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Gravity Payments CEO Dan Price made a stir earlier this year when he announced plans to pay the entire staff at least $70,000 per year.
Last night, the Seattle entrepreneur stopped by The Daily Show with Trevor Noah to explain the decision, officially making his mark on Comedy Central.
Noah first jokes about the altitude Price was at during a hike when the idea started to take hold. Price was with an employee he admired on the hike who was sweating a $200 rent increase.
To Price, who was then making $1.1 million per year, $200 did not seem significant. But then he got into it, telling Noah that he looked at a 2010 Princeton study that put the amount a person needs to make to live a normal life at around $70,000 to $75,000 per year.
Noah points out that “not everybody was happy” with his move.
“There were people who were kind of around that $70,000 number, and they worked really hard to get there, so my decision was actually unfair to them, and I think their criticism of me was correct,” Price replied.
He continued:
“If you’re making like I was, $1.1 million, what’s an extra $20,000 mean to you? But if you’re making $40,000, $50,000, an extra $20,000 is life-changing.”
“Are you a socialist?” Noah flat out asked Price.
“I’m not very good with labels,” Price responded.
“Our system is set up to incentivize me as a CEO to try to suck out as much value, pay everyone the least amount possible, and charge everyone the most possible, and to take the most for myself,” he said. “Does that system actually lead to the happiest life?”
“I would suggest that some of the most successful companies out there actually had something that was really magical called ‘love.’ ” Price continues. “And love is a rational force that can overwhelm some of these economics and create this new economic reality we’re going to.”
Noah responds: “This is insane…if I’m understanding this what I am being presented with right now, so you are a young man who believes in sharing with others, and you have long hair and beard, and you preach love. Have we met before?”
All joking aside, Price’s decision has kept him the limelight for much of this year in the business world, with feature articles in the New York Times and Inc. magazine. It also has shed light on the ongoing lawsuit he is involved in with his brother over what he paid himself in the company’s earlier days.
