LabActive Review: Energy, Nutrition & Skin Care
LabActive describe themselves as a “social commerce company” and claim the company is
a place where premium brands, cutting edge technology, and unparalleled compensation converge!
There is no information on the LabActive website indicating who owns or runs the business. Rather than provide background information on LabActive and executive management, the company’s “About Us” page informs visitors that LabActive is ‘the absolute apex of entrepreneurship (and) quality of the highest order‘.
In LabActive’s Terms and Conditions, a mailing address is provided in the US state of Nevada.
As always, if an MLM company is not openly upfront about who is running or owns it, think long and hard about joining and/or handing over any money.
The LabActive Product Line
LabActive market a range of energy drink products under their “eFusjon” brand.
- Raw – Acai berry based antioxidant drink
- Edge – Acai berry and caffeine based energy drink
- Breeze – Mangosteen, passionfruit and caffeine based energy drink
- Dawn – Quercetin and caffeine based energy drink
A nutrition and skin care range are also mentioned on the LabActive website, however they are marked as “coming soon” at the time of publication.
The LabActive Compensation Plan
The LabActive compensation plan pays affiliates for generating retail sales and purchases made by recruited affiliates in their downline.
A 25% commission is offered on all retail sales of LabActive products.
Residual Retail Commissions
As a paid LabActive affiliate, residual commissions are paid out on the sales generated by your personal preferred customers (preferred customers are able to recruit other preferred customers and make sales to retail customers).
There is no depth limit on the amount of levels the 25% commissions paid out on preferred customers.
Affiliate Purchase Commissions
Executive affiliates earn a 25% commission on the product purchases made by their personally recruited paid affiliates.
What LabActive refer to as their “Social Matrix” actually appears to be a binary compensation structure.
A binary compensation structure places an affiliate at the top of the structure with two legs branching out directly under them (level 1):
Underneath these two positions are another two positions each (level 2) and so on and so forth down a theoretically unlimited number of levels.
New affiliates (and customers, who also generate volume) can be added to an affiliate’s binary either via direct recruitment or the recruiting efforts of their up and downlines.
Commissions are paid out at as a percentage of the product sales volume generated by the affiliates in a unilevel structure:
- Junior Executive (generate a minimum $140 in sales volume a month) – 2%
- Senior Executive (recruit at least 3 Executive affiliates) – 4%
That’s 2% or 4% of all sales volume made by an affiliate’s downline, including purchases made by recruited affiliates.
Note that Matrix commissions are paid out down an unlimited level of recruitment, however they are capped subject to a 50% commission payout. If an affiliate’s matrix earnings require LabActive to pay out more than 50% of total sales volume commissions, that affiliate’s matrix earnings will be capped.
Multiple Business Centers
Upon reaching the rank of affiliate membership rank of Senior Executive (recruiting at least 3 Executive affiliates), LabActive affiliates are able to insert themselves into their own binary teams, effectively doubling up on commissions.
There is no limit to the amount of additional compensation positions a LabActive affiliate can generate via recruitment.
Affiliate membership to LabActive is available in two options:
- Member Package – $95 annual membership (no matrix commissions unless $140 in sales volume is generated monthly)
- Executive Package – $235 annual membership ($140 monthly autoship)
With tangible products that can be sold to retail customers the potential to generate a retail orientated business is definitely there in LabActive. The problem however is the way the LabActive compensation plan is heavily incentivized towards recruiting Executive affiliates on autoship.
The difference between the Member Package and the Executive package is nothing more than a monthly autoship:
The Executive Package includes the $95 annual Membership fee and $140 in Labactive™ product.
The autoship, automatically set up upon joining at the Executive Package level serves to self-qualify an affiliate for matrix commissions, regardless of what they actually end up doing with the product.
Note that reselling it doesn’t count as a retail sale, as it is the affiliate themselves who have purchased the product from LabActive.
“Member Package” affiliates can of course qualify but they’ve first got to generate $140 in monthly sales. Take into consideration though that LabActive affiliates who qualify in this manner are capped at 2% earnings over their higher paying Executive co-affiliates.
Pretty much what we’ve got here is a $95 revenue sharing buy-in that’s designed to pay out a 2% or 4% commission from other affiliates monthly autoship fees.
I’d be very surprised if the retail side of LabActive is anything but negligible, let alone even remotely sizeable to the revenue generated by Executive affiliates qualifying themselves for matrix commissions via the monthly autoship.
If affiliate money makes up the bulk of the revenue being shuffled around in the Social Matrix, unfortunately that drags LabActive into Ponzi scheme territory.
I refer to a Ponzi scheme as opposed to a pyramid scheme because upon recruiting new investors (new Executive affiliates), LabActive affiliates can effectively increase their share of the monthly ROI by re-inserting themselves into the compensation plan (3 new Executives = a near 200% monthly increase).
Paying out on product sales is great (as opposed to the usual membership fee based matrix compensation plan routine), however not if it’s primarily just affiliates paying a monthly autoship.
As a potential LabActive affiliate I’d strongly recommend enquiring about the affiliate/customer ratio of your upline and how many affiliates they have qualifying themselves for matrix commissions via autoship, as opposed to making retail product sales.
If the information you receive indicates an affiliate autoship funded scheme, then the above analysis is most likely applicable to the entire business opportunity.
Retail is possible but due to the mechanics of the LabActive compensation plan, unfortunately highly unlikely.
The address given is a virtual address.
They supposedly have a trademark filed, but it seems to have been denied last December (2012). Apparently it’s too much alike an existing trademark application “ActivLab”
And apparently they used Gerald Nehra to file that trademark application. 🙂
Nehra’s involved? Oh noes!
They are a member of DSA
Though who is rtowles? That’s Rob Towles, formerly with eFusjon, which went kaput back in 2010 after an affiliate lawsuit. They settled out of court.
Looks like LabActive is gonna be eFusjon redux.
Cheers for the research. Looking at that lawsuit I’d say you’ve hit the nail on the head. Efusjon rebooted (at least they changed the stupid name).
Looking at LabActive’s compensation plan, here we go again…
One more info… President is “Frank Borst”
Which brought us this listing:
However, all the director’s address… is a UPS Store