When you hear the word CEO what’s the first thought that comes to your mind? Let me guess. A Rich guy in an expensive Dolce suit who makes the tough decisions. Don’t get me wrong, that’s precisely the image that comes to my mind when I hear that word. So for the past year or so when I heard that the CEO's of world renown companies would earn less than one dollar in wages annually seemed hypocritical to me. How easy was it for them to say that-- seating on their leather couches inside their million dollar mansions-- when their employees earned minimum wage. However, this changed once I read “Zero to One” by Peter Thiel. Before the book, it all seemed like a PR strategy that meant nothing to them, as they all were among the richest people in the world. Nevertheless, that book has opened my eyes and made me understand the purpose behind all those CEO’s who publicly claim they earn less than any employee in the company.
This quote from Peter Thiel’s book explains the purpose behind that diminutive wage perfectly “If a CEO collects 300,000 per year he risks becoming more like a politician than a founder.” In other words, the wage of a CEO shouldn't be an exuberant amount just because he is the one in charge. On the contrary, his wage should remain low; only that way will the company prevent falling away from its principles. When a company rewards its CEO with a high cash compensation then it “teaches employees to claim value from the company as it already exists, instead of investing their time to create new value.” What does that mean? It means that by rewarding the CEO with only cash then employees know that the financial value already exists within the company and won't dedicate as much time or effort to creating value for the company to prosper. It limits the employees, as they believe that they don't need to work as hard because it’s already there. To prevent this from happening and harming the long-term development of the company employees, starting with the CEO should be rewarded with stakes in the company instead of economic rewards. Because “anyone who prefers owning part of your company to being paid in cash reveals a preference for the long term and a commitment to increasing your company's value in the future.” The after mentioned quote highlights exactly the importance of us not earning any wage or putting any profit into our pockets during the “Get Over Yourself” Unit.
When the project started, I was gutted because I was doing so much work and “not” getting anything in reward. My motivation was solely money.
How did that workout? Two failed startup business. However, after reading "Zero to One" I understood the importance of taking ownership of your work instead of caring for the financial aspect. I understood the value that appears when you focus on your company itself and giving back to the community instead of economic rewards. Money stopped being what bothered me and kept me motivated and instead learned the importance of being passionate about my work. As chapter 9 in the book says, “You’re either on the bus or off the bus. Every employee should be in the company full time. Only there would they be passionate and responsible for their work.” There was no way that I would have thrived and enjoyed working on “The Daily Bagel” as I am today if I had been worried about getting paid. Not having the worry about a wage or any economic reward has allowed me to focus on making my “baby” grow and giving back to the community.
If it weren't for that lesson in “Zero to One” then most probably my main motivation would have been money, and I would still despise Corey from preventing me from taking any in reward. Thanks to this lesson I now know the importance of being true to the value of a company and believing in it, because if you don't there is no way you will thrive.
This quote from Peter Thiel’s book explains the purpose behind that diminutive wage perfectly “If a CEO collects 300,000 per year he risks becoming more like a politician than a founder.” In other words, the wage of a CEO shouldn't be an exuberant amount just because he is the one in charge. On the contrary, his wage should remain low; only that way will the company prevent falling away from its principles. When a company rewards its CEO with a high cash compensation then it “teaches employees to claim value from the company as it already exists, instead of investing their time to create new value.” What does that mean? It means that by rewarding the CEO with only cash then employees know that the financial value already exists within the company and won't dedicate as much time or effort to creating value for the company to prosper. It limits the employees, as they believe that they don't need to work as hard because it’s already there. To prevent this from happening and harming the long-term development of the company employees, starting with the CEO should be rewarded with stakes in the company instead of economic rewards. Because “anyone who prefers owning part of your company to being paid in cash reveals a preference for the long term and a commitment to increasing your company's value in the future.” The after mentioned quote highlights exactly the importance of us not earning any wage or putting any profit into our pockets during the “Get Over Yourself” Unit.
When the project started, I was gutted because I was doing so much work and “not” getting anything in reward. My motivation was solely money.
How did that workout? Two failed startup business. However, after reading "Zero to One" I understood the importance of taking ownership of your work instead of caring for the financial aspect. I understood the value that appears when you focus on your company itself and giving back to the community instead of economic rewards. Money stopped being what bothered me and kept me motivated and instead learned the importance of being passionate about my work. As chapter 9 in the book says, “You’re either on the bus or off the bus. Every employee should be in the company full time. Only there would they be passionate and responsible for their work.” There was no way that I would have thrived and enjoyed working on “The Daily Bagel” as I am today if I had been worried about getting paid. Not having the worry about a wage or any economic reward has allowed me to focus on making my “baby” grow and giving back to the community.
If it weren't for that lesson in “Zero to One” then most probably my main motivation would have been money, and I would still despise Corey from preventing me from taking any in reward. Thanks to this lesson I now know the importance of being true to the value of a company and believing in it, because if you don't there is no way you will thrive.