Revolut People: Silicon Valley-style performance culture in Europe?

What happened?

Revolut, the London-based neobank with over 45 million users, has launched Revolut People, an internal initiative aimed at institutionalizing a high-performance culture typical of Silicon Valley tech startups. According to an interview in Sifted, the company implements a system of continuous evaluation, aggressive quarterly goals, and compensation heavily tied to performance, with the goal of attracting and retaining 'elite' talent willing to work under pressure.

The program includes performance reviews every three months, a forced ranking system where a fixed percentage of employees must receive the lowest scores (and be fired), and bonuses that can represent up to 50% of base salary. Revolut argues that this model is necessary to compete globally and that 'Europe needs this revolution' in labor productivity.

Why is it important?

This move is significant because it challenges traditional European labor norms, which prioritize stability and job protection. If Revolut succeeds, it could set a precedent for other tech companies on the continent to adopt similar practices, accelerating a trend toward the 'uberization' of office work.

Moreover, in a context of tech talent scarcity, this approach could polarize the labor market: on one hand, workers willing to accept high pressure in exchange for high rewards; on the other, those seeking more stable environments. The initiative also raises questions about mental health, burnout, and business ethics, especially in countries with strong unions like France or Germany.

Potential consequences

• For Revolut: Risk of high turnover, reputational damage if perceived as exploitative, but also ability to attract top ambitious talent.
• For the European startup ecosystem: Possible imitation by other fintechs and scaleups, normalizing the 'stack ranking' culture (like Microsoft's system in the 2000s).
• For employees: Higher stress, but also opportunities for rapid growth and exceptional compensation.
• Regulators: Could investigate whether practices violate local labor laws, especially regarding arbitrary dismissals.

Context and comparisons

Revolut's model recalls Jack Welch's 'stack ranking' at General Electric, or Amazon's system that prioritizes 'toughness' (frugality). However, in Europe, companies like Spotify or Klarna have opted for more flexible cultures. The key difference is that Revolut applies this model explicitly and aggressively, while others disguise it.

Historically, stack ranking was popularized by General Electric in the 1980s, where employees were classified into three categories: the top 20%, the middle 70%, and the bottom 10%, who were fired. Microsoft adopted a similar system in the 2000s but abandoned it in 2013 due to internal and external criticism that it fostered destructive competition and lack of collaboration. Amazon, for its part, has been criticized for its high-performance culture, with reports of employees crying at their desks and high turnover rates in certain departments. Revolut, however, goes a step further by making its intentions public and presenting it as a necessary 'revolution' for Europe.

In the European context, labor culture tends to be more protective. Countries like France have a 35-hour workweek, while Germany has strong unions and strict dismissal laws. Revolut, based in the UK (which has a more flexible labor market than continental Europe), could face resistance if it expands these practices to other countries. In fact, the company has already had conflicts with regulators: in 2022, the UK Financial Conduct Authority criticized its anti-money laundering controls, and in 2023, the Bank of Lithuania (where Revolut has a banking license) imposed restrictions on its operations. This new initiative could attract the attention of labor regulators.

Moreover, the timing is delicate: the global tech sector has seen mass layoffs in 2023 and 2024, with companies like Google, Meta, and Amazon cutting tens of thousands of jobs. In this context, a system that periodically fires a fixed percentage of employees could be perceived as insensitive or even counterproductive for morale.

What readers should know

If you are an employee or candidate at Revolut, you should know that pressure is high: quarterly evaluations can result in rapid firings. As an investor, this approach could improve operational efficiency but also increase talent volatility. For the European labor market, it is a sign that US 'tech' culture continues to gain ground, with all its lights and shadows.

Speculation: It is unclear whether Revolut People will actually attract the 'elite talent' it seeks. In a market where companies like Google offer competitive salaries without the same pressure, some professionals might opt for stability. Additionally, constant turnover could erode institutional memory and team cohesion. On the other hand, if Revolut succeeds, it could trigger a wave of stack ranking adoption in European startups, especially in fintech, where efficiency is key.

'Europe needs this revolution,' says a Revolut People spokesperson. However, critics warn that the model may be unsustainable in the long term and that employee well-being should not be sacrificed on the altar of performance.