Perpetual Leverage and the Aussie 2-Up System are two very different compensation plans that are frequently believed to be the same by home biz newbies. Perhaps better than a definition of each is a quick contrast between the two. Let's go.

Now if you have heard about the 2-Up system, then you probably know that after you give your first two sales to the person who signed you up, you're free to earn a commission on every sale after that.

So really after you send your first two commissions to your upline director, you become autonomous and by no means will you ever have to send your commission up to another. Every commission that you make from that day forward is yours to keep. Okay, now for the tricky part....

It is exactly at this point where you are free to earn money that things get tricky. With your new found freedom also comes the realization that after your personally sponsored members pass up their two sales, they become your contenders.

What's the real issue here? The real issue is that after you invest valuable time training them with your skills and painfully acquired knowledge to help them make their pass-up sales, they break away and compete with you for sales.

Take Pay-Per-Click (PPC) advertising. Let's say, for example, that after several hard-fought months of learning about keywords, PPC and link building, you've carved out a veritable treasure trove of a marketing niche for yourself. With your first two members, you unload all of your PPC guru tips to get the money flowing upstream. Sure enough, several weeks later they make their first sale and then their second. No problem, right?

Well, everything's good as gold until your members receive their director's releases. Then one morning as you're checking your Google PPC's, you find that they've altered their PPC ads slightly, and are now bragging about how they are better than the other guy-you. Bam! They are now your competitors.

Do you follow me? The Aussie plan results in you putting forth great amounts of effort to learn new skills and train your new members to become your competitors. That's like beginning with a complete cake (the marketplace) and constantly slicing it into tinier and tinier pieces. Who benefits from that scenario? No one.

Just the opposite is true with Perpetual Leverage. With Perpetual Leverage you never make a competitor because you build a team and never pass anyone up. So if, for example, you have five personally sponsored members, you will have five websites working to create income for you, for your commission is attached to theirs. (If they make $500, you make $500 too.) Plus, even if you altogether stop marketing memberships, Perpetual Leverage allows you to stay connected to your team, earning you a passive income.