HubSpot fires marketing chief, sanctions CEO over incident involving book about the company

Hubspot co-founders Dharmesh Shah and Brian Halligan.
Hubspot co-founders Dharmesh Shah and Brian Halligan.

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, though she said explicitly that Halligan was not involved in the effort to obtain the manuscript.

She said the outside firm did not tell anyone at HubSpot about its findings, other than to recommend that Volpe be fired.

“The results of the investigation came back telling us that this is what needed to be done, but we do not know what the specifics of the offense were. We just know what the result of the investigation was,” Moran said.

On Thursday, Moran altered her previous statement, saying “a small group of employees” at HubSpot were aware of the details of the investigation.

Neither Volpe nor Chernov could be reached for comment. The company’s short statement on the book incident provided few details and left many unanswered questions, and the company offered few details.

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.

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.” The book, titled “Disrupted: My Misadventure in the Startup Bubble,” is scheduled to be published by Hachette early next year.

Lyons did not respond to a request for comment Wednesday night.

Moran, the HubSpot spokes­woman, said the book in question is “a book that is being written about HubSpot that we were aware of. The information about that is well-covered online. That is one of the things we are choosing not to elaborate on.”

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.

Globe staff writer Curt Woodward also contributed to this report.

This story was updated at 11:10 a.m. Eastern to correct the type of firm that conducted the outside investigation. It was the company’s outside counsel.