In this episode of "How I Built This with Guy Raz," Guy sits down with entrepreneur Larry Liu to uncover the inspirational journey behind the pan-Asian grocery platform, Weee!. Starting with Larry's boyhood infatuation with American culture and the NBA in China, this conversation reveals the cross-cultural dreams that led to ambition and personal transformation. Adopting his English name after NBA star Larry Bird reflects a young man aligning his identity with his aspirations, setting the stage for a future without boundaries.
Dive into Liu's burgeoning e-commerce expertise, from the early days of eBay reselling to the creation of automated arbitrage software, and explore how fatherhood and Jim Collins' influential book motivated him to pursue a business with lasting impact. Listeners will follow the perilous transition of Weee! from a group buying service facing a dead end to a thriving grocery delivery sensation riding the wave of a global pandemic. As WE adapts and expands, learn how Liu’s vision and commitment to his community drive the company to meet the diverse needs of Chinese American and other ethnic communities.
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As a child in China during the 80s and 90s, Larry Liu, legally named Min, develops a deep fascination with the NBA and American culture. This exposure leads him to dream of living in the United States, associating NBA players with the American dream. He chooses the English name Larry at 12, in admiration of the basketball legend Larry Bird, whose influence extends beyond the court and into young Larry's identity.
Larry begins his e-commerce venture with eBay reselling as a hobby, learning crucial skills for his future business endeavors. By 2015, he moves on to develop software that automates arbitrage between different e-commerce sites, such as Amazon, eBay, and Walmart. This innovative approach allows Larry's team to make a significant profit by exploiting price discrepancies across platforms. However, they soon hit a profitability ceiling and face the harsh truth that their business model lacks substantial value creation, prompting a fundamental re-evaluation.
Fatherhood and the insights gained from Jim Collins' "Good to Great" lead Larry to aspire for more than making money; he desires to establish a lasting business within the e-commerce realm. His personal interests and adeptness in e-commerce mesh perfectly with the potential he sees in the market. The freedom granted by his green card allows him to quit his tech job and fully dedicate himself to launching his own e-commerce startup.
The launch of WE as a group buying platform initially attracts tens of thousands of users, helping them to purchase everything from pianos to minivans in bulk. However, the business stalls as the growth model shows cracks, with increased recruitment difficulties and unsustainable pricing strategies. A serious personal injury then offers Larry time to reflect, leading him to the realization that his customer's primary concern is the accessibility and affordability of their preferred foods. This crucial insight and last-chance funding from investors drive a hard pivot in the company’s direction, transitioning WE to focus on grocery delivery.
WE’s new grocery delivery model finds success, especially among Chinese American communities, experiencing substantial week-over-week growth. It scales from weekly to daily deliveries, quintupling sales in just 18 months. The pandemic drastically accelerates this growth, with the company seeing a 700% year-over-year sales increase. This surge leads to rapid expansion and an understanding that diverse ethnic communities share similar needs, prompting WE to cater to a broader demographic, including other Asian and Latino/Hispanic customers, solidifying its position as a pan-Asian grocery platform.
1-Page Summary
Larry's childhood in China during the 80s and 90s was heavily influenced by NBA basketball, which helped shape his impression of America and sparked his dream of living there one day.
As the NBA games began broadcasting in China, many children, including Larry, became fascinated with the American sport. For Larry, the NBA players, who he considered the best in the world, symbolized the American dream that captivated his imagination. This fascination with American culture and the NBA was a significant factor in his longing to move to the United States.
Larry Liu's legal name is Min, but when he started learning English at ...
Larry's passion for American culture and the NBA as a child in China
Larry's foray into the world of e-commerce began as a hobby with eBay but eventually blossomed into a sophisticated automated arbitrage enterprise.
Larry's journey in e-commerce started off simple with eBay reselling. This hobby not only provided him with supplemental income but also set the foundation for his future endeavors. The skills and experiences he gained from using eBay and WeChat were instrumental in helping him conceptualize a more streamlined approach to online group buying and sales.
Capitalizing on his e-commerce insights from 2015, Larry and his friends utilized the earnings from their eBay business to develop software for a more efficient e-commerce platform. Larry designed an innovative program that could scrape various internet retailers, such as Amazon, eBay, and Walmart, to find the best prices. His software could then automatically list items for sale at a markup on different sites. Whenever a sale was made, the program would order the item from the cheaper retailer and ship it directly to the buyer, netting Larry and his team the price difference minus any commissions.
Despite achieving $2 milli ...
Larry's journey into e-commerce, from eBay reselling to automated arbitrage
Through a series of introspections and influences, Larry came to the realization that his true ambition was to create a lasting business, one that resonated with his personal interests and abilities—especially in the realm of e-commerce.
Having children prompted Larry to reassess the course of his life. He no longer wanted to live by simply walking the paths laid out by others. This new perspective on life and the responsibility of fatherhood were catalysts for his entrepreneurial epiphany.
Larry's reading of Jim Collins' "Good to Great" was instrumental to his career shift. The Hedgehog concept, which advocates for a business to concentrate on what it's passionate about, proficient in, and can monetize in a large market, particularly resonated with him. After some reflection, Larry recognized that the e-commerce sector checked all three of these boxes for him: it was an area he was immensely passionate about, had the skills for, and saw tremendous market potential ...
Larry's realization he wanted to create an enduring business, not just make money
Larry Liu’s entrepreneurial journey with WE is a tale of adaptation, resilience, and keen insight into consumer needs, leading to a pivot from group buying to grocery delivery.
Larry Liu initially set his sight on a group buying platform, releasing software in January 2015 that allowed users to coordinate bulk purchases, achieving quick success and drawing tens of thousands of users by mid-2015. The platform didn't focus solely on food - it seamlessly facilitated group buys for a variety of products, including pianos and minivans. Users leveraged the software to secure discounts on group purchases of items as diverse as 20 minivans at a time.
The business, however, hit a significant roadblock. Liu had to shut down a site in Los Angeles due to recruitment issues for crucial positions like group leaders. This cessation necessitated layoffs within the company, signaling a stagnation in the business model's momentum. The company initially sought to build user interest by sourcing deals for items like pianos and pork belly, often not making a profit on these deals, an unsustainable path that could not continue indefinitely.
Amidst these operational challenges, Larry Liu faced a personal crisis - a crippling fall that left him bedridden with a fractured back for a month. This unfortunate event resulted in a pivotal moment of clarity for Liu. The downtime provided him with an opportunity to deeply reflect on his business. He recognized that his customers' fundamental need was accessible and affordable options to obtain the foods they loved, an issue that group buying failed to resolve effectively.
The challenging journey to pivot WE from group buying to grocery delivery
WE's transition to a new grocery delivery model not only showed resilience during the pandemic but also marked the emergence of a robust pan-Asian grocery delivery service catering to diverse communities across the United States.
Larry Liu shares how WE began with humble once-a-week deliveries and witnessed steady growth. This scaled up to daily service as the demand from Chinese American customer base increased. People embraced the service even with its initial limited delivery frequencies. Liu reveals that by summer 2017, the company was doing $100,000 a week in sales. Remarkably, in just a year and a half, they saw this number quintuple to $500,000 a week. The growth was almost entirely fueled by first-generation Chinese immigrants in the U.S. who preferred Chinese language and food. With limited funds for advertisement, WEChat became their main user acquisition channel, utilizing the app's "Order Share" feature to encourage word-of-mouth promotion, rewarding customers with WePoints for sharing their purchases.
As the pandemic unfolded, Liu observed an early uptick in purchases among Chinese Americans – a precursor to the overwhelming spike in demand once the virus officially hit the U.S. After the Lunar New Year, there was a significant daily increase in sales as the community grew concerned about the pandemic. Revenue skyrocketed, boasting a 700% increase year over year during the pandemic. To manage this explosive growth, the company continually expanded its warehouse capacity, ensuring operations ran without interruption even as they moved locations overnight. This period of intense growth propelled the company ...
WE's perseverance through the pandemic into a thriving pan-Asian grocery platform
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