Startup pays for employee weddings, college tuition
To say that Boxed CEO Chieh Huang views company employees as part of his extended family is clearly an understatement. Not only does he personally cover college tuition expenses for children of his employees, he recently announced the company will pick up the tab for staff wedding expenses.
“Our goal is strengthen the overall employer-employee bond,” he says. “I think paying for college tuition and wedding expenses helps us do that.”
Founded in 2013, Boxed is giving bricks and mortar big box discount retailers a run for their money. Via a mobile app, customers can order bulk quantities of about 1,000 products to be delivered within two business days without any membership fee or delivery charges for orders over $50.
The company services the lower 48 states from four fulfillment centers and six locations across the country. The 130-plus full-time employees do everything from running the company to managing operations to filling client orders.
The catalyst for offering to provide employees’ children with free college tuition at any school was the day the Boxed CEO arrived at a fulfillment center where 20 employees were on shift and noticed there were only two cars in the parking lot in addition to the manager’s vehicle.
“I realized only two people out of 20 could afford private transportation to get to work,” he says. “Even if we doubled their salary, these people couldn’t afford a car or a college education for their kids. So I decided to do something about it.”
By September, Huang will be personally writing college tuition checks for four students. He has committed the value of a chunk of his Boxed stock to fund this benefit as more students become eligible for the program over the next five or six years.
By that time, he hopes the company will be sold or go public and that half of his stock will easily pay for all these college educations.
“The folks who have been with us for the ride and are present on that day will be eligible for the benefit,” he says.
Extending company largesse to paying up to $20,000 for employee weddings was also a decision grounded in the needs of a specific employee. Recently, Huang explains, a Boxed associate at a fulfillment center broke down crying in the middle of his shift.
“Even if we doubled their salary, these people couldn’t afford a car or a college education for their kids. So I decided to do something about it.”
When Huang called him up at home to find out what’s wrong, he learned that the young man had been working long hours to pay for his mother’s medical expenses and save for a wedding so she could see him married before she dies.
“I realized that there are not enough hours in the day, and the math didn’t add up,” he says. “I could have said, ‘I’m sorry. Good luck with that.’ But I had the power to offer him life-altering assistance, and company management agreed with me.”
Huang recognizes that not all employees will get married or have children, so they may never take advantage of some of the company’s more unique benefit offerings.
But the company offers a host of other employee benefits for employees to take advantage of.
All full-time employees are eligible for dental, vision and healthcare plans and participation in the 401(K) plan (no matching yet). The company also offers unlimited paid time off, maternity and parental leave.
He says that no one has ever abused these generous policies.
“Extended vacations have to pass ‘the straight face test.’ If someone tells me they need six months at a yoga retreat in Bali to feel refreshed, it probably won’t pass,” he says. “But if an employee who has worked hard and made their numbers wants to take a three-week family vacation, I’ll tell them, ‘I salute you. Come back in three weeks ready to run.’”
As for the paid maternity and parental leave, he says the longest time an employee has taken off is about seven and a half months. “We had one person who wanted to come back after three weeks but we suggested that she hold off until after two months because, as a father myself, I knew it was just too soon.”
How have Boxed’s investors reacted to Huang’s generosity?
“I don’t think it was a gigantic shocker for them. They not only bet on the company. They bet on me,” he says. “I’m the kind of guy who will always try to do the right thing. After you grow up poor you realize what you really need and what you don’t.”
Huang describes the corporate culture as hard-working and mission-driven.
“I would also describe it as selfless. By that I mean team and company first vs self-first.”
And senior management walks the talk. “The co-founders and I didn’t take salaries until after we raised $33 million,” he says. “Even now that we’ve raised $150 million, my annual salary is only $59,000 with no bonus.”
The federal minimum wage is $7.25/hr, but on average, employees in the fulfillment center earn double that amount. “I think if you pay people well, then hopefully they will deliver a great level of service to our customers,” Huang says.