The once-surging Utah-based seller of a blend of fruit juices, MonaVie LLC, is rebranding itself to the world as "MonaVie Community Commerce: The No. 1 Business Opportunity."
The new slogan is the South Jordan company’s effort to stir up some of the passions and sales that sprung up after its debut almost eight years ago, when it built a cult-like following and generated billions of dollars with a concoction of juices formulated around the supposed healthy attributes of the açai fruit from the Amazon jungle.
The company hopes the phrase better represents what multilevel marketing — also called direct sales or network sales — in which company revenue comes from selling products to independent distributors. Distributors, in turn, are told they can earn anywhere from a few hundred dollars a month to fabulous riches through retail sales and commissions from building "downlines" of distributors beneath them.
But behind the new slogan, which suggests a kind of intimate, we’re-all-in-this-together, friends-and-family business model, still lies a stark statistical reality. An analysis of the average earnings data provided by MonaVie in 2009, when it last supplied distributors with comprehensive numbers, reveals that 98.5 percent of distributors who earned commissions averaged just $129 a month despite the pitches to the contrary.
The history of the rise of MonaVie also reveals a spotted record of exaggerated claims of relief from serious illnesses and questionable claims of nutritional values, as well as odds clearly stacked against low-level distributors who poured in the billions of dollars that fueled the company’s spectacular growth. MonaVie’s story also raises questions about the foundations on which other companies in that thriving segment of Utah’s multibillion-dollar nutritional supplement industry were built.
MonaVie representatives declined to answer specific questions or verify facts for this story, saying the company was disappointed that TheSalt Lake Tribune "continues its assault on the direct sales industry in Utah."
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Behind the rise of MonaVie is Idaho native Dallin Larsen, the co-founder, chairman and CEO who got his start in multilevel marketing as a distributor for Nu Skin Enterprises, the multilevel marketer of skin-care and nutritional products, then was president of a string of weight-loss clinics before he became vice president of sales for Usana Health Sciences, also a seller of nutritional and personal-care products.
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Published Feb 22, 2012 06:23:46PM
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Published Feb 22, 2012 09:01:15AM
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In 2001, Larsen became vice president of sales for Dynamic Essentials in Lake Mary, Fla., which sold a fruit juice called Royal Tongan Limu, where he claimed to have increased revenue 300 percent.
But in 2002, during Larsen’s tenure, the federal Food and Drug Administration issued a letter to Dynamic Essentials warning that claims on the company’s website that the juice could "treat various diseases such as cancer, arthritis, and attention deficit disorder" were in violation of federal law. Dynamic Essentials sometime after that ceased operation. In October 2003, the FDA said it witnessed the voluntary destruction of 90,000 bottles of Royal Tongan Limu.
Larsen left Dynamic Essentials in February 2003.
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The Brigham Young University grad returned to Utah for his next venture. Monarch Health Sciences was registered in the state in August 2003 with a focus on weight-loss products, listing Larsen as co-founder, along with Henry Marsh, the former Olympic track and field athlete, and others.
Early on Monarch, which in 2005 became MonaVie, began using millions of dollars of incentives to lure away successful distributors from other MLMs in order to rapidly build its own business.
One of those was Brig Hart, a Bible verse-spouting reborn Christian from Florida, who came to Monarch after holding a highly successful top-level position at Amway, the original multilevel marketer, before he had a falling out with the company. Another was former top Amway distributor Orrin Woodward, who received a $3 million loan from Monavie he didn’t have to repay if he met certain recruiting distributor goals, according to a lawsuit Amway filed against MonaVie in 2008 that was settled last year. A lawsuit by nutritional juice company Tahitian Noni said one of its distributors also was offered more than $3 million to join MonaVie.
"There are companies who believe their distributors are the property of that company," Larsen said in a 2010 interview. "I believe in free enterprise, and if distributors decide that his or her dreams and goals are better served in this company than that company, they ought to have a right [to change]."
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