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CEO Dan Price Says Company’s Revenue Has Tripled Since He Gave Employees $70K Minimum Salary

Freja

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CEO Dan Price Says Company’s Revenue Has Tripled Since He Gave Employees $70K Minimum Salary


In 2015, Gravity Payments CEO Dan Price announced he would cut his own $1 million salary by 90 percent and bring the salaries of his employees up to a minimum of $70,000 per year

Criticism is part of the job when you're the head of a successful company, and Dan Price received plenty of it six years ago when he announced a radical shake-up at Gravity Payments.

It was in 2015 that Price, the credit card processing company's CEO, announced he would cut his own $1 million salary by 90 percent. Not only that, he also announced plans to bring the salaries of his 130 employees up to a minimum of $70,000 per year.

The move was surprising, and definitely wasn't par for the course in the world of business. A study from the Economic Policy Institute found CEOs in the United States typically make 320 times as much as their workers, and most receive lucrative salaries averaging $21.3 million a year as of 2019.

Today, it seems Price's decision has worked out for the best. On the sixth anniversary of his announcement, Price revealed on Twitter that Gravity's revenue has tripled since 2015.

"Six years later and our revenue has tripled. More importantly, our staff and company are thriving in various ways," Price tells PEOPLE. "[We have a] 10-time increase in new homes bought and babies born. Employees have increased savings and paid down debts."


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Price did hear the criticism back then, and he kept receipts on those who delivered it, namely Fox News pundits who called him a socialist and predicted his employees would end up in "the welfare line." He shared a few of the clips in a video on social media.

"There are still people all over the world who believed we failed because we've been barraged with the scam of trickle-down economics," Price says, referencing the economic theory that reducing taxes on business and the wealthy will benefit the whole of society in the long term.

Price was initially inspired to cut his salary after reading a 2010 study by Angus Deaton and Daniel Kahneman. In it, the researchers claimed that one's happiness and well-being may rise with income, but only to a certain point. They believed a salary past $75,000 wouldn't significantly affect one's emotional well-being, and that incomes higher than that could buy life satisfaction, but not happiness.

Then, after speaking with a friend who said a salary of $70,000 would help her raise a son and pay rent, Price was inspired to make a change at his Seattle-based company, which expanded to Boise, Idaho a few years ago and now has about 200 employees.

Price says he felt it was important to share the update on social media to relieve skepticism and hopefully inspire other leaders to go against the grain.

"It was important not only to share how we are doing but also how we all need to be skeptical of what we hear on TV and read online," Price says. "The B.S. detector needs to be on full force knowing that these false economic narratives that benefit the rich need to be defeated by all of us."

 

AwareNTired

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Making a mere 1 million and willingly cut his own salary by 90%. These other CEOS are out there making $100 million and won't see fit to cut their salary by even 10% to benefit their workers.
 

Lady Spencer

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I see his post on LinkedIn alot. What is the tea about him and his company?

Any black people work in his company and do they have lower job titles?
 

Kitty12

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Making a mere 1 million and willingly cut his own salary by 90%. These other CEOS are out there making $100 million and won't see fit to cut their salary by even 10% to benefit their workers.
The ironic part is if they did cut their salary they would see high productivity amongst their workers. But you know greed is greed.
 

Cinnahs

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Wow, what this guy did was really beneficial for his employees and his company. Imagine what would happen if these filthy rich CEOs who are making tens of millions a year raised the minimum salary. Too bad most CEOs are greedy and self serving.
 

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That’s amazing employees are buying homes and paying down debt thanks to his generosity and leadership.
 
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kaydadiva28

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That is amazing and he will have loyal employees who will probably make sure they stay with the company longterm. These other greedy ass CEO’s barely want to provide better pay or healthcare plans.
 

SouthernNotCountry

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I remember this story from yrs ago, glad he provided an update. Other countries have been proving forever that the more you take care of your employees, the higher morale and quality work they will have. I'm glad he decided to test that here in the US and it's good to see his employees are thriving. I'm hoping this, shorter work weeks, and the guaranteed income they tested in CA recently takes off but I doubt it since the ones in charge here typically have no soul.
 

sleepinchild

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I give props to him for putting his money where his mouth is and leading his employees by example. I am happy to hear his employees are thriving. Greed shouldn't be the end-all, but that unfortunately isn't the case for many...
 

Kitty12

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I remember this story from yrs ago, glad he provided an update. Other countries have been proving forever that the more you take care of your employees, the higher morale and quality work they will have. I'm glad he decided to test that here in the US and it's good to see his employees are thriving. I'm hoping this, shorter work weeks, and the guaranteed income they tested in CA recently takes off but I doubt it since the ones in charge here typically have no soul.
I agree it seems like in Europe they understand this better than America.
 

LooksLikeRain

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I'm hoping this, shorter work weeks, and the guaranteed income they tested in CA recently takes off but I doubt it since the ones in charge here typically have no soul.
*tire screech* WHAT YOU TALKING ABOUT PIMPIN'?! Let me know what's up! I have yet to hear about this one.

ETA: Wait do you mean CANADA or Cali?
 

CicelyTyson

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I remember when he first said he was going to do this, (think it was on FoxNews) they talked so bad about him and said he was a fool. Love him on LinkedIn, he posted how the media said he was crazy for his decision. This country is not a 1st world country, every other developed country takes care of its middle class citizens. These greedy CEO’s would never!
 

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