- Capitalism should be better than a skyrocketing pay gap.
- It sounds simple, but the golden rule is a model of good capitalism.
- Forget that doing business is to make money. Make money to continue doing business and treat others properly.
- Carey Smith founded Big Ass Fans in 1999 and sold it for $500 million in 2017. He now runs Unorthodox Ventures, an Austin-based investment company that helps small companies build enduring brands.
- This is an opinion column. The ideas expressed are those of the author.
When I landed on the moon in July 1969, I was glued to the TV screen like everyone else. Who would have thought that in 52 years, Americans’ attention would be focused on two spoiled CEOs taking a 10-minute drive into the upper atmosphere and returning to Earth to congratulate themselves? Wearing cowboy hats is also a lot.
This is not the future I imagined at all.
But the “optical” of Richard Branson and Jeff Bezos’s brilliant adventure is actually priceless: What better way to account for the soaring pay gap between the people who lead the company and the people who founded it?
The compensation of CEOs of America’s largest companies continues to soar. In 2020, CEO pay will increase on average 16%, Compared with workers’ increase of less than 2%.Amazon reports the median of its workers 29,007 USD Last year—which meant that half of Amazon’s employees earned less than this number—and Bezos’ salary was 58 times that number. Given the company’s sheer size, this may not sound outrageous, but there is also the problem that “King Kong” Bezos has withdrawn more than 50 million shares of Amazon stock, which makes his net worth more than 190 billion US dollars.
By emphasizing money and omnipotent pursuits to make money, and then squandering, this difference has brought a bad reputation to capitalism. This is too bad because it is not worth it.
The goal is to run a good company, not make money
I have been in business all my life. I currently run an investment company in Austin, helping founders develop their company. But the business most relevant to me is Big Ass Fans, a fan and lamp manufacturer. In 1999, I started it with six employees. When I sold it for $500 million in 2017, we had offices on three continents and more than 1,000 employees.
In the early days, when funds were tight, if I paid myself, I ended up paying myself—I realized that this runs counter to every entrepreneur’s manual. Every penny returned to the company and finally paid off.
We continue to grow and have established our own headquarters, and there is room for continued development. But we invest more than just buildings. We invest in our employees—their salaries are also high—because I know they make our growth possible. Our employees are the company’s most valuable asset; they design, design, test, assemble and sell our products, increasing revenue by 30% or more every year. What I do is encourage, motivate, motivate and occasionally badger them. I make sure that the company is where the best people are willing to work.
I started doing business because I saw that people around me were taken for granted at work; I was determined to do better and better than the bad bosses I know. As I always say, I never do business to make money; I make money to continue doing business. Our goal is always to run an excellent company, do our best to produce the absolute best products, and treat everyone we deal with in the way we want to be treated.
We are excellent capitalists
At Big Ass Fans, we aspire to operate according to the golden rules, not because we want to be fair and decent people-even though we did. The fact is that we treat our customers, employees, and suppliers the way we want to be treated, because we are good capitalists, and this is what good capitalists do.That’s why we paid 30% higher than the national average, To issue generous year-end bonuses, provide generous benefits, and ensure that employees get the benefits they want-from on-site nurses to nights in the town.
This is why we did not try to make our suppliers pay the price-and also paid quickly. Our growth means that they have also grown. Our main suppliers are still an hour away from us, and when they scale up to meet our needs, we are proud to know that we are helping our neighbors.
As a good capitalist, we contacted every customer to make sure they are satisfied. If they were not, we fixed something. Sometimes we fix problems that we didn’t even cause. Once, installing a device in a historic church ended up costing us more than $70,000, because its congregation found that industrial fans were too loud. After removing the fan, we asked, “Is there anything else I can help?” They told us, “The church really needs a new set of windows.” What we get is not only a positive word of mouth, but also as a marketing story. It is priceless.
When I talk about good capitalists, I’m not talking about Certification Company B. Becoming a good capitalist does not need a sign to show off that you are more sacred than you. Who are they kidding? We all know that these labels are mainly to attract customers.
In my opinion, good capitalists are those who take responsibility for society and want to make it better. They produce quality products that will never go out of style. Good capitalists want to see everyone rowing in the same direction, but no one will be restricted to the kitchen—or race against time to get orders. Profit is not their top priority because they know that money becomes more valuable as it spreads around. At Big Ass Fans, we want to make money to grow, because through growth, we can share more with more people.
In the early days, we established a stock appreciation rights program to reward loyal employees. When I sold this company in 2017, about 15 of them immediately became millionaires. Some employees made $5 million. A total of 50 million U.S. dollars was distributed, the amount of which was more or less. People come over and tell me “You changed my life”, which makes me very happy.In fact, it was one of the best days mine Life.
After riding the rocket, Jeff Bezos called it his “best day ever.” Then he put his gravity-bearing foot into his mouth, thanking Amazon employees and customers. “You gave it all,” he said. I really want to be a fly on the wall of Amazon’s fulfilment center and see how employees react. Hope that Bezos approves a reduction in the one-day quota so they can stop working for a few minutes and watch their boss spend his life.