Mutiny at HQ Trivia fails to oust CEO

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This week’s banishment of host Scott Rogowsky was merely a symptom of the continued wrestle to determine who will lead HQ Trivia. In line with a number of sources, over half of the startup’s employees signed an inner petition to depose CEO Rus Yusupov who they noticed as mismanaging the corporate. However Yusupov then fired some core supporters of the mutiny, resulting in a downward spiral of morale that mirrors HQ’s plummeting App Retailer rank.

TechCrunch spoke to a number of sources accustomed to HQ Trivia’s inner troubles to piece collectively how the stay video cellular recreation went from blockbuster to just about bust. Two sources stated HQ just lately solely had round $6 million within the financial institution however was burning over $1 million per 30 days, which means its runway might be dwindling. However its early buyers are reluctant handy Yusupov any additional cash. “

Staff petitioned to take away HQ Trivia’s CEO Rus Yusupov

HQ reimagined gaming and cellular leisure with the launch of its 12-question trivia recreation in August 2017 the place gamers all competed stay in twice-daily exhibits with anybody who obtained all of the solutions proper cut up a money jackpot. The video games felt pressing since you possibly can solely take part at designated occasions, enjoyable to play towards associates or strangers, and profitable carried a significance no single-player or continuous on-line recreation might match.

When TechCrunch wrote the first coverage of HQ Trivia in October 2017, it had simply 3500 concurrent gamers. However by January it had climbed to the #three recreation and #6 general app within the App Retailer, and grown to 2.38 million gamers by March. Shortly, copycats from China and Fb entered the market. However all of them lacked HQ’s secret weapon — its plucky host comic Scott Rogowsky. Affectionately awarded nicknames like Quiz Daddy, Quiz Khalifa, Host Malone, and Lure Trebek from the “HQties” who performed day by day, he was the de facto face of the startup.

But HQ had some shaky foundations. Co-founder Colin Kroll, who’d additionally began Vine with Yusupov and bought it to Twitter, had been fired from Twitter after 18 months for being a nasty supervisor, Recode reported. He’d additionally picked up a fame of being creepy round feminine staff, in addition to Vine stars, TechCrunch has discovered. Speedy progress and an investigation by early HQ investor Jeremy Liew that discovered no egregious misconduct by Kroll paved the best way for a $15 million funding. The spherical was led by Founders Fund’s Cyan Bannister, and it valued HQ at over $100 million.

Yusupov did not translate that money into sustained progress and product innovation. His public conduct had already raised flags. He yelled at a Daily Beast reporter after the outlet’s Taylor Lorenz interviewed Rogowsky with out Yusupov’s approval, threatening to fireside the host. “You’re placing Scott’s job in jeopardy. Is that what you need? . . .  Please learn me your story phrase for phrase,” Yusupov stated. When he discovered Rogowsky had expressed his choice for salad restaurant chain Sweetgreen, Yusupov shouted “He can't say that! We don't have a model cope with Sweetgreen! Certainly not can he say that.” The subsequent day, Yusupov falsely claimed he’d by no means threatened Rogowsky’s job.

With HQ’s checking account full, sources say Yusupov was extraordinarily sluggish to make selections, permitting HQ to stagnate. The novelty of enjoying trivia for cash by way of telephone has begun to put on off, and other people more and more ignored HQ’s push notifications to hitch its subsequent recreation. However past bringing in some visitor hosts and the choice to purchase a second probability after a flawed reply, HQ ceased to evolve. HQ fell to the #196 recreation on iOS and the #585 general app as concurrent gamers waned.

That’s when issues began to get a bit Recreation Of Thrones.

Pawns In A CEO Conflict

Liew pushed for HQ to swap Kroll into the CEO spot in September 2018 whereas shifting Yusupov to Chief Artistic Officer, which was confirmed regardless of an HR grievance towards Kroll for aggressive administration. Nevertheless, three sources inform TechCrunch that Yusupov pushed that HQ worker to file the grievance towards Kroll. Because the WSJ reported after Kroll’s dying, that worker later left the startup as a result of they felt that they’d been exploited. “There was undoubtedly what felt like manipulation there, and that’s additionally why that worker resigned from the corporate.” one supply stated. One other supply stated that staffer “believed Rus used their unhappiness about work to make use of them as a pawn in his CEO conflict and never as a result of Rus truly cared about resolving issues.”

Cyan of Founders Fund stepped down from HQ’s board after the choice to swap out Yusupov as a consequence of her agency’s popularity of protecting founders in management, Recode’s Kurt Wagner reported. Sources say that regardless of Kroll’s fame, the employees believed in him. “Colin beloved HQ and was devoted to all the workers greater than Rus. Rus cares about Rus. Colin cared concerning the content material” a supply tells me. 

Three sources say that in a determined ploy to retain energy and stop Kroll’s rise, Yusupov recommended Rogowsky, a comic with no tech or administration expertise, be made CEO of HQ Trivia. He even advised the corporate movie a actuality present about Rogowsky taking up. That concept was shortly shot down as preposterous.

“It was a really private desperation tactic to not have Colin be CEO. It was not a professionally thought-out concept” a supply tells me, although one other stated it was all the time arduous to inform if Yusupov’s loopy concepts have been jokes. Each Yusupov and HQ Trivia declined to answer a number of requests for remark, however we’ll replace if we hear again.

HQ Trivia co-founder Colin Kroll handed away in December

Then tragedy struck in December. Kroll, then CEO, was found dead in his condominium from a drug overdose. Staff have been distraught over what would occur subsequent. “Colin’s plan was to ship quick, and get new issues on the market” a supply says, noting that Kroll had pushed for the discharge of HQ’s first new recreation sort HQ Words modeled after Wheel Of Fortune. “He wasn’t good however within the time he was in cost, the ship began to show, however when Rus took over once more it was just like the 9 months the place we did nothing.”

Coup d’éHQ

By February 2019, HQ’s employees was fed up. Two sources affirm that 20 of the roughly 35 staff signed a letter asking the board to take away Yusupov and set up a brand new CEO. With HQ’s obtain price persevering with to sink, they feared he’d run the startup into the bottom. One supply steered Yusupov may slightly have seen the entire startup come crashing down with the blame positioned on the product than have it come to mild that he performed a big hand within the fall. The tone of the letter, which was by no means formally delivered however sources consider the board knew of, wasn’t accusatory however a plea for transparency concerning the firm’s future and the employees’s job safety.

At a swiftly convened all-hands assembly in late February, HQ investor Liew advised the corporate his fund Lightspeed would help a seek for a brand new CEO to switch Yusupov, and supply that new CEO with funding for 18 extra months of runway. Liew informed the employees he would step down from the board as soon as that CEO was discovered, however the search continues and so Liew stays on HQ’s board.

Principally everybody was on Jeremy’s aspect as nobody needed to work beneath Rus. Jeremy wasn’t making an attempt to screw him over the best way Rus would screw different individuals over. He simply needed to do what was proper, getting behind what everybody needed” a supply stated of Liew. 

As an alternative, HQ’s board moved ahead with instituting a brand new government decision-making committee composed of Yusupov, HQ’s head of manufacturing Nick Gallo, and VP of engineering Ben Sheats. Yusupov would stay interim CEO, and he continued to cling to energy and there’s been little transparency concerning the CEO alternative course of. Till a brand new CEO is discovered, HQ should subsist on its present funds. The employees is “all the time nervous about operating out of runway” and are given obscure solutions once they ask management about how a lot cash is left.

On March 1st, the committee emerged from a gathering and fired three staff — two who had spearheaded the petition and been vocal about Yusupov’s failings.

One who wasn’t fired was Rogowsky, regardless of sources saying at one level he’d tried to arrange the employees to go on strike. Different staff had been cautious about standing as much as Yusupov. “Everybody was frightened of retaliation. Their fears have completely been validated” a supply explains. Engineers and different staffers with robust employment prospects started to empty out of the corporate. These left have been simply making an attempt to carry onto their jobs. With out inspiring management or a technique to reverse consumer shrinkage, recruiting replacements would show troublesome.

Yusupov stays on the board, together with Tinder CEO Elie Seidman who Yusupov appointed to his further widespread seat. Liew retains his seat till the brand new CEO is discovered and provided that seat. And Kroll’s seat seems to have gone to Lightspeed associate Merci Victoria Grace. Lightspeed and Cyan of Founders Fund declined to answer requests for remark.

[Update: Seidman tells TechCrunch that the he sees the internal struggle for the CEO role as over now that Yusupov has accepted that a new CEO will be installed. That search is moving along, and the CEO chosen will report to the board but otherwise be given full autonomy to run the company as they choose. That includes having hiring and firing power over Yusupov. Seidman rightly believes HQ has contributed important ideas to the mobile gaming ecosystem, and now it’s the startup’s responsibility to turn those ideas into a steady business.]

Dropping Face

Tensions at HQ and a want to diversify his prospects led Rogowsky to select up a aspect gig internet hosting baseball speak present ChangeUp on the DAZN community, TMZ reported this week. He’d hoped to proceed internet hosting HQ throughout its huge weekend contests. However tensions with Yusupov and the CEO’s want for the host to stay solely at HQ led negotiations to bitter inflicting Rogowsky to go away the startup completely. TechCrunch was first to report that he’s been replaced by former HQ guest host Matt Richards, who Yusupov bluntly informed me Friday had polled greater than Rogowsky in a SurveyMonkey survey of HQ’s prime gamers.

In tweets, Rogowsky revealed that that “Sadly, it gained’t be potential for me to proceed internet hosting HQ concurrently as I had hoped” noting, “I wasn’t given the courtesy of a farewell present.” Discovering a solution to protect Rogowsky’s ties to HQ doubtless would have been greatest for the startup.  TechCrunch had raised the concern a yr in the past that until Rogowsky was correctly locked in with an sufficient fairness vesting schedule at HQ, he might depart. Or worse, he might be poached by Fb, Snapchat, or YouTube to host an HQ competitor.

“Rus is a visionary however not an excellent chief. He's extraordinarily manipulative in an unproductive approach. He’s a dude who simply cares so much about his popularity” a supply famous. “Loads of the adverse sentiment amongst employees is the assumption that he cares extra about his popularity than the corporate itself.”

HQ’s subsequent try and revive progress seems to be HQ Editor’s Picks, is described as “a brand new reside present in your telephone the place our host exhibits humorous viral movies and also you determine on who will get paid.” Lastly it appears prepared to embrace the potential of interactive stay video leisure outdoors of trivia and puzzles. HQ Editor’s Picks will face an uphill battle, since HQ dropped out of the highest 1500 iOS apps final month, based on App Annie. Sensor Tower estimates that HQ noticed simply eight % as many downloads in March 2019 as March 2018.

After the lack of its spirit animal Rogowsky, the workers’ chosen chief Kroll, the supervision of veteran investor Cyan, and its product momentum, robust questions are what stay for HQ Trivia. The corporate’s struggles have paralyzed its progress in the direction of discovering a brand new viral mechanic or recreation format that draws customers. Whereas HQ Phrases is enjoyable, it’s too just like its trivia competitors to vary the startup’s trajectory. And all the in-fighting might scare off any expertise hoping to show HQ round. Sadly, securing an additional life for the sport will take a greater than a $three.99 in-app buy.

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