“Always invest in people.” – Dan Price
Businesses implement strategies that would make them grow and prosper. Oftentimes, they follow a certain structure that’s aligned with other business establishments so that nobody gets left behind.
However, if you plan on becoming like Jeff Bezos, Bill Gates, or Elon Musk, then you must think out of the box.
When we talk about business, breaking the norm could be dangerous, but it could also propel you in hitting the MEGA jackpot!
While most people would probably say a CEO’s salary must be 1,000 times more than the employees, this CEO thought otherwise.
Dan Price knows his employees’ respect and trust comes with a price.
Price is the CEO of Gravity Payments, a credit card processing, and financial services company.
On April 13th, 2015 he made the biggest announcement that he and the rest of the company, especially the employees, have never forgotten up to this day.
He increased the minimum pay to $70K for all his employees.
Sounds crazy, doesn’t it? Yes, he actually did that! But to pull it off, it came with an absolute effect on his own pay.
He had to cut his CEO pay from $1.1M down to $70K!
Unfortunately, a lot of people and businesses laughed at the idea. He was called names like a “socialist” and the “lunatic of all lunatics” because of what he did and they said his employees would be on breadlines.
A lot of negative feedback has been given about his idea. An idea that for some people was made by the heart and not by the mind. Are his critics true about him? Is it really going to fail?
He’s proven his critics wrong!
They first implemented the $70K minimum wage for the 130 employees that they have in their Seattle office. It became extremely successful they’re able to put up another site in Boise.
From 130 employees, it went up to 200.
In fact, according to Price, at the start of the pandemic, the company lost 55% of its revenue overnight.
But the positive attitude of the CEO was passed onto the employees as they started to volunteer in taking temporary cuts on their pays to avoid any layoffs.
“We weathered the storm, paid everyone back and are now giving out raises,” Price wrote on his own Twitter thread.
What inspired him to implement the $70K minimum annual pay?
It wasn’t because he wanted to be noticed or become a “talk of the town”. He did it because he simply cares about his employees.
“An employee was secretly working a 2nd job at McDonald’s. It was clear I was an awful CEO who was failing his employees. I gave her a raise to quit that job. No one should have to work two jobs to make ends meet.”
How can I be his employee? I mean, who wouldn’t want him as a boss? He truly is a man with a big heart for the people.
Six years have already gone by and he’s still enjoying the fruits of his labor.
He didn’t only prove his critics wrong but also made a huge impact in the corporate world.
He changed the norm, revised and overhauled the original blueprint of the business, and helped his employees in an immeasurable margin.
“After our $70k min wage:
*76% of employees are engaged at work, 2x the national average
*Customer attrition fell to 25% below nat’l average
*We expanded to a new Boise office & enacted $70k min wage there
*Our highest-paid employee makes 4x our lowest-paid employee, down from 33x”
“Since our $70k min wage was announced 6 years ago today:
*Our revenue tripled
*Head count grew 70%
*Customer base doubled
*Babies had by staff grew 10x
*70% of employees paid down debt
*Homes bought by employees grew 10x
*401(k) contributions grew 155%
*Turnover dropped in half”
Dan Price is truly an inspiration.
We hope that more businesses, especially the big ones, would try to follow what he did 6 years ago. It’s a gamble yes but I believe taking risks for the sake of many is always worth the try, don’t you think so too?
Kudos to you Price! You are the BEST CEO!
See how this “socialist” became a hero to his employees below!
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6 years ago today I raised my company's min wage to $70k. Fox News called me a socialist whose employees would be on bread lines.
Since then our revenue tripled, we're a Harvard Business School case study & our employees had a 10x boom in homes bought.
Always invest in people. pic.twitter.com/o7Ca7I4b7e
— Dan Price (@DanPriceSeattle) April 13, 2021
