Orrin Woodward on LIFE & Leadership

Inc Magazine Top 20 Leader shares his personal, professional, and financial secrets.

Archive for February, 2015

LIFE Leadership Reviews – MonaVie & Amway

Posted by Orrin Woodward on February 27, 2015

I am writing, updating and reviewing the FAQ section for LIFE Leadership. Perhaps the most interesting and inspiring answer for me was the one on Amway, Quixtar, MonaVie and LIFE Leadership. For in it, I was able to share how proud I am of the pioneers of LIFE Leadership. I have attached the answer below. Compensated Community is the future of business and LIFE Leadership is in the sweet spot of the growing trend.

Sincerely,

Orrin Woodward – Chairman of the Board: LIFE Leadership

The years 2007 through 2010 were some of the most challenging and yet some of the most rewarding of my life. Indeed, nothing shook my core leadership principles more than events during this timeframe. For one thing, I learned that most of American businesses are not practicing the principles of free markets, and bold entrepreneurship. Instead large corporations used their power with government and the press to block new entrepreneurs from climbing the mountain they had staked out. For another thing, knowing that leaders right injustices, I attempted to right something I believed were wrong by addressing the cartel system head on. Not surprisingly, this has led to increasing attacks on my character since, invariably, when the elites (or their anonymous hit men) cannot defend the message, they attack the messenger. Since I have nothing to hide, I will share my story so people can make an educated decision on who I am, what I stand for, and what the purpose of LIFE Leadership is.

First, I want everyone to know that I love free enterprise and reward for services rendered to customer concept. Unfortunately, however, much of Big Business today is not structured this way. Instead, Big Business has created a culture that rewards cartel credentialists who create value for the powers-brokers by obeying orders rather than corporate creators who create value for consumers by innovating. True innovation, in effect, is not rewarded in the cartels because credentialists promote other credentialist and drive out creators.  Anyone remember how Sam Walton was driven out of Franklin Five and Dime because he had too many ideas and didn’t follow the company line? How about Steve Jobs when he was kicked out of his own company the first time? Dismally, Big Businesses has partnered with Big Governments and Big Banks to create Crony Capitalism – a system of cartels designed to profit the elites at the masses expense.

Ironically, I would have never discovered the Elites Matrices of Control playbook (Financial Matrix, Feudal Matrix, and Physical Matrix) had I not experienced the matrix of control for myself. Evidently, God reveals His deepest truths when people are in the deepest of waters. With that introduction, here is the FAQ summary of the events that led to developing the Financial Matrix book and the notoriety I have received because of it. 🙂

What was the 2007-2010 legal dispute between some of the LIFE leaders, Quixtar and MonaVie about?

I get asked this question periodically even though the dispute ended in 2010. Still, I believe the highlights from the issue can help a person understand the principles LIFE Leadership is founded upon. Before discussing the details, however, I think it’s important to share that I have no hard feelings for anyone who worked with Quixtar or currently works with Amway. As a matter of fact, I still have friends that work within the company. I believe life is too short to carry grudges and what is past is past. Further, I have heard from several sources that Amway has softened its litigation policy against leaders who want to leave the company. For this, I am thankful. Finally, I learned a ton during my time with Quixtar and have many memorable experiences. In consequence, I have taken the good, flushed the bad, and move ahead with no animosity.

Before LIFE Leadership was launched, Laurie and I, along with some of the other top leaders, worked with a company called Quixtar to build our community (business asset). Quixtar was a North American internet based multi-level business started by the owners of Amway, but set up as a separate company from it’s parent. This was an important feature to me because I had joined Amway in 1993 when I learned they were developing an Interactive Distribution model to combine high-tech and high-touch. Regretfully, however, by 1998, I realized this was more hype than substance and had not come to fruition. Since I had no interest in building a traditional Amway business, we planned on starting a new venture.

LIFE Leadership Winter Convention

LIFE Leadership 2015 Winter Convention

Nevertheless, after hearing Ken McDonald (Quixtar’s first managing-director) share his vision for a new online model, we changed our minds. Since it was a separate from Amway (but backed by the founders funds) and would leverage the fast-growing internet, we were intrigued. As a result, in 1999, we chose not renew our Amway distributorship and joined Quixtar instead as an IBO (Independent Business Owner).

The online model fit our young and hungry team perfectly. In fact, from 1999 through 2007, Laurie and I led the fastest growing organization within the whole company. We grew from several hundred to over ten thousand people attending events and our sales increased from a couple hundred thousand dollars to over one hundred million dollars! In addition, many other teams sought our training and started growing resulting in nearly another hundred million dollars in volume. Our training organization, in other words, was responsible for nearly $200 million of Quixtar’s total sales.

Unfortunately, the rest of Quixtar was not doing well, mainly because the older, more mature organizations seemed unable to adjust to building an online business. I saw the loss of confidence and numbers firsthand because I was asked to speak (hundreds of times) to Quixtar groups across North America. Dismally, instead of growing into the 100 billion dollar company predicted by Ken McDonald and other top leaders, Quixtar leveled off around a billion dollars even with our team’s meteoric growth. In fact, many of the top leaders lost half their numbers or more as they struggled to marry high-touch communities with the high-tech online environment. Nonetheless, I didn’t realize the precarious nature of the Quixtar business until Ken McDonald abruptly announced his retirement in 2005 despite flying to see me just weeks earlier to discuss future strategies. To say I was disappointed would be an understatement (Ken and I worked well together), but I also respected Quixtar’s right to choose its leadership team.

Curiously, however, Quixtar’s new managing-director was also an Amway vice-president. Although I thought this was strange, I was assured on numerous occasions that the two were still separate corporations and the change in management was merely to help Quixtar increase its sales. As a result, the 2007 announcement that Quixtar was closing its doors and that all its Independent Business Owners (IBOs) would be transitioned into Amway shocked me. This was unacceptable for several reasons. For one thing, I was not in Amway (having purposefully not renewed when Quixtar launched), nor did I want to be in Amway. For another, I had told tens of thousands of people that they were independent business owners affiliated with Quixtar just as the IBO moniker implied. True, Quixtar was owned by the founders of Amway, but they were allegedly separate companies with separate field organizations. Indeed, I must have repeated this message of separate companies a thousand times because that is what Ken McDonald and the rest of the Quixtar’s management team had told all of us. In sum, I had been misled, and thus had inadvertently misled others.

For me, the whole conflict was a moral issue. On one hand, I knew Quixtar (like any company) had the power to break its commitments to its customers, but it didn’t have the power to avoid the subsequent fallout. On the other hand, how could I represent a company to others that I believed had misrepresented itself to me? Indeed, leadership is character in motion and without trust, it’s impossible for any leader to get in motion. Nevertheless, quitting my independent business was not as simple as it sounded since Amway had stated its intention to litigate against any leader attempting to leave the Amway/Quixtar (indeed, hundreds were sued before and after me). Not surprisingly, the legal risk intimidated many other leaders into submission, but it only emboldened our leadership team. For if we stayed with Amway because we feared litigation, then we would be imprisoned into Amway’s Legal Matrix and not truly independent anyway. How, in a word, could we ever recommend others to join us as independent business owners when we knew in our hearts that this was no longer true?

Although the easiest thing to do would have been to rejoin Amway, announce my retirement, and slowly watch my groups dissolve, this was morally unconscionable. I also doubted Amway’s antiquated business model could work in the internet savvy North American market regardless of how many millions Amway spent on television advertisements (Amway no longer discloses North American sales volume but it is rumored to have dropped precipitously). How could Laurie and I in good conscience give up our purpose and principles for profit while our community suffered? And yet, I also knew that I would be sued by Amway (a multi-billion dollar international company) if I didn’t agree to their plan. Financially, this was a lose-lose scenario. Neither option, in other words, was without massive risk and challenges, but leaders are paid to make decisions and it was time to make a decision.

Thankfully, I had great leaders like Chris Brady, Tim Marks, Claude Hamilton, George Guzzardo and Bill Lewis (interestingly, I barely knew my good friend and LIFE co-Founder Dan Hawkins at the time), who all believed we should choose character over convenience. Accordingly, I called a meeting to announce my immediate resignation and intention to sit out Quixtar’s six month non-compete period. My plan was to form a new company and build our businesses entirely separate from either Quixtar or Amway. Disastrously, however, instead of accepting my resignation, Amway announced it was “firing” me (how a company can fire an independent business owner is still inexplicable to me). They proceeded to call each of the leaders in our community to demand they choose either Quixtar (soon to be Amway) or staying with me. Of course, the field leaders had no idea what Quixtar was talking about since I had not announced to anyone (except a handful of my top leaders) any plans to start another business.

Amway’s management team had no idea the hornet nests they had knocked over. People in our organization were already upset at the name change and now Amway/Quixtar compounded its errors by  “firing” myself and Chris. Indeed, through writing over-the-top blog posts (since removed) on their official sites, manufacturing negative news through their billion dollar contacts (Forbes and various newspapers), and issuing business ultimatum emails to our leaders, Amway/Quixtar evidently sought to besmirching our character. However, as legendary coach John Wooden once said, “Be more concerned with your character than your reputation, because your character is what you really are, while your reputation is merely what others think you are.”

Not surprisingly, Quixtar paid for its hubris. Truth, without a doubt, is a pesky thing. Because our organization knew the truth, over 50,000 people resigned rather than switch to Amway. Of course, Amway (true to their promise) initiated multi-million dollar court and arbitration proceedings against me and others. The financial stakes were high since we had already lost our business incomes and now we risked bankruptcy. Apparently, the plan seemed to be to sue people into submission.

Consequently, starting our own company at that time was ruled out. For it would be foolhardy to outlay the money to create a new company when a multi-billion dollar company was doing everything in its power to drain us financially. I didn’t feel that falling on my own sword and hurting the many people who followed me out of Quixtar was the proper strategy. Rather, I needed a plan for survival until Amway realized we would not surrender our principles no matter what the consequences. Accordingly, I sought a join another company so I could earn money to help support our growing legal mess (tens of millions of dollars). Of course, I ensured, upfront, that once the legal battles were over, we would be free to start our own business if we still desired to.

Fortunately, in 2008, I met the founder of MonaVie, Dallin Larsen (several years after we started LIFE, Dallin retired from MonaVie in 2014 and his company combined with Jeunesse Global), who was leading one of the fastest growing companies in Network Marketing at the time. In fact, his success at MonaVie led to him receiving the prestigious 2009 Ernst & Young Entrepreneur of the Year Award. While he, of course, benefited from partnering with our large organization (millions of dollars per month in volume), he also had taken a huge risk. I am thankful he took that risk. For I do not know whether we would have survived without partnering with MonaVie to defend ourselves against Amway. As expected, Amway subsequently sued MonaVie (I commend their persistence) and countless more millions were spent battling the behemoth. Not surprisingly, MonaVie received the same negative treatment online and in the press that Chris and I received. Talk about strange coincidences. 🙂 Fortunately, Dallin Larsen, despite several years of legal harassment, didn’t flinch and he followed through on everything he had committed to. 

Finally, in 2010, a global settlement was reached. After much pain and pressure (the battle had left no one unscathed) the war was over. I believe Amway finally realized the IBOs who resigned were not coming back and we had enough funding to continue the legal battles indefinitely. As a result, the biggest leadership challenge we had ever faced was finally over. Our community was FREE! This was our team’s finest moment. I have never been prouder of any group of leaders for they had survived nearly three years (2007 through 2010) without surrendering. Some even choosing to declare bankruptcy rather than give in to Amway’s legal demands.

Woodwards Introducing New ELC Hamiltons

Introducing New Executive LC Claude & Lana Hamilton

In closing, many times during the war I had told the leaders that those who stayed would be champions. It is inspiring to see how many achievers stayed with us to finish the million person mission. These men and women are the one’s who dreamed, the one’s who dared, and the one’s who sacrificed to make LIFE Leadership a reality. Although I have read thousands of books on businesses, I have never found a more inspiring example of a group of common people willing to face uncommon giants. Perhaps the best description of the LIFE Leadership pioneers is the plaque at the Overpass Museum in Carney, Nebraska, “The cowards never started. The weak died on the way. Only the strong survived.” If a person is ready to face his personal Goliath, I know of no stronger community to help him do so than LIFE Leadership.

Posted in LIFE Leadership, Orrin Woodward | 100 Comments »

Financial Matrix Debt Money

Posted by Orrin Woodward on February 5, 2015

It’s important to remember that money was not created by the state. Rather, as Mises points out, entrepreneurs created money by trial and error through realizing that gold and silver could be exchanged for current production at any time. Money simply was a measurement of exchange value ratios. Indeed, the rediscovery of gold and silver money led to an explosion of middle-class wealth as people were rewarded for producing more. The gold standard ensured justice for the masses against elites attempts to manipulate the exchange values of monetary system. Because gold is a fixed-quantity and difficult to mine, inflation was low and predictable, whereas the increased division-of-labor caused by the capitalistic system to create more wealth for more people than at any time in recorded history. The gold standard, in short, ensured justice for all by checking the elites desire to create a Financial Matrix by controlling capital.

Unfortunately, however, the elites will not rest until they build a matrix to control the masses wealth. Hence, at the turn of the 20th century, the state and its elite cronies, broke through the gold-standard barrier and created the Financial Matrix. Through using fiat money (money not backed by gold or silver), the elites flooded the marketplace with bogus exchange values causing rapid inflation and rampant injustice. The Financial Matrix was birthed through a web of fractional-reserve banking (FRB), increasing national debts, and increasing taxes. One can recognize the extent of the monetary injustice caused by the Financial Matrix when studying what inflation has done to the value of the US dollar. For instance, the value of one dollar in 1913 is now worth less than four cents today. Or, said differently, one needs 25 dollars today to buy what one dollar purchased in 1913.

Inflation, however, is just one of the many injustices associated with the Financial Matrix. When inflation is combined with the increased personal and national debts (which result in an increase in taxation), one can see why the masses across the civilized world struggle to make ends meet. Indeed, the government-sponsored fractional reserve banking (FRB) system allows banks to partner with the central bank to create the majority of society’s money out of thin air. That’s correct, the FRB system permits banks to loan money into existence while the borrower must pay this fiat loan back with money he must earn through production.

In essence, artificial dollars are created without any real production and then loaned to people who must pay back the loan with interest from real production. Absurdly, the FRB system allows banks to create fake units of exchange that must be paid back by the borrower with real units of exchange plus interest. This is why the FRB system is the root of the new matrix of control and why the Financial Matrix is the most effective form of elites control ever developed. Moreover, the crony-capitalistic FRB system sets the low-interest rates which create the boom/bust cycle plaguing modern society. And, to add insult to injury, once the FRB system fosters the predictable boom/bust cycle, the boom is credited to the ingenious money controllers while the bust is blamed on the free markets. Apparently, its a loaded game of heads and tails where heads means the elites win and tails means the masses lose!

Although economists the caliber of Ricardo, Mises, and Von Hayek have insisted the FRB system is fraudulent and unstable, it survives through the masses ignorance and the elites support. Perhaps British Monetary Reformer, Michael Rowbotham, described the fraudulent nature of the FRB system the best when he wrote:

The creation and supply of money is now left almost entirely to banks and other lending institutions. Most people imagine that if they borrow from a bank, they are borrowing other people’s money. In fact, when banks and building societies make any loan, they create new money. Money loaned by a bank is not a loan of pre-existent money; money loaned by a bank is additional money created. The stream of money generated by people, businesses and governments constantly borrowing from banks and other lending institutions is relied upon to supply the economy as a whole. Thus the supply of money depends upon people going into debt, and the level of debt within an economy is no more than a measure of the amount of money that has been created…

In effect, today’s Financial Matrix relies upon millions of people voluntarily selling themselves into financial slavery. For when one combines artificially-low centrally-controlled interest rates to the FRB system, one has an irresistible combination that leads consumers and entrepreneurs to borrow money into existence. This money-creation, however, leads to the inflation. The inflation causes the boom/bust cycle when prices skyrocket. At this point, the consumers and entrepreneurs default on the loans they can no longer service and the bust wipes out the inflated values created during the boom. Not surprisingly, the boom/bust cycle occurred twice during the Greenspan-controlled central banking era. In both cases, the artificially-controlled low interest rates fueled the consumer’s appetite for speculation and “easy” profits. The internet bubble increased the Nasdaq nearly by a factor of five during the boom between 19995 and 2000, but it then preceded to collapse by over 60% between 2000-2001.

Regrettably, controllers seem to be perpetual optimist go from failure to failure without learning anything. As a result, when the twin-towers came crashing down, Greenspan repeated the same policy which caused the previous boom/bust cycle. This time, however, money poured into the housing markets and prices shot upwards of 50% in just a few short years. Not shockingly, the mortgage companies sought to maximize profits by helping everyone qualify for a home mortgage, even those who didn’t have steady jobs. The increase in mortgages exploded the money supply which further fueled higher priced houses and mortgages. The housing bubble was blowing up. Predictably, however, when the non-qualified borrowers could not make their mortgage payments, the housing bubble collapsed, the money supply collapsed, and the financial house of cards nearly followed them, but for government bail outs.

Above all, however, is the loss of house equities that have occurred since 1950. Disgracefully, the Financial Matrix has gutted the home-equity percentages (amount of value owned after subtracting all mortgages), decreasing home-equity percentages (percentage of ownership free from house loans) from over 80% to just over 30% today. This indicates that the Financial Matrix has gutted nearly 50% of the USA’s $25 trillion housing market in the last 60 years! That’s correct, nearly $12.5 trillion dollars (almost as much as the total USA national debt) lost by US citizens without so much as a whimper.

Americans sense something isn’t right, but few have a clue what it is, let alone how to fix it. Indeed, both the Occupy Wall Street and Tea Party movements formed as protests against injustice and exploitation. Protests without plans, however, usually leads to rebellion and peasant rebellions have a poor historical track records in generating positive change. Instead, the masses must learn to exit the Financial Matrix through a disciplined plan of financial defense and offense. This is why we formed LIFE Leadership and why we created the Financial Fitness Program – to teach people how to exit the Financial Matrix without violence. Remember, one is not coerced into the Financial Matrix, but rather enticed.

To me, the Financial Matrix is eerily similar to Neo’s discovery of the matrix in the movie called The Matrix. In several scenes, Morpheus reveals to Neo that the world is not as it seems. That a matrix controls the masses whether they are working, playing, or sleeping. The matrix is, “the world that has been pulled over your eyes, to blind you from the truth.” Neo, needless to say, asked what truth Morpheus was referring to and learns, “That you are a slave, Neo. Like everyone else, you were born into bondage, born into a prison that you cannot smell or taste or touch. A prison…for your mind….Unfortunately, no one can be… told what the Matrix is… you have to see it for yourself.” Morpheus places two pills before Neo and explains that if Neo takes the blue pill he will live an illusion and never escape the matrix, but if he takes the red pill, he will learn the truth about the matrix and learn how to set himself free.

If you, like Neo, have been searching for answers, the good news is: the search is over. The blue and red pills have been placed before you. Do you take the red pill, read the rest of the book, and learn how deep the rabbit hole goes or do you take the blue pill, set down the book, and believe the illusion of whatever you want to believe. Your destiny hangs in the balance. Choose wisely.

Sincerely,

Orrin Woodward – LIFE Leadership

Posted in Finances, Freedom/Liberty | 29 Comments »

The Financial Matrix System

Posted by Orrin Woodward on February 4, 2015

My twenty years of research into the political, economic, and social histories of state and society have revealed some startling discoveries. In essence, the aristocratic elites of every generation have developed control matrices to exploit the productive capacity of the masses. Indeed, one of the first clues came from reading French political philosopher Bertrand De Jouvenel. In his book On Power, he wrote, “Whoever does not wish to render history incomprehensible by departmentalizing it – political, economic, social – would perhaps take the view that it is in essence a battle of dominant wills (elites), fighting in every way they can for the material which is common to everything they construct: the human labor force. (masses)” (parenthesis mine) In other words, the aristocratic elites (dominant wills) seek methods to control masses (human labor) production. labor.

With this perspective, I reviewed the economic field where I noted the classical economist were the first to identify the three factors of all production – labor, land, and capital. John Stuart Mill, for instance, wrote, “The Law of the Increase of Production Depends on those of Three Elements— Labor. Capital, and Land.” When I combined these two concepts together, it became clear that in order for the elites to control the masses production, they must do so through controlling the three factors of production – labor, land, and capital. Invariably, this theory of control is confirmed by history.

The Financial Matrix, in other words, is not the first matrix of control. On the contrary it is the third one based upon the three factors of production. In reality, most of the readers (assuming you didn’t sleep through history class) already know about the other two matrices of control – the Physical Matrix (human slavery) and the Land Matrix (feudal serfdom). Paradoxically, although Western Civilization’s founders (the Greeks and Romans) wrote about liberty and justice extensively, they hypocritically exercised a Physical Matrix to enslave their defeated foes. The slaves were forced to do the manual work in society since the classical civilizations thought physical work only worthy of slaves. This allowed the ancients the leisure to speak, write, and lead while the slaved toiled away in the Physical Matrix. Indeed, the preferred method of control throughout the classical period was the Physical Matrix until Christianity permeated the Roman Empire.

Christianity changed the social norms of the late Roman society. Whereas slavery for conquered nations was acceptable previously, Christianity taught that all men were created equal before an almighty God and that fellow-believers were all brothers and sisters in Christ. Of course, enslaving one’s brother or sister became increasingly difficult to justify (unfortunately, the same cannot be said for infidels). Thus, the Physical Matrix collapsed under its own weight. Naturally, with the loss of the Physical Matrix, the aristocratic elites sought another control matrix to replace it. With labor no longer controllable, moving to the next factor of production (land) seemed like a reasonable course of action and the Land Matrix was born – feudal serfdom.

The elites simply moved the matrix of control from the Physical Matrix to the Land Matrix. Because they owned all the land, the aristocratic elites (princes, kings, and lords) forced the serfs to pay rent to the lord who owned the land. The serfs, not strong enough to resist the powerful lords and having no other options simply complied. By surrendering around half of their agricultural production plus agreeing to work the lord’s fields several days a week, the serfs were permitted to live on the lord’s land. Although, the people were no longer slaves, they were not much better off since they had no freedom of movement and were taxed over 50% of their productive capacity. Feudalism may have ended slavery (Physical Matrix) in most of Europe, but only to turn the people into serfs (Land Matrix).

During the late middle-ages, the reintroduction of gold and silver changed the economics of feudalism. The serfs no longer needed to live on the lord’s land in order to survive. Instead, serfs began moving to the growing cities where in the city air, the bakers, butchers, and candlestick makers could live free by selling their services for money. They, in turn, could then use their accumulated money to purchase other necessary items to survive. This development freed the serfs from the land and the subsequent economic losses caused the Land Matrix to collapse. Both the Physical and Land Matrix were now history, however, there was still one other factor of production left, namely, capital. Not surprisingly, for nearly four hundred years (from the early 1500’s through the early 1900’s) a battle raged between the elites and the masses to determine whether money would be set by the market (gold standard) or set by the controlling elites.

Sincerely,

Orrin Woodward – LIFE Leadership Chairman of the Board

Posted in Finances, Freedom/Liberty | 16 Comments »