Culture Amp revenue soars, as workplaces face burnout challenge

“The take-up of the whole product [including its newer Perform and Amplify products] across the customer base has been very successful, with more than 23 per cent of our customers [using all three products].

“We’re thrilled with how it’s going and with our trajectory.”

Culture Amp allows companies to survey their employees and then uses the data to give companies an insight into how they can change workplace culture, improve performance and create better working environments. It also enables businesses to give their managers short training courses to improve their leadership skills, and offers performance management tools.

The company, which was founded in 2009, was valued at $US700 million in 2019, after raising $US82 million in a round led by Sequoia Capital China.

It is still not profitable, but in 2020 it grew its revenue quicker than its expenses.

The company’s net loss swelled from $US28 million to $US33.9 million. Employee expenses are by far the company’s greatest expense, accounting for $US55.4 million in spending, while $US11.6 million is spent on marketing.

Ms Bruce, who joined the company last year having previously been the head of AMP Bank, said she was comfortable with the loss the business was making, as long as revenue growth continued to be quicker than expenses growth.

“We’ll keep having expenses growth, but it will solve itself eventually if revenue growth always outstrips the expenses growth,” she said.

“We want to reach as many customers, and therefore as many workers as we can, so we’re focused on that advocacy and growing our customer base.”

Thanks to its customers using more of its products in 2020, CultureAmp has also now had five months of cash flow positivity.

In September 2019, the company set a goal of hitting $US100 million in revenue within two years.

While Ms Bruce and chief executive Didier Elzinga would not forecast the rate of growth it expected to achieve in 2021, they indicated the company was performing ahead of where it was in 2020.

Culture Amp is the largest independent employee engagement business globally.

The company was named as one of the Forbes Cloud 100 list of the top 100 private cloud-based businesses in the world and was also recognised last week by Fast Company as one of the top 10 most innovative companies in the world, alongside Atlassian.

Mr Elzinga said one of the big challenges for managers and HR departments was navigating how to inspire and energise their staff, when people were struggling from burnout and fatigue on the back of the pandemic.

“At a macro level, as leaders we have to acknowledge and continue to acknowledge that it’s been an incredibly difficult time and the cost of that will continue to play out, even if everyone is vaccinated tomorrow,” he said.

“We have to help people process their grief, frustration and concerns. You have to sit down and say we’ll give you what you need, and also role model that vulnerability.”

Mr Elzinga said one of Culture Amp’s manager training courses, as part of its Amplify product, was in adaptability and resilience. People are taught to recognise burnout, and when they need a break, be it a “micro pause”, or a holiday.

Capability of managers

The company’s courses are based on behavioural science and occur in two minute blocks per day and are designed to be quickly and easily applicable to the person’s work life.

Mr Elzinga said the focus on supporting managers would also form the basis of its future product expansions.

“We’re at the early stage of that and there’s so much more to do. A lot of what we do will transition and level up the capability of managers,” he said.

Culture Amp laid off 36 people – 8 per cent of its workforce – when COVID-19 hit, amid fears the pandemic would significantly constrain its growth.

However, this did not eventuate, and since January the business has added 90 people.

Mr Elzinga said the pandemic had allowed the company to hire people from new regions who previously would not have considered applying for roles because they lived outside Culture Amp’s office locations. But, it had also intensified the war for engineering talent.

“I’ve never seen a talent war in engineering as fierce as it is right now,” he said.

“Everyone in the world is asking themselves where do I want to go, what do I want to do and who do I want to work for?

“The beneficiary of being in Australia is there’s people in the US who a year ago would have thought it was too hard to work for a company based in Australia, but now everyone is treating it as a global workforce.”