Fake Gurus and Contrepreneurs Case Study: The Italian Man who went to Malta

Hi (Italian) readers,

This is a follow up of my previous post about Luca Lixi and his company. But it’s not a post centered on him. It’s about Fake Gurus, and how to spot them. Our friend will serve as a case study.

Yes, I know, I also want to do something else with my time. But I think this follow up is very needed, and my bet is that this time even non Italian speaking readers can get a lot of value out of it.

I’m not investing more energies in my anti-shark effort in the short term, promised. But you have to wait for the first chapters of my Money Guide (title still TBD) a bit more 🙂

While we all wait that Estonian Lawyers go to Switzerland, I couldn’t simply move on and forget about this Lixi guy. I had to dig deeper. A comment from a reader pointed me to some of Lixi’s mentors and courses he attended. Those were a good start 🙂

At first I thought that he was a probably acceptable Personal Finance mentor who sells overpriced products and who implements aggressive marketing techniques and questionable communications practices. His arrogance and tendency to insult people on his Facebook group pissed me off enough to write a post about him. That was it.

Then I discovered that Lixi’s strategy (not to be confused with Lixi Strategy, his expensive flagshit product) follows very common patterns, taught in expensive marketing courses. He didn’t invent a thing! And I’m here showing what I learned during last week, i.e. what are the common patterns of these fake gurus and contrepreneurs so that you might be able to spot them, hopefully before it’s too late.

Mind that this is a double edged sword though. We’re going to see how to recognize fake gurus and ruthless marketing professionals, but we’re also going to learn how to use the same techniques to become one. Please don’t. And please, keep me accountable on the light side of the moon 😉

Merenda

Lixi has been a long term customer of Frank Merenda, an Italian Marketing Guru. Which claims to be…

Cool… we found the top marketing expert in Europe, who doesn’t even have a Wikipedia page.

And whose communication strategies reminds me of…

1984? North Korea? Wiki Lixi?

Lixi doesn’t hide that he purchased many products from Merenda. For sure Blog Vendita in 2014. In this 2017 testimonial video (back when Lixi used to refer to his last name as “Lisci” and not “Licsi”) Lixi praises the benefits of having a blog for sales (20-25 articles and a report obtainable via opt-in), and how he was able to obtain 2000 Leads (a term used in marketing to indicate a contact with a potential customer), i.e. 2000 people who dropped their contact information to him.

This Blog Vendita course was part of Frank Merenda courses portfolio, and delivered by Alessandro Vignolo. I didn’t go deep on Vignolo, just a bit on Merenda. Well, I hate to add links to their websites, and apparently I can’t un-embed their vimeo videos from their pages as well. You can search those guys on YouTube though, and make your own mind about their messages.

I found most of what I attributed to Lixi’s strategies in Merenda’s video on the subject of “how to generate authority“.

The funniest part is about “the book”: Merenda says that you need to have written a book. Ideally a new book every year. The book is your business card today. You don’t have to write it, you can hire a ghostwriter. Don’t worry, nobody is going to read it and we don’t care. In your potential customers’ heads if you wrote a book then you’re an expert, you have authority in that sector. It’s a mind hacking strategy for your potential customers. And the sales funnel can start. If someone happens to read your book, the book should be a sales letter in incognito, i.e. disguised as a book. The book should lead to other media of ours, to push potential customers to finally become real customers, we are not interested in writing books per se.

Does it sound familiar? It does, to me 🙂

Good.

The video whose passages I extracted above is embedded in Merenda’s website and I don’t want to link it. But a good proxy is this one on YouTube.

According to Merenda, the three most important things about your book are:

your name (big), your picture, Headline (written in copywriting form)

What about the content? Who the fuck cares, nobody is going to read it!

It can be Lorem Ipsum all the way down! Take a look at this amazing video by Mike Winnet (more about him below) on how to write an Amazon Best Seller with empty pages!

Anyway: name, picture, and copywriting-style Headline that becomes the book title.. wanna go check Lixi’s book?

Who would have guessed?

Btw, Merenda’s work consists in mostly translating in Italian language what Americans marketing gurus like Jay Abraham and Al Ries (who barely makes it in the top50 marketing gurus ranking) say since decades.

Ok, let’s move on.

As I said, I didn’t spend much time on Merenda, I just acknowledged that Lixi’s apparently profitable marketing and communication strategies – unbearable for someone with a brain – were scripted

What’s the role of his book? I told you, to push leads down the sales funnel?

What’s the role of his blog? Same as above.

What’s the role of all his free content? Same shit. Giving you no actionable material, letting you commit more time with them (foot in the door strategy, sunk cost fallacy bias), exposing you to fake scarcity, and trying to sell their expensive products to you.

I wanted to know more about this script. Has it been codified? Are there patterns? How can I recognize the individual tactics and name them? Why does these behaviors make me feel unease? I perceive there’s something wrong (and shitty), but I need to be able to tell exactly why.

So I ended up into another rabbit hole. A very interesting one though 🙂

And at the end of it, Lixi – and others like him – looks like an open book, a decoded code.

Please, follow me this way 🙂 And don’t call me Morpheus, ok?

MLMs

I was reading a nice post on r/personalfinance dated June 28th 2020. Uff, the original post has already been deleted on July 2nd, and I forgot to take a screenshot. Anyway, comments are still there. OP was a guy who has been contacted by a high school friend out of the blue, and offered “free” material to become “financial independent” and a meeting with a “coach”. He asked what he should expect.

All the comments (I’ve read I think a hundred of them at least) pointed to some sort of MLM Scam.

Wait RIP, you offer a lot of free material, you coached people, and you talk about FI!

Ouch, you’re right! Am I a scam? O_o

Well, I’m not selling you any product. Yet. Haha!

Anyway, this post will teach you how to judge if I am a scam or not 🙂

Back on track.

The comments of the above mentioned Reddit thread are awesome. I’ve learned a lot just by reading them. I’m of course aware of MLM (Multi Level Marketing) scams, and their shady cousin Network Marketing. I have friends who fell for it, lost money, lost friends, and now flip burgers. Luckily not many, and just with Herbalife. Stay the fuck away from that shit.

I’ve learned few terms like Foot in Door, the psychological manipulation tricks, the “yes momentum”… some ex Mormons and ex Jehovah Witnesses jumped in telling that the same manipulative techniques were used in their environment as well. Many first hand experiences with MLM and some sad stories.

I recommend you to read the top rated comments of that thread, it’s totally worth your time 😉

Coffeezilla

I’ve also followed some of the external links from that r/personalfinance thread, and re-watched the John Oliver’s Last Week Tonight video about MLM.

one of the external links made me discover the Coffeezilla YouTube channel.

Coffeezilla (amazing channel, btw) is specialized in Fake Gurus detection and documentation. Amazing job, seriously. I loved his video about Mike Vestil and other Tai Lopez clones, the one about Sam Ovens (about fake reviews), and this one about Siraj Raval, who makes online courses stealing others’ code on GitHub. Good job CZ! Or SiFu, like he likes to be called.

Btw, CZ helped me recognize one of the standard technique used by Fake Gurus (especially the one in our today Case Study) when they use logical fallacies and plain lies to try to denigrate the work of those who expose them. Thanks CZ!

But the video that I needed to watch to detect I was heading to the right direction to decode Lixi is the following one, titled “Top 10 Fake Guru RED FLAGS To Watch For!!!” Yeah, it has a couple of exclamation marks more than acceptable and a catchy thumbnail, but it’s a genuinely good video.

What are these 10 red flags? Let’s go thru the list together.

1. Has a “Mastermind”

Wait RIP, you said few times you are part of a mastermind group!

Ouch, I’m definitely a scam!

Actually, my mastermind group is just 4 people (me, Julianek, ElMago, Mr1M) who have fun meeting and talking about FI related stuff. It was not even initiated by me, I was invited to it. And I’m so glad!

What CZ means, explained later in the video, is that their “mastermind” thing is something they will sell to you, like a membership to an exclusive community where to discuss private things.

Like Lixi Strategy Gold, for example

Checked!

2. Luxury cars in the video

You look at people like Warren Buffett, Bill Gates… do they show off their wealth? No, they don’t need to show it off, they got it. Often times when people show it off… mmmh!

What about luxury clothes? Watches? Pictures from expensive locations? Bragging to be rich (without ever attaching some data to the claim)? Hating frugality?

Checked!

3. Disparages 9-5 jobs

RIP, this is you 🙂

Haha yeah, a bit. I don’t think I’m wired for a 9-to-5, but that’s what I’ve done for most of my professional life. And I’ll keep doing it for a while. I dream about a day when I won’t work 100% anymore. I know I can already be there if I really wanted, or at least I could take concrete steps toward a partial retirement. But let’s not digress…

I definitely don’t disparage 9-to-5 jobs! I don’t sell anyone the dream they can quit their job tomorrow if they listen to me!

Guys, hard work first 🙂

Is Lixi selling you the dream? Kind of, not as first step though. For just 10k he’ll tell you how to do it. But you need to have a lot of money, ok? Don’t ask me how to make it 😉

Partially Checked

4. Invites you to a “live webinar”

Ooooh checked!

At least he doesn’t claim it to be “live”.

5. Paid course

Huge red flag! 1.5k, 6k, 10k courses! Run the fuck away!

CZ: “Does it mean that all paid courses are scam? No!

In my opinion:

  • If it costs more than 100 (ok, make it 150, like the FS Learning Community which is much much more than a course) you should probably not pay for it. Or at least question it 10 times before purchasing it. Go for it if you think the free content the creator releases (like I did for FS and Nat Eliason) is very high quality and you want to say “thank you” to the creator.
  • If it costs more 1000 just run the fuck away. Run now!
  • If it costs more than 10k call the police. Seriously.

RIP, what about 9997?

Haha I’ll let you decide 😀

Anyway, checked!

6. Under 35 years of age

CZ: “to be a coach, you kind of have to have done it all, and most people under 35 just haven’t had enough life experience. Your life barely started until you’re 20 years old.

Haha a bit unfair and ageist, but it makes sense that it’s harder for a kid to have enough experience to self elect as a guru.

Wait, how old is Lixi?

35 in September, LOL!

Checked 😀

7. No verifiable financial history

CZ: “Financial history? They make big claims with very little evidence for those claims

A huge “checked” for our friend Lixi!

Nothing about his numbers is public. I asked him to provide some data about his spending, earning, net worth, investing… Nope!

As far as we know, he can be broke as fuck and be all pretending, like a Lucio 2 whatsoever.

Checked!

8. Runs Youtube or Facebook ads

Yes! Even after he banned you!

Checked.

9. “Free book”

Or any kind of free material packaged as a book, booklet, report… anything you’re asked your email in exchange for goes in this category. Registering to Wiki Lixi and receiving a shitload of email spam counts as well.

Even a “real” Merenda-book, written just as a business card (like our friend Merenda said above), can be considered in this category despite not being free.

Everything that puts you into the sales funnel (or lead funnel) should be a red flag, even if it’s for free. I have a very low tolerance for that.

CZ: “fake gurus know how psychology works, they are geniuses with psychology. When you are given something for free, you’re more likely to go and buy the higher priced product. They have your email, and they know you’re interested, so they’re gonna relentlessly pursue your business and try to upsell you on these crazy products

Checked.

10. Can’t stop talking about mentors (This is only a red flag if #5 is true as well)

CZ: “Nothing wrong with mentors, but often times this language is used to pitch themselves as your future mentor

This is a bit harder to check, because our friend Lixi doesn’t talk about mentors all the time, even though he mentions his. But he’s not pushing this concept hard enough. Maybe already at the superhuman stage where he thinks no one can teach him anything? We don’t know.

He talks a lot about his Antilibrary and how he buys 5 books per week. He talks about Taleb, few famous marketers/salesmen, some investor… but I want to be honest and not check this box.

but

CZ: “as soon as someone puts themselves in a mentorship over you, they now know what’s best for you… I would say mentors are good, but find ones who are not interested in profiting off you

If we take this second part into account, of course Lixi checks this box as well, but I must be careful to not go that way myself.

I think I’m doing good with mentoring (which is different from coaching), via helping as many people who asked for my help as I can for free (like I did with Saving Ninja), usually about Software Engineering career.

Ok, so what’s the Coffeezilla score for our friend Lixi?

Drum rolls…

I count 9 out of 10!

I’ve been generous with last one, but a bit mean in a couple of circumstances. Let’s say 8 out of 10.

Sadly CZ doesn’t speak Italian, else… where should I send my email? 🙂

Let’s just RUUUUUUUUUUUUUUUUN for now.

Fun fact, Tiago Forte (which in my personal ranking is NOT a fake guru even though his products are guru-like priced) tweeted about this video, and produced a short doc on unethical online course marketing.

Enjoy:

And for the sake of completeness, here‘s also a bad review of Coffeezilla himself, which – according to my habit of only checking bad reviews of products – is pretty mild and confirms my huge thumb up for CZ 🙂

Next.

James Jani

I’ve watched three videos from Graham Stephan. One about fake gurus, not good enough in my opinion, one about GaryVee and one about Kiyosaki. Those last two were pretty good.

But I’m not going to spend time on documenting them here.

And then this James Jani’s video about Fake Gurus popped up in the recommendations:

Yes, I’m watching videos of people half my age and learning a lot.

This video is very well made.

James starts with Tai Lopez “here in my garage” September 2015 famous ads, that I’ve skipped 100 times I guess.

Introducing those fake gurus who hook you into their free material, have a cult like following, and in the end they’re not trying to teach you anything: the main goal is to keep you hooked to their products.

And evolved defining a script for Fake Gurus in few steps:

1. Pick your niche

JJ: “The actual product being sold is not that important. But it’s usually a niche. It doesn’t matter what you pick, but preferably it’s something to do with wealth, health, or relationships… something you can really target people’s insecurities and their dreams.”

This is very insightful. Targeting insecurities, vulnerable people.

Personal Finance and Investing works well 🙂

2. Create your course

JJ: “it doesn’t matter if you don’t know what you’re talking about… you can hire an expert, get them to write a script you can read out to a video camera… Preferably you have a little bit of experience that you can give some general knowledge that could be probably be found in a book or if you google search for it. It doesn’t matter what’s in the course, what matters is how you market it.

Well said bro.

Marketing is what fake gurus spend all their money on. Merenda Marketing courses, Blog Vendita courses, Ghiaccio agli Eschimesi copywriting courses, plus a lot of Facebook, YouTube, and other kind of ads… and more important than everything else: creating a cult like following.

Do you recognize the pattern so far?

Let’s move on.

3. Marketing

JJ: “It’s all about marketing in this industry. If you can’t market your course properly, you’re not going to make as much as you should be. Put ads wherever the hell you can find people who are young enough and probably in a vulnerable position where they want to buy into whatever the hell you’re selling them. Sell a dream. High income, financial freedom, travel the world, no 9-to-5 jobs, luxury… you just have to click the link below and join their free training

The goal is to appeal to people’s emotions, to hook people in. From leads to prospects.

Remember, the sales funnel.

So the leads enter your funnel, and you offer them your webinar (checked!), free live events (Lixi, what a disappointment… when are these coming?), free content.

JJ: “make sure you keep it a little lengthy. In the case of a webinar, 1 to 3 hours (checked!). The longer it is, the more time they spend with you, the more trust they build, the higher the chances you can sell them on higher priced courses.

The lengthy thing resonated a lot. It also applies to infinite length copywriting pages. Foot-in-door, pre-suasion, sunk costs fallacy, feeling guilty for having wasted your time (or theirs). In one word: commitment.

Checked!

Ah, btw, I joined the free Merenda course on copywriting titled “Ghiaccio agli Eschimesi” (ice to the Eskimos), i.e. how to write a copy page so good that you could sell Ice to the Eskimos with it. Will let you know what’s inside 😉

JJ: “we’re not trying to teach anything in these webinars, the goal of the webinars is to make them ask even more questions, and the goal after that is to get them to buy your course

Got it!

JJ: “now tell them your backstory: you’re just like them, you were poor (checked!), there wasn’t anything special about you, tell them how you hated your job (checked!), how you were stuck in the rat race… you need to sound like you were in the position that they’re in at current point in time. If you’ve done your ads campaign right, you’ve probably attracted the most vulnerable people. Those are our ideal targets.

Ouch, so true. So common. So easy to spot.

JJ: “you also want to rewire their mindset for your benefit: tell them that money is abundant (checked!) so that when it comes down to the point where you give them the price of your course, in their heads the objection of ‘oh, it’s too expensive’ is already been overcome. ‘It doesn’t matter if I finance this with 2000 Pounds that I don’t have yet’

This is also a very good point.

The last two points were not clear in my mind before watching the video.

JJ: “you want to tell them that they need to be responsible for what they do (checked, of course) because when they buy your course, and it doesn’t work for them, you want to make sure that they’re not blaming you, that they believe it’s their fault.

Another good point!

Time for The Hard Sell:

JJ: “Show them testimonials (checked! All the time on Lixi’s world!), make it sound easy easy easy… but it’s not a get rich scheme (checked!), make sure you don’t say those words…

Don’t say it’s a GRQ scheme, but make it seems like one 😉

JJ: “hold on, some of these people would still have a rational part in their brain which we don’t want. Some of them are probably thinking ‘it’s a bit expensive, I don’t think I can afford it…’ so here’s what you want to do: you want to create scarcity (checked)”

Checked again

4. Profit

JJ: “You really didn’t think we were just selling courses, right? Remember our goal: to keep them hooked to our products! First you sell a course (checked, Lixi Strategy), then you sell a Mastermind class (checked, Lixi Gold), then you might sell a live event (missing… can some Lixi minion please fix this?) then sell them even a bigger course (checked, Massima Rendita)… you practically have an army with you. These guys watched you religiously

That’s so easy to spot in hindsight!

Maybe I’m the only one who has never taken a marketing course, but to me seeing these videos “explaining the obvious” is both a disgusting and an eye opening experience.

JJ: “make them feel special at your live event!

I so desperately want to join a live event now!

JJ: “of course, you don’t tell them the truth… I mean, after all we’re selling shovels to a gold rush. We don’t tell them the reason we’re so damn rich and living the life they want to live is because we’ve sold them a dream, and sold them our courses that aren’t really gonna get them there (checked!).

JJ: “and we told them that they are responsible for their own actions so each course they buy, and each failure thy get, they are the ones that feel like they’re completely responsible. I mean, some of these guys are so desperate in their situations that they have to believe it’s gonna work for them.

JJ: “it doesn’t matter at the end of the day. You got your millions, you can sit back, relax, enjoy, and watch you webinars, courses, all selling themselves

A pretty dark ending, but not far from reality.

Conclusions

JJ: “I don’t have anything against online courses … [] … but the kind of courses I’m talking about, they’re not thousands of pounds. Most of them are 10 Pounds here and there. In total I’ve spend 200 Pounds on online courses. They’re not trying to sell me a dream.

I’ve spent 250 Dollars total, mostly as a “thank you” message for the amazing high quality content the creators give away for free anyway.

We’re on the same page.

JJ: “the next time you come across these gurus, someone that sells you a course for thousands really really question whether the value they give you in that course is worth that money because the chances are you can find any of this information in a book or searching it on YouTube – which is probably where they got the information anyway (LOL)”

So true. So f***ing true!

JJ: “What’s important to always look out for is: is what they’re teaching me the method in which they made their money? With most of these people just probably isn’t. (checked!)”

Very good point, and I should also ask myself, if I ever want to step up and teach more: “what can I teach that’s authentic?”

I made most of my money via getting very good at Software Engineering (high earning), and I have a lot to show up for it because I’ve always been frugal (relatively low spending), and I’ve invested my money wisely since 4.5 years now (investing).

I think I’d be good to go, but it’s always good to check your assumptions and credibility.

JJ: “The moment you see these fake gurus pandering to your deepest desires, and really trying to sell you on an emotional level… just RUN. It’s almost never worth it. Ultimately you’re just a number in their funnel to them, and in their bank account.

So.. let’s RUUUUUUUUUUUUUUUUN again!

Mike Winnet

But my rabbit hole didn’t end on James Jani channel (good quality, James, congrats).

The endgame was finding the best channel about fake gurus on the internet: Mike Winnet.

Mike Winnet’s channel is funny, and not only because he looks like what would happen if you genetically mix Mark Manson and Marshall from How I met your mother:

I spent a lot of time watching his videos. Mike is really awesome!

Discovered thanks to Coffeezilla, who made a collaboration with him, where they explained how many fake gurus own their google searches: if you search “is [YOUR_GURU] a scam?” you’ll find some sort of content created by YOUR_GURU answering that question. And guess what? You end up believing YOUR_GURU is not a scam 😀

I tried to see how Lixi scores in this:

Not bad, well positioned on “truffa” (Italian for scam)!

But you forgot to control “scam”:

Oops. Sorry. Truth emerged 😀

Anyway, back to amazing Mike Winnet! You can start from the above mentioned “how to write an Amazon Best Seller with empty pages“, or his experience with a GaryVee and Grant Cardone conference (before, after – this is really amazing!) where you’ll find the Contrepreneur Bingo:

We’re going to comment on all the check boxes in a few minutes, do not worry 🙂

Watch also his amazing series “Get rich or die buying” (roboadvisor, crypto mining, flipping properties), and listen to his podcast named “Not Another D*ckhead with a Podcast“. Didn’t check it out yet though, only a single episode (linked at the end of this section).

Anyway, the video I’m unnecessary procrastinating showing to you is Mike’s masterpiece:

The Contrepreneur Formula Exposed

Note: the video linked here is the “remastered” version, because of false copyright claims by some of the fake guru. The old video is back up again (copyright claim resolved).

Note: Mike coined the term Contrepreneur as a short name for “Con Entrepreneur”, i.e. an entrepreneur who persuades his targets to do or believe something by lying to them (meaning of the verb “to con”). Awesome!

Note: Mike’s formula works best for Live Events, but we can find most of the shady and manipulative tactics in our sharks, and of course in our case study (Lixi).

Here’s the Contrepreneur Formula in its entirety:

According to Mike, the free event is usually the first stage of the sales funnel.

MW: “… and then he’ll say that usually he charges people ten thousand Pounds a day…

LOL! Checked! 10k! Good job Lixi!

MW: “… but for us lucky people that are down there he’ll probably sell it for a discounted price that ends in a seven

Wait, what do you mean by “ends in a seven”? More on this later 😉

Step 1: Targeting ads on social media

Easy.

They invite you on their free live event promising a “shortcut to success”, and “secrets to become millionaire”. So you can earn more money than you’ve ever imagined, easier than you ever thought possible.

The content? Usually revolving around “what people want”, i.e. Wealth, Health, or Happiness.

I just realized that our Lixi equivalent of a live event is the Wiki Lixi group. “Tutti I segreti della finanza” (spoiler: no actual secret revealed).

Usually the live event starts early and lasts for a long time. Remember what James Jani said? Make them lengthy.

According to MW it’s because the contrepreneurs want to leverage on your Decision Fatigue: “the deteriorating quality of decisions made by an individual after a long session of decision making“.

In contrepreneurs terms: victims tend to be complicit in their own deception.

If you’re thinking (like me): “I wouldn’t fall for it, it doesn’t matter how much exposure I get”, mind that everybody can get scammed. It has has less to do with your IQ, and more to do with where you are in life.

Remember? focusing on those more vulnerable.

Step 2: Get you to Commit

This is what we’ve already seen with pre-suasion, yes momentum, foot-in-door.

You are driven to say “yes” a lot of times, to agree with basic common sense stuff, to establish trust and to make it harder to say no later, when it’s time to buy their product.

Take a look at this good article where Robert Cialdini explains what pre-suasion is.

In a live event, not participating in a “yes momentum” can single you out, and make you feel guilty.

I’m trying to find a parallel in our Lixi world, and I can think of how “a nice person” he seemed to me in his Interview with Istituto Liberale. But it’s a bit forced, I agree. On the other hand, Wiki Lixi is a continuous yes momentum, and going against the current will make you publicly shamed, laughed at, and finally terminated. No negativity (toward the dream) allowed. No skepticism either.

Step 3: Bullshit Backstory

The story of their own struggle to success. How they were exactly like you are right now, just a couple of years earlier.

Doesn’t it sound familiar?

I even got a personalized bullshit backstory act before getting banned

The strategy here is called “leveraging wishful identification“, i.e. the attempt to make their prospect customers desire to be like you.

Which means, on one hand, showing how like their targets the contrepreneur was just few years ago, and how wealthy/healthy/happy/successful he/she is right now. Since he/she might not be as wealthy as claimed, better to show it off: expensive dresses, luxury cars, watches, a tie, sunglasses, expensive shoes.

They – those vulnerable bunch – must dream of becoming as successful and wealthy as the contrepreneur. It doesn’t matter if the contrepreneur can back the claims with facts and figures as long as he/she appears successful that’s all that’s required!

… Even if he/she might just have rented it all out, and is broke as fuck.

Lixi-Checked 😀

Potential problem for the Contrepreneur is that facts can be checked. And they address it via Liar’s Advantage:

source: http://maximusandme.blogspot.com/2013/01/liars-advantage.html

On one hand, people are more willing to swallow a lie from someone we perceive wealthy and successful. On the other hand, if one lives and believes in the lies he continuously tells, it’s hard to distinguish a lie from the truth.

This technique is mostly used by politicians. People who can say X and its contrary, and when challenged they reply with “I never said X”… and they end up governing countries like US, UK, Brazil, Russia, and sooner or later Italy as well.

We believe in a lie if it aligns with what we want to believe. It’s a degeneration of the very well known Confirmation Bias.

And, my personal opinion, the lies that work best are those the liar truly believes in. Schizophrenia is a common trait among convincing dictators and prophets. I’m sure most of the Contrepreneurs journeys begun with some sort of acknowledgement that they’re telling lies (with few exceptions), but at one point they convince themselves that there’s no line between their lies and the truth. In the end lying all the time is not easy, and the brain needs some solid ground to attach to, and it makes it up! It’s called Plausible Deniability.

How does our guy performs on this? Judge yourself:

I do think he believes in the lies he tells. I believe he’s now a prisoner of his own character.

Step 4: Establishing Authority

So the lies are accepted because the Contrepreneur is gaining your trust, leveraging on your emotions.

At this point lies can go wild, and bold claims are made. And accepted by newfound cult members.

Like this:

Or this one:

Or… essentially every single sentence they say:

Bold claims, accepted because of perceived (fake) authority, because of cult-like following, because of leveraging on emotions and selling a dream, because this guru has an amazing and convincing bullshit backstory.

Apparently it works in any business, any country, any culture, any sector.

Checked.

Bold claims that reinforce the established authority status, must also be kept vague, so it seems they’re addressing your specific needs or wants.

Step 5: Fake Social Proof and Testimonials

MW: “Picture, text, or video testimonials are there to show you that other people, just like you, have bought this product and became successful. If they can do it, so can you. Genuine testimonials are a great way for a business to build trust. But testimonials are very easy to fake.

… And we know that!

MW: “Sometimes one of the ‘perks’ for these guys ‘premium products’ is that you can talk to future events. To promote your business. And to convince you that they have been successful thru this program. Becoming another part of the Contrepreneur formula. Unethical. Breaching all kinds of consumer protection laws.

Wow, never thought about it in legal terms.

MW: “At this point you might think this is too good to be true. So the Contrepreneur uses a strategy called Objection Removal. They aim is to remove all barriers that might prevent you from buying.

Usually connected with pricing. The most common objection is “wait, do I need to pay 1500 ridiculous Euros to learn this?”

MW: “When you’re hit with a stupid price at the next stage of the con, your gut instinct – which you should trust – is going to be saying things like ‘this seems expensive, he’s not showing me any proof that this works’.”

I know where this is going…

MW: “You’re asked to question your own beliefs.”

Step 6: Low Value Product

MW: “If you buy, you have now committed to the scam. Even worse: the longer you believe the scam, the harder it is to admit you have been conned. You just throw more and more money at it rather than admit that you’ve been had off. Because the Contrepreneur knows he’s overcharging for a Minimum Viable Product

Wow, it’s even nicer to see it in words.

Step 7: The Value Stack

MW: “Worthless add-ons to make the product appear like it’s more valuable

I don’t know if Mike refers to extras to the MVP (monthly reports, access to a private group, et cetera) or if he refers to other products to upsell (like a Gold Community / Mastermind, a more expensive product, an even more expensive product…).

I like to think that it’s the latter, but I might have some bias 🙂

Step 8: Fake Discounted Price

There’s a special price, only for today.

You need to hurry.

You’re lucky, you got a special discount. Usually in the range of 60-90%. A bit unrealistic, don’t you think? Something like from 6k to 2k. And btw, if you search for the Contrepreneur course prices you’ll never find the original price asked anywhere. It’s fake. It’s made up. It’s called Anchoring. Now you convinced yourself that the original price was 6k, yeah a bit expensive, but today special offer, only 2k, is a fucking third of that! It’s on huge sale! And it’s always 2k (for the entry level product, every Contrepreneur). Well, almost 2k 🙂

I’d bet it’s 1999 🙂

No, it’s probably 1997.

It always ends with a seven.

What do you mean… how… why?

There’s been some pseudo science behind pricing. It seems ending in a 7 converts better. And now everybody does this! “It appears more valuable

Haha I can’t believe! Really? I’m sure our friend Lixi doesn…

 

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He does it, all the fucking time! 😀

Checked (5 out of 5)!

Step 9: NLP

NLP is Neuro-Linguistic Programming, another pseudo-scientific approach to communication.

Things likeBuy now or you will be poor forever“, “buy now, you can’t afford not to do it!“, “buy now!“, “buy now!!

Doesn’t it sound familiar? 😀

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“BUY LIXI STRATEGY! NOW!”

Ultra-checked!

Step 10: Fake Scarcity

MW: “The next step of the Contrepreneur formula is to utilize the power of scarcity.”

Leveraging on FOMO, the product must appear to be (artificially) scarce. Scarcity tactics have been used since stone age. According to MW, sometimes they are legitimate: “If Nike releases limited edition training shoes, I’m going to be in the front of that queue wanting to buy them

But… the scarcity used in selling digital products is artificial, it’s fake.

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Checked, of course.

Stage 11: Plants

This is completely new to me. Having (fake) people interested in purchasing your products to increase the perception of scarcity and social proof. It’s like fake reviews / social proof, but “live”. I mean, someone who – like you – is considering the purchase, but it’s being “faster than you”.

MW: “I didn’t see a single person being turned away from this ‘limited’ availability product

Yeah, in fact you can get access to Lixi Gold if you send them an email, and since they never shared the “special price” how can you tell that the price they are going to offer to you isn’t the same? Or less? Or more? I bet they’ll tell you that “you’ve been lucky, and you cans till get the launch offer 😉

MW: “…How can you run out of a digital product?

And that’s it, this is the formula.

The last five minutes of the video is an extract of Mike’s podcast with Jenny Radcliffe, an independent consultant specialized in psychological elements of social engineering. Here‘s full podcast episode, I strongly encourage you to take a look.


Conclusions

Holy crap, it’s been another long trip!

I hope you took your anti-fake-guru vaccine today. Take your time, read this post, check the sources, watch the videos.

Maybe you already know 50-70% of the tactics exposed here. In my case, I learned a good 30-40% of new stuff, and I can spot and name patterns within seconds now.

It’d be great to make a recap of what you should be aware of here. Let’s try to keep it short:

  • Selling online digital products is great, but it’s also a territory for scammers, fake gurus, contrepreneurs.
  • If what they’re trying to sell you is “expensive” (I’d call the cut at 200 USD/EUR/Whatever), it probably isn’t worth. If it’s very expensive (above 1k) you should run away.
  • If they’re selling you a dream, run away.
  • If all their “free” material is not actionable, run away.
  • If there’s any sort of psychological manipulation, run away.
  • If you’re in a difficult moment in your life and feel vulnerable, don’t take any important spending decision, and just run away from expensive courses.
  • If the first contact with the fake guru is because of his products (via ads), run away.
  • If they didn’t get wealthy by what they teach, but because of teaching it, run away.
  • If you can’t find anything about their lives before they started selling the product, run away.

My personal bullshit bar goes even lower:

  • If they do affiliate marketing with crappy entities, unfollow.
  • If in each of their post/video there’s a call to action (subscribe, join my patreon, click on this link…), unfollow.

I’d go even further:

  • If money comes first for them, unfollow.

But RIP, you follow a lot of people! Do all of them meet your criteria?

That’s a good point.

No, not all of them. And I’m a victim of the same bias I’m recommending you to be aware of. Sunk Costs Fallacy. If I’ve committed a lot of time by following a person, it takes a lot of effort to admit that he/she’s not as good as I thought.

But I’m getting better at this. I’m slowly pruning my inflow 🙂

What about our case study, i.e. the Italian Man who went to Malta?

Well, after my last post I thought this guy was a somehow prepared “financial advisor” who monetized the hell out of it, in a borderline unethical way (in my opinion), with aggressive marketing and communication strategies.

Now that I’ve dug more into this, my current opinion is that he’s mainly a marketer, that scores very high on all of the above guru/contrepreneur checklists. He can sell Ice Cubes to the Eskimos. His marketing skills are his top skills, and maybe he has some financial skills as well, which is irrelevant btw.

Tomorrow this guy could sell dietary supplements, a new yoga practice, a way to make money online via YouTube Automation, or whatever the fuck he wants to vulnerable people.

To Italians. From financial heaven Malta. Founding companies in financial and deregulation heaven Estonia (more, and more), like the P2P Lending bankrupted platforms...

Yes, he’s a marketer, got it. And I’ll overpay 10x for his products if I buy them. But is he at least good at what he claims to be?

Well… this is under investigation.

But he said you agreed with him on this point!

Yeah, I’ve read it… sadly you can’t read it anymore: it was few minutes before banning me from Wiki Lixi and making the comments to that post private 🙂

Sadly for him I saved it. Yes, it’s the same reply where he announced his lawyers are investigating.

Anyway, we now have more tools to interpret his reply, don’t we?

He bent reality to please his worshipers and, in the rare case they find my post (I should have written it in Italian language maybe), to minimize the impact it would have on them. How? Trying to appear cool, strong, powerful, and rude (because of his Bullshit Backstory).

Amazing.

I don’t know where he read that I said that “he knows about personal finance” – which, let’s not forget, is NOT orbital mechanics or quantum physics. It doesn’t take a Stanford degree to understand the basics. It’s a task that even a “ragionere e perito commerciale” could do.

In my previous post I extrapolated pieces of his “philosophy” from the available data (posts, interviews, podcasts), and concluded that some of his sentences were qualitatively reasonable. The few times quantitative data were produced on his side, saying “it was of embarrassing low quality” is being generous with him, like his concrete stocks recommendations (Biesse, Panaria Group, Italian small and mid cap).

But ok, maybe he has some skills… well hidden, but they are there, somewhere… and then a couple of days after having published my last post I got in contact with a person who purchased The Lix Files. This person told me “how’s going”, and… holy shit guys! 😀

I’ve seen things that you wouldn’t believe!

Remember this mathematically wrong claim?

Well… I can’t tell much without approval (and screenshots) from the “repented Lix-Filer“, but the impression I had is that maybe the magnitude of the returns is true, it’s the sign that’s wrong, it should be a “minus” 😀

I’ve seen trades and performances that… holy shit! And of course same “1984 regime” in their private Facebook group as well!

The repented Lix-Filer wants to stay anonymous and not recognizable, because “he/she doesn’t know what the consequences of being identified by them would be“.

I totally understand his/her fears, and I’m sad to acknowledge that this is the current situation. It’s like if we had a dinner at a very expensive restaurant, being served with shitty food, and feeling at risk by leaving an anonymous bad review.

But you can help me change that: If you had a bad experience with their products, and want to make it public (but stay anonymous) and provide screenshots and data, I would love to hear from you! Please contact me 🙂

So yeah, my opinions about him changed again, for the worse. I now think he’s some sort of salesman, who is trying to sell you a dream using all kind of manipulative psychology techniques, which include fostering a cult-like following.

He accused me of being “a fake” because of I blog anonymously. I told him what are my reasons and that maybe one day I’ll get rid of my “anonymity”, since it already takes no more than 30 seconds to find my real name if you’re smart enough.

And then I told him that we know nothing about him. He’s a supposed “personal finance authority“, but we don’t know a shit about his earnings, spendings, net worth, investing… we don’t know a shit about him, except he used to pronounce his last name “Lisci” until 2018, and now he says “Licsi” because it sells better.

This guy was broke until few years ago (according to his own bullshit backstory words), and maybe he still his. Having to appear wealthy costs a lot of money. Spending 100k in private education (marketing, essentially) is also expensive. Declaring you hate frugality doesn’t help as well. Lixi, c’mon, put some numbers behind your claims. We’re all ears. Skin in the game! 🙂

In the end it’s he who’s just an avatar, a living meme. A sellable face on the web, that never shows doubts, only certainties. A face that we’re all going to forget soon, because that’s what greed does. Contrepreneurs don’t last much.

A man who wants/needs to appear strong, sayingtell me things straight to the face, that’s how gentlemen solve their problems“, and then banning your interlocutor, canceling discussions for convenience reasons, and go cry to the lawyers instead of “telling me straight to the face” what you think is not ok in my post. I’m willing to cooperate to preserve the privacy of others, and to correct eventual errors I’ve made. No need to go cry to the lawyers, which in my opinion there’s not much they can do.

And btw, speaking about privacy… maybe you should make your “Wiki Lixi: all the secrets in finance (LOL)” a private group. Since you’re fucking asking for people private emails to join this joke group, give them at least the impression of being part of a safe community.

And maybe you should also give a fuck about the privacy of others:

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Dear Italian readers, stay safe and social distance yourself from people like him.

That’s all for today!

I hope you enjoyed this post, it contains exactly 7777 words 🙂

P.S. if someone wants to translate this and previous post in Italian language feel free to do it! Contact me and the translation will be posted here 🙂

I know, I could do it myself but hey, it’s a lot of work!

Again, have a nice day!

28 comments

  1. Thank you for pingback! Your analysis is amazing, I remember the struggle writing that article about our common friend Franco Snack. It’s a shame that some people give away money so easily.

    1. Thank you for your testimony!
      What you documented about Frank Frühstück is exactly what Lixi does in his Facebook group. It was good to see that it’s a scripted pattern and not anything of his own skills.

  2. He comes from one of the worst neighborhoods of Rome and writes lengthy posts… what are you trying to sell us??
    I was about to suggest you the classic book from Robert Cialdini, but you already know it.
    Thanks for your post, nice reading!

    1. Exactly! I’d be the PERFECT fake guru!
      Please, keep me accountable on this, save this post as pdf, because if I’d join the evil side I’ll rewrite my past as well 🙂

      1. Period Taxable turnover Employee count
        2018 yr Q1 0.00 EUR 0
        2018 yr Q2 5 871.02 EUR 0
        2018 yr Q3 20 543.48 EUR 0
        2018 yr Q4 106 013.74 EUR 1
        2019 yr Q1 110 261.79 EUR 1
        2019 yr Q2 77 629.97 EUR 1
        2019 yr Q3 305 191.36 EUR 1
        2019 yr Q4 317 057.82 EUR 1
        2020 yr Q1 137 442.54 EUR 1
        In case, just google “turnover EE102055995”

        1. No, ancora non trovo questa cosa da nessuna parte.
          Ho aperto il tuo link originale con tre browsers differenti, anche in incognito e anche disabilitando uBlock Origin. Vedo sempre e solo una pagina vuota, senza alcun contenuto.
          Ho anche googlato “turnover EE…” e questo è quello che risulta:

          Non ho idea da dove vengano quei numeri che riporti. Se per favore hai un qualche documento o uno screenshot sarei contento di dargli un occhio.

          1. Sono in ritardo, ma io la pagina la vedo (dopo il captcha).

            Non trovo il modo di allegare gli screenshot al mio messaggio, se vuoi te lo mando via email. Comunque i numeri riportati da Nicola sono corretti.

            Btw, per la serie “ci vogliamo rovinare”, il capitale è 2500 euro.

            1. per favore mandami gli screenshot via mail.
              Io non vedo niente, neanche in incognito, neanche cambiando browser, neanche disabilitando tutte le estensioni.

              Non capisco perché.

  3. I was not really interested in reading this until.. I realized it is interesting 🙂

    And what a good timing as my dad told me that my cousin recently invested 1000 euro in platincoin. After your post I realized this is mlm combined with some worthless crypto currency and live webinars.

    Just called my cousin today and told him to get the **** out.

      1. I bet you already know it, but maybe it could motivate your run 🙂

        https://virace.app/runandwinterms/

        PS. i’m neither a swiss resident nor affiliated in any way with that competition, just going for a run with a friend of mine later today, he’s the one who told me about it… feel free to edit/reject the comment 🙂

        Luca

  4. Oh Mr Rip, ti sei cacciato in un rabbit hole non da poco.

    Io ho avuta la fortuna (LOL) di vedere sti personaggi nascere, grazie a Facebook Periodo 2010-2012….riderai ancora di piu pensando che la maggior parte di tutto cio sia partito da un gruppo facebook sulla dieta Paleo. Ho provato anche io a combattere contro questi personaggi, sopratutto sul fake guru della Paleo (che risolve tutti i tuo problemi di salute, ti ricrescono i capelli e ti si allunga il pisello), visto che la si gioca con la salute delle persone. Ma come hai notato non si riesce a combattere, il dialogo per queste persone non puo esistere perche devono mostrare ai potenzali clienti (o polli) solo che il loro verbo è legge e che chi è contrario è un fake / invidioso / incopetente. (trovi lo stesso pattern in tutti i “compagni di merenda”).
    Questi lixi, lutzu, tozzi etc sono tutti stati creati a tavolino dal merenda, ognuno cn la sua nicchia (finanza, copywriting, paleodiet) e ognuno con materiale riciclato dall’america. Lo stesso merendero ha iniziato coi concetti di Dan Kennedy e altri marchettari .
    Alla fine ho lasciato perchè di certo non si puo impiegare il proprio tempo in questa maniera, dispiace dirlo ma se le persone sono disposte a pagare questi personaggi è un problema loro. Anzi complimenti a loro che riescono ad abbindolare le persone e a convincerli a donargli i sudati guadagni. Io di certo non sarei capace di farlo, non credo riuscirei piu a guardare in faccia il mio umile padre della umile provincia della umile sardegna che ha fatto di tutto per farmi studiare (triplo lol).

    Purtroppo L^internet è diventato una grossissima marketing machine, quasi ogni persona dietro un blog / sito ha il solo scopo di monetizzare. Per questo credo tu sia una perla rara dentro un’ostrica di merda 😀 (scusa per la poesia). Se vai a ben vedere anche nel mondo FIRE la maggior parte blogga per cercare di guadagnare, abbastanza triste a parer mio.

    In ultimo, forse potrei offrirmi volontario per la traduzione in italiano degli ultimi due post, credo faccia bene alla comunita italiana….anche se rimango scettico, chi casca nella rete di sti tipi non cerca notizie contrarie ma solo conferme (confirmation bias anyone?)

    Saluti

    1. Non penso che l’obiettivo di Mr Rip sia combattere qualcuno. Piuttosto divertirsi nell’esporre la varietà del bestiario umano. Gli investimenti non sono molto diversi dalle diete. C’è un approccio scientifico e uno dogmatico. Se sei interessato all’approccio scientifico sulle diete, ti consiglio di vedere il sito https://nutritionfacts.org/ del Dr. Greger (con podcast) o di vedere su Youtube alcuni video del Prof. Robert Lustig tipo ‘Sugar, metabolic syndrome, and cancer’. Alla fine anche per le diete, tutto si risolve in una strategia semplicissima basata su una dieta prevalentemente plant-based con poca carne e zuccheri raffinati. Praticamente le verdure stanno alla dieta come gli ETF a base larga agli investimenti e la carne come le azioni acquistate con i fun-money (vanno bene finché non si supera il 5-10% del totale).

      1. Si, in generale non ho molta voglia di continuare queste battaglie “contro”.
        Preferisco creare un’alternativa che renda quella monnezza visibilmente inferiore. Dal mio canto ho che sono decisamente meno affamato dell’Esto-Maltese e degli altri come lui, visto che ho una discreta libertà finanziaria, e posso offrire prodotti migliori a prezzi attorno allo ZERO 🙂

        Ora però mi aspetta un mesetto di viaggi e visite a parenti, e poi torno a lavorare a Settembre… cercheremo di trovare il tempo 🙂

    2. Hai centrato il problema: non si può discutere con i fake guru perché devono mantenere la loro immagine nei confronti dei loro adoratori, senza quella finiscono zampe all’aria in una settimana. Chi glielo continua a pagare il leasing sui Rolex?.

      in ogni caso non sono così intenzionato a proseguire queste battaglie contro i mulini a vento, alla fine la gente a cui sarebbe utile leggere un post come questo non lo troverà mai. Invece si troverà il faccione del pelatone sponsorizzato su facebook e ci clicca. Vaglielo poi a spiegare che – grazie a due soffiate interne di acquirenti di Lix Files – stanno perdendo soldi come pazzi investendo in aziende Italiane che falliscono e… rullo di tamburi… shotando il Nasdaq 3x leveraged. Yep, questo genio è riuscito a chiudere il 2019 (anno da +30%) in perdita 😀

      Compagno di Merenda, nulla più.

      Anyway, se avessi voglia di tradurre i miei due post sarebbe una figata, magari riusciamo a dargli più visibilità tra coloro che ne hanno bisogno 🙂

  5. Ciao Mr Rip.
    Sono un semplice ragazzo di 30 anni che grazie a Marcello Ascani, che ti ha citato su youtube ha iniziato a seguirti da oggi.
    Che dire, sei un fenomeno.

    Non solo i tuoi report sono estremanente accurati e TRASPARENTI, ma sei anche un esempio per la precisione che impieghi (fin troppa ahahah).

    Per quanto riguardo sto Lixi…con degli articoli come questo verrai sicuramente indicizzato su Google, scrivo questo commento anche perchè cosi Google capisca che questo post è utile (qualcosa di siti ci capisco).

    A prescindere da tutto Luca Lixi diventa scam nel momento in cui si approccia insultando la gente.
    A me hanno insegnato che l’educazione conta, ma evidentemente quando “fai i soldi partendo dal basso” te ne freghi di tutto e di tutto, compreso delle regole di pagare le tasse in Italia visto che è andato a Malta.
    Mai e poi mai mi affiderei a lui.

    Posso chiederti una cosa?
    Uno molto più sereno (e con sede in Italia, tra l’altro è di Reggio Emilia come me) è Roberto Pesce. Anche lui vende corsi costosi eh, sia ben chiaro, sempre sulla finanza. Per caso lo conosci?

    In ogni caso, grazie per il lavoro che fai. Sei già stato salvato nei preferiti!

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