Could Lovable’s automatic 10% pay raise be the cure for toxic culture?

Stockholm-based vibe-coding platform Lovable is growing its revenue at astronomical rates — and it’s doing something few US companies, startups or otherwise, would even consider: voluntarily giving all employees a 10% annual salary increase for their workdays.

In the US corporate world, employees typically don’t get built-in raises unless they’re unionized, and even then, a 10% raise across the board is usually spread over several years of the contract, which can be delivered annually.

While many companies have stock and profit sharing programs, the difference here is that Lovable shares the wealth as a direct raise, not dependent on handing out schedules or an employee kicking in cash to convert stock options into actual shares.

Now, it is true that such a positive promotion across the board is made easier – perhaps only possible – in a small company. Lovable said in March it had 146 employees. It currently has 78 open roles listed on its website, so it appears to be on track to reach over 225 by the end of the year.

But it adds revenue so quickly that it can share the money with those who create it. In some months, it said, it has grown its annual recurring revenue by $100 million. Lovable said in March that it had already surpassed $400 million in ARR and, at one point, predicted it would hit $1 billion in ARR by the end of the year. Lovable launched its vibe coding product in late 2024 and has been on a tear ever since.

It is also true that for many companies, cash may be too valuable to commit to paying large salaries forever. Equity compensation does not cost them money out of pocket immediately. That’s a big reason that many startups tend to load employees with options rather than increasing base salary.

The bottom line is that this represents a reversal of the way Corporate America has tended to automate workers. The usual process is: get hired (usually through a laborious, multi-step, multi-month process) and go through an annual review. The message is: prove your worth to get the offer, then keep proving it over and over again to keep your job. If you dream of promotion and promotion, go above and beyond first, present your case, and then … we will see.

The grinding culture of startups is undoubtedly very difficult. The trope is that employees are expected to sleep on the job to increase the value of their stock, then wait for the company to go public or offer them some kind of tender (a chance to sell their shares before the company’s IPO).

So, can Lovable’s approach eliminate the toxic corporate politics that eat into job insecurity and infiltrate so many companies over time? Lovable’s Head of Growth Elena Verna says it’s possible.

“Because we don’t value retention. It’s considered an integrated value that is actively recognized and rewarded. You don’t have to reconfirm your value every cycle. So that everyone can focus on doing the best work of their lives, not managing optics,” he wrote on LinkedIn.

Founder CEO Anton Osika added on Twitter: “Because people get more valuable the longer they stay, and they don’t have to worry about getting a raise or not.”

It is also true that this is also the last game with experience. Lovable is almost immune to poaching attempts from aggressive rivals. The truth is, if Lovable’s value continues to rise, additional equity may eventually be needed for much more than a 10% capital increase. However, cash is certain, while equity is a bet. And in a world where workers have been laid off in droves thanks to AI — even as their companies post record revenue and profits — this kind of approach is refreshing.

Beloved has not yet responded to our request for comment.