I'm A CEO With A Paycheck Of $0—And You Should Join Me

Who needs quick cash if you truly believe in the future of your company? Lessons from the Mark Zuckerberg, Larry Page, Michael Bloomberg, and Steve Jobs playbook.

We're all aware how A-list actors such as George Clooney and Brad Pitt usually make about $20 million up front and then 10% of the back-end to appear in a new motion picture. But if a performer really believes in their ability to bring people into theaters, the smart ones take far less, sometimes even zero dollars for a role and instead upgrade their back-end compensation.

That's the way it's gone for years, most famously perhaps with Jack Nicholson, who took $6 million instead of his usual $10 million salary to play The Joker in 1989's Batman and traded the difference for a bigger cut of DVD and merchandising revenues that eventually gave him a $60 million payday. No one begrudges these actors for taking more back-end rewards, and we never judge a new Pitt or Clooney deal based on the past riches they've already garnered.

Hollywood's elite is filled with actors who took massive pay cuts and instead gambled on future earnings. There's Bruce Willis, who made $120 million from The Sixth Sense, taking a chance on working with a first-time director with an unusual script. Tom Hanks made $70 million from Forest Gump, sacrificing half of his $20 million paycheck in exchange for 10% of the movie's gross revenues. The list goes on and on.

The way I see it, that same formula should apply to a CEO. Sure, a top executive can draw a salary that pays millions of dollars up front. Another way is to take little, or no compensation up front and plow that money back into the company so it can grow the firm by hiring superstar employees, inventing new products and making smart acquisitions. I'm currently the CEO of my third company, RadiumOne, I've formed out of scratch. I take a bi-weekly paycheck, and every other Friday afternoon I open my envelope and smile when I see the amount payable comes out to zero point zero. Unlike many, if not most of my peers, I'm a zero-dollar CEO.

I'm 31 years old and sold my first two online advertising businesses for nearly $350 million. My latest enterprise—RadiumOne—arguably marks the most ambitious and important move in my career. After four years, Radium One is my biggest project thus far in terms of size, the number of employees, revenues, and every other metric. Having two very successful outcomes in the past has only served to reinforce my belief that taking no money up front for my services is the proper way to go.

Starting a successful company is dependent on three words: Return On Investment. We all know about CEOs who have come in to a great, historic company only to systematically destroy it through bad deals. Then they leave with golden parachutes priced at $50 million or $100 million dollars. It's happened so many times over the past decade—a company gets trashed and loses billions, while one person walks away with a fortune. What's the ROI in that? A CEO should earn their salary, not merely get it as a reward for merely showing up.

I look at Mark Zuckerberg, Larry Page, Michael Bloomberg, and the late Steve Jobs as men who have taken no money or perhaps a single dollar per year in salary—these great executives are all about building and creating and innovating things, spending 80 hours a week or more focusing on the best way to achieve new heights. When I look at my own paycheck and see the zero dot zero mark, I'm completely fine with it. The money I could make in salary is far better off being reinvested into creating new jobs. I feel much better about the shareholder equity being created, compared to simply having a larger bank account with my name on it.

Compare that to the greed you see on Wall Street. There, it's all about making your short-term, quarterly numbers and very little is tangible or part of any future growth. I've always been a big believer in looking far ahead—if you focus on short-term things, not a lot actually happens. Indeed, greed is not good, despite what Michael Douglas's character Gordon Gekko said in the movie Wall Street, in what's given that industry a bad name.

Of course, the typical response from naysayers would be, "Well, you can afford to take no money because you're already rich." The same might be said for Clooney or Pitt. No one begrudges their decision, but in actuality the one-dollar actor and the one-dollar CEO come from exactly the same place. They both know that forgoing a paycheck upfront means a better product down the line and, ultimately, better results for everyone involved.

Every executive has a choice to make. For 99.9% of all CEOs, there's a nice salary dangled before their eyes. You can suck it up like I did when I was 16, take nothing, and then create a multi-million dollar company with hard work. If you've had prior success with other businesses and already have enough to live on, you can double-down. Why not be the zero- or one-dollar CEO who creates more jobs that, in turn, creates more equity in the company? Have some skin in the game. Align yourself with the greater good.

It usually comes down to a simple question: what motivates you? If it's fast money and greed, then you'll negotiate a salary that guarantees you can squeeze the most money out of the job, whether you do well or not. But if you're more interested in the greater good of your company, you'll align yourself more closely with its long-term growth and success. You can't optimize for the short-term; you've got to optimize for the long-term.

As I said earlier, every executive has a choice to make. Taking no money upfront isn't always easy. You've got to have great intuition, a strong heart and—above all—lots of guts to turn down that bi-weekly bundle of cash. But if your business is truly dependent on ROI, and you intend on spending every waking hour to make your company the best that it can be, you won't miss a single dime.

Gurbaksh Chahal is CEO of RadiumOne, an enterprise advertising platform based in San Francisco.

[Image: Flickr user Plaits]

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21 Comments

  • Lisa Caporale

    Dreaming out loud. This is who he sees himself as. Maybe it's a pitch for a Motion P-i-c-t-u-r-e! Humpf! Emphasis on the drawn out picture and the humpf! Dreaming, dreaming, oh the daydreaming! Someone has to write articles to read.
    Seriously there is both good and bad points on either side. Bottom line he can afford to say whatever the f*,!" he wants. I doubt he loses sleep over anything we have to say. Can't you just see him sitting there laughing at the comments. If I have bills to pay then i must not be a CEO with a $0.00 paycheck. ✔️Reality check.

  • Jesse B.

    Did he take $0 during his first startup? What about his second? Is he only doing it on his third? It is easy to forego a salary when you have the proceeds from $350 million worth of acquisitions to your name... but the average first-time startup CEO has to pay rent, buy food, etc. While I advocate living as frugally as possible, most are not in a position to take zero.

  • Chris

    How idiotic to use Steve Jobs as an example of the 'Great Zero Dollar CEO', not taking a paycheck for the good of his company. He didn't take a paycheck because he got paid completely in AAPL stock. And you think he did that for the good of his company? He did that to avoid paying income tax! A multi-billion dollar CEO doing all he can to avoid taxes, something to admire - Yeah...

  • Jesse B.

    For someone that is supposedly so smart, it is amazing how much he misses.

  • Sarah

    I think it's easy not take a salary when you've already got millions in the bank from other investments...

    I think if we were all millionaires ,we'd quit our jobs and do what we love for free.

    Unfortunately not even all CEO's have that luxury - and still have bills to pay, pensions to save for, children to educate.

  • Pawan Sharma

    I am glad to see there are many like me... Honestly you dont even feel an urge for the paycheck while you are lost working, trying to make your startup a success.

  • Denise

    While I completely agree that many CEOS have over-inflated and unjustified salaries -- especially in under-performing companies, the examples you used of those who gamble on the backend for less salary have the wealth to take such a gamble.

    I don't see such an argument translating to those CEOs overseeing younger companies where many have invested their life savings and living on a shoe string as either a viable or smart strategy to take little or no salary.

  • Mason Whipple

    Simply a ridiculous article. You mentioned what
    the typical "naysayer" would say but didn't actually address
    it. You danced around it using George Clooney as an example which made no
    sense at all. Your arrogance can be overwhelming. You boast about
    your success and struggles and while I don't doubt your intelligence or your
    work ethic, you and I both know much of that success was luck and good
    timing. Your philanthropic efforts are commendable but you act like
    you've created companies that revolutionized the world when you don't even make
    anything. There are hundreds of people out there who made
    millions doing the exact same thing you did related to internet
    advertising. The only reason why you're famous and they're not is because
    you keep promoting yourself and tooting your own horn like your some kind of god. You have much to be proud of but you are far from being anything close to Steve Jobs or Mark Zuckerberg.

  • rsha7

    Jack Nicholson, 1989, bigger cut coming from DVDs, etc? DVDs in 1989? probably should review the article.

  • Shams Juma

    Very inspirational, thank you. Your strategic insights help many
    CEOs – including myself – reinforce the value of taking zero now, and investing
    back into the company. After all, what could be more confident inspiring, then for
    a CEO to let go of a promised today, for tomorrow’s dream.

  • Vicky

    zero-dollar CEO's are awesome, I agree - if they can afford to do that, great. This article seems to only focus on multimillion dollar CEO's, and says nothing about what the little guys, trying to get there, should do.

    I am in the process of starting a social enterprise, and I certainly cannot afford to be zero-dollar CEO. Should I feel bad for that? Apparently, according to this article.

  • Paulo

    I like Gurbaksh, but I do not agree with the argument put forward in this article. To suggest that receiving a salary for your work as CEO of your own company, or someone else's for that matter, is being greedy, or somehow an indication that you do not believe in the future of the company is a real stretch, not to say "BS". All of the CEOs mentioned in the article were circumstantially/favourably positioned to turndown a salary, or pay themselves a symbolic amount. And most likely he (Gurbaksh) did not pay himself a salary at 16, when he started his first company, because that was not a choice he had at the time, or perhaps because he had the security of a roof over his head and mom and grandma's home cooked meals everyday. How about if you are a budding entrepreneur that also has a 9-5 to fulfil financial commitments (i.e. child to feed, student loans to pay, etc), and you obtain seed capital from an Angel Investor on the condition that you dedicate 100% of your time to the start-up? What would you do then? Leave your job? Dedicate your full time to your start-up? Become a zero-or one-dollar CEO? Default on your financial commitments? Or pay yourself a salary (higher than the cool-sounding one dollar CEO salary). Greed is when you pay yourself a senselessly unfeasible salary early on, before the company starts producing, but paying yourself so that you can dedicate your full attention to your start-up without worrying about eating a hot meal or keep electricity on in the house is definitely not greet, nor an indication of not believing in the company. This is why I avoid putting blanket statements and arguments out there; everything is circumstantial.

  • CleverNameHere

    I believe the blanket statement is assuming that he is referring to all CEOs. Clearly he is not referring to those who depend on that paycheck to eat a hot meal, but rather those who have the means not to take a paycheck in the first place... whether that be millions from previous capital gains, or "grandma's homecooked meals". Obviously every situation is circumstantial.

  • Jesse B.

    Then he's making a moot point. If its his own money in the startup (and with the proceeds from $350 million in sales, if it is not, then he is going against his own advice by giving up equity for cash flow) then taking a salary is just taking money out of his own pocket.

  • Jesse B.

    Not following how someone that doesn't take a paycheck from his own money is a hero. A paycheck would just be transferring his money from one pocket to another. He's trying to be inspirational without realizing how clueless he looks while doing it.

  • John

    Hero? You're calling this guy a hero? Bruce you should be ashamed. I agree with most of the people here that this article is ridiculous. Having started a company from scratch with no money I need to pay my bills. When I sell my business for $350M only then will I pay myself $0. You sir, are a pompous arse.