The History of Wattpad and Startup Lessons From Eva and Allen Lau
- Sam Hajighasem
- May 1
- 5 min read
The history of Wattpad is a modern tech tale of perseverance, vision, and storytelling. Founded in 2006 by Allen Lau and Ivan Yuen, what began as a bold experiment to deliver long-form stories on mobile phones evolved into a global storytelling platform with over 90 million users. Behind this success story are Allen Lau and Eva Lau, who not only helped build Wattpad but went on to champion new startup founders through their venture capital firm, Two Small Fish Ventures. In this article, we’ll explore the startup journey of Wattpad, entrepreneurial lessons from the Lows, and how storytelling became both their product and startup superpower.
How Did Wattpad Get Started?
In 2006, building a mobile-first storytelling app seemed counterintuitive. Smartphones weren’t mainstream yet, and long-form reading was associated with print or desktop. Yet Allen Lau believed in providing access to stories via mobile devices—even flip phones.
Allen and co-founder Ivan Yuen launched Wattpad on a shoestring budget, driven by the question: “What’s the worst that could happen?” With hosting costs of just $5 per month, the risks were controlled. However, the beginning was rough—minimal users, hardly any engagement, and a demoralized team.
From First Readers to First Writers
It took nearly two years before the first user uploaded content. Until then, it was mostly passive consumption. Still, they persisted, gradually improving the platform until it attracted both readers and writers, triggering the user-generated content (UGC) flywheel. Once creators joined in, user engagement skyrocketed—proving that even slow starts can lead to startup success.
Who Are the Founders of Wattpad?
Allen Lau, originally from Hong Kong, moved to Canada and developed deep expertise in mobile technology during his career. Eva Lau, his wife, worked in business operations and later played a key role in shaping Wattpad’s internal growth strategy.
Eva Lau’s Critical Role
While not a co-founder by title, Eva’s impact can’t be overstated. Initially skeptical (she doubted reading on flip phones would work), she joined after seeing Allen’s conviction. Her business acumen helped them scale their product, team, and community. Today, Eva and Allen co-lead Two Small Fish Ventures, an early-stage VC fund investing in underestimated founders.
What Challenges Did Wattpad Founders Face?
One of the earliest and most personal hurdles was skepticism—even from family. Eva recalls saying, “Why would people want to read on a flip phone?” Yet through open dialogue, Allen won her support by sharing his plans, risks, and why he believed in the vision.
The Dark Days
In the first year, Wattpad had little traction. There were moments they considered shutting it down. But by keeping hosting costs low and seeking optionality (e.g., side jobs, pivot planning), they found ways to keep moving forward without draining resources.
Lessons From Wattpad Founders on Entrepreneurship
The story of Wattpad holds timeless entrepreneurship lessons for anyone launching a company from scratch. Allen and Eva Lau embody many of the traits that lead to startup success, from resilience to visionary thinking.
1. Optionality Matters in Tough Times
"Don’t be a sitting duck," Eva advises. Always create options—even when it feels like there are none. For Wattpad, this looked like juggling freelance work and side gigs while continuing to build.
2. Conviction Wins Skeptics
Allen had to convince his own family on the viability of Wattpad. Founders must show transparency and belief in their mission. Storytelling and empathy are tools to win over doubters.
3. Build Community Early
Wattpad’s true strength came from building a space where users contributed stories, not just consumed them. Engaging user-generated content (UGC) created a self-sustaining ecosystem that drove platform growth.
4. Data-Driven Creativity
Wattpad’s innovation wasn’t just creative—it was driven by data. They used metrics like engagement, comments, and completion rates to identify which stories had mainstream media potential—such as turning Anna Todd’s ‘After’ series into a best-selling franchise.
Why Is Storytelling Important in Entrepreneurship?
For Allen Lau, storytelling wasn’t only the product—it was the foundation of leadership. Founders who tell compelling stories inspire their teams, attract investors, and build loyal audiences.
As Eva points out, great entrepreneurs must "sell their vision through story before they sell the product." Through effective storytelling, Wattpad turned readers into creators, skeptics into investors, and ideas into media franchises.
Craft a Narrative Vision
Whether raising capital or recruiting a team, a strong vision narrative sets successful entrepreneurs apart. Your story helps others understand not just the ‘what’ but the ‘why.’
What They Look for in Future Startup Founders
Now as venture capitalists, Eva and Allen Lau help build the next generation of startups through Two Small Fish Ventures. Their founder-first, empathy-led approach shapes how they select investments.
Qualities They Value
- A growth mindset: Founders who grow through adversity
- Openness to feedback: Willingness to listen and evolve
- Conviction: Ability to lead even when no one else believes
- Grit: Willingness to endure early failures as part of the entrepreneurial journey
Wattpad’s Growth and Exit: A Startup Success Story
In 2021, Wattpad was acquired by Naver for over $600 million—proof of the value they created over the years. What started on flip phones turned into a global business model, crossing over into publishing, film, and television.
Key milestones include:
- Reaching millions of users through the UGC model
- Launching popular stories that became major films
- Integrating community data into creative and commercial decisions
From App to Media Deal Maker
Wattpad redefined storytelling infrastructure. By recognizing patterns in user behavior and content trends, they transitioned from just a reading platform to a talent discovery engine.
The Entrepreneurial Path of Eva and Allen Lau
Wattpad wasn’t the endpoint. Eva and Allen brought their lessons into new ventures, becoming investors who understand what it’s like to build from zero.
Through Two Small Fish Ventures, they now focus on:
- Investing in immigrant or overlooked founders
- Supporting network effect businesses
- Providing mentorship around cap tables, hiring, and scaling
Their experience makes them especially empathetic to those forging their own startup biographies.
Conclusion:
The history of Wattpad and the entrepreneurial path of Allen and Eva Lau offers a masterclass in resilience, storytelling, and startup success. From humble beginnings to a $600 million exit, they turned a visionary idea into a thriving global community. Today, they pay it forward by investing in future entrepreneurs through Two Small Fish Ventures, emphasizing growth mindset, grit, and the power of crafting a compelling narrative. Whether you’re dreaming of launching your first business or scaling your startup, their journey reveals vital startup lessons—and shows that every great business begins with a story worth telling.
If you're an early-stage founder navigating the ups and downs of entrepreneurship, we help transform your story into a meaningful brand that builds trust and traction—just like Allen and Eva Lau did with Wattpad.
