Pull Back From Pyramids As you can see, the organization chart of an MLM organization is shaped like a pyramid. Therefore, a lot of people confuse legitimate MLM organizations with pyramid scams. And, in truth, some business opportunities billed as "multi-level marketing" or "network marketing," are pyramid scams. How can you tell the difference? With a pyramid scam, the payoff is primarily for bringing in recruits instead of for selling products. Ask yourself if there are any conditions under which a person would rather purchase a product than become a distributor; if there aren't, you're probably looking at a pyramid scheme.