Take a look at this website, Beauty Holding. Here’s the premise: Invest in stock of a fledgling model. When the total capital raised hits $10,000, the website/model management company takes this girl under their wings, and pays for her to get a portfolio. Theoretically, international superstardom ensues, and investors receive 45% of her next 12 months earnings. Yay! Everybody wins!
It takes about ten seconds worth of math to realize this is horrible as an investment. Here it is quickly – if a model from this site can somehow earn $60,000 (which she won’t do) in the first 12 months, $10 invested (which I hope you won’t invest) returns you $27 (which you’re not going to get). Which means you need 2 out of every 5 models you invest in to be $60,000 earners literally right off the bat. So yeah, no. This may not fund your retirement.
That being said, it’s pretty ingenious as a business idea. If the website doesn’t gain much traction, you just collect all this cash, $10 and $20 at a time, that has been theoretically allocated to the models by (presumably) a bunch of horny guys sitting at their computers, vainly believing they might actually earn money this way. But since most (all) models will never hit $10,000, whose cash is it? That $1,400 sitting in the account for Lisa from New Zealand? Effectively it’s yours, clever business owner. That’s the brilliance of it; because you haven’t committed to doing anything until the $10,000 mark, you’re almost instantly cash flow positive. And if the business really does somehow take off, and a lot of models hit $10,000, there’s really no way for investors to verify that you spend all $10,000 in services or check what the model ultimately earns in those 12 months. So it’s really easy to skim off the top, not that I can prove they would do that. (I’m just saying that if I ran this business, that’s what I would do.)
Creators of this website, I salute you. This is brilliant. Simply brilliant.
It takes about ten seconds worth of math to realize this is horrible as an investment. Here it is quickly – if a model from this site can somehow earn $60,000 (which she won’t do) in the first 12 months, $10 invested (which I hope you won’t invest) returns you $27 (which you’re not going to get). Which means you need 2 out of every 5 models you invest in to be $60,000 earners literally right off the bat. So yeah, no. This may not fund your retirement.That being said, it’s pretty ingenious as a business idea. If the website doesn’t gain much traction, you just collect all this cash, $10 and $20 at a time, that has been theoretically allocated to the models by (presumably) a bunch of horny guys sitting at their computers, vainly believing they might actually earn money this way. But since most (all) models will never hit $10,000, whose cash is it? That $1,400 sitting in the account for Lisa from New Zealand? Effectively it’s yours, clever business owner. That’s the brilliance of it; because you haven’t committed to doing anything until the $10,000 mark, you’re almost instantly cash flow positive. And if the business really does somehow take off, and a lot of models hit $10,000, there’s really no way for investors to verify that you spend all $10,000 in services or check what the model ultimately earns in those 12 months. So it’s really easy to skim off the top, not that I can prove they would do that. (I’m just saying that if I ran this business, that’s what I would do.)
Creators of this website, I salute you. This is brilliant. Simply brilliant.
4 comments:
Eric! The ad on your sidebar says "Meet Married Women," and then there are a bunch of pictures of women, with come-hither looks. Why is this?
Because if you're married, it is difficult to date other married people without the help of an online service.
Or is that not really what you mean?
Oh, I meant what was it about your blog that prompted Google to post such an immoral ad on your sidebar? I can't ever remember you promoting dating services for married people.
sure, now you tell me this is a bad investment idea... damn economy.
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