What is Team of Destiny ^® ?

I get mail every week from curious Team of Destiny ^® prospects who want to know more about the "TOD business". TOD distributors (IBOs - Independent Business Operators) are taught to not give out too much information when contacting prospects.

"Your site is invaluable. All the questions I asked about TOD were
answered with shallow answers. You saved me time and money" - Site Visitor

"There was even less information in the TOD plan we saw tonight
than when we used to show in Amway." - Site Visitor

Many of the TOD prospects that write me don't even know that the Quixtar is the business being offered and that Quixtar replaced Amway in 2001.

Team of Destiny ^®(TOD) is a "Line of Sponsorship" (LOS) in the Quixtar / Amway business. Quixtar is "Multi-level-marketing". Every representative (Independent Business Owner - IBO) is sponsored into the business by another IBO. The progressive line of people is call a "line of sponsorship", or a "family". Below is a graphic naming some of the larger lines-of-sponsorship. These families are also know as "AMO's" (Amway motivational organizations).

Team of Destiny ^® is one of these many Quixtar organizations. Not all of them are shown above. The leaders of TOD were previously associated with Dexter Yager's group at "Internet". TOD's system is basically a copy of the Yager system.

How Do TOD IBOs Make Money?

The Quixtar product business is supposed to be the primary business opportunity of TOD representatives, despite the fact that the Quixtar name is hidden from prospects for as long as possible. Team of Destiny also promotes the two complementary businesses of "Speaking" and "Tools" otherwise known as "Business Support Materials" (BSMs).

The Quixtar products business sells Amway branded consumable products, name brand consumer goods, and pays referral fees for purchases from the Quixtar Partner Stores. IBOs are paid commissions on these sales according to a pyramided compensation scheme.

The business differs from traditional franchising because IBOs are allowed to recruit other IBOs into the business. You will be a sponsor to those you recruit. People you recruit are your "downline". Those people sponsored by those you recruit are "in-depth". The people above you in the chain are your "upline". The example below shows an IBO with a business that has three legs. Leg 2 goes three deep.

How Do You Make Money in Quixtar?

Quixtar pays IBOs commissions for sales of the Quixtar marketed products. Total wholesale commissions can range from as low as  3% on some Partner Store purchases to as much as 50% on some of the Amway core line products. Additionally an IBO can earn the retail markup on retail sales to normal customers. Team of Destiny ^® however placed little effort on retailing and heavily promoted "self-consumption" of product. TOD started a "Top Gun " retailing program in 2004.

The chart above shows the profit potential on the various Quixtar product lines with and without retail markups. Due to the already high prices of many Quixtar products, it is difficult to find many people who want to be plain retail customers. Most Quixtar groups tend to promote "buy from yourself" since retail sales are time consuming to acquire. An IBO's bonus is calculated on the sales volume running through his group. Each product has a point value (PV) and a Business Volume (BV) assigned to it. Each IBO is paid according to the bonus schedule. For an introduction to how this works, read this page on Quixtar Basics.

It is very important to remember that "width" is the key to profitability in the business. Depth provides volume to qualify for high bonus levels, but without "side volume" to take advantage of the high bonus level, an IBO's bonus will be small. In order to be a legal business, IBOs must also have retail sales or purchases by customers "Members" and "Clients". According to FTC case precedents, at least 50% of rewards paid need to come from sales to those outside of the compensation scheme to not be considered an illegal pyramid. See this page for more in-depth explanation.

An IBO achieves the "Platinum" level by having volume of at least 7,500PV points for 6 out of 12 months. This is considered the first leadership level in the business. A Platinum IBO qualifies for the 25% bonus level. There are other leadership levels such as Diamond, and Emerald. A Diamond had six Platinum qualifying IBOs in his direct group. An Emerald has three qualifying Platinum legs.

The chart above shows that about 29% of the Quixtar bonuses go to those above Platinum and 71% is kept at or below the platinum level. Quixtar paid back to IBOs about 31 cents of every sales dollar. One hundred PV in personal volume generates about $62.50 in bonuses for the Platinum and levels below. About $25.53 is paid in bonuses for those above Platinum.

How Do You Make Money From Team of Destiny ^â BSMs?

Team of Destiny ^® sells motivational, promotional and training supplies to their downline IBOs. All materials can be purchased at the option of the IBO. These materials include subscriptions to the Team of Destiny ^® web site, tapes, CDs, literature, seminars and weekly meetings.

Weekly tapes cost $12 with an additional leadership tape for $6. There are three major functions where tickets cost $90 each. Weekly promotion meetings cost $5, and monthly seminars cost $25. The Team of Destiny ^® web site costs $30/quarter (+$24 one time charge), and voice messaging is about $20/month. The chart below shows the annual cost of all these optional system products for singles and couples.

According to Team of Destiny ^®, they pay commissions on BSMs only to those at Platinum or above. Contrasting other LOS's, TOD pays commission strictly on the volume of BSMs sold and is independent upon pin level after the minimum of Platinum is attained. The more BSMs a qualifying IBO sells to his downline, the more he gets paid. There are few public details about their plan and you should ask to see the commission schedule and contract.

Just as in Quixtar, IBOs can increase their income by sponsoring others who also attain Platinum and who will also earn money from selling TOD materials. Some will debate that the TOD BSM business is not actually a MLM. This type of system can no doubt be called a "chain marketing scheme" since the participants have the right to franchise other participants. The graphic below shows endless "chaining" that can take place as new participants achieve Platinum and finally obtain qualification to participate in the system income.

A Quixtar IBO needs to have at least 100 points to qualify for the first bonus level. This contrasts the TOD BSMs business. TOD has a significantly more stringent requirement of having at least 7,500 Quixtar points, for 6 months (Platinum) in order to participate in the TOD BSMs business.

Ask your sponsor for a copy of the TOD BSM's bonus plan and contract. I can bet you they will not give you one, even if there is one. They might give you a TOD BSMAA , however this is not a contract for participation in the TOD BSMs business. It is only an agreement to arbitrate out of court with Quixtar appointed arbiters and also is an agreement to silence if you ever get cheated in the business. In Quixtar each and every IBO is entitled to see a prospectus for the business, SA4400 and the rules for the business. It seems strange that a supposedly "legitimate" business opportunity like the TOD BSMs business has no such prospectus and commission schedule.

The Team of Destiny ^â Quixtar Products Plan

Team of Destiny ^® promotes a plan showing two legs. I attended a Team of Destiny open meeting and the following plan was shown. The first leg is what they call a tap root leg. This is a leg that your upline will help you build or build for you. The second leg is one the IBO is responsible for building.

The taught structure is to have 50 IBOs in the taproot leg with at least 15 buying the TOD system. The second leg is to have at least 15 IBOs with 5 buying the TOD system. This would result in a total of 75 IBOs with at least 20 buying the TOD system. In reality, the profitability of being in such a taproot leg is very low. 93% of these IBOs gross less than $100/month. As explained above, when there is no width to your business there is no leveraging of a high bonus percentage on side volume.

The speaker, at the open meeting I attended, said one could earn $2,000-$3,000/month with this two legged structure shown above. Using this structure and 100PV per IBO, this IBO would earn instead just $606/month. Quixtar reported the average IBO generated 38.5PV/month. Using 38.5PV with the TOD model, the IBO would earn just $365/month. If everyone in the IBO's downline had almost four times the average Quixtar sales meeting the TOD 140PV goal, the IBO would earn just $1,113,/month. A Q-12 bonus is only paid when a group has at least 7,500 PV points for 12 consecutive months. With the Annual Q12 bonus the amount increases to $1,971/month, still shy of the $2,000 - $3,000/month claimed.

An analysis of a TOD tap-root leg showed it only developed 2500PV with 95 IBOs. The average PV per IBO was just 26PV. The TOD model hopes for 7500PV of volume from just 66 IBOs who should be averaging 113PV/month.

TOD IBO Profitability - Below Platinum

Let's assume we have a Platinum group of 76 people and it qualifies for the annual Q12 bonus. The minimum gross bonuses paid to this group of 76 people will be $66,250/year. Since each IBO below the platinum has no width, they will only earn an average of $62.50/month ($750/year) on their Quixtar purchases of $250/month.

TOD IBOs fully plugged into the TOD training system will pay as singles about $1970/year. Couples would pay about $2,640/year. TOD IBOs fully plugged into the system, without sponsoring anyone outside the tap-root leg, and without having any retail sales will lose at least $1,200/year as a single and $1,890/year as a couple.

From the TOD 2-leg model, 20 fully plugged in singles would be paying $39,400/year for the system and 20 couples could be paying up to $52,800/year. This contrasts with the best case bonuses paid to the non-Q12 group of $56,205/year. With this model, anywhere from 70 - 93% of the Quixtar bonuses are consumed just by the TOD system itself.

The histogram below on the left shows the skewed earnings distribution for those below platinum. The majority of IBOs (93%) gross less than $100/month. The diagram below on the right shows the net profit the top 20 earners in the group when factoring an average of $2,000/year in system costs per IBO.

Two-thirds of this group (15 out of 20) will be losing an average of $88/month, while two people earn a net of $31/month, and 2 people net $133/month. One IBO in this group will net $730/month assuming no Q-12 bonus is paid. This group of 20 people has a combined gross income of $3,070/month, yet $3,333/month in expenses. The top 20 earners, as a group, still have a net loss of about $250/month and still have not been in any way compensated for their time.

Certainly many businesses start up with losses, and this business is no different. The TOD business model however relies on recruiting more money losing IBOs (and no hourly compensation) rather than teaching a break-even business model. An ethical business model would teach IBOs to have sufficient personal sales to cover their own expenses. A break even business model would have personal sales at least four times the expected expenses. (the inverse of the 25% bonus level) If the business model taught has $2,000/year in expenses, the only ethical business model to teach would be one with 8,000BV/year (333PV/month) in retail sales. The current model teaches just 150PV per month or less than half the break-even point.

"Recruits are brainwashed into spending a fortune on peripherals while consuming Amway products. They either lose their shirts or begin making money by getting enough people underneath to do the same."
Don Gregory former speechwriter for Amway's Co-founder Jay Van Andel Forbes March 25, 1985

We can see from the TOD Quixtar business model that the average IBO is programmed to lose money. The lack of emphasis on retail sales ensures that majority of system consuming IBOs will be losing money.

Where's the Real Money?

It costs about $0.50 to reproduce a cassette audiotape, which is sold for $6. Further more, most of the tapes are just recordings of their meetings, which IBOs have also paid to attend! In this case 92% of the tape price is profit. At the TOD open meeting I attended they collected about $250 from their IBOs to attend the meeting. The room rented for only $50. The cost to rent the building for a major a TOD function in Las Vegas was said to only cost $1,000 where as the gross receipts were $45,000 from 500 $90 tickets. The cost to host my website is only $120/year; the same cost as one IBO pays for access to the TOD website. Throw in the Web site maintenance for $30,000/year covered by the $25 set up charge for 1,200 new IBOs yearly, and you find that they probably net 100% profit, or $120/IBO/year on their website alone. The voice messaging is possibly the least profitable item they sell since it must be sourced from another company. I speculate that added all together the TOD BSMs are at least 80% pure profit to the TOD leaders. The graphic below shows the profit potential from each IBO 100% on the system assuming the tools are 80% profit.

The annual profit available from a Quixtar IBO's product purchases of 150PV/month, to those above platinum is only about $450/year when counting those bonuses above the 25% level. I suspect a single TOD IBO buying the complete system however would generate about $1,575/year in gross profit to the TOD leaders. I suspect a couple buying the same system would generate about $2,100/year. Team of Destiny leaders could earn at least three times more from an IBO on the system than they would from their product sales. It would seem there is a greater incentive to sell their system then there is for the Quixtar products. It is quite easy to see their emphasis in selling the system when you listen to them speak.

A Quixtar group at 7,500 PV would generate about $18,000/year to those above platinum. Assuming this group had just 20 IBOs (10 couples, 10 singles) consuming the full system, and an 80% profit on the tools, the profit to the TOD leaders on the system alone would be almost $37,000/year, or double that from the "Quixtar opportunity".

There is also a significant income from new IBOs and prospects. TOD could expect to net at least half again the income of its "active groups" from purchases by new IBOs and prospects. Many prospects are encouraged to attend a seminar or a major function. There are many who buy the recommended TOD starter kit for about $235 even though the actual cost to sign up for Quixtar is only about $50. The diagram below shows my estimates of the net income from Quixtar, active IBOs, and one time purchases by new IBOs and prospects to the Team of Destiny ® leaders for each Platinum group.

In the final analysis I suspect that the Team of Destiny ® Business Support materials business is at least three times as profitable to the TOD leaders as their supposed main business of moving products for Quixtar. There is of course nothing wrong with making a profit. I suggest you only be aware of the money being made and their motivations for wanting you to consume their BSM's. Is their motivation to make all IBOs businesses profitable? Is it their goal to make their own business more profitable? Given the amount of money involved I would suspect they have other motivations than what is best for the average IBO. It would seem if these items were really needed to help IBOs build profitable businesses, that they would be as inexpensive as possible.

I've heard it said on their tapes that there is profit built in on tapes so that the leaders can recover some of their costs in the case of lost tapes. A leader could afford to lose a lot more tapes if they only cost him $0.54 instead of say $6.50 (when you include the sales tax).

IBOs will argue that the cost of the TOD system is inexpensive when compared to the cost of going to college. No doubt IBOs can learn many inter-personal skills from the books sold in the business. Prospecting people for the business is also a way to practice these newly learned skills. The majority of what can be learned from the business can also be obtained for nothing at your local public library in the self-help, motivation, and sales sections.

"Two-- you dropped a hundred and fifty grand on an education you coulda' picked
up for a dollar fifty in late charges at the Public Library. Matt Damon -Good Will Hunting

You can practice these skills with everyone with whom you come in contact. The advantage here is that every new person you meet will be an individual and not just a prospect that can be exploited in what I believe to be a pyramid scheme funded by the profits from the BSM scheme.

Is it a Pyramid Scheme?

Officially Team of Destiny ® and Quixtar have never convicted in a court of being a pyramid scheme. However the FTC defines a pyramid scheme as:

Definition from FTC vs. Equinox April 2000, is the same as FTC vs. Trek Alliance June, 2003

The following diagram shows the money flow in Quixtar including products and BSM's. You can see that the majority of money flows around within the group of the IBO participants. Certainly some sales results from retail customers, who are not IBOs, but a critical analysis of the total bonuses paid would show the majority of the bonuses come from sales by the participants to the participants themselves.

According to the FTC definition, for a pyramid scheme to be legal, at least 50% of bonuses must result from sales to those outside the compensation scheme.

What Questions Could I Ask?

Ask to see the commission schedule and contract for the TOD BSMs business. After all, the business looks to be quite attractive when you see how much money is involved. Given the time and effort to work your way up to Platinum, you will want to make sure you have a contract that allows you to participate once you do the required work. Other line-of-sponsorships have no contracts for this side of the business. This leaves you with a lot of risk if your group decides to "pull the plug" on your tools income. This has happened many times in other LOS's. Ask your upline if you would still be allowed to get commissions from the BSMs if you no longer actively promoted them, but still had the required volume.

Ask if retail sales are required to earn bonuses. Pyramiding laws require at least 50% of the sales be to people not participating in the compensation scheme. Ask your sponsor to show you the Quixtar 70% rule and member/Client rule. I bet some IBOs don't even know these rules exist.

Ask to see the Quixtar prices before you sign up. Many people find that a lot of the prices are not competitive or that the prices are very expensive. For example, the last time I checked the Quixtar Double-X vitamin cost $1.55 each (at wholesale!). The multi-vitamin Centrum costs 6.3 cents at Wal-Mart. The reason the average IBO volume is only 38.5PV/month might be the fact that the prices are uncompetitive.

Ask to see your upline Platinum's IRS 1040 Schedule C (tax return). No doubt they will avoid this at all cost since most are making little money. Many might even be deducting bogus expenses to avoid paying the taxes. There can be a lot of other legitimate costs involved with the business such as car expenses, hotels and meals out. There is nothing like actual data. Until they show you the proof they might just be telling you a fib about how much they make. Their tax return will no doubt show all the expenses they might forget to tell you about when showing the plan. Look at the division of income from Quixtar and that from BSM's.

Ask to see your Platinum's schedule (planner, PDA) for the last couple of months. Understand how much time the business really takes.

Read up on the characteristics of illegal pyramids.

Listen to some of their tapes. Take notice of how the use of the system is stressed more than the Quixtar products. Take notice of how repetitive the tapes, meetings and seminars are.

Make your own decision once you have more information.

Religion and Politics

Unlike most other businesses, Quixtar lines of sponsorship outwardly promote and endorse fundamentalist Christian views. Most Quixtar leaders can be associated with the radical right as well. Religion and politics are a fundamental part of the business. Many meetings and functions will have prayers, and there are Sunday morning services where the some of the leaders will preach. Understand that religion and politics are an integral part of the business. It is not uncommon for IBOs to eventually have clashes with their upline due to the ever-present mix of religion and politics in the Quixtar business.

"Team of Destiny" ^® is a registered trademark of Orrin Woodward and "Team of Destiny" ^®. The author has no intention or desire to suggest that "Team of Destiny" ^® or Orrin Woodward either approve of or sponsor the content of this site and any use of the trademark is purely incidental to the author's purpose in describing and criticizing the practices of "Team of Destiny" ^® and its leadership, including Orrin Woodward.

 Is Team of Destiny a
"Pyramid Scheme?"

 Rebuttal to Orrin's
"Complementary Business"

 Rebuttal to Orrin's
"Two Rules"

 Bo Short's Rebuttal to "Complementary Business"

 TOD sues this site

Rebuttal to TOD's Emerald Attorney Matt Abraham

Analysis of a TOD "Tap Root Leg"

Rebuttal to
"The Facts about Quixtar"