This morning, the Wall Street Journal printed a shocking truth about Zynga CEO Mark Pincus.Apparently, when Pincus finds that an employee – even a long-tenured one – is under-performing for his or her compensation, Pincus will approach this employee and demand they get in gear.
This demand comes with a threat: start performing or we’re going to cut your pay.
Now, it just so happens that in Silicon Valley, employees are often paid with equity more than cash.
That means Pincus’s threat to slacking executives has been this: get in gear and prove you’re worth all that stock. If you can’t perform up to expectations, you’ll have to surrender some of that unvested stock or get fired and lose what hasn’t vested yet.
The people Pincus decides to confront on this manner end up on a list called the “MIA list,” named for the acroynym “Missing In Action.” Sometimes people on this list get off it by throwing their backs into a new project. Sometimes they get new stock grants, even. In fact, 15% of employees at Zynga get “leveled-up” each quarter. That means they get a new title, new stock, or a salary bump.
The point is that Zynga is a transparent meritocracy.
Still, Pincus’s approach is not a pleasant one for those on the receiving end.
As one source told the WSJ: “Nobody likes to be told ‘you’re getting this taken away.'”
In fact, the whole practice makes Pincus seem rather like an a-hole.
But having just finished Walter Isaacson’s biography of Steve Jobs, let me tell you: sometimes, having a an a-hole with exacting standards for employee performance in charge is good for everyone – for employees who work hard, for shareholders, and for users.
Everyone else can grow up.
Fortune’s Dan Primack landed a memo Pincus sent Zyna employees today. Read:
The wall street journal posted a story last night (copied below) which paints our meritocracy in a false and skewed light. The story is based on hearsay and innuendo which is disappointing but is to be expected as we move towards becoming a public company.
We have nothing to hide in our past and present policies and I am proud of the ethical and fair way that we’ve built this company. As many of you have heard me say — we’re building a house that we want to live in.
Being a meritocracy is one of our core values and it’s on our walls. We believe that every employee deserves the same opportunity to lead. Its not about where or when you enter zynga its how far you can grow. This is what our culture of levelling up is all about and its one of our coolest features.
we want everyone to put zynga first and contribute to the overall success of our company and all of you have.
Disagree? Got an insider’s perspective on Zynga? Reach us at [email protected] or 646 376 6014.
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