Feb 20, 2020 by Hsu Han Ooi
It was a typical rainy day in Seattle, June 2009. Brian and I had locked ourselves in a closet only big enough for an Xbox, 16-inch Dell monitor, and two people. It was 7:00 P.M. on Brian’s last day at Zillow, where we had met and been working together for a year, and we were determined to have one final battle on our favorite game “Guitar Hero 3.” Brian and I were battling it out on our favorite song “Through the Fire and Flames” by Dragonforce. It wasn’t really much of a battle though, because Brian had the advantage of his longtime cellist skills to play the song on Expert mode, but alas I tried.
The week before Brian’s final day we had already started talking about life after Zillow. We were both young 20-odd year olds who’d just graduated from the University of Washington (UW) and wanted to embark on the startup roller-coaster. 12 months prior I had turned down a lucrative job offer from the biggest software company in Seattle, Microsoft. I’d always known turning down Microsoft and choosing Zillow would propel me down the course of doing my own startup someday, and that day was finally here.
As we planned for life after Zillow, Brian and I set a date to talk about an idea he had been thinking about for awhile. He said he had written a business plan, prepared a deck, and that his brother, Ian, was interested too. I told him I had a brother as well and we planned to have them both be present during the pitch.
Growing up together, if you’d asked Hsu Ken and I if we could see ourselves starting a company together when we were 13 years old, I don’t think either of us would’ve even imagined it. We had a tendency to make different choices in life, but we always shared a passion for technology. One of my earliest memories of our time spent together was figuring out how to network two computers over Internetwork Packet Exchange to play the game “Doom” together.
Ian was the youngest of our 4-person co-founding team. In fact, when we first started, he was still enrolled at UW, where he was finishing his computer science degree. He was a Google ambassador for the university, which more or less guaranteed him a job at the company following graduation.
The four of us met in my living room over a weekend to review Brian’s pitch and 20-page business plan. I’ve forgotten most of the pitch by now, but I can clearly recall the feeling of being energized at the thought of starting our own company. After a little deliberation we had our idea, and boy was it ambitious. We decided we were going to help people achieve their dream jobs. Imagine you were a software engineer now, but wanted to pursue being a Chief Technology Officer (CTO) at a big Fortune-500 company. How would you get there?
We took a page out of the Zillow play book and decided to use publicly available data to find out. We scraped for resumes to trace the likely trajectories that CTOs at large Fortune-500 companies used to achieve their position. From there, we created career plans that we would use to guide our users. We named our company Eggsprout, because we thought of ourselves as hatching and growing this idea.
We embarked on our journey with the only way we knew how, cheaply. We worked from my basement with plastic folding tables and chairs and no heat (it’s cold in Seattle during the winter) to maximize our runway. We microwaved dinosaur-shaped chicken nuggets on odd days and cooked spaghetti and meatballs on even days for lunch as a team and settled disputes on product/design with the game “Super Smash Bros. Brawl” at lunch. We all came from frugal Asian-American backgrounds. Brian and Ian grew up for most of their lives in Hong Kong, while Hsu Ken and I grew up in Oregon but were born and spent our early childhood in Penang, Malaysia.
As soon as we started building our product for Eggsprout, we made two of the most common mistakes first-time founders make. First of all, we were trying to use technology to solve a problem no one had. As it turned out, people didn’t need a personalized career path based on other people’s career choices. The people that needed the most help were those who needed a job in the moment. But we didn’t learn this until we had already spent several months building the product. We certainly could have gathered more information to avoid trying to solve a non-issue by conducting a small customer survey or finding and speaking with ten customers.
The second mistake we made was thinking our idea was so novel and innovative that we couldn’t talk to anyone about it otherwise they would steal it. I know it sounds crazy but remember this is 10+ years ago and LinkedIn was still growing at the time. Former President of Y-Combinator Sam Altman once said, “Ideas by themselves are not worth anything, only executing well is what creates value.” Coveting our idea as sacred and holding it so close resulted in us going down a time-costly rabbit hole, which trusted advisors could have helped us avoid through their guidance.
Luckily for us, an advisor and future co-founder was on the way. As we continued working tirelessly on our idea, Ian was still attending UW. He was taking a computer science course on search algorithms with an unusually entrepreneurial professor, Oren Etzioni. He had founded and sold his company Farecast to Microsoft the previous year, and on a whim, Ian pitched him our idea. We didn’t receive the feedback we were hoping for, but it turned out to be what we needed. He said he hated the idea, but was interested in us.
Hindsight is always 20/20, and after all these years, I can say that our idea was never going to work. That being said, it’s easier to shoot other people’s ideas down than put yours out into the world. We continued with our first idea, but over time began to wonder about others. Running out of passion for the first idea, we were determined to choose the next idea more pragmatically. This time, we took multiple ideas at once and ran with them for a predetermined period of time - about a month each. Afterwards we measured the team’s appetite to keep going and any progress that had been made before moving on to decide which idea to pivot to next.
Using this systematic approach, we settled on three ideas, and the one that stood out to all of us was the idea that would eventually become the startup eBay purchased in 2013. This idea was sparked by Brian’s wife, Jessica, who had noticed prices on Amazon.com were continually fluctuating up and down. She wondered, “When would be the best time to buy a product?” Answering that question would become the premise of our first startup.
Once we had the idea down, we began building a minimum viable product. We knew it needed two things: coverage of the top products and sellers and pricing information we could make predictions on. We set out to collect the data, all the while meeting with professor Oren as our advisor. We pitched our new idea to him and he loved it.
Loving an idea isn’t enough to close funding though. We spent six months after pitching the initial idea vetting the premise, building a prototype, collecting data, gathering feedback, and pitching to investors. However, looking back, we wouldn’t have been able to move as fast without the help of our experienced professor. He helped guide us through fundraising and the first few hires and joined us as a co-founder.
He took a chance on four young college students with a poor idea and a lot of passion. Sometimes what people need the most is reinforcement that they can do something great and a kick in the right direction. With Iterative, we hope to be able to accomplish something similar with our batches.
After many late nights and chicken nugget lunches, we finally closed USD$2.5M in funding for our first startup Decide.com and began a new chapter in our journey.