Fewer Jerks, Better Results: Performance Culture Helps You Keep The Right People

Melissa Phillippi, the Co-Founder and CEO of Performance Culture

When the financial crisis of 2008 happened, financial advisor Melissa Phillippi watched as all the wrong people were let go based on a broken performance management system. 

“It was really pervasive in the financial industry to see really bad people decisions being being made off of frankly broken performance management systems that were not telling the whole story,” Phillippi said. “So what ended up happening is you ended up keeping the people who had learned how to game the system.”

When Phillippi read the book Performance Culture by Dallas Romanowski, she had a lightbulb moment. While doing consulting work for businesses, Phillippi and Romanowski had a mutual client and soon realized their shared passion for helping others build better teams for better results.

So they collaborated on how to create something that would look at more than just performance but also at culture fit—something that wouldn’t just reward “brilliant jerks” who can put up high-performance numbers—in their own consulting work. 

That something turned into Wilmington-based Performance Culture, which they spun out independently in 2015.

Performance Culture is now backed by a $2.9 million investment made in December by Durham’s Jurassic Capital. [Editor’s Note: GrepBeat Godfather Joe Colopy is a Partner at Jurassic Capital.]

The SaaS startup offers a cloud-based, standalone performance management tool. Once employees are hired, Performance Culture’s business clients can start them in the platform, looking at goals, expectations and reviews. Performance Culture measures and coaches expectations and is customizable for varying industries.

The market potential is huge, said Phillippi—who recently took over the CEO role from Romanowski—as everyone catches up to the fact that there must be something better than paper and manual methods to conduct performance reviews.

So far, Performance Culture’s 210 global clients predominantly come from professional services, with the technology sector at the top.

But Performance Culture has expanded into assisting traditionally blue-collar roles and industries as well, increasing their potential market even more.

The Wilmington startup is also looking to hire a Director of Sales as a new addition to their leadership team to continue its mission in helping build better teams for better results.

The need is greater than ever

Phillippi said there are still way too many stories we hear of toxic, unhealthy organizations and workplace environments.

“I would love to say that that doesn’t happen anymore, but there is still just awful story after awful story,” Phillippi said. “And we’re trying to change that one organization at a time.”

Managers and leaders often actually want to have a healthy culture, Phillippi said; they just don’t know how to do it. Performance Culture can be their solution by incorporating culture fit into how performance is measured.

“You can’t have a really high performer without having a cultural alignment,” Phillippi said. “So that can create a lot of toxicity within organizations. It caps that organization’s potential to make a difference themselves.”

With Jurassic’s partnership, Phillippi said Performance Culture’s goal is to grow both quickly and sustainably.

Her personal goal for the company is for Performance Culture to be a key market leader in performance management systems. Even beyond that, she wants Performance Culture to be known among the big players in the human capital management industry as the best standalone performance management system out there.

While the pandemic has caused some clients to cut expenses and not renew their Performance Culture subscription, the vast majority of the startup’s clients see the clear value in their return on investment.

“If they can still be doing something using technology versus manual methods, they’re going to save money anyway by utilizing a system like ours,” Phillippi said. “Then, even more so, it’s actually been giving them an ROI because people are now more focused. We’ve increased focus, accountability and team chemistry.”

About Suzanne Blake 362 Articles
Suzanne profiles startups and innovation for GrepBeat. Before working at GrepBeat, Suzanne attended UNC Chapel Hill, obtaining a degree in journalism and political science. Previously, she wrote for CNBC, QSR Magazine, FSR Magazine and The Daily Tar Heel.