CEO Dan Prince Gives All Company Employees $70k Salary

Mar 04, 2020 by apost team

Dan Price just might be the world’s best boss. Back in 2015, Dan introduced a minimum salary of $70,000 at his card payment company, Gravity Payments, taking a pay cut from his $1.1 million salary in the process.

While many in the media criticized Dan’s move, five years later, the Seattle-based CEO says that the move has done wonders for his company and his many happy employees.

According to BBC, Dan came up with the idea of a $70,000 minimum salary while he was out hiking with his friend Valerie in the Cascade Mountains. As they strolled through the woods, Valerie confided in Dan her many financial struggles. Although making $40,000 a year, Valerie still struggled with basic necessities, including her rent in the incredibly expensive Seattle-metro area.

Speaking with reporters from the BBC, Dan says that he was heartbroken by Valerie’s plight. Part of what moved Dan so much about what Valerie was going through was that she was a veteran of the War on Terror, having served two tours in Iraq. Dan saw Valerie as the embodiment of honor and service and as a person who shouldn’t have to face such difficult times.

Looking over the picturesque mountain scenery, Dan realized that he himself was part of a larger problem facing America’s working people. At only 31 years old, Dan was already a huge success.

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As a teenager, Dan had set up Gravity Payments and the company had made him a millionaire. Looking at his $1.1 million salary, Dan was able to infer that many of his employees were also probably struggling financially like Valerie.

Dan has always seen himself as a champion against inequality. Raised in a deeply devout Christian family in his home state of Idaho, Dan has always scoffed at extreme wealth. The CEO points out that while the average worker struggles to make ends meet, executives live in the lap of luxury.

Dan also told BBC that the situation has gotten worse in recent years. Back in 1965, the average CEO made 20 times as much as one of their workers. This number ballooned to 300 times in 2015.

Dan immediately promised Valerie that he would get to work fixing the inequality at Gravity Payments. Returning home, Dan did some number crunching and determined that a base salary of $70,000 would be enough to ensure that his employees could live financially secure.

Nevertheless, this base salary could not come without a fair amount of sacrifice on Dan’s part. In addition to cutting his salary, Dan also had to give up his savings and stocks and had to get additional mortgages on two of his homes.

When Dan made the big announcement at Gravity, he was surprised to find that his workers didn’t immediately realize how much this would change their lives. Nevertheless, about a third of the company’s employees had their salaries doubled overnight.

The new $70,000 base salary had other benefits for employees as well. Many staffers, unable to afford homes in the Seattle area, moved closer to the company, giving them more free time in their personal lives. Dan proudly told of how one employee used this new free time to get healthy, dropping 50 pounds.

Employees are also having bigger families. Before the $70,000 minimum salary, among the entire staff, employees welcomed at most two new children each year. Since the salary growth, Dan’s team has had more than 40 babies.

Rosita Barlow, one of Dan’s employees, says that the higher salaries make workers contribute more to the company. Rosita further adds that she feels that employees are more passionate now that they are receiving a higher salary.

Dan’s move has also been helpful for Gravity Payments itself. Before 2015, the company processed about $3.8 billion in payments each year, compared to $10.2 billion now.

What do you think of Dan’s decision to pay his employees more? Let us know your thoughts and feel free to pass this on to others so they can weigh-in as well!