Gravity Payments is a credit card processing and financial services company. The company was founded in February, 2004 by brothers Lucas and Dan Price. The company is headquartered in the Ballard neighborhood of Seattle, Washington and employs over 100 people. The company received media attention in 2015 when CEO Dan Price announced that all employees would receive a minimum salary of $70,000. In September 2019, Price issued an additional increase of $10,000 to all employees in the Boise office, with salaries increasing every year until 2023, when it would reach $70,000.
History
Gravity Payments was co-founded in February 2004 by Lucas and Dan Price. By June 2008, the company was the largest credit card processor in Washington, with over 15,000 clients country-wide. In 2013, Dan Price increased pay for all employees earning less than $100,000 by 2%, as a response to the lapse of the Middle Class Tax Relief and Job Creation Act of 2012. The company also provides unlimited paid time off to employees. Repeated pay increases resulted in "surprising" productivity jump from 30% to 40%, as did overall company profits. The company faced harsh criticism from Fox News and multimillionaire Rush Limbaugh who said "socialism does not work, because it's gonna fail". In April 2015, Dan Price announced that over the next three years, the company would raise the pay of all employees to at least $70,000 per year, stating this was the minimum needed to secure them from financial hardship when hit by unexpected expenses. Price, who previously paid himself a $1 million yearly salary, cut his own salary down to $70,000 to partially cover the increased pay for employees. The change lost the company two long-standing employees due to the flat payment structure. Price quoted Daniel Kahneman research on salaries as one of influencing factors. In October 2015, Dan Price was sued by his brother and co-founder Lucas Price over claims that Dan received excessive compensation and that he had been working against Lucas' interests. Dan prevailed in the case on July 8, 2016 and was awarded attorney's fees and other expenses incurred from the lawsuit. The company processed $3.4 billion in payments in 2014 and $10.2 billion in 2018. In 2015 it had 91% employee retention rate. Customer retention rate increased from 91% to 95% and company profits have doubled. In 2020 the company was making $4m per month in revenue but faced drop of 55% in card processing fees as result of the COVID-19 pandemics and introduced pay cuts while preserving employment.
