to success. Although many MLM companies have been started in garages and at kitchen tables, it is not realistic to be able to work with competent professionals in the arenas of legal, technology, compensation plan design, and creative without adequate capitalization. Those services can amount to tens of thousands of dollars and prospective MLM startup companies should set aside sufficient funds to bring on such resources.
For more information on capitalization read the article “MLM Consulting: How to Build a Successful Direct Selling Company.” In addition, capitalization is discussed in the article “MLM Corporate Startup Essentials: Part I (a three part series).”
Also, watch our video Capitalization of the MLM (third video down) at MLMLegal.com to learn more information.