00:00 From funding to leadership, businesses can be tough to run, especially for up-and-coming
00:08 entrepreneurs.
00:09 What can Filipino startup founders learn from leading industry leaders?
00:14 Alex Cabrera of the Management Association of the Philippines tells us more.
00:18 Attorney, great to have you back on The Final Word.
00:22 So what does this SCALE program hope to achieve for startups?
00:26 What the SCALE program hopes to achieve for startups is to help them, as the word says,
00:31 scale up.
00:32 You know, because the startups, there are many startups in the Philippines and some
00:36 of them, they fold up.
00:38 Most of them fail.
00:39 I will say most of them fail.
00:44 And how many percent only succeed?
00:47 Maybe one or two percent.
00:49 I wouldn't say that low, but sustainability is an issue.
00:54 But since you made that comment, I'd like to say that actually the startup scenery in
00:59 the Philippines is actually quite good, Rico.
01:03 It is very vibrant.
01:04 I mean, a lot of people want to start their own micro and small enterprises, but the big
01:10 question is, will they have the funding, can they find the right talent, and do they have
01:15 the mentorship?
01:16 Yeah, exactly.
01:17 So, you know, when we started this inventory of startups in 2017, as PWC then, we had,
01:25 in partnership with MAP, we counted 300 plus startups.
01:30 And today we have like, you know, between 600 to 700, which really means that they barely
01:36 scratch the surface of their potential.
01:39 And there's so much potential that startups have because they could be such a game changer.
01:45 You know, I can explain by examples, you know, this current batch that we have, one startup
01:50 there called Export One is actually helping SMEs export their products.
01:57 That could be, you know, unheard of for a small enterprise, you know, but they can help
02:01 them with the labeling, with the documentation, with the logistics, et cetera, and they can
02:05 even provide the service and the SME can pay later.
02:10 And that is really good news because that is what this economy needs, more exports rather
02:16 than imports.
02:18 So we have an economic surplus rather than an economic deficit.
02:23 Yes.
02:24 And also, but also, Rico, on the substance of the product, because the startup is also
02:31 helping these local manufacturers, you know, up their game to international standards.
02:37 If I can just mention one more, Humble Sustainability, for instance, is in the circularity business.
02:46 So corporations who have old laptops, that can be recirculated, refurbished and recirculated.
02:52 So Humble actually even collects merchandise that can't be sold and they help companies
02:57 dispose of that.
02:58 So this circularity business is very important for sustainability.
03:02 All right.
03:03 One month's trash can be a game for so many people.
03:07 So how many startups, Tony, have you chosen for this scale program?
03:12 For this Maiden program, there are shortlisted 15 startups.
03:18 And of course, we bring them into this program.
03:21 And we-- So sustainability to exports, which other sectors
03:26 have been covered among these startup enterprises?
03:28 There are the medical, FinTechs, logistics, transportation.
03:36 So we have a very good batch.
03:38 And of course, we've been talking about when it comes to startups, for them to succeed
03:42 and fail is funding.
03:44 How much funding is MAP and your partners in this initiative giving these startups so
03:51 they can scale up?
03:52 We're going to find out, Rico.
03:54 We're just in the middle of the program.
03:57 Because what we have really seen is that these tech startups are really great at making the
04:02 hamburger.
04:03 But they're not as great in minding the hamburger store.
04:06 That's right.
04:07 So that's the scale that we're actually trying to--
04:10 That's where the mentorship comes in.
04:11 Indeed.
04:12 Indeed.
04:13 From top executives from the management association of the Philippines, like Attorney Cabrera.
04:18 Yeah.
04:19 And because we know the business, we know what to give them help on, like structuring
04:25 governance and how does valuation work and how do you value your business, what do you
04:30 do in a deal process and what to expect, et cetera.
04:33 And how long is this program?
04:34 And when do you expect to find out if this business or one or two or three or all of
04:42 the 15 startups will succeed or not?
04:46 Is there a timeline?
04:47 No, there's no timeline on watching them on whether they succeed or not.
04:51 But what we really hope to happen is for these startups to be all sustainable.
04:57 So this is the maiden program and I think this program will go on until the next year.
05:03 We still have a long way to go.
05:05 It's only not about finding investors for them.
05:08 It's actually also introducing them to MAP members to be part of their value chain.
05:13 And that is the key to startup.
05:15 You have a captive client, you have a market, and then that can also be the source of partnerships.
05:20 And what is important here, Attorney, is that from micro to small to medium to becoming
05:25 a large or maybe even a conglomerate and compete with the top companies here in the country.
05:32 Until IPO, Rico.
05:34 Until IPO.
05:35 Thank you so much for joining us on The Final Word and sharing with us this latest initiative
05:40 of MAP, the scale program.
05:43 Thank you for having us, Rico.
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