Nik Storonsky, CEO of Revolut, emphasizes a need for startups to manage underperforming staff effectively.
- Storonsky suggests employees should either improve within six weeks or opt for an immediate exit package.
- His approach is aimed at creating high-performance teams by retaining top talent and expediting the exit of underperformers.
- Storonsky and co-founder Vlad Yatsenko’s methods have been successful but not without criticism.
- Quantumlight, Storonsky’s venture, offers a detailed playbook incorporating these strategies for tech startups.
Nik Storonsky, the CEO of Revolut, has outlined a rigorous approach for managing underperformance in startups. He asserts that employees who consistently underperform should be given six weeks to improve or should accept an immediate separation package. This strategy is a part of his broader philosophy aimed at building fast-growing tech companies by retaining top talent and swiftly managing underperformance.
He elaborates that a high-performance company must channel resources towards retaining and promoting top talent, while ensuring the swift exit of employees who fail to perform. Storonsky adds, “Experience has shown that employees are unlikely to naturally return to an ‘above bar’ level of performance in a role where they have been consistently underperforming.”
These management strategies are detailed in a new playbook by Quantumlight, Storonsky’s venture investing business. Quantumlight’s guide offers step-by-step instructions for integrating these best practices in tech startups, drawing from Storonsky’s experience in building Revolut into a $45 billion fintech powerhouse over a decade.
However, the practices Storonsky and his co-founder Vlad Yatsenko implemented have not been free from scrutiny. Reports indicate some former employees have felt pressured by unachievable targets and uncompensated work, leading to high stress and eventual resignations. In response to such criticisms, Revolut has initiated measures to monitor and improve its corporate culture, focusing on approachability and respect.
Storonsky’s playbook also advises creating a dedicated team to report directly to the CEO on performance matters, separate from HR. This, he believes, ensures that talent management becomes a core priority of the CEO’s office rather than just HR. The report promotes a system of individual performance reviews every six months, with promotions being merit-based, and highest bonuses reserved for the most impactful performers.
Moreover, Ilya Kondrashov, CEO of QuantumLight, states that cultivating a high-performance environment is complex but essential. He emphasizes the unique value of insights from founders who have successfully built a global business, suggesting that sound advice is hard to come by in the tech world.
Nik Storonsky’s approach underscores the importance of managing performance rigorously to foster successful tech startups.
