MichaelBluejay
Joined: Sep 17, 2010
• Posts: 1259
April 12th, 2021 at 9:11:25 PM permalink
A college student I know got an invitation to the National Society of Collegiate Scholars. For a \$95 membership fee you get the chance to apply for scholarships, which seems to be the only real benefit, since there's no prestige in having this particular organization on your resumé. I wondered, what's the expected value of the membership?

Browsing their website, I saw awards for \$500 or \$1000, so let's call it \$750 per award.

The sales letter said they give out \$750k/year in awards, so that's 1000 awards per year.

Their website says they get 45,000 new members a year.

So if awards were distributed randomly, the chances of getting one would be 1000 / 45,000 = 1/45.

So the expected value of an award would be 1/45 x \$750 = \$16.67.

So the return on the \$95 membership fee would be \$16.67 ÷ \$95 = 17.5%.

So, I conclude it would be a better deal for me to buy \$95 in lotto tickets for this person than to pay the \$95 membership fee.

Also, \$95/member x 45k members = \$4.3M in membership dues, but they give out only \$750k in scholarships. Hmm.

In fact, the org's Form 990 for 2018 shows:

\$5M in revenue from member dues
\$417k in grants paid out (probably the scholarships)
\$1.5M in salaries, including \$290k for the director, or \$24k/mo.
.....The director's compensation isn't far from the total amount paid out in scholarships.
\$1.5M for direct-mail solicitations

Note that they spend 3x on direct-mail marketing versus the scholarships they award.

Discuss.
Last edited by: MichaelBluejay on Apr 13, 2021
drmario
Joined: Nov 21, 2011
• Posts: 30
April 12th, 2021 at 9:44:14 PM permalink
Heck of a gig if you can get it apparently. One of many exhibits of a broken “non-profit” taxexempt status system
billryan
Joined: Nov 2, 2009
• Posts: 13347
April 12th, 2021 at 9:46:46 PM permalink
\$95 gets you bragging rights. It's another line of a resume. I'm guessing they also have networking parties in a bunch of cities.
It's a better investment than buying a star but not as good as putting it into a 401K.
I bet they also sell cool-looking plaques proclaiming your membership.
The difference between fiction and reality is that fiction is supposed to make sense.
JohnnyQ
Joined: Nov 3, 2009
• Posts: 3709
April 13th, 2021 at 3:38:10 AM permalink
Good research/analysis.

I've seen invites for this for both my kids. The invitation letter looks impressive and I think they try to look like they are affiliated somehow with the University, without saying directly that they are, because they aren't. We did NOT join.
Like the castle in its corner In a medieval game; I foresee terrible trouble And I stay here just the same
Wizard
Joined: Oct 14, 2009
• Posts: 24466
April 13th, 2021 at 11:24:46 AM permalink
Good investigative work there! What a fraud that organization is.

I have two kids in college. Both of them got lots of invitations to join miscellaneous so-called honor societies. My older daughter said they were all basically scams selling resume decoration.
It's not whether you win or lose; it's whether or not you had a good bet.
Mission146
Joined: May 15, 2012
• Posts: 15308
April 13th, 2021 at 12:02:21 PM permalink
Quote: MichaelBluejay

A college student I know got an invitation to the National Society of Collegiate Scholars. For a \$95 membership fee you get the chance to apply for scholarships, which seems to be the only real benefit, since there's no prestige in having this particular organization on your resumé. I wondered, what's the expected value of the membership?

Browsing their website, I saw awards for \$500 or \$1000, so let's call it \$750 per award.

The sales letter said they give up \$750k/year in awards, so that's 1000 awards per year.

Their website says they get 45,000 new members a year.

So if awards were distributed randomly, the chances of getting one would be 1000 / 45,000 = 1/45.

So the expected value of an award would be 1/45 x \$750 = \$16.67.

So the return on the \$95 membership fee would be \$16.67 ÷ \$95 = 17.5%.

So, I conclude it would be a better deal for me to buy \$95 in lotto tickets for this person than to pay the \$95 membership fee.

Also, \$95/member x 45k members = \$4.3M in membership dues, but they give out only \$750k in scholarships. Hmm.

In fact, the org's Form 990 for 2018 shows:

\$5M in revenue from member dues
\$417k in grants paid out (probably the scholarships)
\$1.5M in salaries, including \$290k for the director, or \$24k/mo.
.....The director's compensation isn't far from the total amount paid out in scholarships.
\$1.5M for direct-mail solicitations

Discuss.

Nothing to discuss. They don't charge a \$95 membership fee to lose money on it, probably overstaffed, as well...either that or some of the higher-ups make a ridiculous amount of money compared to work output.
https://wizardofvegas.com/forum/off-topic/gripes/11182-pet-peeves/120/#post815219
Mission146
Joined: May 15, 2012
• Posts: 15308
April 13th, 2021 at 12:05:10 PM permalink
Quote: Wizard

Good investigative work there! What a fraud that organization is.

I have two kids in college. Both of them got lots of invitations to join miscellaneous so-called honor societies. My older daughter said they were all basically scams selling resume decoration.

The Better Business Bureau is an even bigger scam.

AAA, on the other hand, can be great value. That's just the Planet Fitness business model of making a ton on the folks who join, but don't use the services. If all Planet Fitness members used the nearest gyms three times per week, not only would PF get financially crushed---there probably also wouldn't be enough machines for everyone.
https://wizardofvegas.com/forum/off-topic/gripes/11182-pet-peeves/120/#post815219
MichaelBluejay
Joined: Sep 17, 2010
• Posts: 1259
April 13th, 2021 at 12:08:23 PM permalink
Quote: billryan

\$95 gets you bragging rights. It's another line of a resume.

Hardly. Put it on your resumé, and what it says about you is either, "This applicant is trying to pass off this paid-for distinction as legitimate," or "This applicant is too dumb to realize that this organization isn't a bona-fide honor society." I used to write resumés for a living, I'd never suggest a client put an org like this on her/his resumé.

Years ago my insurance agent sent out a press release, bragging about the bogus award he got from one of those award companies, apparently not realizing it was bogus. I immediately switched agents, not trusting his competence, since that was a big red flag. Turned out I was right: The new agent advised that one policy the first sold me was wrong wouldn't have covered me in the event of a peril. (I confirmed that with the underwriter.) That could have cost me \$500k.
Mission146
Joined: May 15, 2012
• Posts: 15308
Thanks for this post from:
April 13th, 2021 at 12:14:13 PM permalink
Quote: MichaelBluejay

Hardly. Put it on your resumé, and what it says about you is either, "This applicant is trying to pass off this paid-for distinction as legitimate," or "This applicant is too dumb to realize that this organization isn't a bona-fide honor society." I used to write resumés for a living, I'd never suggest a client put an org like this on her/his resumé.

Years ago my insurance agent sent out a press release, bragging about the bogus award he got from one of those award companies, apparently not realizing it was bogus. I immediately switched agents, not trusting his competence, since that was a big red flag. Turned out I was right: The new agent advised that one policy the first sold me was wrong wouldn't have covered me in the event of a peril. (I confirmed that with the underwriter.) That could have cost me \$500k.

Resumes are bullcrap anyway. Of course, I probably spent my first several years out of college working against myself due to that opinion. The only thing I'd list on my resume was previous jobs and educational stuff. No hobbies. No clubs. No distinctions---because those are all bullcrap and none of the employer's business anyway.

There's really nothing dumber than the concept of a resume, in my opinion. It seems that employers like to have twenty, or so, rules when it comes to the writing of resumes. That's a complete waste of time. Here are my jobs, here are my schools, this was my GPA---you either want to interview me or you don't.

I always loved it when people would list stuff like that as being pertinent to places where I did the hiring, basically, both hotels. The, "What other skills," section of an application. Pretentious as hell. That application was going in the trash. If anyone brought in an actual resume to work at a hotel---that was definitely going in the garbage.

Also, anything with a misspelling.
https://wizardofvegas.com/forum/off-topic/gripes/11182-pet-peeves/120/#post815219
Joeman
Joined: Feb 21, 2014