How Cheezburger Almost Wasted All Their Funding

December 3, 2014

6:30 pm

Instead of issuing some fluffy press release about how wonderful the new Cheezburger app is, CEO Ben Huh got personal about his journey in a Medium post called “Rewriting Cheezburger Saved My Life” – including guilt over an employee’s death, self-doubts, and almost quitting.

“To me, this release is my redemption,” he writes. “Every new product has a painful history.”

After Cheezburger raised $30 million in 2011, things went downhill. On the outside, they looked successful – selling merchandise, featuring in a Bravo reality show, making lolcat jokes. But internally, they spent so much time hiring that they weren’t actually releasing anything good.

We were turning into a confused, money-losing mess,” Huh writes. “Instead of intervening, I made excuses for my team.”

When they did manage to move Cheezburger over to a new platform, users rebelled.

“The disagreements with my team escalated. My top executives were either fired or pushed out. The team that got me here was not going to get me there,” Huh recalls.

Then came a deep psychological blow: Huh hired Amber Dunn, who had terminal ovarian cancer, as chief revenue officer. She led some of their big plans to make more money until she ended up back in the hospital. Things fell apart with her away and Cheezburger laid off a third of its staff, including Dunn, who died a few months later.

“Nothing can make you feel good about the fact that you just laid off a terminally ill mom in the hospital,” says Huh. “To this day, I often wonder if I am responsible for shortening her life.”

After the layoffs, some other people quit and everyone’s morale, including Huh’s, was incredibly low. He remembers telling a CEO coach: “I’m not sure what to do. . . . I may not be the right CEO for my company. . . . Maybe I killed Amber.”

“I realized I was drowning in loss – regret over my botched attempt at building my platform, guilt over wasting my investors’ money, anxiety over what my role might have been in Amber’s decline,” he writes.

In the end, Huh’s solution was to separate his identity as CEO from his identity as a person, so the risk of failure didn’t feel so devastating. His solution was to return to his original vision – encapsulated in the new Cheezburger app – and slowly rebuild the team, raise more money, and regain the trust of his employees.

“No one can promise you success. All I can do is keep trying,” he concludes.

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Kira M. Newman is a Tech Cocktail writer interested in the harsh reality of entrepreneurship, work-life balance, and psychology. She is the founder of The Year of Happy and has been traveling around the world interviewing entrepreneurs in Asia, Europe, and North America since 2011. Follow her @kiramnewman or contact [email protected]

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