In a recent development, startups are advised to either let go of underperforming staff immediately or allow them six weeks to improve.
- The strategy was detailed in a report by Nik Storonsky, co-founder of Revolut, who stressed the need for high performance in tech firms.
- Storonsky advocates for directing resources to retain top talent, highlighting the inefficiency of keeping underperformers.
- Criticism arises from practices perceived as setting unachievable targets and fostering a high-pressure work environment.
- The report further recommends performance reviews and promotions based on merit every six months, managed separately from HR.
Nik Storonsky, co-founder of a rapidly growing fintech, Revolut, discusses a strategic approach to handling underperforming staff in startups. He proposes that employees not meeting performance standards should either exit the firm with an enhanced separation package or improve within six weeks.
Storonsky, in his new report released through Quantumlight, a venture he initiated, presents a playbook aimed at assisting tech startups in adopting effective employment practices. He emphasizes that firms should focus on retaining and promoting top talent swiftly while ensuring underperformers are managed decisively.
The report sheds light on practices developed during the growth of Revolut over the past decade. However, these practices have been criticised, as some former employees allege that unrealistic targets and high-pressure conditions led to their resignation. In response, Revolut has attempted to address cultural criticisms by monitoring employee conduct towards more respectful interactions.
Storonsky suggests a dedicated team, reporting directly to the CEO, should oversee talent management beyond the purview of HR. His report advises regular performance evaluations with opportunities for promotion based on actual contribution rather than tenure, reserving significant bonuses for the most impactful employees.
Ilya Kondrashov, CEO of QuantumLight, notes the complexity and importance of nurturing high-performance environments in startups, highlighting the value of guidance from experienced founders.
The report by Nik Storonsky offers a controversial yet data-driven approach to managing performance in tech startups.
