The altruistic CEO who raised his company’s minimum wage to $70K has seen revenues double and profits soar.
The CEO who received world-wide praise after setting his company’s minimum wage at a generous US$70K says his decision can now be financially justified thanks so soaring profits.
Dan Price, thefounder and CEO of Seattle-based start-up Gravity Payments, insists the move was an ethical choice rather than a business strategy but it seems his good will has paid off – revenue is growing at twice the previous rate and profit has doubled.
The altruistic leader offered the impressive salary to all 120 employees in April of this year, personally taking a 98 per cent pay cut in the process – since then, only two workers have quit.
In addition, the company’s customer retention rates rose from 91 per cent to 95 per cent and customer inquiries jumped from 30 a month to 2,000 a month, reports Inc.
Despite the success, Price admitted there’s still a major challenge on the horizon – the lawsuit he faces, filed by his brother.
The pair founded the credit card payment processing company together but minority shareholder and sibling Lucas Price claims he was deprived of such shareholder benefits and alleged Dan excessively paid himself before taking the widely-publicised pay cut.
Speaking to Inc., Dan said he was happy to help his brother achieve his monetary goals, “As long as it doesn't lead to price increases to our merchants, decreases in services to them, pay cuts, or other types of cutbacks to our investments in our team [I will help him]."
“I want the scorecard we have as business leaders to be not about money, but about purpose, impact, and service,’ he added. “I want those to be the things that we judge ourselves on."
