The numbers come first — even for your next raise.
Wonder, the food-tech company founded by billionaire Marc Lore, has built an AI-powered performance management system that determines whether employees advance through the organization. Lore disclosed the details in a recent episode of Fortune's Term Sheet podcast, offering a rare look at how a fast-scaling startup is pushing algorithmic management into human resources.
The mechanics are straightforward. At least a dozen coworkers rate each employee on performance, behaviors, and leadership qualities every six months. Those ratings, combined with written feedback, are fed into an AI model that generates a performance report. Wonder layers on a second metric it calls 'value above replacement,' or VAR — a measure of how difficult it would be to replace a given employee with someone at the same organizational level.
'Between your VAR score and your performance management score, AI basically calculates whether or not you should be promoted,' Lore said. 'So it's very objective.'
Human managers retain override authority, but Lore noted those exceptions are shrinking. 'There's a handful of exceptions every period where we disagree with the AI model,' he said, adding that 'the model is getting smarter, and there's less exceptions every time.' Disagreements with the model are themselves fed back as training data.
Lore argues the system reduces personal bias and potential discrimination against women and minority employees by anchoring decisions in standardized scores rather than managerial discretion.
Wonder's internal structure reflects the same quantitative instinct. Positions are color-coded after taekwondo belts — white and yellow through brown and black — so leadership can scan the org chart and immediately assess where senior talent is deployed. The company also runs a transparent compensation system, allowing employees to see what colleagues earn.
The AI promotion framework arrives as Wonder scales aggressively. The company raised more than $650 million this summer at a $9 billion valuation, bringing total funding since its 2018 founding to roughly $3 billion. Wonder operates 135 food halls across 10 East Coast states and, Lore told Fortune, will be 'ready and prepared to go public early next year.'
Automation is moving into the kitchens as well. Lore said at Fortune Brainstorm Tech in June that an automated bowl-making system can produce as many as 500 bowls an hour, compared with up to 45 for a human worker.
CEO Times take: What Lore is building at Wonder is a case study in what free enterprise looks like when it stops apologizing for rigor. A merit system anchored in peer data and a replacement-value metric is precisely the kind of transparent, rules-based framework that cuts through the favoritism and identity-group politics that have corrupted HR departments at larger corporations. Capital rewards clear rules — and a $9 billion valuation heading toward a public offering suggests the market has already voted. Whether the model scales beyond Wonder's walls is the question every operator in America should be asking.
