The 10% Bet That Built a $11B Company | Howie Liu (Airtable)
This article delves into the entrepreneurial journey of Howie Liu, co-founder of Airtable, a company valued at $10 billion. It explores his upbringing, early fascination with technology, and the pivotal experiences that shaped his vision for building a company with significant global impact. Liu’s story highlights the importance of choosing the right problem to solve, even if the initial solution is only a small percentage of the total answer. He emphasizes how a 10% solution to a massive, universal problem can yield more significant results than a 50% solution to a niche problem. The article covers his childhood in Texas, his parents' strong work ethic, his introduction to the internet, his college experiences at Duke, and the lessons learned from his first startup, ETAX, leading to the inception of Airtable. It underscores the non-linear nature of entrepreneurship and the value of continuous experimentation and problem-solving.
Howie Liu's Early Life and Influences
Howie Liu was born in Texas, the son of Korean grandparents who had immigrated to China during World War II and then later moved to the United States. Both of his parents were academics in China before moving to the US, where his father pursued a PhD at Texas A&M University focusing on agriculture and cotton research. His mother, a civil engineer by training, initially worked minimum wage jobs, including at a Chinese restaurant and McDonald's, due to language barriers and an inability to use her degree. She later earned another undergraduate degree from Texas A&M, securing a white-collar job.
I saw the incredible work ethic. Both my parents worked hard but my mom especially. These were really grueling jobs. It's not easy to go and do that and then come home, watch the kids and help with schoolwork for me. So, the most profound thing was just the level of work ethic and tirelessness that she took to her jobs.
Liu grew up in what he describes as a financially poor environment, though within a town where extreme wealth was not prevalent. This upbringing instilled in him a "scrappiness" and a hunger to "make something from nothing." Early on, he was captivated by the internet, seeing it as a free and expansive world beyond his small college town. He started experimenting with online ventures, including a Pokémon website and an eBay account to sell baseball cards, learning early on about monetization and online presence.
His parents, particularly his mother, actively supported his academic pursuits, especially in math and science. He also developed a love for science fiction, which he credits with broadening his perspective beyond his limited travel experiences. The acquisition of their first computer, an Acer with a 133 MHz AMD K6 processor and Windows 95, was a significant event, sparking his deep fascination with computers and the internet. He reminisces about the early internet's personal nature, with numerous homegrown websites offering glimpses into people's unique interests and personalities. He was also drawn to services that combined gaming with real-world rewards, such as sites where points could be redeemed for prizes like baseball cards or a DVD player.
Liu's early internet explorations also exposed him to product innovation, including an alpha test for a physical smell printer from a company called DigiScents. This experience, despite the product never launching, taught him to critically evaluate business models. He was also active on early online forums, particularly Neopets, where he engaged in discussions and virtual trades, experiencing the early forms of online communities and digital marketplaces. He started learning HTML using Dreamweaver, which allowed him to build websites and understand the fundamentals of web design, albeit with early, noisy aesthetics.
His interest in technology companies like Microsoft, with its ubiquitous products like Windows and Office, and games like Fighter Ace, fueled his desire to combine passion with commercial viability. Unlike the stereotype of "tiger parents" pushing for specific professions, his parents encouraged him to explore his interest in tech, advising him to learn how companies like Bill Gates and Steve Jobs built successful businesses. This encouraged a non-traditional path, although financial self-sufficiency remained a core consideration, leading him to abandon ideas like a career in music due to financial risk.
College Experience at Duke
Howie Liu attended Duke University, a period that offered him greater flexibility and exposure to ambitious individuals. Unlike many peers, he did not major in Computer Science, opting instead for Mechanical Engineering and Public Policy. He felt he could continue to refine his programming skills independently and sought to learn about government and policy, areas he knew little about. His public policy studies exposed him to complex real-world issues like intellectual property law and its disruption by technologies like Napster, bridging his interest in tech with broader societal concerns.
Duke's social environment, marked by a pretense of not caring about academics despite widespread ambition, led him to connect with a small subculture of students interested in technology. This niche community, including his future co-founders of both his first startup and Airtable, Andrew and Emtt, shared a passion for platforms like TechCrunch. This shared interest fostered a "kindred connection." His college years were characterized by extensive prototyping of app ideas and rigorous vetting of business concepts beyond academic assignments. He sought to understand if there was a sustainable business model before building the product, an approach distinct from simply creating cool tech.
Despite the prevailing trend among Duke graduates to pursue careers in investment banking or consulting, Liu remained committed to a technology and entrepreneurial path. He viewed traditional corporate ladders as potentially limiting and financially predictable but creatively stunting. He recognized the lower risk of taking entrepreneurial leaps during college, where returning to studies was always an option, compared to later in life with family responsibilities.
First Startup: ETAX
After college, Liu briefly considered a consulting job with a tech incubator but ultimately decided to pursue a startup after an internship at CrowdFlower (now Scale AI), which provided a visceral experience of working in a small, venture-funded tech startup. His first startup, ETAX (contacts with an E), was inspired by his own frustration with existing CRM solutions while managing client and personal relationships. He envisioned a smart CRM that automatically tracked interactions and aggregated information from various sources like Facebook, Twitter, and LinkedIn.
ETAX went through Y Combinator's Winter 2010 batch, an intimate experience with only seven or eight companies. Despite gaining early traction and monetizing new features related to email tracking, Liu realized that the problem ETAX addressed was not significant enough to achieve the scale of impact he desired. His ambition was to build a company generating billions in revenue, which to him, was a reflection of the meaningful impact it had on the world.
This realization led ETAX to consider acquisition offers. Interestingly, companies like Google that previously dismissed his portfolio were now seriously considering acquiring his company. They ultimately chose to be acquired by Salesforce. Liu's decision was rooted in his belief that while consumer products relied heavily on luck and trending popularity, B2B solutions offered a more predictable path to value creation. He felt working at Salesforce would provide invaluable learning about building a successful B2B company.
Lessons from Salesforce and the Birth of Airtable
During his time at Salesforce, Liu gained a critical insight: businesses across diverse industries, from healthcare to automotive, shared a universal need for storing business objects or data and creating workflows around them. Salesforce's platform, force.com, though initially broad, eventually focused on customer records. However, Liu saw an untapped opportunity in a universal platform that could solve a myriad of business application needs, providing layers of abstraction for data models, logic, and interfaces. He realized his expertise in modern product UX, combined with his interest in real-time collaboration technologies like Node.js, could be applied to this larger problem.
The Salesforce acquisition provided Liu with a significant financial safety net, allowing him to be more ambitious and deliberate about his next venture. This comfort enabled him to address larger, more complex problems. This led to the founding of Airtable, built over approximately two and a half years before its public launch, a testament to the complexity of the product's UX and backend, including core real-time collaboration capabilities. The goal was to create a modern, intuitive, real-time collaborative application platform so easy to use that even business users, not just developers, could build their own applications.
The most crucial lesson from his first startup experience and the Salesforce acquisition was the importance of choosing the right problem. ETAX, though a "decent product for a decent problem," was a "local maxima problem," not a universally significant one. Airtable, in contrast, aimed at a "massive problem that affects every single business," offering immense potential for impact.
If you pick the right problem, you can make more mistakes along the way, but you'll have much more upside and outcome to make it worthwhile. The V1 of Airtable probably only solved the bigger problem we were going after by like 10%. Even the 10% good solution was actually good enough to get initial product-market fit and a lot more of it than that first product.
Liu underscores that even a 10% solution to a colossal, widespread problem can achieve significant product-market fit and impact, outweighing a more complete solution to a smaller, less critical problem. This philosophy allowed Airtable to gain traction despite its initial limitations, as businesses were willing to pay for even partial solutions to pervasive inefficiencies.
Takeaways
- Choosing the Right Problem: Prioritize solving a massive, universal problem, even if your initial solution only addresses a small percentage of it. A 10% solution to a multi-billion dollar market can be more impactful than a 50% solution to a niche problem.
- Non-Linear Entrepreneurship: Entrepreneurship is inherently non-linear and requires constant experimentation. Approach it like a Jenga game, gently testing many small ideas to find the ones that will move the overall structure forward without causing collapse, rather than following a rigid checklist.
- The Value of Scrappiness: Growing up with financial constraints can instill a vital "scrappiness" and hunger to "make something from nothing," which are essential traits for entrepreneurial success.
- Financial Self-Sufficiency Aligns Passion with Viability: Aligning personal passion with commercial viability is crucial. Financial independence provides the luxury of being more ambitious and deliberate in choosing a problem, allowing for a longer time horizon to build complex, impactful products.
- Product Thinking Drives Programming: For aspiring entrepreneurs interested in technology, programming should be viewed as a tool to build useful products that solve real problems. The focus should be on product thinking—how software can effectively address a need—rather than solely on the technical challenge of coding.
References
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