It was another few years before people started submitting regularly. In the meantime, Lau and Yuen started and sold a mobile ad company, using the proceeds to keep Wattpad going.
It was a full two years before a user uploaded an original story to Wattpad-its first works were public domain titles from things like Project Gutenberg.
The lucrative evolution from Wattpad post to mainstream book to Hollywood movie is precisely what Wattpad wants to see more of.
Wattpad followed up with iPhone and Android versions in 2009. “It’s readable, but nothing compares to the iPhone or Android,” says Lau, who became the CEO while Yuen took the chief product officer title. Back then the most popular phone was the Motorola RAZR. They joined forces in 2006 to simultaneously launch Wattpad’s desktop site and its mobile app, which was compatible with most mobile phones across nine manufacturers. They were also both working on creating a mobile reading app, and Yuen had already built a site where people could publish stories.
They were both engineers-Yuen worked at Lau’s first startup, a mobile internet company that Lau left in 2006 and that folded in 2008-and both liked to read. Lau and Yuen plotted out the idea for the company in the Vancouver airport in 2006 while Lau waited for a flight. Wattpad was born on the back of a napkin.
“There’s a lot of crowdfunding, curating platforms, but you need a huge number of people contributing to make it work,” says publishing consultant Jane Friedman. But it is hoping that pieces like “After”-a distinctly more modest success compared to Fifty Shades-can be discovered among the 565 million stories on the site, an increase of 165 million from 2017. It may never hit on the next Fifty Shades of Grey, which started out as fan fiction on a rival site. Wattpad’s greatest competitive advantage is, simply, its scale. Blogs, Tumblr posts and Twitter accounts have all been turned into additional forms of media over the years-with varying degrees of success. The model “is a great way to seek talent without having to pay huge amounts for it,” says Lorraine Shanley, a publishing industry consultant.
It has few costs beyond bandwidth, its 130 employees and the Toronto offices. That lean business model means Wattpad is profitable. Nearly all its writers are unpaid several hundred make money from ad-sharing revenue and 200 of those also earn from writing sponsored content and inking publishing deals with Wattpad.
The company brings in an estimated $19 million in revenue, mostly from ads on its site and from stories sponsored by companies like Unilever who want to advertise alongside a specific writer or genre. Wattpad’s 65 million active users (most of them women under 30) spend 383 million hours a month on its site and its mobile apps, reading pieces like “Brave ,” a yarn about the Harry Potter character Neville Longbottom, and “Taking Selfies and Overthrowing the Patriarchy With Kim Kardashian.” Wattpad has more than 4 million writers, who post an average of 300,000 pieces a day. Canadian engineers Allen Lau and Ivan Yuen were inspired by their love for reading to found Wattpad, the largest writing platform outside of China, where Tencent’s China Literature reigns supreme.