Hatchlings, a Des Moine-based startup that uses Facebook to put on the world's largest virtual Easter Egg hunt, says it was almost killed by Google.

The five-person bootstrapped startup was founded in 2008 and it has 3.5 million users.

For its first few years, Hatchlings says its relationship with Google was "great." Now, Google is allegedly blocking Hatchlings from collecting 40,000 hard-earned AdSense dollars.

Here's what happened.

After launching Hatchlings from an Iowa State dorm room, the site started to gain a little traction in spring 2008. The founders began working with a Google account manager to optimize ad placements; it was told multiple times that its account was in good standing with Google.

Suddenly, on April 18, 2011, Hatchling received this email:

Here, Google explains what it means by "invalid activity." Hatchlings says Google never mentioned any violation of its terms prior to the email.

When Hatchlings inquired about the blocked account, their Google account manager didn't pick up the phone or respond to emails. Hatchling says Google's unexpected account block kept it from collecting $40,000.

But a thread on Y Combinator seems to suggest Hatchlings did violate Google's terms. It created a content site that gamed Google to make money driving referrals to "Guitar Hero 4" on Amazon, during the time Hatchlings was live.

The Hatchlings founder writes, "I made [an additional small content site] to drive Amazon referrals for Guitar Hero 4 pre-orders. It was SEO'd and at the top of the search results for 'Guitar Hero 4' at the time so it generated quite a bit in affiliate revenue but almost nothing in terms of Adsense. They never told me what was wrong with it but if I had to make a guess it might have been flagged as a 'Made for Adsense' site since it was pretty light on content. And as mentioned I removed the ads from it without as much as a rebuttal. It was a no-brainer since it was so small-time compared to Hatchlings."

The founder says he doesn't think the Guitar Hero 4 site had anything to do with the ban though, as there were two years in between that site and Google's email.



One year later, the Hatchlings founder is still left scratching his head with no word from Google. He pleads on his blog:

"Personal Note to Google: I realize that this probably wasn’t done maliciously and that we were probably caught up in some algorithm gone awry. And I also realize that for the amount of money we’re talking about you probably don’t even consider this to be an issue worth your time. But for a startup like us this is a huge deal. Feel free to reach out...you have my cell number and email address. But after almost a year of being ignored I’m not holding my breath."

When we asked Google about the incident, its PR replied pointed us to the email from April 18 (above) and its invalid activity explanation page.