Philippine Startups Need to Think Bigger to Ignite Investor Interest
Filipino startups need to think globally, or at least regionally, if they want to attract investors and catch up to rivals in Singapore, Thailand and Malaysia.
That was what attendees told me at the recent Ignite 2019 conference, where about 2,000 global entrepreneurs and investors gathered to meet, listen to Asian leaders in innovation and find ways to support and “internationalize” the Philippines’ startup ecosystem. Speakers ranged from Brian Cu of Grab, the seven-year-old Malaysia-founded firm that’s grown to dominate ride-sharing in Southeast Asia, to Samuel Jeanblanc of Google, one of the world’s most successful startups.
Filipinos are creative and talented, but “they lack patience to overcome difficulties in comparison to entrepreneurs in other places,” said angel investor Yutaka Kitade, who is familiar with the Filipino market and focuses on seed stage startups across Asia for a US-Japan venture capital firm.
Philippine startups are usually satisfied with local success and “tend to give up or sell the business,” Kitade added. “They don’t have the mindset to be a global player and lack huge ambition to be a Mark Zuckerberg of the world.”
Case in point: the Business Process Outsourcing (BPO) sector. As one of the first BPO investors from Japan 18 years ago, Kitade says he saw the potential of the Philippines to dominate globally, but to date, no local operator has attained the success of Accenture or Convergys.
Despite the challenges, stakeholders say the Philippine startup scene is improving. With the theme “Innovating Asia: Shaping the World,” the third annual event organized by digital marketing firm dentsu X Philippines, local media startup Techshake and incubator Brainsparks, aimed to give Filipino companies a platform to showcase their innovations to a global audience and corporations looking for potential partners.
"When we first started this conference, no one was supporting or providing funds for Filipino startups," said Donald Lim, CEO of Dentsu Aegis Network Philippines. “We are very innovative people, but we were not getting noticed. We had to get people together so they can work with one another.”
While most attendees say they would love to see the Philippines create a "built-in-a-garage" unicorn, implementing innovations that alleviate poverty and improve everyday life is even more important, such as EduCredit.ph, which offers Filipino students financing and remote employment, and Zennya, an on-demand home health and wellness service app.
Philippine-based tech company Smarter Robotics, for instance, is working to improve customer service with its humanoid robots, starting with six UnionBank branches to handle mundane tasks for bank customers. From there, co-founder and CEO Roger Collantes said he hopes to bring artificial intelligent humanoid customer service to more industries, including retail/hospitality, airports, healthcare and tourism.
The agriculture industry, in particular, is in desperate need of innovative solutions, like the one offered by Cropital, a platform that connects farmers with potential financiers from across the world. The startup beat out 30 or so others to win the conference’s WILDFIRE competition, $10,000 equity-free cash and a trip to the Seedstars Regional Summit in Switzerland.
While business matching and pitch competitions are helpful, more needs to be done to facilitate partnership and collaboration. “The community is not united enough,” angel investor Kitade said. “They need a Filipino role model to see what it is like to achieve success at the global level.”