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Stockholm-based vibe-coding platform Lovable is growing revenue at an astronomical rate<\/a> \u2014 and doing something that few U.S. companies, startup or otherwise, would even contemplate: voluntarily promising annual 10% salary raises for all employees on their work anniversaries.<\/p>\n In the U.S. corporate world, employees don\u2019t generally get built-in raises unless they\u2019ve unionized, and even then, a 10% raise across the board is typically spread over multiple years of a contract, not delivered annually.<\/p>\n While most companies do have stock and profit-sharing plans, what\u2019s different here is that Lovable is sharing the wealth as a direct raise, not contingent on vesting schedules or the employee kicking in cash to convert stock options into actual shares. <\/p>\n \u201cThis program reflects the enduring company we want to build. It applies to all full-time employees meeting performance expectations on their work anniversary. The longer someone stays at Lovable, the more deeply they understand the company, contribute to its momentum, and shape its culture,\u201d Maryanne Caughey, lead of Lovable\u2019s people team, told TechCrunch.<\/p>\n Now, it\u2019s true that such a decent raise across the board is made easier \u2014 perhaps is only possible \u2014 at a smallish company. Lovable is currently at 200 employees but plans to grow to 400 by year-end, with hiring in roles across the board, Caughey said.<\/p>\n Still, the startup is adding revenue so rapidly that Lovable can share the cash with those who are creating it. In some months, it has said, it grew annual recurring revenue by $100 million. Lovable claimed in March that it had already crossed $400 million in ARR<\/a> and, at one point, projected hitting $1 billion in ARR<\/a> by around the end of the year. Lovable launched its vibe-coding product in late 2024 and has been on a tear ever since<\/a>.<\/p>\n For many companies, cash may be too precious to commit it to the permanent overhead of larger salaries. Equity compensation doesn\u2019t cost them cash out of pocket immediately. That\u2019s a big reason most startups default to loading up employees with options rather than raising base pay.<\/p>\n Techcrunch event<\/p>\n \n\t\t\t\t\t\t\t\t\tSan Francisco, CA<\/span> The bigger point is that this represents a reversal of how Corporate America tends to treat employees by default. The typical process is: get hired (often through a grueling, multi-step, multi-month process) and then go through annual reviews. The message is: prove your worth to earn the offer, then keep proving it repeatedly to keep your job. If you dream of raises and promotions, go above and beyond first, make your case, then \u2026 we\u2019ll see.<\/p>\n Startup grind culture is arguably even more grueling. The trope is that employees are expected to sleep at work to potentially grow the value of their stock, then wait for the company to go public or offer them some kind of tender offer (an opportunity to sell their shares before the company\u2019s IPO).<\/p>\n So, would Lovable\u2019s approach nix the toxic corporate politics that feed on job insecurity and creep into so many companies over time? Lovable\u2019s Head of Growth Elena Verna argues it could.<\/p>\n \u201cBecause we don\u2019t take retention for granted. It\u2019s treated as compounding value that is actively recognized and rewarded. You don\u2019t have to re-prove your worth every cycle. So everyone can focus on doing the best work of their life, not managing optics,\u201d she writes<\/a> in a LinkedIn.<\/p>\n Founder CEO Anton Osika added on Twitter<\/a>: \u201cBecause people get more valuable the longer they stay, and they shouldn\u2019t have to worry about getting a raise or not.\u201d<\/p>\n It\u2019s also true that this is a savvy retention play. Lovable is almost certainly fending off aggressive poaching attempts from competitors. <\/p>\n \u201cWe hire people with a founder mentality who can operate with autonomy, ship meaningful work early, and grow their impact over time. We want to reward that,\u201d Caughey said.<\/p>\n The truth is, if Lovable\u2019s valuation keeps climbing, more equity might ultimately be worth far more than a 10% cash raise. Still, cash is certain, while equity is a bet. And in a world where employees have been subjected to mass layoffs attributed to AI \u2014 even as their companies post record revenues and profits \u2014 this kind of approach is refreshing.<\/p>\n Note: This story was updated to include a comment from Lovable and its most recent employee headcount.<\/em><\/p>\n<\/div>\n When you purchase through links in our articles, we may earn a small commission<\/a>. This doesn\u2019t affect our editorial independence.<\/em><\/p>\n
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