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My first attempt at network marketing did not go very well. So to tell you the truth when I was approached the second time about a network marketing business I was a little skeptical. But the truth of the matter was I did not really understand the fundamentals of network marketing.

See I knew I the way to make money was to sign up distributors and of course to sell a product or service. But when I was first told network marketing they told me how exciting this business was when I had a team of over 1,000, I had no clue how I could find and talk to that many people.

Even though I thought I knew what exponential growth I still thought there was no way I could ever build a big team of 1,000 or more.

So let me explain the fundamentals of network marketing and the power of exponential growth.

The correct mindset of network marketing is not to see how many people you can personally bring in to the business. The key is for you to bring in one person and then show them the power of exponential compounding.

If you sponsor 2 people and teach them how to sponsor 2 people then you have 4 people. Now if you show those 4 people how to sponsor 2 people, now that is 4 times 2 or 8 and if you show those 8 how to sponsor 2 people you now have 16 people. Now add up 4 plus 8 plus 16 and that is 28 people. Pretty cool right?

But look what happens if you just sponsor one more person. So now you sponsor 3 people and teach those 3 to sponsor 3 people. So now that’s 9 people. Now teach your 3 people to teach those 9 how to sponsor 3 people and you have 27. Going down one more level, you will have 81. If you add up 9 plus 27 plus 81 that becomes 107 on your team. But do you notice the difference between 107 and 28? That is 79 more people on your team.

By sponsoring two more people and teaching them the same process that translates to 336 people or 229 more people.

Now this is the exciting part. By sponsoring 3 more people or a total of 5 people and continue to teach each person how to sponsor 5 people. The total on your team grows to 780 people. (5 plus 25 plus 125 plus 625 equals 780)

At this point it does not matter what kind of network marketing or multi-level organization you are in. If you have 780 people in your organization just USING the product themselves then you have a huge amount of volume that you are going to get paid for. This is when your residual income starts to become serious money and of course the residual income just keeps growing.

All we are showing is that you have 5 SERIOUS people in your organization. To find 5 serious people you may have to sponsor 5, 10, 20 or maybe even more. Or guess what? What if you only sponsor 1 serious person but then they go on and find 1 serious person and so on and so on.

The beauty of the fundamentals of network marketing is exponential growth. Once you have learned how to sponsor and teach people how to sponsor you are on your way to financial freedom!!

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Source by Mark J. Nelson