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HOW I DID IT

How I Live With Myself After Firing a Third of My Employees

Ben Huh, founder of Cheezburger, talks about the most difficult week he's ever experienced.
"I knew people would be angry. But I also knew there was nothing I could do about that."
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This is the story of entrepreneur Ben Huh, as told to Inc.'s Liz Welch.

Cheezburger was always profitable-until we took venture capital investments. We raised $30 million in 2011, and our company went from 45 to 90 people in nine months, and we started spending more than we were making.

I was on vacation with my wife in Spain when I received our Q1 2013 numbers. They were much lower than expected. I did a call with my investors-from a parking lot in Puerto Real, the only place I could get good reception. Someone asked, "Can you keep the annual loss within 10 percent?"

I hung up and gave myself 48 hours to think. I decided to be proactive and make manageable cuts now versus Herculean ones later. The board did not ask for this--it was entirely my call. I called my executive team and said, "I'm coming back early."

We knew we needed to scale back--same destination, smaller boat. I figured that I would be judged by the honesty with which I handled the situation. I knew people would be angry. But I also knew there was nothing I could do about that.

The morning of the layoffs, the executives informed their teams as a group and then met with each person individually to discuss retention or severance. It was very tense.

To mitigate the risk of leaking information, I called John Cook, a local reporter who runs GeekWire, to let him know what was happening. I wanted him to hear it from me. A board member had suggested reaching out to other companies to help place employees, so two days later we held a job fair in the offices of one of our VC investors.

Twenty-four people were let go, bringing our head count to 42. It was the most difficult week I've ever experienced. Often, when faced with a problem, you want to run in the other direction. It's like seeing a lion in the jungle. But I have to do what is best for the company, even if it sucks emotionally.

 




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