ViSalus

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ViSalus
Traded asParent Company NYSEBTH
IndustryMulti-level marketing
FoundedMarch 1, 2005 (2005-03-01)
HeadquartersLos Angeles, CA, USA
Number of locations2
Area servedUSA, Canada, UK
Key peopleRyan Blair, Co-Founder, Chief Executive Officer; Blake Mallen, Co-Founder and Chief Marketing Officer; Nick Sarnicola, Co-Founder and Global Ambassador;
ProductsDietary supplements
Employees275[1]
ParentBlyth, Inc.
Websitewww.visalus.com
 
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ViSalus
Traded asParent Company NYSEBTH
IndustryMulti-level marketing
FoundedMarch 1, 2005 (2005-03-01)
HeadquartersLos Angeles, CA, USA
Number of locations2
Area servedUSA, Canada, UK
Key peopleRyan Blair, Co-Founder, Chief Executive Officer; Blake Mallen, Co-Founder and Chief Marketing Officer; Nick Sarnicola, Co-Founder and Global Ambassador;
ProductsDietary supplements
Employees275[1]
ParentBlyth, Inc.
Websitewww.visalus.com

ViSalus is a multilevel marketing company based in Los Angeles, California, with offices in Troy, Michigan.[2] ViSalus is a subsidiary of Blyth, Inc. The company markets weight management nutritional products, dietary supplements and energy drinks in the United States, Canada and UK through a network of approximately 76,000 independent distributors.[3] Weight management products, including Vi-Shape meal replacement shake and Vi-Trim Clear Control Drink Mix, form the bulk of the company's sales.[4]

History[edit]

ViSalus Sciences was originally started in 1997 as The Free Network, LLC, a long-distance Network Marketing company founded by David Rutz in Troy Michigan. In 2001, Rutz left the company to start a different Network Marketing company. Later, in 2005, the company officially changed its name to Visalus Sciences yet remains headquartered in Troy, MI. Sarnicola and Mallen were distributors for The Free Network prior to being named "founders" of Visalus. In March 2005, Sarnicola and Mallen began promoting ViSalus full-time, in Northern California.

In 2008, ViSalus was acquired by Blyth, Inc. In the first stage of the takeover – completed in 2008 – Blyth purchased a 43.6% equity interest for $14.0 million.[4][5] Blyth completed the second phase of the takeover in 2011, investing an additional $2.5 million and increasing their ownership share to 57.5%.[6]

The 2008 recession put ViSalus near bankruptcy, with the business $6 million in debt.[7] Ryan Blair, the company's CEO – a reformed gang member turned entrepreneur[8] – steered ViSalus back to profitability, investing his last million dollars in the business. By 2010, when Blair was awarded the DSN Global Turnaround Award for his role in reversing the company's fortunes, ViSalus was making over $15 million a month.[8]

In 2013, Visalus launched in the United Kingdom.[9]

In October 2013, Visalus appointed Dr. Silvia Uribe, PhD., as Vice President, Research & Development. Dr. Uribe will be responsible for providing strategic direction, planning and leadership for the formulation, licensing and regulatory management of the Company's global product portfolio.[10]

Controversy[edit]

In August 2012, Blyth – which then owned a 73% share of Visalus – planned to spin off the company in an initial public offering of shares worth up to $175 million. In September 2012, Moody's Investors Service downgraded Blyth's credit from "stable" to "negative,"[11][12] and Blyth withdrew the Visalus IPO citing uncertain market conditions.[13]

In November 2012, Bernstein Liebhard alleged in a class action lawsuit that Blyth overstated the nature and viability of Visalus' strong financial results which masked declining performance in Blyth's other operating units. The suit alleged that Blyth officers and directors violated the Securities Exchange Act by issuing materially false and misleading statements regarding Blyth's financial performance.[14]

CNBC Commentator Herb Greenberg said ViSalus walks "a controversial line between legal direct selling and pyramid scheme."[15]

Criticisms[edit]

ViSalus was investigated by the Southern Investigative Reporting Foundation which published a detailed report that assailed the company's business model and high probability that investors will lose their money in the scheme, as reported by The National Council Against Health Fraud in their journal Consumer Health Digest (2013).[16]

Oct 2013: Ocean Avenue Hits ViSalus With Espionage Lawsuit[17]

Products[edit]

Weight-management products, including Vi-Shape meal replacement shake, Visalus Go Instant Energy and Vi-Trim Clear Control Drink Mix, form the bulk of the company's sales.[4] Other products include Neuro, an energy drink, and Vi-Pak, an energy supplement, which was developed by Dr. Michael Siedman, an ear, nose and throat specialist.[2] Visalus promotes its products with the Body by Vi Challenge, a weight loss initiative encouraging people to lose weight and achieve fitness goals over a 90 day period.[18][19][20]

Charitable activities[edit]

The Body By Vi Community Challenge is a program in which the company matches customers' contributions of Visalus products to regional food banks.[21] The company also sponsored the Game of Life Basketball Camp, a one-day children's summer camp in Memphis, Tennessee.[22]

References[edit]

  1. ^ ViSalus. "ViSalus Careers. About Us.". Retrieved 6 May 2012. 
  2. ^ a b "Pill Power". Metroactive. Retrieved 3 May 2012. 
  3. ^ "Blyth, Inc., Form 10-K, Annual Report, Filing Date Mar 14, 2013". secdatabase.com. Retrieved April 26, 2013. 
  4. ^ a b c Edgar Online via Yahoo Finance. "Blyth Inc. 10K - 4/18/2011". Retrieved 15 May 2012. 
  5. ^ DM News. "Blyth Makes Two Acquisitions". Retrieved 3 May 2012. 
  6. ^ Reuters. "Blyth, Inc. Completes Third Closing of ViSalus Acquisition". Retrieved 6 May 2012. 
  7. ^ Giang, Vivian (14 August 2012), How This Guy Went From Gang Member To Multimillionaire Entrepreneur, Business Insider, retrieved 10 February 2013 
  8. ^ a b Forbes. "Entrepreneurship: Nothing to Lose and Everything to Gain". Retrieved 3 May 2012. 
  9. ^ |title=Visalus Launches in the United Kingdom | url=http://www.bmmagazine.co.uk/news/17436/visalus-launches-in-the-united-kingdom/
  10. ^ http://visalusblog.com/press/press-releases/
  11. ^ "Blyth shares down as Moody's wary of IPO plan". CBS Marketwatch. September 21, 2012. Retrieved 2012-09-23. 
  12. ^ "Moody's lowers outlook on Blyth". Bloomberg Businessweek. September 20, 2012. Retrieved 2012-09-22. 
  13. ^ Blyth's ViSalus unit pulls plans for IPO, Marketwatch, 26 September 2012, retrieved 10 February 2013 
  14. ^ Bernstein Liebhard LLP Announces that a Securities Class Action has been Filed Against Blyth, Inc., Bernstein Liebhard LLP, 13 November 2012, retrieved 4 March 2013 
  15. ^ Greenberg, Herb (24 August 2012), Beware of Get-Rich-Quick IPO, CNBC, retrieved 1 March 2013 
  16. ^ National Council Against Health Fraud, Consumer Health Digest #13-10, March 7, 2013
  17. ^ http://www.businessforhome.org/2013/10/ocean-avenue-hits-visalus-with-espionage-lawsuitocean-avenue-hits-visalus-with-espionage-lawsuit/
  18. ^ Kitt Walsh. "Be a kick butt entrepreneur". CNN Money. Retrieved September 25, 2012. 
  19. ^ "Supplement Maker's Sales Appear Up to 'Challenges'". Los Angeles Business Journal: 10–12. 30 April 2012. 
  20. ^ "The Changing Face of Commerce". Nutrition Business Journal (Direct Sales Channels: Internet, MLM, Media) XVII (4): 3–4. 1 April 2012. 
  21. ^ My Ambassador Academy. "Giving Back - The Body By Vi Community Challenge". Retrieved 8May 2012. 
  22. ^ Yahoo News. "Percy Miller, Romeo Miller, Ryan Blair and Urban Born Founder Johnell Langerston Team Up To Help Kids". Retrieved 6 May 2012.  (press release)