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Well Being

Fox News predicted his 70K minimum salary idea would fail. He proved them wrong—by a lot.

Fox News predicted his 70K minimum salary idea would fail. He proved them wrong—by a lot.

In 2015, Gravity Payments CEO Dan Price had a life-changing epiphany.

Price, who founded Gravity with his brother in 2004, was out hiking in the Cascade Mountains with his friend, Valerie. She told him her landlord had raised her rent by $200 and she was struggling to get by on her $40,000 a year income. Price, who was making $1.1 million a year as CEO of Gravity, was struck by her story. Not only did he feel for Valerie—a military veteran working two jobs and barely making ends meet—realized that some of his own employees might be facing similar struggles.

And they were. One employee frankly told him his entry-level salary was a rip-off. Another employee had secretly been working at McDonald's outside of work hours to make ends meet. So Price decided to make a drastic change by investing in his employees.

He researched how much money the average person would need in order to live comfortably and settled on $70,000 a year. In one fell swoop, he dropped his own salary to that amount, while also making it the minimum salary for anyone who worked at Gravity.

The move drew media coverage—and dire predictions from pundits. On Fox News and other conservative outlets he was called "foolish," a "socialist" and a "lunatic of lunatics." Rush Limbaugh called the company policy "pure unadulterated socialism" that was "going to fail" and should be a case study in MBA programs on how socialism doesn't work. Talking heads predicted that his employees would end up in the welfare line.

Six years later, Price has proved the haters wrong—by a lot.


Sharing a video with clips from those outspoken detractors on Twitter, Price wrote:

"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."

He then added:

"Since our $70k min wage was announced 6 years ago today: Our revenue tripled, headcount grew 70 percent, customer base doubled, babies had by staff grew 10x, 70 percent of employees paid down debt, homes bought by employees grew 10x, 401(k) contributions grew 155 percent, [and] turnover dropped in half."

The business is thriving, his employee numbers have grown from 130 to 200, and they've expanded to a second office in Boise, Idaho. And perhaps most notably, the highest-paid employee makes four times the salary of the lowest-paid employee, not 33 times.

The benefits of taking care of his employees extended into the pandemic, which led to the company taking a 55% revenue hit overnight. Rather than lay people off—with Gravity has never done in its 17-year history—Price held a call with his employees and explained the company's situation. He didn't want anyone to lose their job, and he also didn't want to jack up prices on the small businesses that relied on their services.

In response, nearly every employee offered to take a temporary, voluntary pay cut, ranging from 5% to 100%. That's the kind of loyalty money and support can buy. And it worked—those employees have been repaid and the company is now giving out raises.

Price is outspoken about his company's success because he believes it's a model other companies should follow if they are able. CEO salaries have risen 940% since 1978, while average worker salaries have only risen 12%. The longer that discrepancy goes on, the more normal it becomes in people's minds, but Price is on a mission to disrupt that norm and convince people that paying employees well pays off in a multitude of ways.

Price says he doesn't miss anything about the millionaire lifestyle he lived prior to his pay cut. "Money buys happiness when you climb out of poverty," he wrote on Twitter. "But going from well-off to very well-off won't make you happier. Doing what you believe is right will."

Investing in people is what Price believes is right, and he's lived that belief—successfully—for six years and counting.

The pandemic has revealed how much money there truly is at the top, as billionaires got 54% richer over the past year and while millions of people took devastating financial hits, and large company CEOs received huge bonuses while laying off lower-level employees. Let's encourage more corporate leaders to take a page out of Dan Price's book and invest in the people who made them successful in the first place. Those investments can pay off big time, as Price—and now others—have repeatedly proven.

All images provided by Prudential Emerging Visionaries

Collins after being selected by Prudential Emerging Visionaries

True

A changemaker is anyone who takes creative action to solve an ongoing problem—be it in one’s own community or throughout the world.

And when it comes to creating positive change, enthusiasm and a fresh perspective can hold just as much power as years of experience. That’s why, every year, Prudential Emerging Visionaries celebrates young people for their innovative solutions to financial and societal challenges in their communities.

This national program awards 25 young leaders (ages 14-18) up to $15,000 to devote to their passion projects. Additionally, winners receive a trip to Prudential’s headquarters in Newark, New Jersey, where they receive coaching, skills development, and networking opportunities with mentors to help take their innovative solutions to the next level.

For 18-year-old Sydnie Collins, one of the 2023 winners, this meant being able to take her podcast, “Perfect Timing,” to the next level.

Since 2020, the Maryland-based teen has provided a safe platform that promotes youth positivity by giving young people the space to celebrate their achievements and combat mental health stigmas. The idea came during the height of Covid-19, when Collins recalled social media “becoming a dark space flooded with news,” which greatly affected her own anxiety and depression.

Knowing that she couldn’t be the only one feeling this way, “Perfect Timing” seemed like a valuable way to give back to her community. Over the course of 109 episodes, Collins has interviewed a wide range of guests—from other young influencers to celebrities, from innovators to nonprofit leaders—all to remind Gen Z that “their dreams are tangible.”

That mission statement has since evolved beyond creating inspiring content and has expanded to hosting events and speaking publicly at summits and workshops. One of Collins’ favorite moments so far has been raising $7,000 to take 200 underserved girls to see “The Little Mermaid” on its opening weekend, to “let them know they are enough” and that there’s an “older sister” in their corner.

Of course, as with most new projects, funding for “Perfect Timing” has come entirely out of Collins’ pocket. Thankfully, the funding she earned from being selected as a Prudential Emerging Visionary is going toward upgraded recording equipment, the support of expert producers, and skill-building classes to help her become a better host and public speaker. She’ll even be able to lease an office space that allows for a live audience.

Plus, after meeting with the 24 other Prudential Emerging Visionaries and her Prudential employee coach, who is helping her develop specific action steps to connect with her target audience, Collins has more confidence in a “grander path” for her work.

“I learned that my network could extend to multiple spaces beyond my realm of podcasting and journalism when industry leaders are willing to share their expertise, time, and financial support,” she told Upworthy. “It only takes one person to change, and two people to expand that change.”

Prudential Emerging Visionaries is currently seeking applicants for 2024. Winners may receive up to $15,000 in awards and an all-expenses-paid trip to Prudential’s headquarters with a parent or guardian, as well as ongoing coaching and skills development to grow their projects.

If you or someone you know between the ages of 14 -18 not only displays a bold vision for the future but is taking action to bring that vision to life, click here to learn more. Applications are due by Nov. 2, 2023.
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This validates my burn out, right? #momtok #momsoftiktok #sahm #boymom #toddlermom #toddlersoftiktok #3under5

@jothemama

This validates my burn out, right? #momtok #momsoftiktok #sahm #boymom #toddlermom #toddlersoftiktok #3under5

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And they say being a stay-at-home mom isn’t a full-time job! “This validates my burnout, right?” Jordan captioned her post.

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