Solavei, An MLM Telecom Company In Space TelexFree Wants To Occupy, Declares Bankruptcy Less Than 2 Years After Debut; Competing Affiliates Try To Poach Recruits

Source: Twitter.

Source: Twitter.

UPDATED 6:07 P.M. EDT U.S.A. In yet another bizarre development in the world of MLM, a company that competes in a space TelexFree said it wants to occupy has declared bankruptcy less than two years after its formal launch.

As though on Stepfordland cue, competing MLMers started trawling the Internet for the carcasses of potentially disaffected affiliates.

Seattle-based Solavei, which offers a cell-phone service, announced its Chapter 11 filing yesterday. Now in bankruptcy court itself, TelexFree has said it, too, wanted to offer a cell-phone service on top of its VOIP product.

Solavei formally launched in July 2012, saying it was a “new social commerce company with an affordable, contract-free mobile service that actually pays back consumers for adding new members.”

The company, however, now says it needs to restructure its debt “in line with operating income and more accurately align costs and infrastructure needs.”

Some MLMers immediately pounced on the news of the bankruptcy filing, using it as a means of poaching Solavei affiliates into competing MLM “programs.” Like some TelexFree loyalists, some Solavei fans tried to dismiss the Solavei filing as business as usual.

Solavei itself declared on Twitter that it was “Happy Pay Day.”

The firm says its members and employees “will notice no changes in service or operations as we work with our vendors and investors to refine the social commerce platform and model we pioneered. Solavei will emerge from this process equipped to continue our growth with strong operations, a better cost structure, and opportunity for our members.”

Read a Solavei brief (and accompanying comments thread) at BusinessForHome.

MLM often is known for epic PR blunders and embarrassing efforts to poach recruits. When two TelexFree affiliates were referenced in Brazilian media accounts about suicide deaths, some fellow affiliates spammed the stories with offers to join the “program.”

After TelexFree confronted pyramid-scheme allegations in Brazil, some affiliates responded by asserting they were “100% TelexFree.”

Perhaps channeling the PR approach of TelexFree Stepfordians, one Solavei affiliate on Twitter declared himself “100% Solavei now!” Another on Facebook roared, “I am Solavei!”

MLM’s telecom sector is known for strange occurrences. In 2010, an upstart  “program” known as Data Network Affiliates purported to be the world’s low-price leader in cell phones, offering “unlimited” talk and text for $10 a month. The company appears to have made the claim despite the fact it had no carrier agreements and no licensing.

It then backed away from the claim, bizarrely asserting that a vendor had made it believe it had crushed all competition on earth.

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3 Responses to “Solavei, An MLM Telecom Company In Space TelexFree Wants To Occupy, Declares Bankruptcy Less Than 2 Years After Debut; Competing Affiliates Try To Poach Recruits”

  1. Quick note: When the SEC moved against Zeek Rewards in 2012, an MLM telecom company known as Vi-Tel and its affiliates immediately went trawling for warm bodies.

    Some of that is covered here:

    I haven’t seen anything yet that suggests Solavei is in regulatory hot water. But some affiliates from competing companies or opps are definitely seizing on the bankruptcy filing as a means of scooping up affiliates.

    Just another day in Vultureland, with Stepfordians present on both sides.

    In 2012, Zeek’s carcass was still warm. Here is part of what Vi-Tel said in a news release announcing a purported “Zeek Rescue Program”:


    “Vi-Tel will give safe harbor to any and all Zeek representatives and affiliates who have lost their business and have no control over the situation. Dealing with the loss of a business can be difficult and Vi-Tel understands this through its compassion for others and the industry.”




  2. Quick note: NikSam at reports that Solavei listed $5.27 million in assets and $63.1 million in liabilities:


  3. IIRC, ViTel pulled the “rescue plan” about a week later after heavy criticism. Last year they launched ViSocial and went nowhere. They also had a ViEnergy which went nowhere either. They merged with Shopping Sherlock and disappeared.