June 19, 2013 10:25

Breaking MLM Penny Auction News: BidiFy Launches Their Penny Auction House Bidsson

Jun 20 2012 in Bidify, Bidsson by Troy Dooly

Well after a few date changes, BidiFy has finally officially launched their penny auction house Bidsson. Here at MLM Help Desk we started covering the penny action niche in the 4th quarter of 2011. But it was not until about Feb or Mar of 2012, that we started to see this niche fire up in the network marketing space. Today I know of at least five new network marketing penny auction companies who are funding to launch or already funded and are creating their sites. Today I want to look at BidiFy and Bidsson.

I first want to cover one concern I have with the BidiFy site. All in all they have done a great job, and Kevin Thompson their MLM Attorney has really tweaked and cleaned up their business model from our first review a few months ago. However, there is still one concern I have. I am reaching out to Kevin Thompson and a few other MLM Attorneys to get a better understanding of current laws.

Bidify Mandatory Account

Now when you read the explanation of the BidiFy Mandatory Account, my concern comes from the following:

“20% of all cash rewards earned in Bidify are paid as mandatory funds to your Mandatory Account. Funds in your Mandatory Account cannot be withdrawn as cash, instead it must be spent at the Bidsson site.

Funds in your mandatory account are transferred to Bidsson upon your request, by a single click on a button.
Purchasing Retail Bids to bid at auctions.
- Paying for your won auctions.
- Buying products at retail price directly from the Bidsson site.
- Paying for your monthly administrative fee in Bidify.
NOTE: Mandatory funds used to purchase Retail Products will generate PV and GV, and can also generate retail bonus to your sponsor.”

It is my understanding that when a company doing business in the USA, using a direct sales distribution channel, in this case network marketing, they can not demand that their sales/marketing force purchase or use their services. When a company makes such a demand, they may trigger both IRS rules regarding Independent Distributor status, and could trigger anti-pyramid laws at both a state and federal level.

Again, let me be clear, the laws may have changed, and if so we will be updating this post in the future. But, in years past, it has been very clear, you CAN”T demand independent distributors purchase products and services in order to earn commissions.

Outside of that one issue, things do look pretty standard, and the new penny auction site is a clean launch. I do need to make it clear, the money amounts on the Bidsson site are in Euros and not US Dollars, which may cause some confusion for bidders. So make sure you fully understand the conversion rates before making any form of purchase.

Troy Dooly

Troy Dooly is recognized internationally as an influencer in the areas of personal branding, leadership development, marketing campaigns, organizational expansion, and corporate launch strategies. Dooly is a speaker, results coach, and radio host. He is a founding member, show host (Beachside CEO) and News Director of the Home Business Radio Network. He is a founding member, and currently serves on the Board of the Association of Network Marketing Professionals

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21 Comments »

  • http://behindmlm.com Oz

    I'm going to be reviewing Bidify today so this was a good heads up, cheers.

    20% mandatory accounts or whatever you want to call it is a common sustainability clause in Ponzi schemes, which force members to re-invest a certain amount of their earnings to keep payouts going.

    As far as a penny auction goes, there should be no reason to force members to purchase anything when revenue is supposed to be coming from the penny auctions… either the auctions can sustain the compensation plan or they can't.

    That said I haven't gone over the comp plan yet, this is going solely off your video.

    • Troy Dooly

      Oz,

      Oz, thanks for stopping by. The "mandatory account" is their terminology. I know that in all other network marketing companies I have reviewed, and the laws I have studied that is just not accepted in the States. But, laws are always changing, so I am digging into that one.

      I fully agree the auctions or any other product or service sold to the general public should be able to sustain the growth of the compensation plan.

      As always I am looking forward to your review.

      Living An Epic Adventure,
      Troy

  • cap

    the "euro" is a bit weak right now. Just saying.

  • cap

    P.S. good critic Troy. You know how to "read between the lines". Appreciate your diligence, sir!

    amen!

  • Patrick

    Hi Troy good review though I did had a question. From MY understanding is if someone joins this company that they are not REQUIRED to do any form of work. I can purchase bids and the company just automatically gives them away. So I could purchase a plan, get bids and not obligated to do anything else. I know it similar to ZR but ZR do require a level of effort. My question is How is this different than me going to a stock broker giving a some of cash and sit back and wait with no further effort? To me its the same thing. I am not bashing Bidify or praising ZR I love any company that can change peoples lives "legally" May be I understand this wrong and can get some clarification. Because it maybe legal in one country but not the other. Thanks

    • Troy Dooly

      @Patrick,

      Great question and one I am sure will come up since from what I have seen each MLM Penny Auction has a sightly different qualification requirement.

      At BidiFy from what I have researched, they are not making a specific requirement of placing ads, but are making if very clear, each affiliate must be bringing in new retail customers monthly. I believe that for every 1000 points, you must have one new retail customer.

      So, although some folks might see that there is "no work" involved, I would respectfully disagree because from being in the network marketing profession for three decades, the hardest work I have ever done is recruiting new affiliates or attracting new customers :)

      As for ZR, they have two different qualifiers and from what I have received will tweaking the qualifiers in the next week or so.

      With ZR, all affiliates must post a daily ad, and once a specific level is reached, they must have a specific amount of active retail customers.

      Although the process is different both companies are focused on retail bidders.

      Now, the difference between taking money to a broker and then sitting back and watching your money grow or in some cases decrease is the fact you are expecting the stoke broker to do all the work. However, in BidiFy and ZR, you are expected to do the work, or you don;t get paid.

      Sadly, some affiliates in both companies may try and circumvent the business model by getting third party companies to either, attract the retail customers or place the ads. These can be termination events.

      Hope this helps.

      Living An Epic Adventure,
      Troy

    • Gboogie

      May I ask where you got your information from about no work requirement? Because the official Bidify presentation debunks that idea on the very 2nd page/slide. FYI, you must bring 1 retail customer for every 1000 bonus points qualification. Not only that, but those customers must use the sample bids. Here is an excerpt from a Bidify Newsletter:

      "…Keep in mind, with each 1,000 bids, there needs to be a VERIFIED customer. And commissions are not cut until those bids are actually used, so if you’re looking to simply purchase sample bids and sit on them for qualification purposes, it’s not going to work here… "

  • Ed

    Hi Troy, again, let me first of all thank you for all your good

    work you do on behalf of our MLM industry..

    I have a concern about bidify, in your interview with the CEO, who's name I can't pronounce, he said that all the

    bids given to customers must be used by those customers.

    Troy, how in the world do you force a customer to use the

    free bids you give away, the answer is, you can't..

    The CEO said you will not be paid unless those bids you

    give away are used in the auctions, this is a big problem for

    me because no one can be forced to use the bids, your

    thoughts please..

    Yours in success & God bless,

    Ed Miller the money mentor.

    • Troy Dooly

      @Ed,

      Fantastic question. I think what Frode was getting at is the fact, Affiliates or 3rd party folks can't use the bids indirectly. In reviewing some of the propaganda on the net, it seems there are some folks who promote a "passive" income stream through penny auctions. In some cases Affiliates buy their leads, then instead of giving them away to legit customers, they do their best to manipulate the business model.

      So, although you can't force the customer to use the bids, you can monitor "IF" the bids are being used, and if they are being used, you can track if they are coming from one or multiple IP Addresses. You can also monitor if the bids given away are being used by the affiliate's IP Address instead of a new one.

      Now, since I am not part of the company I don't know all the safe guards but I do know all the companies are implementing these safe guards based on their legal and compliance teams recommendations. I think this is a great move, because it is only through the penny auction houses, that the parent companies can support and fund the compensation plans.

      In other words, if all that is happening is affiliates of the network marketing arms are buying bids, but not giving them away and attracting new retail bidders at the penny auction sites, then everything is internal, which is illegal. So, for BidiFy and other MLM penny auction companies to now be tracking the usage of the bids is a fantastic move.

      I do agree 100% you can't force a customer to use their bids. Maybe BidiFy has a way for the affiliates to pull back the bids after a specific period of time, so they can give them to someone who will use them.

      In reviewing other MLM penny auction sites, it does seem that people who have received the free bids are using them.

      Hope this helps.

      Living An Epic Adventure,
      Troy

      • Ed

        Thank you so much for your answer. I have been a member of Zeek Rewards now for several months and could not be happier, as you know the customer has 30 days to use the free bids you give them and then they expire, but if they use them or not is impossible to know, it

        will be very interesting to see how this whole deal plays out.

        Yours in success & God bless,

        Ed Miller

  • http://kellytolar.com Kelly Tolar

    Hmmmm… is all I can say ;-) I have tried bidding and can't seem to win anything. LOL. Love you Troy!

  • James A.

    I think you are doing yourself, this industry and those viewers who come to your website an absolute disservice to simply throw something out "possibly" claiming anti-pyramiding and "possible" IRS violations without knowing for sure.

    Think about how many good people you influence or hurt by being reckless with guesses, when you admittedly aren't clear whether you are correct in your accusations.

    Since Kevin Thompson is also your attorney it would have taken minimal effort and time to contact him prior to throwing something like this out on the world wide web. Recording a video and publishing it that was not time sensitive, is in my opinion.irresponsible and self serving.

    • Troy Dooly

      @James,

      First let me say thank you for stopping by and sharing your thoughts.

      1. I am not sure how else I could have said what I did, without sounding like a critic who hates the company and Frode. If you look on critics websites, you will find they just flat call all penny auctions scams. If you take the time to review ALL the editorials I have done on BiziFy you will see I am providing facts and possable issues which could come up if and when regulators decide to take action.

      I did not just "simply throw something out “possibly” claiming anti-pyramiding and “possible” IRS violations without knowing for sure." I do know the laws in North America. But because I have not talked to the BidiFy attorney on this specific issue, and Frode and I have not yet connected on this issue.

      I also decided to cover this issue first, before it was brought up on any of the critics website, so all BidiFy affiliates would know of a safe place to come get the facts as we finish uncovering them. The laws are clear, what is not clear is exactly how the mandatory account fits inside those laws.

      2. I was neither "reckless or made any guesses". Not to long ago someone said to me on the comments "Troy you called Frode an owner of BidiFy, and he is not an owner" I was very respectful of this person, and explained that the facts would stay as I saw them. He was not happy, and fully disagreed with me. Yet, just a few weeks later the fact that Frode is an owner came to light in a wonderful interview between himself and his attorney.

      So I respect the fact you feel my reporting seems reckless and and full of guesses. But at the end of the day, you will find I am neither reckless or guessing on issues. And as facts are made clear in areas where they are murky I will always clarify and update.

      3. You are correct Kevin Thompson is my attorney, and as I stated in the video and here, we had not talked on this issue yet. But, to assume I did not reach out before shooting the video and writing the editorial is subjective on your part, and is not factual.

      4. I can see why you might not see it as time sensitive. However, the #1 critic against network marketing penny auctions, posted just a few hours after I did, and the post has already drawn harsh comments from additional critics.

      It is always good to see you stopping by James.

      Living An Epic Adventure,
      Troy

      • James A.

        Thanks for your prompt and professional response. It would be easy to react unprofessionally to criticism, but you always respond with professionalism and that is much appreciated.

        That being said, I guess we will have to agree to disagree with the methodology of most of your editorials.

        As a whole, your viewed in this industry as a credible watchdog for the industry itself, so I just think that openly throwing out these types of accusations without first insuring you are correct and factual, can really hurt a lot of good people trying to build their businesses.

        You always seem to throw a lot of red flags up on a company without first finding out the facts or the truth and then make corrections at a later date without making a retraction or simply removing the original incorrect content.

        Obviously, when people are Googling and conducting their due diligence it will drive more traffic to your website and generate more potential revenues for your site, but the potential damage it does using this methodology seems to be completely unfair.

        Also, we will have to continue to agree to disagree about your continued "rose colored glasses" in regards to Zeek, while continuing to paint Bidify in a negative light whenever possible.

        It just couldn't be more obvious the appearance of a conflict of interest, while you are speaking from the stage at Zeek events for whatever direct or indirect compensation you "may" be receiving. Zeek affiliates are constantly linking to your video editorials to build their businesses while simultaneously bashing Bidify while at the same time building you up to be an impartial industry watchdog.

        If you Google "Bidify", a Zeek affiliate's blog comes up as the 2nd listing, with numerous links to outdated and inaccurate information on Bidify that directly links to your outdated and now inaccurate video editorials. Wouldn't the industry, your credibility and fairness be better served to simply remove outdated and inaccurate information to keep this kind of injustice from occurring?

        Basically, what is happening is your video editorials are being used to libel and/or slander one company, for the purpose of building an affiliate's competitive company?

        • Troy Dooly

          @James A,

          I am not sure I am viewed as a watchdog at all. That would be Mr. Rod Cook MLMWatchDog.com. I would claim to be an advocate for the network marketing community as a whole.

          I think what has happened is you may not fully understand my editorial style. And I am confident that my facts are correct and factual when it comes to the laws in North America.

          And since my goal is not to hurt anyone, I do tend to shoot my editorials in a way that will raise the issues in a relative calm manner, instead of the alarming sensational way some critics do on blogs.

          I tend to shy away from personal attacks, and when I know the intent of people are not to harm, I give them plenty of room to correct issues. If I see the issues are not being corrected, then I will report in a little more harsh manner.

          Now, I always scratch my head on why people want to bring up revenues from driving traffic. This is one of the oldest myths facing blogging today. Sure in the old days this was a blackhat tactic used for blogging revenue. But in the last two years, the search engines, especially Google have created new algorithms in place to stop this.

          If you look at my articles, you will find that 99.9% never track anyone else's keywords in order to drive traffic, or to hit the top of the search engines on a particular subject.

          In reviewing my analytic, only 33% of the traffic to MLMHelpDesk.com comes from people searching on the web. All other traffic comes from my social profiles, news feeds, and direct links from sister sites and 3rd part linked in sites.

          I report from my world view of things, and never focus on traffic or who's toes I might step on. I want the facts presented in a fair and balanced manner, and I am willing to give all parties the opportunity to change and grow.

          It has not always been this way, and regrettably I can't go back and change that. All I can do is grow and move forward.

          I guess we will need to continue to disagree. First I have never painted Zeek with 'rose color glasses". Nor have I pained BidiFy "in a negative light". Both companies are pioneering uncharted territory, and both companies are and will weather some more rough waters.

          I have covered and answered folks issues with Zeek and done my best to act as a 3rd party advocate for the affiliates by finding and providing answers to their issues. I am also doing the same thing for BidiFy affiliates who are having issues.

          When doing reviews, as information has been presented, we have reported, and in a few cases when Frode or others have reached out, I have been fast to report their side of things. I guess you missed the great interview between Frode and Kevin Thompson we posted last week.

          But, I respect your position, and would not want you to change it based on anything I might write. Do your own due diligence, read through the posts and comments, and find one time where I have spoken negatively about BidiFy. Critical at times, yes, but never negative.

          I speak from the stage of several companies each and every month, not just Zeek. And as it common in all industries, speakers receive their expenses paid. Although, Frode has not asked me to speak at a company event, I would gladly do so (well after I get my passport), since he holds their events internationally.

          All affiliates from any company are allowed to link to my videos. I do videos to help the distributor base of many companies. Several affiliates for BidiFy are now linking to the news report where we showcased Frode and Kevin in Thailand. And many folks take time to comment on the social videos sharing their passion for Frode and/or BidiFy…. And some yell at me for sharing concerns. But those who have followed our reports for a whole, fully understand I love the profession and the people in it at all levels.

          I should correct one area you seem to not fully understand. I am neither impartial or a watchdog. I am very partial to network marketing and the people in it, and I am NOT a watchdog. I am an advocate and an Ambassador for the community. Len Clement and Rod Cook are classified as watchdogs. Although they do not always see eye to Eye. Patrick Pretty and Oz at Behind MLM are outside critical watchdogs. I have never claimed that title nor do I write like any of these folks. Although I respect them all and have been known to link to articles they write, even when I may disagree.

          As for what a Zeek affiliate may do or not do, I have no control over. If, however a person does Google for BidiFy and finds links back to my blog, then they will more than likely take the time to read and fully understand from start to finish where I stand. They will read the post, the comments, and soon realize their is more than one post. If they read through them all, they will see I am very passionate about all company founders launch in an ethical manner and that their #2 priority after creating a legal business model, is to do all they can to always protect their distributors.

          Now, as for the liable and slander statement, if that were true, do you not think Frode and others would have already had their attorneys issue Cease and Desist letters or sued us outright?

          My goal is to always show the progress of a company. Unlike many critics, they just want to post critical info, and keep hashing it over and over. In my case, I create a case study of many companies showing how they started and where to are going. Although information can be called outdated, I call it historical, and by sharing all the info, we provide a defense for the companies to show where they have come from when regulators come by to review companies.

          By the way, BidiFy affiliates love to connect to my early reviews on Zeek also.

          Again, it is an honor to engage in conversation sir.

          Living An Epic Adventure,
          Troy

          • James A.

            Understood Troy. I would however wonder if Kevin Thompson would agree with your characterization of Bidify as it relates to anti-pyramiding and IRS violations in your video above.

            Either he disagrees with you or Bidify has blatantly ignored his legal advice as it relates to these issues.

            Looking forward to hearing more when you hear back from Kevin in regards to these issues.

          • Troy Dooly

            @James A.,

            Great question. There are plenty of times Kevin and I have disagreed. However, we always talk it through, and when we disagree on an issue, he knows I will till report. He also knows that when I have reported on something, then he is able to prove to be in case law I have misinterpreted something, or a Judge has issued a new opinion, I will report that also.

            Your deduction "Either he disagrees with you or Bidify has blatantly ignored his legal advice as it relates to these issues." is not that cut and dry.

            1. Kevin may not have ever addressed the issue with BidiFy period. Many times outside eyes see something that those inside the project just did not catch.

            2. And I would be the first to say I DO NOT think Frode and the team at BidiFy would ever blow off Kevin's advice.

            I can tell you I will be following up on this, and Frode and I will be talking soon on this issue. Of all people he will be able to share why it is in the compensation plan and I will learn more :)

            Living An Epic Adventure,
            Troy

  • kris

    hi James A

    I understand troy just look at this link http://www.youtube.com/watch?v=SGexrPB_FeM

    there are many of this out there on the net just make your own search

    This will be Frode Jorgensen 3 lucky strike

    but i think it is amazing to see what is going on with bidify when they started they went all the way to explain that frode was not involved in the company but now when they have gotten started he is a founder os here is the first lie and believe me there will come more

    i could post 100 links here with people have bin scammed by Frode and co

    will post more later

    • Troy Dooly

      @Kris,

      I have read and reported on Frode's past. However, I also know of many company owners who have had false starts and have been shut down because regulators have deemed them ponzi and/or pyramids.

      In each conversation I have had with Frode, he has not backed down from his past issues. And since I have had my own mistakes in life, I refuse to judge a person just on their past, or to think they can't change.

      Although, time will tell how BidiFy works out, and I still have a few concerns, I am willing to watch, report and give the company and affiliates plenty of room to make this work.

      Living An Epic Adventure,
      Troy

  • http://bidify.com/mkexos Magnus Eyjolfsson

    Hi Troy

    Bidsson have installed a currency converter on it's site.

    Regards,

    Magnus

    • Troy Dooly

      This is great news!!!

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