The movie “Betting on Zero” is, at best, an infomercial targeting the direct selling industry and companies like Avon, Pampered Chef, Mary Kay and Amway. Products from direct selling companies are typically not sold in retail stores but are available through a network of independent businesspeople. In 2015, in the United States alone, direct selling companies generated more than $36 billion in retail sales and involved more than 20 million people.
Conceived and paid for by a New York hedge fund investor trying to make good on his own financial bet against a direct selling company, “Betting On Zero” purports to tell the story of Bill Ackman’s unprecedented, uninformed and unimaginable billion-dollar-bet against one of the largest direct selling companies in the world, Herbalife Nutrition. Now surpassing four years, Bill Ackman’s attack on Herbalife Nutrition has been called everything from “deplorable abuse” to “foolish” to a “colossal hubristic quest for vindication.”
Noted policy makers, thought leaders and journalists have all publicly questioned Ackman’s motivation, tactics and judgment and have called on him to stop his vicious attacks against the nutrition company. For instance, when asked by CNBC about comments made to the New York Times as to whether Ackman had crossed the line from “trying to spread the truth” to “trying to move the price of a stock,” former SEC Chairman Harvey Pitt explained, “It is certainly looking that way.” Pitt continued, “If you are trying to move the price of a stock to vindicate your investment philosophy, that’s not okay.”
The fundamental problem with the “Betting On Zero” film is that while it calls itself a “Herbalife documentary”, it really is an infomercial that is neither balanced nor grounded in the truth. It fails to capture one important side in this battle and fails to interview any of the more than 4 million independent distributors or customers who use Herbalife Nutrition products around the globe.
But then again, the movie was never designed to be a fair portrayal of the Ackman attack, but instead was intended to be a stalking horse for one investor’s bet against a direct selling company. To understand more, one merely needs to follow the money.
Betting on Zero – THE HISTORY OF HOW THIS CAME TO BE
In 2014, the director of “Betting on Zero” approached Herbalife Nutrition about having its CEO appear in a film he was making about Bill Ackman’s attack on the company. When asked who was funding the film, the director answered that a “businessperson [is] interested in financing a series of films about American small business. The funder wishes to remain anonymous.” The director stated the funder did not have, and never has had, a financial interest in Herbalife Nutrition. Herbalife Nutrition’s representatives considered the filmmaker’s offer but ultimately decided not to participate because of the director’s vague answers.
The company’s decision not to participate was prescient as it was later revealed, despite the director’s claims to the contrary, that the film was funded by a short-seller who stands to profit financially when the direct selling industry is attacked. Additionally, it was recently revealed that Bill Ackman and his team of bankers were also collaborating and conspiring on the film which is not surprising as he has been involved in a case of market manipulation for more than four years in an attempt to make good on his failing billion-dollar bet.
Yet the director attempted to conceal the identities of those involved in the funding and creation of the film. Why? Well, it is simple. They knew that revealing the identities would undermine the film’s credibility, authenticity and independence.