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> Mr. Price, who started the Seattle-based credit-card payment processing firm in 2004 at the age of 19, said he would pay for the wage increases by cutting his

by reustle 12y ago

> Mr. Price, who started the Seattle-based credit-card payment processing firm in 2004 at the age of 19, said he would pay for the wage increases by cutting his own salary from nearly $1 million to $70,000 and using 75 to 80 percent of the company’s anticipated $2.2 million in profit this year. What a crazy world we live in where people can start companies and pay themselves a salary of $1 million. Wouldn't that money be better off being reinvested into the company? Sure, they are doing it now, but didn't it cross their minds when they (he?) first decided his contributions were worth $1m per year?

pan69 12y ago
A lot of people tend to change between the age of 19 and 30. PS: I didn't down vote you.
jacquesm 12y ago
If it's his company he can pay himself whatever salary he sees fit as long as the company doesn't tank, in which case it might be looked at as 'bad management'. After all, it's mostly a taxation issue, if he pays himself a million in salary he'll pay one tax rate, but if he pays himself a lower salary and a chunk of the profits as dividends that's simply another tax rate. So you can start your own company and pay yourself whatever you want as long as you stay liquid as long as you own the thing. As soon as you have other shareholders or co-founders you won't be able to do that any more.
kondro 12y ago
Who said he was drawing $1m in 2004? That was 11 years ago. You're assuming that he's not the only shareholder. Did they grow to be a billion dollar business in 11 years? No. Has he created a successful business? I'm pretty sure you could argue a business with $23k/employee net profitability (after his changes in minimum salary) for a SME is pretty successful.
modeless 12y ago
Yeah, what a crazy world where a person who creates 70 jobs after taking on great personal risk and working hard gets rewarded after 10 years. I suppose you'd rather that he never got rich, and didn't even bother to take on risk and work hard and create those jobs in the first place, because why bother if he's just going to make the same money he would otherwise?
- notahacker 12y ago
  As this is HN, surely the argument is along the lines of "he should plough everything into growth and take external investment too". Then, instead of paying himself $1m per annum now, he could have a 10% chance of $100m in 10 years time! I think his 70 employees probably prefer his existing approach, even when he was taking all the $1m for himself.

by reustle 12y ago

pan69 12y ago

A lot of people tend to change between the age of 19 and 30. PS: I didn't down vote you.

jacquesm 12y ago

If it's his company he can pay himself whatever salary he sees fit as long as the company doesn't tank, in which case it might be looked at as 'bad management'. After all, it's mostly a taxation issue, if he pays himself a million in salary he'll pay one tax rate, but if he pays himself a lower salary and a chunk of the profits as dividends that's simply another tax rate. So you can start your own company and pay yourself whatever you want as long as you stay liquid as long as you own the thing. As soon as you have other shareholders or co-founders you won't be able to do that any more.

kondro 12y ago

Who said he was drawing $1m in 2004? That was 11 years ago. You're assuming that he's not the only shareholder. Did they grow to be a billion dollar business in 11 years? No. Has he created a successful business? I'm pretty sure you could argue a business with $23k/employee net profitability (after his changes in minimum salary) for a SME is pretty successful.

modeless 12y ago

Yeah, what a crazy world where a person who creates 70 jobs after taking on great personal risk and working hard gets rewarded after 10 years. I suppose you'd rather that he never got rich, and didn't even bother to take on risk and work hard and create those jobs in the first place, because why bother if he's just going to make the same money he would otherwise?

notahacker 12y ago
As this is HN, surely the argument is along the lines of "he should plough everything into growth and take external investment too". Then, instead of paying himself $1m per annum now, he could have a 10% chance of $100m in 10 years time! I think his 70 employees probably prefer his existing approach, even when he was taking all the $1m for himself.