State of the Startup Nation Address
It is difficult to track back when the rise of startups actually began in the Philippines, but looking at several definitions, there is a clear consensus that the growth of startups is typically associated with a dynamic technologically driven landscape.
Looking back at our 2012 interview with Joey Gurango, president of the Philippine Software Industry Association (PSIA), an industry veteran, and a startup founder himself, he described that the Philippines was behind countries like the United States in terms of adoption of technologies, for example, enterprise resource planning (ERP) software suites. The United States is far ahead of us with the Silicon Valley being the cradle of many successful startups which are now the tech giants of today, namely Apple and Microsoft. Eventually, the Philippines was able to catch up with the United States around 2005 and the rate of adoption became faster. Gurango predicted that by 2015, we would be almost at par with the United States in terms of technological adoption. It seems that his prediction is consistent with the current state of affairs, now that we are in 2016. Today, adoption of technologies is further hastened with the increased accessibility of the general public to mobile devices such as smartphones and tablets, faster Internet connection, social media, and the steady growth of the technologically-driven industries like business process outsourcing (BPO).
Adding to the vibrant and promising startup landscape in the Philippines is the amount of support coming from both the government and the private sector. In 2015, the Department of Information and Communications Technology (DICT), formerly known as the Department of Science and Technology-Information and Communications Technology Office (DOST-ICTO), set up the roadmap consisting of short- and long-term strategies for the startup community in the country. The government’s strategy toward the local startup community is further strengthened with the signing of the 2015-2017 Philippine Export Development Plan (PEDP) by President Benigno Aquino III in February this year. Seeing startups as models that will spur entrepreneurship in the country, the Department of Trade and Industry (DTI) is working with organizations, such as the IdeaSpace Foundation, one of the country’s leading early stage technology incubator and accelerator backed by tycoon Manuel Pangilinan, in growing the local startup community. In August, the two entities jointly launched QBO as a hub where startups can connect and convene with various academic institutions, startups, investors, and stakeholders. Another startup incubator firm, Kickstart Ventures, Inc., is also backed by a telco giant, Globe Telecom, a key competitor of Pangilinan’s Smart Communications.
Support from individuals and foreign entities are pouring in as well. One serial entrepreneur and investor, Joe Maristela, has invested USD 1,000,000 in putting up Katalyst.ph to serve as a platform that encourages the emergence of more budding local startups. “I believe the additional one million US$ will go a long way out here given the talent and strong spirit of Filipino entrepreneurs. It will allow us as well to get into several niches that we have not considered investing in yet in the past. These companies don’t need to be in the tech businesses. I believe that there are businesses that are non-tech that can still have great impact, and by that I mean startup businesses that are ready and available to engage 90% of the market within a year or two in operation,” Maristela shared.
Impact Hub, another startup incubator that originated from London, recently collaborated with World Wide Fund for Nature Philippines (WWF-Philippines) and Peace and Equity Foundation (PEF), held a competition where startup groups were encouraged to come up with innovative sustainable solutions in resolving today’s energy problems.
However, with our country burdened with several issues like heavy traffic, primarily in Metro Manila, high poverty incidence, and slow Internet connection, many are saying that these factors can hinder the healthy growth of startups in the country. But optimists and opportunists should see the other way around, as these problems can serve as driving forces to push the people behind startups to come up with new effective yet bankable ideas that will help in resolving these pressing problems.
In line with this perspective, Diane Eustaquio, Executive Director at IdeaSpace Foundation, shared her experiences with local startups and provided an optimistic view. “There are a lot of hyper-local solutions coming up. For the past four years of running the IdeaSpace startup competition, we are seeing more on-demand services, shared economy apps, solutions addressing inefficiencies experienced by an emerging economy, fintech, edtech, and logistics, among many others,” Eustaquio said.
The concept of startups is a new thing to the general public, but it will only make sense to the man on the street if solutions presented are meant to address real problems, sticking to the famous adage, “Necessity is the mother of invention,” and not just designed to generate profit.
Lionell Go Macahilig / Group Editor
Building on the learnings that he earned from the academe and his almost three-year professional experience in the outsourcing industry, Lionell joined HardwareZone Philippines in 2007. In his free time, he runs his PC shop and reads various articles online. He also likes cats and jogging.