The old ways are gone, the digital economy is here, and “startups are powering up and making things easier and being frontliners in their own right,” said QBO Innovation Hub executive director Katrina Chan during the recent Philippine Startup Week conference.
“This new normal means new products, new services, new processes,” said Rowena Cristina Guevara, Undersecretary for Research and Development at the Department of Science and Technology (DOST). “Who are the ones who can do it fastest? Startups.” Manila HealthTek, Inc., for example, developed the first local COVID-19 RT-PCR detection kit in 21 days.
E-commerce is a fertile field for startups, as they can also take on related needs such as transportation, logistics, and fintech. “There are additional opportunities with respect to tech solutions like artificial intelligence, robotics, drones, 3D printers, and animation,” said Rafaelita Aldaba, Undersecretary of the Competitiveness and Innovation Group of the Department of Trade and Industry (DTI), at the same event. “To survive this pandemic, we need to apply all these new technologies.”
Edtech and entertainment are other avenues in the digital economy that Filipino startups should explore. Among the top 10 rising Google search topics in the Philippines in the past 90 days were queries on the Philippine Basketball Association, the Miami Heat basketball team, and the education company Brainly. An October 2020 report by Fitch Ratings further said that Filipinos are expected to spend more in 2021 especially on recreation, and that household spending on recreation and culture is expected to grow by 15.3% next year–the fastest among all sectors–after shrinking by 17.8% this year.
“These are strong indicators of changes that are happening in terms of our consumer behavior,” added Ms. Aldaba. “These are signals as to where we can go.”
FUNDING FOR STARTUPS
The government offers several funding facilities to support the startup ecosystem. Representatives from DTI, DOST, and the Department of Information and Communications Technology (DICT) shared the programs they have in place.
- SB Corp., the DTI’s financing arm, can extend a loan amount of Php 10,000 for businesses with a minimum asset size of Php 50,000; a Php 20,000 loan for businesses with a Php 100,000 minimum asset; Php 40,000 for those with a minimum asset of Php 200,000; Php 60,000 for those with a minimum asset of Php 300,000; Php 80,000 for those with a minimum asset of Php 400,000; and Php 100,000 for businesses with minimum assets amounting to Php 500,000. Another funding resource startups can tap is the COVID-19 Assistance to Restart Enterprises (CARES) program of the DTI.
- DOST has a Startup Grant Program through the Philippine Council for Industry, Energy and Emerging Technology Research and Development (PCIEERD). Among the first batch of 15 grantees received funding last year is EduSuite, an artificial intelligence-powered management system that automates campus administration.
- The DICT’s ICT Industry Development Bureau aims to implement its Innovative and Startups and Acceleration Program in 2021 next year. Its four components are: 1) the creation of an Innovation Network for Filipino innovators and startups; 2) the establishment of Innovation Studios in strategic areas nationwide; 3) the setting up of the DICT Philippine Startup Grant; and 4) the development of the Philippine Startup Portal, which will serve as a repository of all Philippine startup-related information.
“I am excited to hear proposals and get to know new ventures that would like to take a crack at our startup fund,” said Emmanuel Rey Caintic, Assistant Secretary of the DICT. “We’ll make sure we’ll select the right startup to fund. Even if they don’t qualify, we can tie them up with government projects. Even if we don’t give them money, we can give them opportunities to make money.”
The pandemic has forced more than 1,600 local government units and 300 agencies to go online and digitize their processes, which Mr. Caintic said is a galaxy of opportunities that startups can tap. “It may not be as lucrative as building solutions for the private [sector], but this is a sure need. It’s like a multiplier: times 1,600.”
“I pray you have perseverance and grit to make your enterprises thrive,” he added. “Panimula pa lang ang Philippine Innovation Act and Innovative Startup Act. Kayong mga digital entrepreneurs ang magbabago ng ating lipunan. [The Philippine Innovation Act and the Innovation Startup Act are just the beginning. All you digital entrepreneurs will be a force of change for our nation.]” — Patricia B. Mirasol