The boom in online ad networks, those automated brokers of discount banners patronized by websites desperate for quick cash, is at long last turning to bust. And the shakeout couldn't have started with a more deserving company. Amid lawsuits and layoffs, has seen two-thirds of its once-15-strong salesforce leave, a source familiar with the company tells us. Meanwhile, the company is trying to sell its, a video destination targeted at young men, so far without success. The plan is to focus on its porn-friendly Husky ad network. Who's to blame? Recently hired "grownups," says our source.Heavy has never been a particularly reputable company. It used to inflate its traffic with popup ads. Yet it still managed to raise $20 million in venture capital in January 2007. By last fall, investors began to clamor for more revenue. The startup's management then brought in what our source calls "C-level grownups." The hires included CMO Eric Hadley from Microsoft; CTO Scott Penberthy from Photobucket; CFO Todd Sloan from Nielsen; and VP Richard Rocca, who spent a few months at shady ad network Glam Media after leaving the equally unsavory ad startup Gorilla Nation. That crew now runs the company, "but the problem is there's not going to be anybody to run it with them," says our source, who calls the new leaders "ineffective."

Most C-level people, you know, they might have been able to roll their sleeves at one point in time, but now they're pretty much ineffective people. In one instance, [Hadley, who came] from Microsoft was going around asking for help with Excel. Didn't they give classes on Microsoft Excel at Microsoft? He was like, 'well, uh, I went to business school.

Heavy's problems run deeper than its executives' lack of skill with office-productivity software. Its advertising deal with MillerCoors to sponsor Heavy's "Tiny Entourage" show has the brewer in trouble with consumer advocate groups. Also, our source says the ad network that's supposed to save the company isn't making any money. The litany of defections from Heavy is long. The VP of west coast sales left in June. The VP of east coast sales left this week for a competitor. Three sales directors on East Coast left, leaving one with the entire territory. ("He's loving it," our source says.) The entire U.K. team quit in June, and the company is trying to hire new staff there. The VP of marketing left for Ripe Digital Entertainment, an online-video studio. And Jimmy Jellinek, a VP of programming who had quit the company once but returned in February, has left again, this time for Playboy. But the hardest loss to bear, for a company trying to attract 18-34 males, may be comely reality-TV star Jen Schefft. Scheftt, who starred in ABC's "The Bachelorette," only joined the company in June. She's gone, too, our tipster says. That's a pretty abrupt cancellation. (Correction: Richard Rocca informs us he was not fired from Gorilla Nation, as we reported, but left on his own. "Gorilla Nation and I are still close and I forward business there way all the time.")