Friday, July 31, 2015

This Blog Hits the HubSpot

Seems like a good place to end the month:

"HubSpot fires marketing chief, sanctions CEO over incident involving book about the company" by Dan Adams and Curt Woodward, Boston Globe, July 30, 2015

HubSpot, one of the area’s hottest tech companies, fired its top marketing executive for attempting to obtain a draft of a forthcoming book about the company apparently written by a former employee and billed as his “Misadventure in the Startup Bubble.”

The Cambridge marketing software company also disclosed Wednesday that a second executive had resigned and that a third, chief executive Brian Halligan, had been sanctioned for knowing about the incident but failing to alert HubSpot’s board of directors “in a timely fashion.”

Mike Volpe, the company’s chief marketing officer, was fired for violating HubSpot’s code of business conduct and ethics code after an independent investigation overseen by its board of directors found that he tried to procure a copy of the book, the company said in a statement.

Vice president of content Joe Chernov resigned before the company could determine whether to fire him, as well, HubSpot added.

HubSpot has become one of the most influential tech companies in the Boston area as it capitalized on the emergence of social media by making tools that help businesses connect with their customers. Its stock has doubled in recent months, and it had a market value of more nearly $1.8 billion on Wednesday.

The company disclosed that it had hired outside legal counsel to look into allegations regarding the book, and that the firm’s report formed the basis of the board’s decision to fire Volpe.

The firm also “notified the appropriate legal authorities” about the incident, but spokeswoman Laura Moran said HubSpot did not know which authorities received the information.

Moran also said that “no one” within the company — Halligan included — knows exactly what transpired.


The book is likely the work of Dan Lyons, a former journalist who worked in a marketing position at HubSpot until December. In addition to writing screenplays for “Silicon Valley,” the HBO series spoofing the tech-startup culture, Lyons previously penned the wildly popular blog Fake Steve Jobs, which parodied Apple co-founder Steve Jobs before his illness and death as a vulgar, self-righteous, and power-hungry executive impatient with others’ stupidity.

Rumors are that Jobs was killed because he didn't want to go along with NSA trapdoors spying capabilities in his products.

In February, Lyons announced that he was working on “a memoir of my ridiculous attempt to reinvent myself and start a new career as a marketing person inside a software company during the second tech bubble.”

Undercover employee?

RelatedWinchester writer revels in ruffling feathers

"In their first interview since the episode blew up this week, CEO Brian Halligan and cofounder Dharmesh Shah reconstructed some of the events that led to former chief marketing officer Mike Volpe’s firing, but Keith Frankel, a former creative director at HubSpot, said veteran technology journalist Dan Lyons was probably a poor fit with HubSpot. His personality as a writer and cultural critic was at odds with the enthusiastic culture promoted by company executives, Frankel said.

“HubSpot is a very polarizing environment. To some, it’s the greatest place they’ve ever worked. They view their time there with the utmost fondness, and they’re very close with the people they worked with,” Frankel said. “To others, it more closely resembles Jonestown. I think the truth is likely somewhere in the middle.”


HubSpot was founded in 2006 by Halligan and Dharmesh Shah, who met as graduate students at MIT’s Sloan School of Management. The company makes software tools to help businesses connect with their customers online through social media, search engine results, e-mail marketing, and original content on blogs.

The introduction of its products was timely, emerging as the Internet was maturing as a commercial platform and more companies looked to compete online. As a result, HubSpot grew quickly, eventually raising $100 million from a broad group of investors.

In one of the most anticipated public stock offerings for a Boston-area technology company in years, HubSpot went public in October at $25 a share. The stock has since then more than doubled, closing at $54.12 Wednesday, giving HubSpot a market value of about $1.79 billion.

The company employs 887 workers, mostly in Cambridge, Moran said.

HubSpot reported revenue of $116 million last year, 50 percent higher than in the previous year. But as is typical with young, fast-growing tech companies, HubSpot was in the red, posting a loss of $48.6 million for the year.

HubSpot declined to detail the sanctions it meted out to Halligan, but said the CEO cooperated with the board’s investigation.

“While we wish Brian [Halligan] had reported promptly, we are confident as a board in his ability to lead HubSpot and our outstanding team of dedicated employees going forward,” Lorrie Norrington, the company’s lead independent director, added in the statement. “We are disappointed by the actions of Mike and Joe. Our board and HubSpot took these matters seriously, and acted swiftly and thoroughly once learning of this through an internal report.”

The company declined to make Halligan, a co-founder of the company, available for comment.

Kipp Bodnar will take over as chief marketing officer, Hubspot said.


Time for me to grab some grub before curling up with a good book.

See you next month.


Justice Dept. drops HubSpot case with no charges, but leaves plenty of questions

"One of the region’s fastest-rising software companies is sticking around its longtime home in East Cambridge for another dozen years."