I’m starting to get more questions within my team regarding Viridian Energy, especially in Maryland where they have a few months of a head start on us. This review is my best effort to give an honest comparison between the two companies and which has the edge in all the important areas we compete. Please note that the compensation plan review is based on the updated Viridian Energy comp plan that does not go into effect until November 1st, 2010. I have made my best effort to represent Viridian Energy honestly using the most updated information I could find online and in conversation with several Viridian Energy associates. If you find that I have unknowingly misrepresented anything please leave a comment and I’d be happy to fix it.
Viridian Energy Start-up Cost Versus Ambit
Viridian Energy has a very strange strategy regarding startup cost for their distributors. The $20/mo for website with $59 annual renewal is nothing unusual, but the upfront cost to get started depends on how much access you want with their product line and geography, here are the options…
- $99 Single State Single Product
- $299 Single State All Products
- $399 All States All Products
Ambit Energy takes a much simpler approach at $429 to get started and have access to all operational states. On an ongoing basis it will cost you $25/mo for website and there is no annual renewal.
Viridian Energy Leadership Versus Ambit
Michael Fallquist – MBA Cornell & former COO of Commerce Energy, just happens to be the company that Ambit bought out in Texas because it was struggling due to the volatile energy spikes. This is not to say Michael was responsible for the problems at Commerce because he was brought in after the problems were created and likely he was brought in to help solve the problems. Michael started with commerce March 10th, 2008 and Commerce sold to Ambit October 27th, 2008. I just think it’s ironic that he was the one who orchestrated the sale of Commerce Energy’s Texas book of customers to Ambit Energy. There is no question that Michael has an impressive traditional resume, the one big void I see is his lack of any network marketing experience to speak of… anyone who understands the industry can attest, network marketing is a whole different animal. As the former COO of Commerce Energy, I’m sure he saw the success of Ambit Energy and Stream Energy in Texas and realized how powerful the concept of MLM is. Personally I would not feel comfortable with zero network marketing experience at the helm.
The leadership of Ambit Energy is strong from both a traditional business and network marketing background. Jere Thompson built a multi-hundred million dollar business during the deregulation of telecom. Chris Chambless experienced the Excel phenomenon from a corporate upper level management position. John Burke is a techno phenom who regularly graces the pages of top technical and computer trade magazines.
Viridian Energy States/Markets Versus Ambit
Viridian Energy has the following markets…
- Connecticut since 6/1/9
- Pennsylvania since March 2010
- New Jersey & Maryland since June 2010
- New York projected 9/10
Ambit Energy has the following markets…
- Texas since 2006
- New York since 2007
- Illinois since 2008
- Maryland on Nov 1st, 2010
- Pennsylvania 1st quarter 2011
There is one additional point that must be made regarding territories because it’s not just about having the most states, it’s also about having the right states. Texas being one of our states available for business is a much bigger deal than it may seem.
First of all, the markup and margins in Texas are much larger so residuals paid out in Texas are almost 3x bigger than those in other states like Maryland, New York and Pennsylvania. Part of the reason for this is that it is a true fully deregulated state, retail energy providers in Texas are required to handle all aspects of customer service, billing and collections which means it takes a lot more infrastructure and investment to do business in Texas. We have also made the massive investment in programming to directly handle smart meters. We are rapidly expanding to cover the entire north east but because Ambit is setup to do business in Texas means we have the infrastructure in place to open up future states/countries that will require energy retailers to handle all aspects of the retail process.
Viridian Energy Pricing versus Ambit
Viridian Energy uses variable rate pricing similar to Ambit (with the exception of Texas where contracts must be offered due to a more developed and competitive environment) and there are no credit checks or deposits with Ambit Energy or Viridian Energy.
The area where Ambit takes the lead over Viridian Energy is that we offer a savings guarantee in writing and since we’ve been offering this for more than 3 years now we have the history to back up the guarantee. This is also in writing in the terms of service so customers know that it is a zero lose proposition to choose Ambit for their energy supplier.
With a written guarantee in place the edge definitively goes to Ambit.
The Power Of Our Exclusive Free Energy Program… Yes That’s FREE Electricity & Natural Gas
Our Free Energy program is something that not just separates us from Viridian Energy, but it also separates us from the entire network marketing industry. It’s almost like cheating… except it’s not! Having one of the largest companies on the globe as our energy supplier combined with Ambit’s patented billing and customer care platform gives us the efficiencies to offer not only the finest compensation program and guaranteed customer savings, but also some even more exciting and game changing programs… namely our “Free Energy” program.
The Free Energy program works like this… any Ambit customer (even if that customer is also a consultant) who refers 15 other customers will get a free energy credit or rebate check in the mail (depending on territory) every month equal to the average of the electricity bills or supply charges of the 15 or more customers they referred.
Why is this so big?
This program turns your customers in to walking billboards for your business. It gives affiliates/non-profits some serious marketing juice when their supporters can not only switch their service to support the cause but also help actively promote others to switch for the cause and they can get free energy for doing so.
In addition imagine how powerful it is to have your entire team of consultants earning free energy each and every month. Ambit already pays up to $400 in up-front “Fast Start” bonuses to new consultants just for gathering customers and these same customers count toward the Free Energy program as well! So just by joining as a consultant and gathering customers you need to earn your investment back and be qualified, you will earn Free Energy on top of it all!
Normally in network marketing people can’t stay excited long enough and end up getting frustrated and quit long before the magic of exponential growth can kick in. With Ambit’s Free Energy program, our consultants are getting reminded every month why Ambit works and their story gets stronger and more exciting every month! We’re turning the MLM industry upside down with Free Energy!
Viridian Energy vs. Ambit Energy Fund-raising program
Both Ambit and Viridian Energy offer programs catering to fund-raising and/or non-profits. Both companies pay the same commission to the non-profits on a per customer basis but because Ambit’s minimum usage requirement is lower than Viridian’s, Ambit is going to end up paying much more in residuals in an apples to apples comparison.
Viridian Energy pays out one time customer acquisition bonuses starting at $250 for 25 customers then there are 7 stepping stone levels of customer acquisition that pay out a bonus of $250 on the way up to 500 customers which is the last bonus level and pays out $2500.
Ambit’s Free Energy program gives our affiliate/fund-raising partners extra zing to work with because they can promote the fact that not only can people switch their service to help the cause but they can refer customers to help the cause and earn free energy for doing so. This is some serious marketing juice that can help affiliate/fund-raising efforts go viral.
There is no doubt that Viridian Energy focuses much more heavily in their promotion and branding on their fundraising/non-profits program but does Ambit Energy or Viridian Energy have the better program is kind of a matter of opinion. The big perk with Viridian Energy is the up-front bonuses for customer acquisition while the big perk with Ambit is their “Free Energy” program that incentives their customers to go out and gather more customers who also help the cause.
Commercial Energy Availability
Viridian Energy has chosen to offer commercial energy right out of the gate in all markets it serves, which is a different strategy than Ambit which does commercial in Texas and New York. Ambit has historically entered every marketplace with just residential because it fits the network marketing business model of keeping it simple and allows them to focus on one thing and dominate it.
Generally speaking commercial energy is a segment that is heavily competitive and the domain of professional sales people who do nothing but focus on commercial. This is also why so many commercial brokers work with Ambit Energy as well because we can offer better value for the people that want residential which is not what they focus on and so they cannot offer the same kind of value.
If commercial business is important to you than Ambit’s lack of commercial in some markets could be a negative so on this point Viridian Energy has an edge.
So often in network marketing it is tough to overcome the credibility factor and negative stigma of the industry. Ambit is the ONLY network marketing company in the history of INC.500 to be named #1 fastest growing. Ambit has a BBB A-Rating, is a member of the DSA (Direct Selling Association) and has its own iPad application. I’m not implying Viridian Energy or any other company that does not have some of these credibility factors behind them is not credible but it sure is nice to be in a position of such strength as Ambit is where the question of legitimacy and credibility becomes a non-issue.
Please note the difference in terminology that is used between the two companies. In the titles of each section the Viridian Energy equivalent to the Ambit Energy term is shown in parenthesis.
Jump Start (Fast start) bonuses:
Viridian Energy pays new associates an upfront $100 “fast start” bonus for getting 5 customers within their first month. Viridian Energy associates can continue on within 90 days to earn an additional $200 in bonuses by gathering 10 more for a total of 15 customers.
Ambit pays new consultants an upfront $100 “jump start” bonus as well but it only takes 3 customers to earn it. Consultants can continue on within 120 days to earn an additional $300 in bonuses by gathering additional customers.
Advantage goes to Ambit here because the first $100 is earned much faster at 3 customers versus 5 with Viridian Energy.
Team Builder (Mentor) Bonus:
Viridian Energy matches the “Fast Start” bonus to the sponsor of the new associate who is gathering customers which means if a associate earns $100, $200 or $300 in “Fast Start” bonuses, their sponsor also earns the same and this is called a “Mentor” bonus in the Viridian Energy compensation plan.
Similarly, Ambit matches Viridian Energy with ‘their “Jump Start” bonus but only the first level called “Jump Start 1” which means every time you sponsor a new consultant who gathers 3 customers in their first month you will earn $100.
I have to call this a draw and here is why: the average distributor in a utilities based network marketing business gathers right at 7 customers historically speaking, this may vary a bit but not much, and therefore very few Viridian Energy associates are going to earn that second or third tier of “Fast Start” bonuses. This also means very few sponsors are going to earn the second and third tier of “Mentor” bonuses. Also factor in the first $100 is earned much easier with Ambit at 3 customers versus the 5 it takes with Viridian Energy, therefore more people will earn it.
Consultant Leadership (Mentor) Bonuses:
Developing a residual income takes time and so both companies compensate for a growing team that is gathering customers.
Viridian Energy does this through an extension of their “Mentor” bonus in which they pay $25 every time a “Fast Start” bonus is earned by new associates through levels 2, 3 and 4 of your organization. This is a leadership based bonus so you must be a Director to earn this. Add these bonuses up and you come to a total of $75 that gets paid out when a new consultant joins and gathers 5 customer points within their first month. Theoretically if that new consultant went on to earn the 2nd and 3rd tiers of the “Fast Start” bonus program then two more sets of $75 would get paid out upline but since the average consultant gathers well less than 10 customers in their lifetime this is a rare occurrence.
Ambit Energy’s “Consultant Leadership” Bonus program also pays for growing a team that is gathering customers. As consultants promote through the leadership ranks they earn a bonus for every new consultant that joins their team through unlimited depth. These bonuses start out at $55 for Regional Consultants, add an additional $80 for Senior Consultants, add another $80 for Executive Consultants and another $25 for National Consultants. All together there is a total of $240 in leadership bonuses that get paid out every time a new consultant joins the business that gathers 3 customers within their first month in business.
The edge on this area of compensation goes definitively to Ambit for 3 reasons: (1) they pay much more upline ($240 versus $75) for every new consultant that gets their first couple customers (2) earning this bonus requires only 3 customers versus 5 and therefore more of these bonuses are going to be paid (3) they pay $240 EVERY TIME a new consultant joins that gathers their customers versus only paying $25 three levels upline if there happens to be a Director on those three upline levels
Customer Residual Income (Monthly Income Bonus)
Before we get into the numbers of the residual payouts on both companies it is critical to understand that the two companies use a completely different measuring stick to determine residual payout. This makes comparing the residual payouts a bit of an apples and oranges situation, check out the video to see what I’m talking about…
Both companies pay residuals based on tiers of banding (usage) so that if a customer uses more electricity you get paid more residual and vice versa. The big hidden difference is where the first band (usage level) starts and then when and how the bands change as customer use more energy. Viridian’s first usage level starts at 300 kWh. Ambit’s first level of banding starts at 200 kWh, which means that a customer using less than 200 kWh would not trigger a commission in either comp plan but Ambit is going to pay residuals on a significant chunk of customers that would fall into the 200 to 300 kWh range that trigger no residual in Viridian Energy . In addition, Ambit’s first band of usage (band 1) that starts at 200 kWh pays out a total of $3.25 where Viridian’s band 1 starting at 300 kWh only pays out a total of $1.10. Between 500 kWh and 1000 kWh the advantage flips to Viridian’s favor then from 1000 to 1500 kWh if flips back into Ambit’s favor. The flip flop continues beyond throughout the additional banding levels.
It’s impossible to tell if Ambit Energy or Viridian Energy pays out more in uni-level residuals (which is what were talking about in this section, regardless of what Ambit Energy or Viridian terms it) without knowing exactly what percentage of customers fall into which bands of usage.
The big difference I see is not in how much is paid out but how it’s paid out, check out the next video to see what I’m referring to…
Viridian Energy pays its uni-level residuals only through 3 levels and the amount paid per customer reduces the further down you go. This structure rewards personal production and the production of your personally sponsored associates, which is much more of a direct sales format. Ambit pays through 6 levels and the amount paid per customer increases the further down in depth you go, which is a structure designed to reward leverage and duplication… much more of the network marketing approach.
To put real world numbers behind what I’m talking about, I’ll use my downline of customers, and out of the customers that fall within 6 levels, 68% of them fall in levels 4, 5 and 6, which makes these levels very important to me! I don’t know about you, but I didn’t get into this business to go out and enroll hundreds of customers and make a living as a sales person, I got into business to create leverage and get paid on tens of thousands of customers through teamwork and duplication.
For me I have to give the edge on this area again to Ambit because I am in this business to create a residual income through the power of network marketing and Ambit is structured to compensate much better for that effort.
Viridian Energy Customer Residual Bonuses (Infinity & Generation Bonus):
Viridian pays a “Generation Bonus” that essentially means when you reach the rank of Director and then develop other Directors in your team you will earn an additional customer residual of between $0.25 and $2.00 per month on 4 generations of leadership groups as you move up the ranks. There is A LOT of breakage in this aspect of the comp plan so it is impossible to determine exactly how much is really getting paid out, but there is a $2.00 per customer cap so you can be sure that Viridian is expecting to pay significantly less than that amount.
When you promote beyond Director to Platinum Partner and beyond there is an “Infinity Bonus” of between $0.05 and $0.25 per customer with a per customer cap of $0.50. Once again, impossible to determine how much actually gets paid out on this but because it is an infinity bonus you can expect less breakage here than in the previous “Generation Bonus”.
Ambit has a similar rank/leadership based residual bonus called “Customer Residual Bonuses” which pays $0.25 for each leadership rank (RC, SC, EC & NC) which adds up to $1.00.
So does Ambit or Viridian have the edge in this aspect of the comp plan? On the surface it would seem that Viridian pays much more per customer in leadership based residuals but because all their bonuses have significant breakage it is impossible to actually say how much is getting paid out. Ambit’s leadership based residuals are paid out every time no matter what so unless Viridian wants to let me know what their breakage is I can’t say who comes out ahead.
My final thoughts on Viridian Energy
In the end I guess it depends on what you plan on doing as to which company Ambit Energy or Viridian Energy would work out better for you. If you plan on signing up hundreds of customers yourself, making affiliates/non-profits your main focus, and/or enrolling distributors who are going to do the same thing then Viridian might work out better for you. On the other hand if you understand that network marketing is a business of leverage in which most people don’t do a lot individually, then you probably want to work with a company that understands this and rewards accordingly. Viridian Energy is a fine company but when it comes to network marketing I hope this review has helped you realize that Ambit Energy is still leading from the front.
Please share your thoughts
Don’t be afraid, it’s an open forum so share your thoughts and if you’re with Viridian and reading this review please let me know if I’ve incorrectly represented anything. My goal is to be 100% factual and if I’m off the mark let me know.
Yours in success,
Ambit Energy Founding Executive Consultant
Top 20 Income Earner
Six Time 5-Star Club Qualifier
Pacesetter, Powersurge & Pure Energy Award Winner