Pyramid scheme

Etymology

From the shape of a pyramid, since each recruit must enlist several more, so the base widens at every level. The metaphor captures why collapse is inevitable: the population needed to sustain it grows geometrically until it cannot be filled.

noun phrase · /PEER-uh-mid skeem/
A fraudulent business model in which participants earn mainly by recruiting new members, whose payments flow upward to earlier recruits.
What it names
A structure doomed by its own arithmetic — one that needs endless recruitment to survive — as a recognizable category of fraud.
Example
It was dressed up as a wellness brand, but with no real product it was a pyramid scheme paying off whoever joined first.
Related idea
Close cousin of the Ponzi scheme, but the mechanics differ: a Ponzi is run centrally, with one operator secretly paying old investors from new deposits, while a pyramid pushes the recruiting down to participants themselves, each pressured to enlist the next tier.