Get All Access for $5/mo

Work From Home--Without Getting Scammed Don't believe everything you read. Before you invest in an opportunity, make sure it's legit.

By Karen E. Spaeder

Opinions expressed by Entrepreneur contributors are their own.

Q: I'd like to work from home, and I'm currently back in college learning Web design. But right now my inquiry is in regards to a company* that I saw a sign for on a telephone pole--I checked out their Web site, and it mentions a positive reference from Entrepreneur magazine. Before I go headfirst into this or any other business, I want to know if such an article was ever written. Are there companies like this that I can start from home?

A: Thank you for your questions. This company* does not sound familiar to me, but that doesn't necessarily mean it's either good or bad. In any event, even if this company is a legitimate franchise or business opportunity, Entrepreneur would not endorse it, per se--we would merely provide as much information as possible to our readers, based on disclosure documents and/or other relevant data provided to us by the company, such as growth rate, size of the system, number of years in business, number of operators and so forth.

We don't get all this data for every company in existence, however, because disclosure requirements vary based on whether it's a franchise (for which more disclosure is required, in the form of a Uniform Franchise Offering Circular) or a business opportunity (which has fewer regulations in place). In short, when it comes to franchises and business opportunities, our best advice is always this: Proceed with caution, and conduct your own thorough investigation.

If it's a franchise or business opportunity you want--meaning you prefer to invest in a proven business concept rather than start your own company from scratch--your job at this point is to separate the legitimate opportunities from the scams. Be wary of any opportunity that promises you'll get rich quick with little or no effort. (And it probably wouldn't hurt to be wary of any company that markets via telephone poles.) Any legitimate business will require time and effort on your part to build it and realize a profit.

To begin your investigation, gather as much information as possible about the company. We have several searchable databases at Entrepreneur.com (click on " Business Services "); get some of the basics from them if possible. We also have several sections of our site devoted to conducting your own investigation, including:

You should also contact the company directly. Find out exactly what materials and services you can expect to receive that will help you run your business. Request a list of all the buyers in your state and adjacent states, then call them. Are they satisfied with the business? Would they recommend it? Have they made money? Did the seller live up to its promises? Call several people, not just a few--you don't want to get conned into believing someone who was paid by the seller to earnestly endorse the opportunity. (This does happen.)

It's also a good idea to contact the Federal Trade Commission , Dun & Bradstreet , your state's attorney general's office and the Better Business Bureau . This will help you determine if there are any pending or previous complaints against the company as well as provide you with additional information about investigating opportunities.

Remember, it's your money you're investing. It pays to take your time so you don't wind up throwing it all away.

*company name has been omitted

Karen E. Spaeder is a freelance business writer in Southern California.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

The Side Hustle He Started in His College Apartment Turned Into a $70,000-a-Month Income Stream — Then Earned Nearly $2 Million Last Year

Kyle Morrand and his college roommates loved playing retro video games — and the pastime would help launch his career.

Marketing

5 SEO Hacks to Help You Rank Fast

Discover the best SEO hacks you can use to rank fast and avoid waiting for months to see results.

Starting a Business

Inside the Exclusive Private Club Devoted to Food, Wine and the Arts

Barrett Wissman breaks down the passions and partnerships behind his latest venture Domus Artium Reserve.

Business News

Elon Musk Threatens to Ban Employees from Using Apple Products, Says Will Lock Devices in 'Cages'

The Tesla founder sounded off on X following Apple's 2024 Worldwide Developer Conference on Monday.

Collaboration

Watch Out for These 5 Consequences of Too Much Collaboration

Beware of the collaboration trap! Too much collaboration causes overload, and well-intentioned efforts to have broad collaboration can backfire.

Science & Technology

Why We Shouldn't Fear AI in Education (and How to Use It Effectively)

Facing resistance to new technologies in the educational process is nothing new, and AI is no exception. Yet, this powerful tool is set to overcome these challenges and revolutionize education, preparing students and professionals for a future of unparalleled efficiency and personalized learning.