Over the last few weeks I have spoken with many female friends and seen a lot of activity on Facebook regarding women’s “Gifting Circles.” In case you haven’t heard of them yet, a Women’s Gifting Circle (also known as a “Women’s Empowerment Circle,” “Vision Sisters,” etc.) is a group of women who get together to help support and empower each other to become more abundant and financially independent. Typically they get together once a week (usually by phone) to talk about their process and to support each other with the challenges that come up, sharing experiences and helping each other stay in an abundant mindset.
Oh, and it’s also a pyramid scheme.
Yes, although entry fees vary, typically you are asked to pay in $5000, which goes to the person at the top of the pyramid (typically called the “dessert” stage; you are considered the “appetizer”), who at one point also paid in $5000 and then recruited more women to join under her. Eight people at the bottom pay one person at the top (with a layer of four women above them and another layer of two women above that), and then that person “retires” and everyone else moves up a level.
Although I personally applaud the mutual love and support that the women in these Circles often provide to each other, there are a lot of problems with this model, which I will try to explain as concisely as possible:
1) It is illegal. No matter what linguistic contortions the founders and beneficiaries of these Circles make, every one of these circles is completely illegal, and those who participate can be fined and jailed. Even if you sign something that says, “I swear to God Almighty that my $5000 was a gift and I expect nothing in return,” they will still put you in jail, because it is completely disingenuous to say that you are making a gift on the one hand, while participating in a structure that is designed to provide an 8X payoff, especially when you are expected to recruit other women to pay in their $5000, as well.
2) Although estimates vary slightly, the math shows that only about 12%-14% of those who buy into these schemes ever see their money back. So you are far more likely to lose your money than you are to receive a windfall.
3) Even if you do receive that 8X windfall, that means that you have profited off the backs of the other 86%-88% of women who lose their money.
4) Once you join, all of your female friends become potential “marks.” You will be encouraged to say lots of nice things to your friends, and even to the people you haven’t spoken to in years. Your friendships are reduced to commodities, an asset to trade on in order to get more money into the system; otherwise you won’t be able to profit from having joined. This cheapens your friendships and many women have lost dear friendships due to this dynamic.
5) It is completely unsustainable. Assuming that every woman on the planet has $5000 to spare (including female children and all the world’s desperate poor), and they all bought into just one Circle (there are actually many Circles out there, so there would be some competition) it would take less than 10 full cycles to reach every single woman and girl on the planet. In the end, someone will always be holding the bag – specifically, 3.2 billion out of 3.7 billion women would be left with nothing to show for their gift/investment.
6) Although some women involved in these circles swear by the the benefits they’ve gained in terms of support and personal growth, the pyramid structure itself produces nothing of actual value. It just transfers money from the many to the few. And again, any value gained by your participation in the circle must be weighed against the $5000 buy-in cost, as well as the cost to other women.
7) Despite the trappings of feminine empowerment, the pyramid structure is actually one of the most negative forms of patriarchy out there, given that it is based on unsustainable exponential growth, funnels resources from the many to the few, requires secrecy and double-speak to work, and it actually exploits women.
8) Women who join these circles often withdraw from friends and family, because they are taught that some people “don’t get it,” so they are encouraged not to talk to people who might criticize it – or who might even go so far as to report it to the police. This means anyone that they invited but who declined the invitation, thereby ending long-time friendships.
9) It distorts and corrupts the spiritual principles that it purports to uphold, including integrity, sisterhood, empowerment, generosity, abundance consciousness, and inclusiveness.
10) Alternatives do exist. You don’t have to pay $5000 to be a part of a women’s support group. Many are out there that don’t charge anything, or perhaps a nominal fee to pay for space rental. This removes the financial burden on yourself, the strain on your friendships, any possible legal action against you, all the moral hazard, and would still allow you to benefit from the strength, support, and integrity of your fellow women.
Of course everyone has to make their own decisions about what is in alignment with their core values, and I cannot make that determination for anyone but myself. However, many of these Circles use half-truths and even outright lies to legitimize their existence, and this article is my attempt to educate those who would not get involved if they knew all the facts. I hope it has been helpful to you. If you would like more information, I invite you to check out these articles: