When Is A Good Business Model A Scam?
shoemoney.com
shoemoney.com
For me, having a history of never monetizing anything but my time, I can identify with a general sense of urgency. Still, I would probably never do something like this. But, if I did, I would certainly never tell anyone.
Edit: I changed my mind. I'll see you at the Kansas State Fair... look for the booth titled "Will your startup ever be profitable? Two questions will tell the answer. 'Free'"
With the 200% guarantee, that might not even be illegal.
EDIT: Finally got to read the actual article and realised that this is already covered. Sorry - /mea culpa./
In this case, if the prediction is wrong (not the best widget/customer not satisfied), they can get their money back.
Come to think of it, the prediction claim isn't much different from most test prep higher score guarantees.
UK law is very broad in its protection of consumers against "products" that are presented in a deceptive manner.
You mean like just about every software license agreement in the world? ;)
If people get really rowdy, refund anyways. Shoot even if it's late refund. I'd be super lenient with it, you will make plenty of money.
About the only criminal area you need to worry about is mail fraud. Which would be fraud while using the U.S. postal service. But that's not a real concern either, as your only using mail to process refunds, not to solicit. You also don't need to use the mail, as you can require faxing or email of birth info. btw, IANAL.
I think if you offered a no questions asked moneyback guarantee for wrong predictions, then the only people paying would be people whose predictions were correct (assuming every person with a wrong prediction requested a refund). You would of course put a disclaimer (as psychic hotlines do) that it is for entertainment purposes only, etc.
There's a reason for that little line.
By that definition, casinos aren't scams: they are quite honest with the "house always wins (but we'll make sure you're having fun)" business model. The gender prediction would be, because this guy knows he's as good as flipping a coin, while anyone paying him to do so will be believing that he can actually do something (otherwise they'll just flip the coin themselves and save the $50).
The "are you going to heaven" guy might actually, honest to god, believe in what he's saying = no scam. (Although if he was, he'd probably be more likely to be explaining how joining his religion will secure admittance to heaven)
Explain to me when you aren't doing that. You've basically described every consultant, lawyer and expert in existence with that statement.
Your morality is subjective and therefore not applicable to a business transaction between to other parties. This is where your thinking fails.
A business transaction is an exchange of money for something of value. The "value" is only determined by the buyer (where the price is non-negotiable). If the buyer considers the product valuable, then the transaction is legitimate. This is why it's legal to sell $100 track pants and call them "yoga wear". The buyer is in agreement that the track pants are worth $100.
You seem to think that there is an ultimate morality that can govern the perception of value, which there is not. Your bargain is easily my rip-off. It's fundamental market theory.
The only time you can call a business transaction a "scam" is when the value delivered is not what was agreed to prior to the event. So, if I tell you I will fix your roof for $50,000, and after I do this it leaks like a sieve, you have a case that I wasn't honest in living up to my end of the bargain, or have not fully lived up to my previous agreement.
If I promise to sell you mythical cherries that make every woman you meet fall in love with you, and you, in sound mind, believe that these cherries work as advertised I am not a scammer.
The ability to exploit ignorance of all shapes and sizes is a fundamental concept of the operation of a free market. I know that this can sound disturbing, but it is true. If I can't benefit from your lack of something, I can never create value for anyone.
When pg says "create something of value" he is really saying "create something somebody values". His clearer definition of the statement is only a caveat - that is, if you think something is valuable, chances are a lot of other people do to. That doesn't mean however that there are a lot of people out there that perceive value in things that you do not.
But what you're describing as a scam is a "mere" breach of contract. I don't think that qualifies as a scam. I'm still partial to a definition that includes some sort of intentional malice, however subjective :)
All those other guys predict non-binary scenarios. If I try to predict the result of a dice-throw by throwing a dice myself, I'll get a success-rate of exactly 1/6, but when factoring in the number of outcome scenarios, I'm doing exactly as well as the coin-tosser.
If, on the other hand, you simply said "Pay me $50 and I'll guess if your baby is a boy or a girl" It wouldn't be a scam, nor would anyone pay for it.
To put it more simply, if the customer handing over money depends on them believing something that isn't true, it's a scam.
All you need to do is link the questions to something. As in:
How many brothers/sisters do you have? More brothers = +1 girl, and vice versa. There is no requirement to have any sort of science behind the reasoning of whether or not your +1 assertion is correct.