Todd StottlemyreHans Deryk
Toronto Blue Jays fans remember him for his face-first belly flop into third base during the 1993 World Series. But former major leaguer Todd Stottlemyre is making a play of a different sort now: He wants to sell you long-distance plans, cellphone service and a home security system.
More importantly, he wants Canadians to join his network at ACN, a multi-level marketing company that promises an ongoing stream of commissions for members who manage to convince friends and associates to buy telecom services through them from companies such as Telus Corp. and Verizon Communications Inc.
"Here's what I bring to the team - I'll come to your house and you can invite everybody you know," said Mr. Stottlemyre, 44, who spent half of his 14 major league seasons in Toronto. "You can say, 'Remember that crazy fool that was a baseball player in this town? Well, he's at my house tonight and you should come over.' That's what I can bring to the table."
ACN is similar to companies such as Amway Corp. or Mary Kay Cosmetics Inc., except its agents sell Internet connections and cable television services instead of tinfoil and lipstick. But multi-level marketing companies are controversial; their critics charge that they recruit new members by making unrealistic promises about how much money they can make.
Canadian law dictates that any multilevel marketing program must disclose the income of a typical participant (currently about $500 a year for ACN) rather than a top earner, and bonuses can't be paid to members for successful recruiting.
The federal Competition Bureau tried, unsuccessfully, to prosecute ACN in 2002, laying eight charges under the Competition Act's provisions on deceptive marketing practices. The bureau alleged that the company misled its participants about how much they could earn, and also expressed concern that recruitment bonuses were being paid. A year later, a judge ruled after a preliminary hearing that there wasn't enough evidence to prove the company was operating illegally.
In 2002, ACN reached a $45,000 (U.S.) settlement with the Pennsylvania Public Utility Commission after 185 consumers complained about various problems, including their accounts being switched without their consent. There was no admission of guilt in the settlement.
Mr. Stottlemyre is careful not to make any promises - ACN knows it's being watched carefully by regulators.
"If you want to retire in about four years and be making $100,000 a month, if you work hard it's achievable. I'm not telling you it's guaranteed - I'm telling you it's achievable," said Mr. Stottlemyre, who retired in 2002 and has since been a broker at Merrill Lynch, a self-employed day trader, and a hedge fund founder.
ACN, founded in 1993 in the United States, compensates its members for every contract they sell. If a member persuades a relative to get their next cellphone plan from Telus, ACN receives a royalty from each month's bill, which is then distributed to the member.
The person who recruited that person gets a small cut, and the person who recruited that person. The more people below you in the recruitment chart, the more you stand to earn, theoretically. But building out an extended network - the key to higher earnings - can be difficult as would-be partners drop out.
While Mr. Stottlemyre hopes to earn more than $30,000 a month (he said he earned $7,000 in the past month), ACN said an average conscript takes home about $41 a month.
"The general rule of thumb is that if you're going to get in on something like this, get in early because what happens is it hits a saturation point where all of the easy hits have been picked off," said Kenneth Wong, a marketing professor at Queen's University in Kingston. " It becomes harder and harder to recruit people as you run out of friends."
The large companies that allow ACN to repackage their services do so because it saves them marketing costs, Mr. Wong said.
A Telus spokesman said customers don't save any money by using ACN, because its deal with ACN offers the same rates customers would receive at any other retail partner. Most customers are motivated by a desire to help a friend with their business, Mr. Wong said.
ACN doesn't disclose the number of agents it has - a company executive said more than 10,000 people have signed up in Canada since it began operating here in 1997 - but Mr. Stottlemyre isn't worried about competition. He took out an ad in a daily newspaper recently inviting Torontonians to a hotel conference room to learn more about a business that showcased the world champion as "Captain of the Team."
The ad was purposefully vague, since the company discourages its members from actively recruiting through traditional channels. The sessions led to 10 recruits, who each paid $500 for "a licence to sell telecom all over the world" and a personal relationship with Mr. Stottlemyre.
"Look at it this way - I had a chance to play Major League Baseball for 15 years and since I retired there's not one team paying me for the work I did because they could care less about me," he said. "Some of them were pissed they had to pay me when I was there. But the fact of the matter is in this business you can get paid over and over and over. That's the beauty."