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7 things to know about the bottom up economy

WePay founder Bill Clerico takes note of the “bottom up economy” that has taken shape in America as a result of technology, globalization, and a shaky recovery.

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Getting familiar with this bottom up economy

The American economy is currently undergoing a transformation of sorts, impacted not only by a recession but technological innovations and globalization. The days of working the same job for a lifetime to rake in that pension are dwindling, and not only are job changes increasingly common, but it has created the perfect storm for entrepreneurialism.

WePay founder Bill Clerico notes, “The new reality is that more and more Americans have to fend for themselves, economically speaking. More people are turning to forms of self-employment than ever before. More Americans are investing in their own education.”

As a result, Clerico says a new sector is taking shape, referring to it as the “Bottom Up Economy” where more people have become their own boss. “The line between ‘individual’ and ‘business’ is getting blurrier,” Clerico adds. “The Bottom Up Economy is made up of babysitters, freelancers, part-time truck drivers, and anybody else trying making money as a (very) small, informal business.”

Many new platforms and marketplaces are providing tools to enable this sector (think eBay, Etsy, and Kickstarter). WePay and Clerico specialize in underwriting this new type of business. Clerico says there are a few things everyone should know about The Bottom Up Economy and the people who compose it.

7 Things to Know About the Bottom Up Economy

1. It’s growing (by the number of people involved)
The percentage of the American workforce defined as “Proprietors” (workers who generate all or part of their income through a form of self-employment) has increased from ~10% in 1970 to ~21% in 2013.

2. It’s shrinking (as a percentage of the overall economy)
Proprietors’ share of total American income has decreased from ~11% in 1970 to ~6% in 2013.

3. The line between individual and business is shrinking
Most of the increase in Proprietors has come from people who are not fully self-employed. The number of fully self-employed people has actually decreased or remained constant over the past few decades. These are people who augment income as “Extended Proprietors” – people who classify their self-employment income as peripheral to their primary employment.

4. It’s partly driven by technological advances
More and more people are generating this income online. The IRS drastically underestimated the number or 1099K forms that would be filed in 2012 (1099K forms must be filed if a citizen accepts over $20,000 and 200 payments via credit cards or through an online payment gateway).

5. It’s partly driven by necessity
The recession in 2008 saw a surge in self-employment interest. This is noticeable via Google searches at the time, as well as relative Proprietor % increases in those years.

6. A lot of it happens off the books
The Bottom Up Economy is certainly linked to the underground economy. Several studies have placed the size of the underground American economy at several trillion dollars. These aren’t just drug dealers and pimps – they are real people running real businesses that are either too small or too informal to file paperwork for.

7. It’s important
More and more Americans find themselves working in the Bottom Up Economy. They need to be acknowledged with better infrastructure, regulation, and tools!

The takeaway

Times are changing and companies like WePay (which accepts online payments), are leveling the playing field for the little guy in by disrupting traditional tools, a niche that will become even more relevant in coming years as entrepreneurship becomes more common. The shift towards entrepreneurialism is not necessarily a choice for all Americans, but the shift is here, regardless, and getting familiar with the tenets of what Clerico calls the Bottom Up Economy is critical.

Business Entrepreneur

This podcast explains the schemes behind MLMs & the dangers they pose

(ENTREPRENEUR) The Dream podcast provides another valuable way to understand the pervasive nature of MLMs, from their history and tactics to their legality.

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MLMs twisting the American Dream with microloans. Image of the American dollar with collage background.

Okay, if you haven’t been a part of an MLM scheme or known someone in an MLM who has had things go horribly wrong, it can be hard to understand why they are so pervasive and so dangerous. If you don’t know what an MLMs are, check out our introduction here, but if you’re ready to learn more, consider checking out The Dream, a podcast by Little Everywhere and Stitcher.

The Dream podcast is a great way to gain insight into the world of MLMs. Narrated by Jane Marie, this podcast uses a blend of research, interviews and personal experiences – one team member actually joins an MLM – to give an in depth view on how they operate. You’ll learn about why people join and stay in MLMs, ways they screw over their customers and the history behind MLMs.

This podcast manages to tackle difficult topics without dehumanizing the people victimized by the system. One reason is likely due to the fact Marie grew up surrounded by individuals who had been sucked into MLMs, including family members, and she discusses their plights with compassion.

That said, the sweetness of sympathy in each episode is cut with legitimate research from academic authorities. From the history of MLM mentalities to the legal battles waged around these pyramid schemes masquerading as businesses, listeners will gain a logical, as well as emotional, understanding of how these schemes operate.

Each episode ranges from 30 – 60 minutes, perfect for listening during a commute.

Need a second opinion before taking the plunge? Here’s what others have had to say about The Dream.

Alice Florence Orr of The Podcast Review notes: “The podcast zooms in and out, encompassing both the deeply personal and shockingly political.”

Shannon Plaus of Slate adds that: “This relatability is exactly what makes the show so excellent. Rather than perching from a place of financial guru explaining to people why MLMs are so bad, it willingly positions itself as closer to the victim of such a scheme.”

The first season is eleven episodes, with an additional four “bonus” episodes, opening with a discussion about pyramid schemes before diving into the more sinister world of MLMs. The Dream has also recently started its second season, this time with a focus on the “wellness” industry.

If you want to learn more about MLMs, you could do a lot worse than the well-researched, deeply personal perspective of The Dream. Check it out today wherever you get your podcasts.

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Business Entrepreneur

Check your risk for burnout with this FREE scientific quiz

(ENTREPRENEUR) This new tool lets you take a free self-assessed, science-based burnout test to give you an idea of how much self-care you need.

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Woman with face on table suffering burnout in front of computer.

Concerns of keeping self-care and mental health in a positive spot – specifically in relation to burnout – have been a hot topic of discussion. While COVID-19 exacerbated these concerns and stress levels, the issue of burnout has been around for quite some time.

Work burnout is often discussed in terms of work-life balance. Simple ways to avoid that crash are enforcing a hard stop on reading or responding to emails at a certain time of evening, or to continuously clean your workspace. Easier said than done, but it is critical.

But sometimes you have to look at the nitty-gritty. Sometimes you have to ask difficult questions about your job and your personality in order to understand how burnout is impacting you. This can now be done with the Global IT Burnout Index, a free, science-based assessment to tackle your stressors before it’s too late.

This is geared toward people working in tech (as the website reads, “burnout in tech is high and real”), but is useful for any industry.

To begin, you simply start the quiz and answer a few questions about yourself and your job (e.g. “I find it difficult to relax after a day of work” and then you answer based on how strongly you agree or disagree).

There are 10 total questions, and no personal information is asked (no name or email). It is open data, meaning it will help people on the other side better understand burnout; but, it’s totally anonymous.

The quiz takes no longer than 2 minutes. At the end, it will give you a number out of 6 measuring your burnout rate. The higher the number, the more likely you are to experience burnout.

Burnout has the ability to manifest physically and mentally, and can take a toll on your body and mind. Knowing if you’re experiencing high amounts of activity that can lead to burnout can help you know if you need to take precautions to change things in your life or job.

For those of us working from home, the situation is a Catch-22. You aren’t currently forced into a stressful commute. But it’s harder to pull yourself away when 5pm (or whatever your end time is) rolls around.

For people in the office or on-site, it’s the same thing. You get to socialize (safely, obvi) with your coworkers, but there are those on-site pressures.

No situation is perfect, but understanding if you’re in a situation where you could use a change or some help is incredibly important – especially these days.

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Business Entrepreneur

Scammers are out to prey on MLM victims and small businesses

(ENTREPRENEUR) MLM pyramid schemes are already predatory enough, but for victims trying to get out of the cycle, scammers are waiting on the sidelines.

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Thieves Young Living MLM Oil

Predatory, scam, rip-off, shady, trap… all of these may be words that rightfully come to mind when I mention pyramid schemes, multi-level marketing campaigns, or “MLM.”

It probably conjures images of annoying messages from the one gullible high school friend you haven’t quite had the heart to unfriend on Facebook. Perhaps you know someone who got put through the wringer themselves. The one thing victims of these predatory marketing schemes have in common is being in the hole of a lot of money. Usually money the victims can’t afford, since these scams prey on the economically vulnerable. Truly, there are few things more universally detestable than MLM pyramid schemes… but I found one.

Did you know there is an entire secondary scammer market to recycle victims of MLMs?

A new spin on the idea of ambulance chasers, there is an entire demographic of scammers out there that trawl social media such as Facebook and Reddit to find recently victimized people looking for a way out of the pyramid-shaped hole they’ve found themselves in, offer services to these victims to “assist” them in recovering lost investments or liquidating their almost valueless inventory, and then ghosting the victims – taking them for their non-existent money a second time. They often pose as legal representation or consumer relief of one flavor or another.

Here is an example posted on the subreddit r/antiMLM:

That website doesn’t exist. That is not a real law firm. The premise is a scam looking to make a sucker twice out of the same victim. One commenter using the user name ‘lemontest’ shared the following account:

After my relative got scammed by a company that promised to help her set up a drop-shipping business, another business magically appeared that promised to get her money back. She gave them money and never heard from them again. I’m sure there’s a lot of money to be made selling contact lists of people who fall for get rich quick schemes.

How incredibly filthy toxic is that? Be vigilant out there, the scammers are creative.

If you (asking for a friend of course) or anyone else you know has fallen victim to any online scam, I recommend this light-hearted, and a little bit cheeky, recovery guide found on the Federal Trade Commission website and authored by Jon M. Taylor, MBA, Ph.D. of the Consumer Awareness Institute.

Any stories to share about MLMs or other comments? I’d love to hear from you.

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