<img height="1" width="1" style="display:none" src="https://www.facebook.com/tr?id=192888919167017&amp;ev=PageView&amp;noscript=1">
Thursday,  July 25 , 2024

Linkedin Pinterest
News / Business

Seattle celebrity CEO Dan Price’s rise and fall at Gravity Payments

By Lauren Rosenblatt, The Seattle Times
Published: January 2, 2023, 6:00am

Remembering their time at Gravity Payments, some employees of the Seattle-based credit card processor recall a pernicious cycle.

Come in star-struck by celebrity founder and CEO Dan Price, a progressive social media star famous for setting base salaries at $70,000. Then notice the demands pile up. Attend a company event where colleagues share their personal traumas. Answer Price’s late-night calls. Overhear one of the CEO’s “explosive” outbursts.

Watch your stress level rise and work-life balance collapse.

Finally, get fed up and leave, or speak up and get pushed out.

Price was 19 and full of grand ambitions to slash credit card processing fees for small businesses when he launched Gravity in 2004. Now 38, Price has branded himself as a model corporate leader who puts employees’ interests ahead of his own.

But, in interviews with The Seattle Times, more than two dozen former Gravity employees said Price became obsessed with curating his compassionate persona, even if it didn’t match the person behind the viral posts. As CEO, Price cultivated a sense of fear and built a company that, as one former employee put it, was “just there to get Dan famous.”

Price resigned as CEO from Gravity in August following accusations of assault and rape that have resulted in two police investigations. Price denies those accusations. Whether he remains a force at Gravity, a 200-plus person company based in Seattle’s Ballard neighborhood, remains to be seen.

Over the past five months, The Times contacted 75 people close to Gravity or Price. About 40 individuals shared their experiences.

In those interviews and in correspondence, as well as police reports, court documents and internal communications, a picture emerges of Gravity, a small company that drew an outsized amount of attention with Price at the helm. Gravity offered workers pay raises and opportunities to get in on Seattle’s tech boom, but, many former employees said, it came at the cost of stressful days, sleepless nights and lasting memories of working for a man six former employees described as a “manipulative” boss.

“You see the Dan in the news where he’s very charming and polished and then you’d hear these behind-the-scenes stories,” said Caitlin Palfenier, a former Gravity recruiter. “He either wants you to worship him or, if you don’t worship him, he wants you to be afraid enough to not do anything about it.”

Gravity declined to comment on specific allegations from former employees, or make current CEO Tammi Kroll available for an interview. A spokesperson for the company told The Seattle Times the statements from former employees are “either false, badly misleading or severely out of context.”

“Gravity’s business practices have created industry-leading satisfaction and retention among our employees and clients,” the spokesperson said. “The leadership team is committed to continuing to make Gravity Payments a destination employer for people around the country.”

Price denied allegations of harassment, assault and abusive behavior, while defending his record at Gravity. The claims made to The Seattle Times are “exaggerated or untrue,” Price said.

“I am immensely proud of the nearly two decades of work that went into building Gravity Payments into a thriving company that offers reliable credit card processing services to small businesses and provides good jobs to over two hundred people in Seattle and around the country,” Price said by email. “It has always been my goal for Gravity Payments to be both a successful and ethical company.”

Meet the star

From its inception, Gravity was an extension of Dan Price.

He started the company in his dorm room at Seattle Pacific University, after noticing steep credit card processing fees — up to 3.5% of a transaction, on average. As the company grew, so did Price’s reputation. He was named National Young Entrepreneur of the Year by the U.S. Small Business Administration in 2010 and visited the White House to meet President Barack Obama. He was crowned Entrepreneur of the Year by Entrepreneur Magazine in 2014.

“He always wanted to be CEO of a company — full stop,” said Kristie Colón, who has known Price since he was a teenager, and was married to him from 2005 to 2011. “I think he always wanted to be famous and there’s some prestige that comes with being able to own something. And he’s always wanted to make a lot of money.”

Gravity doesn’t have to disclose financial information as a private company, so its true size is unclear. Price owns 100% of the company, nine former employees said. Gravity and Price declined to answer questions about the company’s finances.

In the world of credit card processing, Gravity is a middleman, acting as a sales and customer service apparatus in a complicated web of transactions, according to four former employees. Gravity connects retailers to banks, and handles customer service, transactions and communication between the two. The machines that Gravity sells come from different companies, including Clover Network, a subsidiary of First Data. Kroll, a C-suite longtimer at Gravity, spent 12 years working at First Data.

Gravity’s attempts to engineer new products and services fell flat, said Jen Peck, a former director of engineering. Many Gravity engineers were new to the field and weren’t provided clear goals, making it tricky to compete with much larger payment processors like Stripe, Square and Toast.

There was rarely any executive direction, said one former project manager. “They just ran up a bunch of side endeavors just trying to get something to stick.”

Gravity hosted staff retreats in luxurious resorts — at Suncadia in Cle Elum, Las Vegas and Hawaii, among others — billed as a chance to set goals and strategize. Instead, the trips were like vacations, according to five employees who experienced them. Palfenier, the former recruiter, recalled snowmobiling and taking cooking classes. Grant MacLeod, a former product manager, said Price showed up to meetings too hung over to present.

As CEO, Price rarely visited the office, according to two former employees who worked closely with him. But his influence loomed large.

Twenty-six former employees who spoke with The Times said their time at Gravity took a mental or emotional toll, but credited the company with creating friendships among co-workers or helping them gain a foothold in a new industry. Most said they believed in the vision of helping small businesses but said that was clouded by Price’s behavior. A 27th employee said they were not bothered by the workplace culture or the head of the company; most of the other former Gravity employees who spoke with The Times described Price as an unpredictable manager prone to outlandish requests, grand entrances and outbursts.

Price once arrived at a company party, wakeboarding shirtless behind a boat, MacLeod said.

In the middle of a job interview, Price laid down on the couch, took his shoes off and began playing on his phone, Palfenier recalled.

One afternoon, Price walked to the middle of the office, an open floor plan, and announced he was going to shoot himself, Peck said.

When two marketing employees declined to film Price cutting down fish nets — an idea Price pitched to symbolize Gravity cutting out the red tape in credit card processing — he said he felt he was being oppressed like Jewish people in Nazi Germany, according to one of those employees, who asked to remain anonymous to protect the people still working at Gravity.

In the same conversation, that employee recalled Price saying he believed Gravity could do for small businesses what Rosa Parks did for civil rights. Matt Dho, another former marketing team member at Gravity, said he recalled hearing this story from colleagues after he returned to his desk that day. Price declined to comment on the allegations.

Veteran employees warned new hires not to take his calls to avoid long criticisms. Some employees refused to work directly with Price, according to five former Gravity workers.

Stephanie Brooks, who worked in Gravity’s human resources department, said that in her first year at the company, a supervisor asked her to pick up a bag of trash left after a yacht party Price attended, unrelated to Gravity business. When Brooks arrived, the docks were locked. Feeling she couldn’t return empty-handed, she scaled the gate at the South Lake Union marina.

Still in her early 20s then, Brooks said Price offered to host a pool party for her at his house.

After five years at Gravity, she quit in 2020 without a job lined up. “I got in at what I call the ‘gold rush.’ I came in starry eyed,” Brooks said. “That was the golden age of Gravity before we started to see the facade.”

Brooks started at Gravity in 2015, right before Price announced he would cut his own salary and raise the company’s minimum wage to $70,000 a year. That announcement made Price a symbol for fair compensation and workers’ rights.

He appeared on Kelly Clarkson’s TV show, on Fox News and on MSNBC. In April 2015, Bernie Sanders congratulated Price, writing on Twitter that Gravity’s CEO “sets an example that other companies should learn from.”

After that, Gravity “did not sell credit card processing. We sold Dan Price,” said Jane, a former sales rep who asked to be identified only by her first name out of a fear of retaliation.

When a potential customer called, sales reps had to first ask how they heard about Gravity, Jane said. If the person didn’t immediately mention the CEO, the rep was supposed to follow up: Have you heard of Dan Price?

When recruiters reviewed job applications, many read like love letters to Price.

“Gravity’s notoriety is what got Gravity business,” said Christoph Foulger, who worked on Gravity’s marketing team. The team focused on Price because “that got you results now,” Foulger said.

Sign the dotted line

When Ylan Muller was 22, she took a $13-an-hour job at Gravity. She was using government assistance to pay her electric bill.

Then Gravity raised its minimum salary to $70,000. Muller’s wages nearly tripled.

“I felt very indebted to the company from then on,” Muller said. She stayed at Gravity for five years despite a CEO who could be “explosive.”

“The funny thing about believing you’re not worthy of more is that you don’t attempt to look for more,” she said.

Gravity tended to hire recent college grads or people new to the industry. Having little to compare the Gravity experience to, they were eager to learn and slow to ask questions.

“I think Dan — and Gravity — does this on purpose,” said Yuri Prater, a former IT employee who, before starting at Gravity, was working 12-hour days split between the Geek Squad and a 401(k) administrative company. Gravity paid more than both those jobs combined.

“They find people who they know this money is life-changing for them … because they know the likelihood that these people are going to leave is very small,” Prater said.

Alyssa O’Neal, who worked in customer service and tech support, said she feels Gravity used her to fill in the narrative the company was spinning.

O’Neal said Gravity asked her to represent the company in media appearances and, she felt, used her “sob story to pinpoint” her as a 20-year-old single mom with a 2-year-old son who relied on the company’s generosity.

She was happy to speak with the media, she said, until she learned the story she was pedaling — that Gravity workers pooled their money to surprise Price with a Tesla — wasn’t true.

Price had taken a pay cut when he raised Gravity’s minimum wage to $70,000 a year. To thank him, the company claimed, employees came up with the idea to surprise him with the car. O’Neal said her co-workers agreed to dock their own pay to fund the gift.

But, Ryan Pirkle, formerly a spokesperson for Gravity, said Price had been involved with the Tesla idea from its inception. It’s not clear who paid for the car; O’Neal said workers never saw a drop in pay.

“My son’s all over the news and that feels like exploitation now that it’s fake,” O’Neal said. “Here I am doing all of this in my personal time, here I am being truthful when [others are] not.”

Money came up often at Gravity, as did reminders that there was never enough of it, four employees said.

Muller recalled sitting in front of a white board as Price told staff the company could fold if it didn’t come up with new revenue streams fast. In a video message, Price told a sales representative who had recently put in their two weeks’ notice that without their sales Gravity might not be able to pay three other employees. “I hope you’ll change your mind and help us get through this crisis together,” he said in the video viewed by The Seattle Times.

As Gravity struggled to make up for lost revenue at the height of the pandemic, Price told news outlets that 98% of employees had offered to take a pay cut to help the company.

But, 10 employees who worked at Gravity at the time said the pay cuts weren’t something the workforce offered. Instead, employees were given two choices: Take a pay cut or face layoffs. The cuts were voluntary, but those who declined felt ostracized.

Later, according to Matt Knezevich, a former account manager, Price wanted to test a delivery service for Gravity’s restaurant customers, with Gravity employees acting as drivers, hopping in their cars when an order was placed — at all hours.

That service never fully rolled out, Knezevich said, though one employee did make deliveries. Price talked up the new offering on the Kelly Clarkson show.

Join the family

Shortly after new hires picked up their badges and smiled for their IDs, Gravity encouraged them to share deeply personal experiences with co-workers.

Nine former employees said they attended a dinner for new hires to get to know one another, their managers and Gravity’s senior leaders. There, three employees remembered, they heard about their colleagues’ highs and lows in life — a mother’s death, a drunken-driving arrest. Another remembers being asked what their biggest regrets were.

The goal was to make new hires feel as if Gravity was family, according to one manager who hosted several new-hire dinners at Seattle restaurants. That manager, who asked to remain anonymous out of a fear of retaliation, said they were instructed to buy drinks and anything from the menu to extend the meal and keep new hires talking.

That manager said they attended, in their first week at Gravity, company sexual harassment training where colleagues were paired up to share a personal experience of abuse. It became so emotional, the manager left the training early.

Three people shared the story of their new-hire dinner fondly. Another three said it felt like a way to learn workers’ insecurities, tether them to the company and break down boundaries.

Palfenier, the former recruiter, recalled a similar tactic at her first Gravity retreat. Nestled in the Suncadia resort, employees grabbed markers and began drawing their “lifelines,” timelines of moments that shaped them, on large sheets of paper.

When sharing their drawings, one worker, Palfenier remembered, offered a story about their spouse, who had survived being sexually assaulted.

“We were all told we were a part of something special,” said Palfenier, who was 24 at the time. “You have a shared experience. We broke down in front of each other. We got really emotional and vulnerable and we bonded over that.

“It’s bonding over life trauma — and now we’re all together.”

Uncomfortable talking about her personal life with her colleagues, Palfenier’s presentation focused on her time in college. She remembers being shamed for holding back.

“It became a competition to see who would be more vulnerable and who could break down the most,” she said.

That desire for intensity permeated the office — and physically broke some employees, according to interviews with more than two dozen former employees.

One former employee described crying on the bathroom floor after a meeting with their manager prompted a panic attack. Another said on-the-job stress caused them to develop shingles and facial paralysis. Peck, former director of engineering, and MacLeod, a former product manager, both received doctor’s notes, viewed by The Seattle Times, pinning stress from work as the source of anxiety and Gravity as detrimental to their physical and mental well-being.

Price would involve himself with minutiae, like the placement of chairs before a meeting, according to Bobby Powers, a former head of HR. Two employees said Price would call or text at all hours with requests or suggestions. Four said Price told employees that he was smarter than them.

When employees brought concerns about Price’s behavior or workplace treatment to HR, they felt intimidated, rather than supported, according to 12 former workers who recounted experiences with what Gravity calls “team advocates.”

The meetings with HR took place in a room that felt like the size of a phone booth, two employees said. Another two said they got the impression that Gravity would rather they simply left, instead of asking for help.

Gravity said, in a statement to The Seattle Times, “We investigate every case of reported harassment between employees.” A spokesperson declined to answer questions about specific allegations.

Tori Tripoli, who worked in technical support in Boise, Idaho, after Gravity acquired a company there, said she went to HR after receiving inappropriate messages from her manager. The HR team acted swiftly to fire the supervisor, but later scolded her for sharing her experience with co-workers, said Tripoli, who was then 25.

She quit the next day.

“At first I really thought I was crazy,” Tripoli said. “I really, for a long time, felt like I was the problem.”

Read the fine print

Price resigned as CEO of Gravity Payments on Aug. 17 to, as he told employees and his followers on Twitter, “focus full-time on fighting false accusations made against me.”

In the years since he rose to fame, Price has been repeatedly accused of sexual assault and inappropriate behavior, according to police reports and court records.

In a TEDx lecture at the University of Kentucky in 2015, Colón, Price’s ex-wife, detailed allegations of abuse — including that Price had waterboarded her and slammed her to the ground. Hoping to preempt any controversy surrounding the lecture, Price, who has denied Colón’s allegations, held a meeting and told employees that his ex needed his help, according to three former employees who attended the meeting. The university recorded Colón’s talk but didn’t release the video of it.

At Price’s direction, Pirkle emailed the university and asked to see the video, telling them it could include defamatory statements. A representative from the school sent the recording and later told Pirkle they had decided not to post the talk.

In November 2017, at the height of the #MeToo movement, Price wrote a companywide email detailing Gravity’s stance on workplace abuse. One former employee who worked closely with Price and read the first draft of that email said it read like Price was telling survivors of abuse to “try to have some grace for the people who are perpetuating it.”

In a copy of the draft reviewed by The Seattle Times, Price advised individuals who “have any tendencies that scare yourself” to seek help through therapy.

In the final version sent to employees, the CEO writes: “I realize that it can be difficult to speak out after experiencing sexual harassment. … I assure you that your voices will be heard and that Gravity will be a safe space in which to discuss your experiences without fear of reprisal or judgment.”

Recent allegations against Price have resulted in police investigations in Palm Springs, Calif., and Seattle.

In February, Seattle prosecutors charged Price with misdemeanor assault after a 26-year-old woman told police Price choked and forcibly kissed her following a dinner. Price pleaded not guilty in May, and is set to go to trial Jan. 10.

Morning Briefing Newsletter envelope icon
Get a rundown of the latest local and regional news every Mon-Fri morning.

Police in Palm Springs investigated allegations that Price raped a drugged woman. Prosecutors there said recently they expect to make a charging decision by the end of January. The New York Times detailed allegations against Price in a lengthy piece in August, the same week police in Palm Springs passed their investigation to prosecutors. Price resigned as CEO of Gravity the day before the story was published.

Price, in an emailed statement to The Times, denied the claims made by police and prosecutors.

“The media coverage of the allegations against me served as a distraction from the work of making Gravity Payments a great place to work,” Price said. “To be clear, the allegations against me are false. I have never physically or sexually abused anyone, and I look forward to being vindicated in court.”

Following his resignation, Price added, he has “passed the baton to exceptional leadership” and is “pursuing other interests.”

Find an exit

Looking back at their time at Gravity, former employees describe how extreme loyalty morphs into extreme stress. Excitement about the company’s mission turns to skepticism. Concerns over impressing the CEO become concerns about the CEO.

In interviews with The Seattle Times, six former employees pointed to moments that marked a turning point, an instance where they spoke up against leadership and, shortly after, no longer felt welcome. The issues they brought up ranged from disagreeing with the decision to break a contract with a DJ to questioning how the company planned to handle allegations of sexual assault against Price.

A former sales representative, who asked to remain anonymous to protect people still at the company, said they were suspended for one day after raising concerns about Gravity’s decision to hire Mike Rosenberg, a former Seattle Times journalist who had resigned from the newspaper after reports that he had sent sexually harassing messages to a freelance journalist.

Gravity’s marketing team disappeared quickly after two employees expressed discontent with Price.

During a company retreat in Portland, marketing team member Dho and former marketing director Pirkle shared work stories with Stefan Bennett, then a product manager. Pirkle recalled a non-work-related party he’d attended at Price’s house, where it appeared women who were younger than 21 were serving alcohol.

Alarmed by the stories, Bennett texted Kroll, hoping she would take action. Later, Bennett said, Gravity’s head of HR told him the company planned to hire a consultant to investigate the incident. Bennett said an investigation did take place but employees never learned the results.

In Portland, Dho and Pirkle said they were later pulled into a hotel room, questioned about what they had said about Price and sent home with instructions to stay quiet and away from the office. They both left Gravity two weeks later, feeling as if there was no way to return.

Twelve of the 14 marketing team members followed them out the door, Pirkle said.

Gravity declined to answer questions related to the matter. “We strongly encourage an open dialogue in all meetings, because it is employees who help us shape our policies,” a spokesperson said in an emailed statement.

By email, Price said employee surveys show “the vast majority” of Gravity workers feel empowered to communicate openly with managers. A majority of workers also said they feel they can voice contrary opinions without fear of consequences, Price continued. Gravity has a policy against workplace retaliation, he said.

“Making Gravity Payments a great place to work was not only the right thing to do for employees, but it also helped the business thrive by reducing turnover and promoting productivity,” Price said.

Yet, Knezevich, the former account manager, believes he was fired for asking Price and Kroll how Gravity planned to address allegations against the CEO.

Price took a leave of absence in 2021 as writer Doug Forbes was publishing blogs detailing allegations against Price. When Kroll called an all-hands meeting, Knezevich was optimistic they would discuss the accusations. But Kroll unexpectedly announced Price was coming back, and would lead the discussion.

During the call, leaders asked employees to brainstorm ways to “deflect questions” about the allegations and ensure Price quietly stayed involved, according to the former sales representative who was suspended after objecting to Rosenberg’s hire.

Knezevich said he asked Price: How do you respond to the pattern of allegations?

He remembers Price responded: I don’t have enough information to agree with your question.

Knezevich said he later asked Kroll: Does Gravity plan to investigate these allegations?

He remembers Kroll responded: No.

Knezevich said he was fired three months later.