Anonymous messaging service Secret, at one stage thought to be valued at more than $100m (£66.5m), is shutting down.
Founder David Byttow said: "Secret does not represent the vision I had when starting the company" and that he believed in "failing fast".
The app was created, in part, to promote free speech but was criticised for promoting cyber-bullying.
User numbers have dwindled in recent months. Secret said it would return some of its $35m funding to investors.
Flash in the pan
It is a big turnaround for the company that was the talk of Silicon Valley, both among investors and users of the app, just a year ago.
Founded in 2013 by two former Google employees, the company was backed by some big names including actor Ashton Kutcher, Alexis Ohanian - a founder of Reddit, and Google Ventures.
The anonymous nature of messaging on the app led to its early adoption by technology sector workers, who used it to post rumours of forthcoming products or company mergers.
It was also used for political discussion in Russia and in Israel.
But the service was criticised for allowing people to defame others while remaining anonymous. It was banned in Brazil for promoting cyber-bullying.
A redesign of the app last year prompted users to "think before they post" and made it easier for users to flag up abusive content.
But user numbers have been falling in recent months, with some of those remaining complaining of an increase in the number of posts of a sexual nature and that public chat had become dominated by users from Indonesia.
In his blog post on Medium, Mr Byttow said: "I believe in honest, open communication and creative expression, and anonymity is a great device to achieve it.
"But it's also the ultimate double-edged sword, which must be wielded with great respect and care.
"I look forward to seeing what others in this space do over time."
Secret is not the first app to attract millions of dollars in funding only to flop shortly afterwards.
In 2012, photo and video-sharing app Color closed just 12 months after its launch having raised $41m from investors.
In June that year, Napster founders, Shawn Fanning and Shaun Parker launched their video-chat site Airtime, attracting $33m in funding.
It had very limited success, with Fortune magazine reporting that it had had to be quietly relaunched two years later.
Analysis: Rory Cellan-Jones, BBC Technology Correspondent
"The truth is that there is fierce competition right now to get in early on any start-up that looks buzzy - who wants to be the guy that turned down WhatsApp in 2009 or Snapchat in 2012?
And if that means throwing a few million dollars at companies which appear to have no moral or business compass, then so be it."
In closing Secret just 16 months after its launch, Mr Byttow said: "This has been the hardest decision of my life and one that saddens me deeply."
"Unfortunately Secret does not represent the vision I had when starting the company."