In Company Forensics, most articles revolve around one of the following aspects. It's either bad business decisions, peculiar personalities, products that are too good to be true, or flawed business models.
But, in this case, it seems to have all the above. This game was wildly successful. It rose to the top, hovered there briefly, and then crashed and burned in a fireball of controversy and champagne. All in three years.
We talk, of course, about HQ Trivia. It was a seemingly innocent game where players earned money by answering general culture questions against the clock.
The premise was simple, so simple, in fact, that millions downloaded the game and got hooked. Many called it the revival of the TV Quiz show.
But behind the scenes, there was drama, tales of abuse, addiction, and much more. We'll tell you all about it in this article.
HQ trivia was the product of Rus Yusupov and Colin Kroll. You might remember them as the creators of another failed startup called Vine. After the failure of Vine, Yusupov and Kroll ended up working for Twitter but lost their jobs in rapid succession. And I need you to remember this for later.
The pair had an obsession with user interaction. For them, the most valuable product a customer can provide is attention. They were right, and to get it, they aimed at games.
"We really set out to develop this network of live interactive shows on mobile phones," Yusupov told CNN Business.
The startup was just that. 12 questions, each with a ten-second timer for a cash prize. With 10 seconds, cheating was impossible, which made the game much more enjoyable. Plus, like the gameshows of the past, a charismatic host announced the questions. But, this time, winners appeared in an online leaderboard for the entire world to see.
If you won a round, you claimed a jackpot that varied in size, ranging from a couple of hundred dollars to thousands. But the prize money was split between all the winners, so there was no guarantee on the size.
You had plenty of opportunities to take part in the game. Every workday had a 9 pm session, and weekends had an extra 3 pm session. Plus, they lasted around fifteen minutes, so coffee breaks had a whole new meaning.
So, in short, you played against the clock for a chance to make money, plus bragging rights. The combination was perfect. But, there was something extra.
Part of the success came from the host, Scott Rogowsky. He had worked in improv and standup to local fame before taking the job. But, in no time, he became somewhat of a celebrity. Rogowsky was, after all, a likable dude that added a fun vibe to the game.
So, with many factors helping its case, the game launched in August 2017. By March 2018, it has millions of users logging in every day. The game was a hit.
The game was so successful that, in months, it raised $8 million, then another $15 million against a $100 million valuation. Investors included big names, like Peter Thiel. So, at first, the model seemed to catch investors' attention, and it had the evidence to prove it.
Take a look at Christmas 2017. 730 000 people chose to play HQ Trivia instead of talking to their weird relatives about uncomfortable topics. But, the massive numbers were helpful for the players. For example, that day had a total jackpot of $2000. So, the payout for winners was $5.16 each. Still, like crack addicts, users wanted more. By January 2018, it was the number 3 game and number 6 app in the Apple App Store. At its peak, 2.38 million players join every single match.
These numbers proved that HQ Trivia was popular. But, it was also very flawed.
Livestreaming an interactive game through a mobile phone is hard. Very hard. Interactivity needed to be instant, especially if the questions have a timer. So, one frequent complaint was the lack of responsiveness. Many users complained that clicking on an answer did nothing, and time ran out, so they got the boot.
Other times, the quiz didn't work at all. So, when it crashed, which it did often, the hosts worked hard to keep the frustrated players from leaving before the problems were solved. In general, they managed to keep them entertained. But issues like these weren't the only red flags around. In addition, there was the question of money.
Though each game had a prize, at first, there was no subscription and no prominent ad placement or revenue from advertising. So, where did it come from? Though the startup had investors, there were questions around its sustainability.
After all, money runs out fast. But, when asked about this, the host, Rogowsky, was pretty secretive.
"I can't really speak to it — they've got a strategy, and they're figuring it out," Rogowsky said.
Perhaps, he was riding the wave of addiction around the game. Because the questions of money didn't seem to matter. Plus, the game was popular enough to get some sponsorships, which helped with the funding.
The startup worked with big brands, such as Chevrolet and Nike. So, things were going great. At least, so it seemed.
Users began to complain that some of the Trivia was too tricky. It wasn't unusual to see questions that had poor grammar or didn't even make sense. Also, the glitches increased, and delayed payouts were more frequent, with payments taking months.
In April 2019, HQ Trivia lost a bit of its essence. Beloved host Scott Rogowsky parted ways with the company.
It turns out that Rogowsky wanted another job and was willing to work on weekend shows. But HQ Trivia wanted total commitment. So, they split, and the startup hired Matt Richards, who had a tough job on hand.
The standup comic came when the game was no longer popular: the novelty of online Trivia was wearing off. By April 2019, when Richards came in, the show was already out of the top 1500 apps. Downloads had dropped by 92%. Damn.
As it usually happens in these articles, a lot happened behind closed doors, more than we could see. Remember the creators, Kroll and Yusupov? And how they worked for Twitter, but then they lost their jobs?
Well, it turns out that they were let go because they were "difficult to work with." Now, many people might be challenging to work with, but these two were in a league of their own. The word many former employees used was "toxic."
Employees labeled Yusupov as abusive and disinterested in his work. On the other hand, it was common for Kroll to arrive late, hungover, and disheveled. Plus, he was even accused of sexual harassment.
Things weren't different with HQ Trivia. Kroll and Yusupov clashed had constant clashes. The arguments reached new heights in September of 2018. Kroll and another board member forced Yusupov out of his position as CEO, and Kroll took over. Three months later, in December of 2018, Kroll died of a drug overdose in his NYC apartment. So Yusupov took over again as CEO.
Talk about a healthy working environment. The issue was that, unsurprisingly, people weren't happy with Yusupov. Tech Crunch reported that:
"More than half of the startup's staff signed an internal petition to depose CEO Rus Yusupov, whom they saw as mismanaging the company."
So Yusupov did what he believed was best. He fired them. This is some Game of Thrones stuff right here. Minus the dragons and decapitation. But you get the idea. Because of this, staff morale and interest in the game plummeted. And HQ Trivia fell off the ranks in the App Store. Plus, the bank account was drying up. Yusupov was dishing about $1 million per month in prizes. But there was very little income. And, back when he had money, sources said that Yusupov was slow to improve his creation.
The efforts weren't great. First, Yusupov tried different versions of the game, which were pretty much the same. Then, he gave users the chance to buy extra lives, and he even added another game on weekdays. But, none of these stood out as transcendental. Users weren't in love with the game anymore.
HQ Trivia guzzled cash, and it needed lots of it. And it's not like Yusupov didn't try. He had been looking for funding since early 2018 but hadn't been able to secure any investment. The reason why? Well, investors didn't like him. That simple.
Yusupov's reputation preceded him, and the game's reputation preceded it. As employees complained about the CEO, users complained about the game. It wasn't appealing anymore. In a desperate effort to spike interest, the startup released yet more new features. New ideas like HQ Photos, where users rated photographs, and HQ Tunes, where users had 10 seconds to guess multimedia questions.
Major networks like NBC and CBS helped in promoting the game. Even Jimmy Kimmel guest-hosted the trivia show, but it wasn't enough. Because Yusupov still ran the ship. A ship, mind you, that was sinking fast. Desperate to get something out of HQ Trivia, Yusupov decided to sell. So, it did come as a surprise when he announced that he had one. In fact, he even assured the world that an "established business" was willing to buy the startup. But it never happened.
That "established business" pulled out of the deal. So, Yusupov took to his media to communicate the inevitable end with an intriguing choice of words. Yusupov explained that they had an offer, had worked on the legal documents, and even came up with a projected date. But, the deal dropped, and Yusupov wasn't aware of why.
"For REASONS WE ARE STILL INVESTIGATING, they suddenly changed their position. Despite our best efforts, we were unable to reach an agreement."
"And so effective today, HQ will cease operations and move to dissolution. All employees and contractors will be terminated as of today."
(That's how the statement came out, by the way. Caps and all).
So, in the day of love and friendship, chocolates and roses, as the 9 pm trivia started, host Matt Richards said out loud: "Not gonna lie. This f*cking sucks. This is the last HQ ever!"
No, you know what? This is appropriate. It was the only way HQ Trivia could go out: in flames and vice.
Why go out quietly when nothing about this game was ever quiet? But even after its demise, even Yusupov didn't stay silent. Four days later, he announced that an "unnamed company" was purchasing the startup for it to live on. But he said so in his very own way:
"We have found a new home for HQ, with a company that wants to keep it running. All employees, contractors, and players are top priorities. Severance will be paid, and you will be able to cash out.
NOT A DONE DEAL YET, BUT I'M OPTIMISTIC."
Well, he might have had some truth to it. Because, in the end, HQ Trivia is still alive in 2021.