The 4 Stages of Growth in MLM




We have all been there. A friend calls and shares what he claims to be the best opportunity ever: a company with an incredible compensation plan, great products, and we are at the right place at the right time. The company is in “momentum” and this is the perfect time. Timing is critical in most any MLM you join and while you can always find success in most any company if you put in the work, joining a company during a key growth phase may help maximize your success as well as others. There are four phases of growth that MLM companies experience however, what is momentum and when is the best time to join a MLM company? How do you know you are joining a company that will experience massive growth, and provide the long term opportunity and stability you are searching for?



MLM companies go through four growth phases consisting of: The Formulation Phase, The Concentration Phase, The Momentum Phase, and finally The Stability Phase. While most every company started will go through three of the phases (assuming of course the company survives the Formulation Phase), many companies never experience the excitement and mass success of Momentum. That is to say, some companies just skip right by and go right into stability. Here is some key factors to consider when you evaluate any opportunity, as well as some advantages and disadvantages of the phases of development:

The Formulation Phase

In this first phase, an MLM is in start up. This is the riskiest time to get started, but it’s also the best time to market your product because no one has heard of it. Many leaders work to build a foundation of a business during this time. Formulation is usually lead by a period of time called “pre launch,” which often attracts a lot of opportunity seekers to what may be seen as the next big thing. While it may be true that the people who get started early with a company during pre-launch may reap many rewards long term, there is also a price to pay. Companies often have a lot of challenges within this period in terms of products, support, and internal infrastructure. They may also have challenges with the compensation plan, and often there is a lot of attrition during Formulation while the company goes through the growing pains of the initial launch. Many industry leaders will not even consider joining an MLM company during Formulation, as the risk of company failure is hig
h. Still, if a company does go the distance, and affiliates stay the course, it can be rewarding long-term assuming the company moves well into the other phases of development.

The Concentration Phase

While there is no hard set rule as to when an MLM company will enter the Concentration Phase, it is generally about a 3-5 years or more before they have worked out the start up kinks and started to establish a solid foundation. Some MLM companies have hit this phase within the first year; some take as much as five years to hit Concentration. When and if a company hits Concentration, many leaders start to join the company as it now has the appearance of a more stable and long-term opportunity. This is generally seen as the best time to join an MLM company, as it is established but has not yet hit the coveted Momentum Phase. Depending on many factors, much of which related to field leadership, Concentration can last a few months to a few years. It generally occurs when core field leaders amass a solid foundation of leaders who push into the business full-time. While MLM owners generally start out working part time, professional networkers who commit to an opportunity full-time
generally are the ones who push a company toward the next phase��” Momentum.


The Momentum Phase

Again, there is no set rule as to when (or if) a company will hit Momentum. However, it is generally after a seven years (Formulation and Concentration) once a company has build a solid foundation of leaders who are all working the business as their primary revenue stream. During Momentum, an MLM company will experience explosive growth, and distributors will see rapid team growth. While most consider Concentration to be the best time to enter an MLM, Momentum is the best time to be part of one. MLM Momentum can last a year or two, but could go much longer depending on the viability of the opportunity, products, and of course team support. During this phase, many MLM millionaires are born, and even the average distributor can do very well with building a successful business. The challenge of course, is that Momentum is just a phase that will come to a close at some point. However, if all goes well in this phase, an MLM company can see sales that exceed $100’s of millions, and
for some they even break the billion dollar threshold (BDABB); a level that only a few companies have ever hit.

The Stability Phase

The final phase in an MLM company business development is Stability. This is seen after a long, proven track record of success and a stabilization of massive growth. While companies in the Stability Phase continue to see growth, they seldom will see explosive growth that may be experienced in the coveted Momentum Phase. While companies in the Stability Phase still have a solid opportunity (in fact many have a very good opportunity), most distributors will never see explosive growth in their individual business. Companies in the Stability Phase have a proven track record of success, and will generally have very solid corporate and field leadership with large teams. However, they may provide less of an opportunity to really build massive success FAST for the average distributor to break into the six and seven figure incomes that they are seeking.