People Helping People, or PHP Agency, was started in 2009 out of Northridge California. PHP was formed with ‘the vision of bringing life insurance to multi-cultural middle-class America while simultaneously providing an entrepreneurial opportunity to individuals in these communities.’

PHP Agency now has over 14,000 agents selling life insurance through their multi-level marketing system. Here at The Finance Guy, we believe you can’t make money with MLM, but we’ll go ahead with this full review of PHP Agency.

What Is The PHP Agency Opportunity

To get an idea of how they will be providing an entrepreneurial opportunity, we looked at an official copy of the PHP Opportunity Brochure.

The first thing we learn from this brochure, is that in 2012, Patrick appears to have started a YouTube channel, called ‘Valuetainment’. He has shared photos of himself with famous people. This is a common thing in MLMs, we see pictures of famous people because it’s supposed to make us trust the company

They then show us that over the last 25 years, the cost of living has been going up faster than wages. They urge us that ‘now is the right time to create wealth’.

They then tell us that creating wealth is a simple 4 step process shown below:

Learn Sales
PHP tells us that the average annual income for a ‘sales manager’, is just under $118,000. They conveniently forget to mention that if you join PHP Agency, you will be a commission based salesperson, not a manager.

They then tell us that 46% of salespeople never wanted to enter the industry, but are happy they did. We are not sure where this statistic comes from, it could be made up on the spot.

Become An Entrepreneur
They tell us that most college students don’t have jobs lined up before they graduate and most millionaires are self made. This is MLM speak to try and make us think that we don’t need to go to college to be in a high paid job.

The interesting facts they leave out is, that most college students don’t look for jobs before they graduate, and almost all millionaires have college degrees.

Choose The Right Industry
Here they tell us that the aging Baby Boomers are in need of retirement and other financial solutions. They then show us a graph which tells us that since 1970, the number of insurance agents has severely decreased while the population has grown.

They are trying to tell us that there is shortage of insurance salespeople, what we are seeing is that there is less demand for insurance salespeople. The process has become much simpler in the computer age. Each agent can now service more customers and many customer choose to do it themselves using online providers etc.

Choose The Right Platform
Based on nothing more than their word, they tell us that PHP Agency is the fastest growing financial services company in America. They also show us that they have an app for smartphones and a website, just like every other financial services company in the world.

The Brochure ends with more of the MLM hype we saw in the beginning. Pictures of celebrities mixed in with random people they think we should know. Then to top it off there is the reminder that PHP Agency provides all 4 steps to creating wealth.

The brochure was fun but it did leave us wondering how the system actually works, so we thought we better keep looking.

How Do You Make Money With PHP Agency

To find out how you can make money, we looked at a copy of the PHP Agency Compensation Plan, this document explains all the ways PHP agents can earn commission as well as what they need to do to qualify for it.

PHP has managed to condense all the information into a 1 page document. We’ll do our best to extract as much as we can from what they’ve given us.

In true MLM tradition, the amount you can earn depends on your rank in the PHP Agency MLM. They higher you climb the triangular system, the more you can earn.

There are 11 ranks with PHP Agency, we’ll go through them below:

Trainee
The entry level rank, all you need to do is pay the initial fee, which we believe is $150, to become part of the PHP system. There is also some sort of training known as PHP System Flow. This does trigger the Pay To Play Red Flag

While you are at the ‘trainee’ rank, you can earn 30% commission on any sales referrals you send to PHP Agency

Associate
From what we can see, all you need to do to level up to from trainee to associate, is make 3 sales, recruit 3 people and accrue 3,000 Group Volume (GV) points.

In other words you need to recruit 3 people, make 3 sales, and sell around $3,000 worth of insurance products. Keep in mind that any purchases made by your new recruits count as GV

If you reach this level, you can earn 40% from any insurance products you sell through PHP Agency. For us, the requirement to recruit triggers the promotion through recruitment red flag.

Field Assosciate
If you reach this level, you can earn 50% commission on any insurance products you sell. To get here you will need to have achieved 15 sales, have at least 15 recruits with at least 30,000 in GV. To top it off at least one of your recruits must be at the Associate level.

To achieve this level, you will also need to become a licensed insurance agent. This will involve taking some state legislated exams… If that’s not your thing, then maybe PHP isn’t for you.

So for you to be promoted, your recruits need to also recruit.. We see this as the Constant Recruitment Red Flag.

Director
All you need is 2 direct Field Associates (personally sponsored), 6 licensed agents, 30 recruits, and 30 sales. If all this adds up to 60,000 GV points with PHP Agency, then you will be promoted to this rank!

So if you constantly recruit, you will achieve this promotion through recruitment and can now earn 60% commission on your sales.

Marketing Director
Continuing the recruitment theme, to get to this level, you need 3 Field Associates. Or this can be substituted with 1 Director and 1 Field Associate

You will also need 15 licensed agents, 50 recruits, 50 sales and 100,000 GV points… The theme of recruitment coupled with sales continues…

If you reach this level with PHP Agency, then your personal sales commissions could range from 75% to 115%

We can’t really decipher how you earn more commission. PHP Agency gives us an asterix in their document, but then fails to explain further with any small print. It could be an oversight or it could be that PHP Agency is being elusive.

Senior Marketing Director
Well the theme continues… To reach this rank, you will need:
2 Marketing Directors
60 Agents in
100 Super Recruits
100 Super Base Sales
200,000 Super Base Points

Unfortunately we can’t tell you what these ‘super’ things are because PHP Agency has chosen not to share these details.

What we can see it that if you climb their Egyptian structure and reach this level, you can earn between 77% and 117% on your sales… they haven’t explained the difference, but this is your commission range!

If you happen to climb the ranks and achieve this rank, you will also be eligible for a Generational Override, as shown below:

The generational override, is the commission you earn from sales made by your recruits, and anyone they recruit. It is only available to Agents who reach the rank of Senior Marketing Director or higher.

There is total of 30% paid on up to 7 generations in your PHP Agency downline. We see the generational override as raising the more than 5 levels in the payout red flag.

Executive Marketing Director
All you have to do to reach this rank, is double your results from Marketing Director! So you’ll need:

4 Marketing Directors
120 Agents in
200 Super Recruits
200 Super Base Sales
400,000 Super Base Points

If you manage to achieve this, you can earn between 77% and 117% in commission. This is only a slight increase for doubling your business, but that is something to discuss with PHP Agency.

As you continue to grow your downline with PHP Agency, you can climb to the top of the triangular system, and earn even more, as shown below:

If you reach the top rank of ‘Chairman’s Council’, you could earn up to 152% in commissions. You will also be entitled to the generational overrides, as well as the ring and watch shown in the image above. We see this as the most of the rewards go to your upline red flag.

Are PHP Agents Making Money

PHP Agency has conveniently declined to provide any proof that their agents are earning a decent income. However based on our review of WFG and our review of Primerica, we can assume that PHP Agents earn well below the industry average.

To get an idea of how much agents are earning, we applied Dr Jon Tayolors 5 Step MLM evaluation to the PHP Opportunity. We found that it raised all 4 of 5 flags, as shown below:

Red Flag 1 - Constant Recruitment of New Members
We managed to find some of the ‘education’ PHP provides to agents. They have an entire section on how to recruit for PHP. Interestingly there was no content about financial literacy or other courses which might actually help people become educated insurance agents.

You can not succeed in PHP Agency, unless you build large downline. To do this, you will need to constantly recruit.

Red Flag 2 - Promotion Through Recruitment
As we saw in the compensation plan, to climb the ranks in PHP Agency, there is a required number of direct recruits, as well as total recruits in your downline.

Coincidentally the sales requirements are at a similar level, so you could gain these promotions if only your recruits by the insurance products.

Red Flag 4 - Most of the Rewards go to your upline
When you join as a trainee, you can earn 30% commission on any sales. If you climb all the way to the top of the triangle, then you can earn up to 152%. Plus you will start to earn generational overrides and other incentives.

As a new trainee, most of the commission from your sales will go to people in your upline.

Red Flag 5 - More than 5 levels in the payout plan
As we saw PHP agency pays generational overrides on up to 7 levels in the MLM. Dr Taylor explained that the only way to have so many levels in a payment scheme, is if the underlying service is overpriced.

The only flag not raised by PHP is Red Flag 3 - Pay to Play.
After you have paid the initial sign up fee, there is no requirement for agents to buy any products. Having said that we have no doubt that buying insurance policies is strongly encouraged in new agents.

If we look at the compensation plan, we can see that at each level, the requirement for base recruits is the same as the requirement for base sales. In other words if every recruit was also a customer, you wouldn’t need any retail customers to get promoted.

Dr Taylor explains that this is particularly harmful because there is no money coming from outside the system. The only way for the people at the top to make money, is if people at the bottom are losing it.

According to his research, Dr Taylor says that if any MLM raises 4 or more flags from his evaluation, then 99.7% of participants will lose money.

Based on this we can hypothesize that only the top 0.3% of PHP Agents are making money, while the other 99.7% of PHP Agents lose money.

Is PHP Agency An Illegal Pyramid Scheme

Even though MLMs closely resemble pyramid schemes, they are not illegal. The reason dates back to the 1979 case of Amway vs the FTC. After 4 years in court Amway was found to be offering a business opportunity, rather than a pyramid scam. The technicalities came down to wording in their paperwork. One example requires consultants to make retail sales.

The Amway ruling effectively opened the doors for all other MLMs to operate within the law. However we should remember that being legal doesn’t make it ethical. If you knew that less than 1% of people had a chance of generating a real income, would you feel comfortable recruiting new consultants?

We also looked at the 2018 FTC Business Guidance for MLMS. The FTC explains that several activities used by MLMs to promote their business opportunities, may be misleading and unlawful.

Should You Join PHP Agency

The only reason to join PHP is if you are already interested in becoming an insurance agent. If this is the case, then we encourage you to thoroughly check all your options before deciding which path is best for you.

As always, we’d love to hear what you think in the comments section below, especially if you can share your own experiences with PHP Agency

For more posts like this, look at our list of mlm reviews.