From a psychological perspective, there actually is set of criteria (a "formula") for determine whether a group is a cult in the popular, negatively perceived, mind-control manner. A pretty well-accepted list is [summarized on wikipedia][1]:

1. People are put in physically or emotionally distressing situations;
2. Their problems are reduced to one simple explanation, which is repeatedly emphasized;
3. They receive what seems to be unconditional love, acceptance, and attention from a  charismatic leader or group;
4. They get a new identity based on the group;
5. They are subject to entrapment (isolation from friends, relatives and the mainstream culture) and their access to information is severely controlled.

From a psychological perspective, groups that follow the pattern above are **very** dangerous. The use of the word, however, does not always imply this dangerous cult-entity. So, it's not necessarily appropriate to correct someone who uses the word "cult" to describe a small following that doesn't meet these criteria.

Similar checklists have been put forth by various PhD's and psychological groups. One example:

http://www.csj.org/infoserv_cult101/checklis.htm

Another example of *how to **start** a cult*:

http://www.psychologytoday.com/blog/look-it-way/200906/how-start-cult

You'll find that a lot of small religious groups meet the first 4 criteria pretty quickly. I can't think of many well-known groups that satisfy the 5th indicator, though.


  [1]: http://en.wikipedia.org/wiki/Cult#Mind_control