This study sought to examine the effect of talent development on organizational performance among family-owned businesses in the retail sector in the Nairobi Metropolitan Region. The study focused on family-owned businesses in the retail sector and adopted the quantitative research design. This study was premised on the Human Capital theory. The study population was chosen from eight retail stores who have more than four branches in the Nairobi Metropolitan region, constituting of 274 branch managers and their deputies chosen from 137 retail store branches in total. A census sample of 274 managers and their deputies were picked. Primary data was collected using questionnaires. Data was analyzed using quantitative techniques using the SPSS software. The findings were presented in tables and figures. From the 274 questionnaires that were issued, 252 (91.971%) were completed and returned. The study's results revealed that talent development significantly improved the performance of family-owned businesses (β = 0.294, p 0.001). The study thus concludes that talent development had a positive effect on organizational performance. The study recommends that future research may focus more on the particular talent management strategies that work best for Kenyan family-owned businesses.