The History of Wattpad: How Allen and Eva Lau Founded a Startup Giant
- Sam Hajighasem
- Apr 8
- 3 min read
Introduction: The History of Wattpad and Its Startup Journey
The history of Wattpad is a remarkable tale of entrepreneurship, resilience, and innovation. Founded by Allen and Eva Lau, Wattpad started as a passion project that struggled in its early years but eventually revolutionized the world of digital storytelling. From humble beginnings to being acquired by a tech giant, the journey of Wattpad offers invaluable lessons for entrepreneurs and startup founders.
How Did Wattpad Start? The Early Days of a Game-Changing Storytelling Platform
Allen Lau and Ivan Yuen co-founded Wattpad in 2006, long before smartphones became widely available. Their vision was simple yet ambitious: to create a storytelling platform where people could read and share stories online. However, convincing users to read on mobile phones was met with skepticism—Eva Lau, Allen’s wife, was among the first naysayers.
Despite early doubts, the founders remained committed to their vision. They launched Wattpad as a startup with minimal funding, relying on a lean approach to product development. In the first year, Wattpad had only a few hundred users, and no one was writing original content on the platform yet.
The Turning Point: How Wattpad Scaled Against the Odds
One of the biggest challenges Wattpad faced was growth and user adoption. In its early days, the platform struggled to attract writers. However, instead of giving up, the founders took a pragmatic approach. They realized that their operating cost was just $5 per month—a small price to pay to keep the platform alive.
This realization led them to adopt an “optionality mindset,” meaning they always created multiple ways forward instead of relying on a single success metric. By continuously iterating and improving the platform, they eventually found product-market fit. Once the first writers joined, user-generated content began to snowball, leading to exponential growth.
Key Growth Strategies that Helped Wattpad Scale:
- User-Generated Content: Encouraging readers to become writers, fueling viral content.
- Community Building: Fostering an interactive space where authors and readers could engage.
- Global Expansion: Making stories accessible in multiple languages, leading to international success.
- Venture Capital Support: Securing funding from investors who believed in the vision of Wattpad as a global storytelling giant.
Lessons from Wattpad Founders: Overcoming Challenges as Entrepreneurs
Eva and Allen Lau’s journey demonstrates the resilience it takes to build a successful entrepreneurial venture. They had to navigate an evolving tech landscape, adapt to digital media trends, and find ways to sustain long-term growth.
What Challenges Did Wattpad Founders Face?
1. Skepticism from Others: Even Eva Lau, one of Wattpad’s co-founders, initially doubted the idea of reading stories on a mobile device.
2. Slow Early Growth: For nearly two years, Wattpad had minimal traction, forcing the founders to question whether they should continue.
3. Funding and Monetization: In the initial years, Wattpad operated without significant venture capital backing. They relied on a lean approach before attracting investors.
4. Content Moderation: As the platform grew, managing user-generated content and ensuring quality storytelling became a major challenge.
Inspiring Entrepreneurs: What Makes a Successful Founder?
As seasoned investors with Two Small Fish Ventures, Eva and Allen Lau now mentor aspiring startup founders. According to them, successful entrepreneurs possess:
- A Growth Mindset: Willingness to learn, adapt, and accept feedback.
- Conviction and Trust: The ability to believe in their vision and convince others to join them.
- Perseverance: Willingness to withstand early failures and pivot when necessary.
- Strategic Business Growth Thinking: Founders must always look for scalable growth strategies and innovative ways to operate.
Wattpad’s Acquisition and Legacy in the Startup World
In 2021, Wattpad was acquired by Naver, a South Korean internet conglomerate, in a deal worth $600 million. This acquisition validated Wattpad’s impact on digital storytelling and cemented its place as a startup success story.
Post-acquisition, Wattpad remains a dominant storytelling platform, providing opportunities for aspiring writers to reach a global audience. Eva and Allen Lau continue to shape the startup ecosystem through Two Small Fish Ventures, investing in the next generation of innovative founders.
Conclusion: Lessons from the History of Wattpad
The history of Wattpad is a compelling example of how entrepreneurship is a journey filled with uncertainties, setbacks, and breakthroughs. Allen and Eva Lau’s perseverance, strategic growth mindset, and conviction in their idea played a crucial role in building what is now a global storytelling giant. Their experience serves as a powerful lesson for founders on scaling startups, overcoming challenges, and staying committed to long-term vision despite early struggles.
Entrepreneurship comes with challenges, but having a solid content and brand strategy can make all the difference—let’s talk about how we can position your startup for long-term business growth.