Cheezburger CEO Ben Huh, the guy who helped popularize cat photos on the Internet, is sharing some of the missteps he made over the past few years following a huge $30 million venture round that he raised from Madrona Venture Group, Foundry Group and others.
Huh, who founded the startup in his apartment seven years ago, writes about how tough things got after raising the venture money. And he blames himself for the poor choices, failing to rein in employees or set a proper course for the online comedy network.
In a nutshell, we didn’t know what we were doing. We had been profitable for years, selling ads, t-shirts, books and even a reality show on Bravo. But having investment money in the bank was new for us. More important, so was the process of transforming ourselves from a team that built and acquired WordPress sites to a company that produced a full-on content platform. We tripled our headcount.
After cashing out our original investors, however, our $30 million had dwindled to just $4 million. That figure is small by venture capital standards, but for a company that was used to duct tape and folding chairs, we felt like we were swimming in cash. We were turning into a confused, money-losing mess.
We documented some of Cheezburger’s struggles, including the layoff of 35 percent of the staff last year and its missed opportunities around mobile.
In fact, the inspiration of Huh’s post today — titled “Rewriting Cheezburger Saved My Life” and featuring a giant photo of Huh with the caption “I Can Has Redemption” — comes as the company unveils a new iOS app.
“Entrepreneurs usually share only the happy, proud announcement of a new product. We sweep aside the failures that hounded us along the way, as if we believe that a celebration is no time for honesty. Yet every new product has a painful history,” writes Huh.
Definitely worth a read.