It's not exclusive to hip-hop, it's an industry thing. It's not that often for hip-hop...at least it didn't used to be. But R&B and other genres of groups/singers used to have to display the entire package. It used to be hustle a demo, rap for some folks, battle against some others and they may catch you perform if they were interested.
My thing for hip-hop is, why? The people in that room aren't gonna feel your performance. the package doesn't really matter. They aren't your target demo, have no clue to your references. For hip-hop, if it ain't your lyrics, it's how the people respond to you, so putting on a show for the suits is a moot point.