How a Hot $100 Million Design Startup Collapsed Overnight

The board likely shares half of the blame, speculates Steve Blank, an adjunct professor of entrepreneurship at Stanford University. “Where were they?” he asks. “It seems like a toxic combination of a board not paying attention and a first-time founder in crisis.”

Santos, dark-haired and so striking-looking one website referred to him as “the brains (and beauty)” behind the operation, was the CEO. Nathan, who had a shaved head, sometimes with a beard, was the chairman. They started the company with $400.

Santos and Nathan argued about how to use the infusion of cash. Santos wanted much of it to go to marketing; Nathan thought it should go to coders to strengthen the back end. But within six months of the funding announcement, the arguing stopped — Nathan left.

By employee estimates, 75% of the leadership team that started in 2018 didn’t end 2018 with the company.

The founders openly favored signing up the most physically attractive designers, saying they would be more appealing to clients.

What had more important ramifications for the company’s future was Santos’ singular focus on press, with nearly all profits — at least in the early days — going to marketing.

The company’s unraveling, which was reported by New York magazine, left dozens of designers reeling. At least two were owed more than $30,000, potentially life-altering sums for freelancers.