By Chelsey Keith P. Ignacio, Special Features Writer
In the past years, the Philippines had been advancing its capacity to innovate. Its ranking in the Global Innovation Index went from 100 in 2014 to 50 in 2020, though moving a spot down last year. Startups play a key role in keeping and enhancing the country’s innovation performance especially amid the continuing pandemic and even beyond.
But there are issues to look at to fuel the startups to innovate, as discussed in the recent session of BusinessWorld Insights, in partnership with Globe, on “Empowering Filipino Innovation and Creativity for a Post-Pandemic World.”
While there are still many challenges for the startup ecosystem enablers that need to be faced and addressed, Katrina Rausa Chan, executive director of QBO Innovation Hub and IdeaSpace Foundation, saw the “resilience, diskarte, and problem-solving skill” of local startups which came to fore during the crisis.
“The startups were the first to try to solve the problem, to come up with solutions, to ‘turn calamansi into calamansi juice,’” she observed.
Ms. Chan also believes that the country can be developed as a regional hub of technological innovation.
“The Philippines has so many kinds of ingredients to become an engine for driving innovation,” she said. “It has the right age group, talent pool, a growing economy, and the willingness to adopt new technologies and use them.”
Ms. Chan also admitted that there are some things still “missing” in terms of the country’s regulatory environment and infrastructure, as well as some work to be done on the investment side.
“But absolutely, I think we can position ourselves as a hub, not only as a market but as a creator of technologies because of many factors. [I’m] very bullish about this,” she expressed.
Education and talent development
Since startups and innovations are mostly inclined to technologies, there is a high demand for developers. Luis Sia, co-founder and chief commercial officer of fintech startup PayMongo, is a “strong believer” of the need to teach more Filipinos, even at the basic educational levels, on how to code and about technology.
“I think this is really a skill of the future; it’s being done in many other countries. It’s something that will become very important in having young kids anywhere to participate and be part of the Internet economy,” he said.
Mr. Sia added that the government has a crucial part to play in making sure that people will be given the opportunity to have access to tech education, “especially those who may be inclined to get into courses like engineering, which will be very much in demand as the Internet economy grows over the next five or 10 years.”
He also stressed that the role of startups is not only to hire people but also to train them.
“When you hire developers or engineers, especially out of college, even if they come from the best schools, the real learning comes from the real-world practice,” he explained. “And as startups get and raise funding and are able to scale up their operations, they should also develop programs initially that can train these developers and eventually will benefit the whole ecosystem.”
Supportive and consistent policies
In time with the May 2022 elections, Startup Village President and Co-founder Carlo Calimon wants to see not just new but consistency in policies related to startup innovation.
“Anything that helps enable and makes it easier for a startup to start or maybe fail or just to operate would be good for the startup. But it doesn’t have to be something on the national level, a lot of it can also be on a local level that allows innovation to be tested and executed,” he said.
Explaining how a policy can impede the execution of innovation, Mr. Calimon recalled the food truck craze few years ago. People saw these food trucks in events or parties instead of moving around or parked at the back of a building.
“How come they’re not functioning the way they’re supposed to function? Simple. Because when you apply for a permit, the LGU will say ‘I’m sorry, you cannot operate.’ Why? ‘Because you don’t fall under any category,’” he shared.
“That’s a simple example,” he continued. “What more for a startup that has something new and disruptive [offering] but they cannot execute and sell to be used by real people? So, there has to be that provision or a policy that allows for these things to be tested. Otherwise, you’re killing the startup before they actually start because they’re not able to test their products. They are not able to gain traction. And then eventually they’re gonna run out of money and they can’t even attract an investor no matter how good the idea is.”
He added that there must be more policies that support an entrepreneurial mindset, especially in the beginning stages.
“Starting up is already difficult. Running a startup in the early stages without funding or whether you’re bootstrapping is already difficult. Then all of these restrictions are falling on your lap, and eventually, you’re just going to give up,” he said.
Mr. Calimon also wanted to see an ‘ease of closing down a business’ policy.
“Especially when you’re starting, there’s no guarantee that you’re going to succeed. We are being encouraged to register our businesses. But when we fail, it’s so expensive for us to even shut it down. It would be great to have policies that make things easier for us to start and to fail,” he said.
He further emphasized that there should be “authentic local support.”
“It cannot be tied up to just an election, to be honest. It has to be an ongoing thing. Somebody has to start it, somebody has to continue it,” Mr. Calimon said.
He added, “There has to be continuity from an implementation perspective. It’s not just about the policy all the time. It’s about consistency and maybe fine-tuning and improving the previous policies that are already in place.”
To watch this BusinessWorld Insights session, go to https://bit.ly/3rYIGyy.
