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A fraudulent business model, illegal in most places, in which participants are paid to recruit more participants, rather than commissions on sales.

Frequently passed off as Multi-Level Marketing by incorporating sales of an unmarketable product or service into the scheme. In such cases, participants are usually required to maintain a monthly purchase quota to qualify for payments.
Pyramid schemes market to prospective participants while Multi-Level Marketing plans market to prospective consumers. Pyramid schemes fail because scam participants are not a viable market. Most of the participants pay more money to participate than they receive for participating because there aren't enough suckers left to recruit.

Once the suckers figure that out and quit paying into the scheme, those who recruited them start losing money too, and then they quit. The scam shrivels even faster than it grew.
by Downstrike September 09, 2004
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The best sceme to ever set up once you learn to never underestimate the stupidity of the human majority. Just make sure you don't get caught, though.
I started a pyramid scheme eight years ago, and made $32,761,449 before people found out about it. But by then, I had already retired to the remote jungles of Brazil, where I built my deluxe compound equipped with the latest anti-tracking technology.
by suckers! October 31, 2003
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Any form of business proposal in which one pays a fee to begin, and rises up in a pyramid-like form, being given money by people under the original payer. Usually considered a hoax.

See also: wordChain letter/word
That's a pyramid scheme! Don't fall for it!
by Falconrath October 24, 2003
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illegal money-making arrangement where great wealth is promised, usually in a relatively short period of time.
very few people, if anyone, end up making any money, and in fact end up GIVING money in their vain hope of striking it rich.
there are many organizations which are, in reality,legalized versions of the pyramid scheme - Amway is probably the most well known and has been around the longest.
by James January 22, 2004
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An actual business strategy that is proven to work, and if done right is completely legal. Consists of the first person signing up, who then gets X friends to sign up, and those get X friends to sign up, and can give something away for "free" (eg. This works on the principal that even if EVERY person in America was to sign up, the bottom of the pyramid (which would consist of most likely more than half the US population) wouldn't be able to get the X friends and couldn't complete the offer. The scheme will make them money no matter what happens, even in the worst case scenarios.
Aww man, I tried to sign up for, but all my friends already have an account!
by Yort May 31, 2005
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The pyramid scheme:
A lot like the pyramid where the girl rides cowgirl and the other sits on your face but instead u are tricked by chicks with a dick or a full on dude
I thought I was gonna get in on a pyramid with these two chicks from the bar but it was just a pyramid scheme
by Smarty-pantz December 04, 2018
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