This is a story from 2015 about how being positive works better than being negative. You may have heard it before -- I certainly have -- but it bears repeating, especially in this time of extreme financial inequality.
--Kim
In 2015, Dan Price, founder of Gravity Payments — a Seattle-based credit card processing company — returned from a hike with a close friend named Valerie. She told him her rent was increasing by 200 percent and that she was struggling to stay afloat, despite working hard and doing everything she reasonably could.
Dan went quiet. He did the math.
He realized that a significant portion of the people working at his own company were earning even less than Valerie — people who showed up for him every day, who were helping build something he was genuinely proud of, who were going home at night worried about covering their basic bills.
He couldn't unsee it.
A few weeks later, he gathered his team and announced a significant policy change: every employee at Gravity Payments would earn a minimum of $70,000 a year. To fund this, he cut his own annual salary from approximately $1.1 million down to that same $70,000 figure, sold a second home, and drew significantly on his personal savings to support the transition.
The reaction was immediate and intense.
Critics labeled the decision reckless. Several business commentators predicted the company would fail. Some clients reportedly cut ties with Gravity Payments over the policy, with some calling Price a socialist. Two longtime employees resigned, expressing frustration that their raises were proportionally smaller than those given to newer staff who started from a lower baseline salary.
Media coverage across the country largely framed the experiment as likely doomed.
According to the company's reported outcomes over the following years, the predictions did not hold up. Gravity Payments has reported that a substantial majority of employees were able to pay down long-standing debt, that home purchases among staff increased significantly, and that employees who had previously felt unable to consider starting families began doing so — with the company reporting dozens of new births among staff members in the years following the policy change. The company also reported substantial increases in employee retirement contributions.
On the business side, Gravity Payments has reported that revenue grew substantially in the years following the policy, that its customer base expanded significantly, and that employee turnover dropped notably.
The company faced a genuine test during the COVID-19 pandemic, when Gravity reportedly lost more than half its revenue almost overnight. According to Price's public accounts, employees voluntarily offered to take temporary pay reductions specifically to protect their colleagues from layoffs. No employees were let go during this period. When the company's finances stabilized, it reportedly repaid the temporary pay reductions in full and subsequently issued raises.
Gravity Payments and its compensation policy have since been referenced in various business education contexts as a case study on alternative approaches to compensation and their potential relationship to business performance, generating ongoing discussion in business and economics communities about the relationship between employee financial wellbeing and company outcomes.
Dan Price has said publicly that the original decision wasn't made with headlines in mind — it stemmed from a friend's genuine struggle and from a question he found himself asking about whether he was actually taking care of the people responsible for the company's success.
This story has resonated widely as a case study in an ongoing and genuinely contested conversation about compensation, business sustainability, and what businesses owe the people who build them. Reasonable people continue to debate whether this specific model is broadly replicable across different industries and company sizes — but the core experiment itself, and the reported outcomes that followed, represent a notable real-world test of an alternative approach to how companies might structure compensation.
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