Heavy, one of 400-some online-advertising networks competing to broker banners in a pale imitation of Google, has laid off 14 of its 71 employees. Layoffs and attrition have reduced its staff by almost half since June. [Silicon Alley Insider]

Funny video site Heavy.com managed to make it through the tech boom and bust intact. But the site—and its venture capital investors—may have overestimated how popular it could actually get. We hear that Heavy's VP of marketing has left the company, taking two of his top salesmen with him on the way out. His departing words: "Rome is burning." Not long after getting an infusion of capital in 2006, it was revealed that Heavy was inflating its traffic numbers by buying pop-up ads featuring Heavy content on other sites, and counting them as visits. Which is not something any advertiser wants to hear:

Young man's video site Heavy will lay off nearly a quarter of its staff — 25 out of 105 workers — as it cuts costs and spins off its video ad network Husky Media into a separate company. Most of the layoffs will come from tech and ad sales. Heavy co-CEO Simon Assaad told PaidContent the re-org will make the site profitable this year. We're not surprised. Buying shady traffic cheap and then selling it on to ad agencies at a higher price may not be a way to build a business for the long haul, but it'll get that cash flowing fast.

Already under fire for its racy videos, Heavy.com now wants to bring all of the online-video world into its sticky embrace. Heavy has mastered the art of selling advertisers on wrapping Web videos with advertising banners, like the example above. Surrounding the video itself is a come-on for newly released movies or other similar fare, paid for by advertisers eager to reach Heavy's young-male demographic. But as BrightRoll CEO Tod Sacerdoti points out in a not-safe-for-work blog post, the result isn't always good for an advertiser's brand. Heavy's anything-goes website is already dangerous territory for advertisers. But a new initiative, Heavy's so-called "Husky Network," could make it trickier yet.

Larry Kramer, founder of the MarketWatch stock-news site now owned by Dow Jones, has joined Polaris Venture Partners as a senior advisor. The firm's portfolio includes online-media companies like JibJab and Heavy. [LinkedIn]