Filipino Entrepreneur Katrina Chan On Raising Capital And Finding Opportunity In Underserved Markets
Katrina Chan is the co-founder of startup accelerator Qbo, which she started in 2016 to support and grow the start-up community in the Philippines. The result of a partnership between the public players, the Department of Science and Technology and the Department of Trade and Industry, and private players JP Morgan and tech accelerator IdeaSpace, the company has organised over 500 free programmes where entrepreneurs can get access to mentors, networks and funding.
Here, the Filipina entrepreneur shares about the growth of her country's startup landscape, looking for opportunities in underserved markets and fundraising tips.
How has the Philippines' startup scene evolved since you first started?
I've been working in this field for almost a decade now and when I first started, hardly anyone knew what a “startup” was. Today, we have worked with over 500 startups and recently staged the annual Philippine Startup Week, which was attended by about 15,000 people.
The Philippines' startup ecosystem has reached an inflection point in the last year or so, and there’s no turning back. There’s been a huge increase in new founders, funding rounds especially in the earlier stages, and general awareness and adoption of technology. And there’s only more growth from here.
What makes the Philippines' startup scene unique?
I think our talent pool is one of our biggest assets, and the more we present success stories and bring human capital to the scene, the more we will be able to unlock our potential. The big challenge of the next few years will be to attract, retain and foster even more top talents in this space.
Any tips for someone looking for a new business opportunity?
I’d say it’s important to intentionally design for underserved markets. I think people initially shy away from this because it’s a lot of work, and looking at purchasing power, low internet speeds, or tech-savviness at a micro level can be a deterrent. But if you want to gain market share, even domestically, you can’t focus solely on the high-income urban millennial. (The competition for the latter is probably the fiercest too, especially among global companies). The biggest potential for growth is tapping into the larger, "underserved" base, as un-sexy as it might sound.
Lean into the cultural quirks, relationships and other behaviours too. While the world is changing quickly and in unprecedented ways, I think tradition is underrated, especially when it comes to underserved communities. It’s hard to work against something that has been built over generations, so I believe having insight into these behaviours and cultural traditions can be a huge point of differentiation for a business, versus simply trying to "disrupt" or introduce a new way of doing something.
What are the top fundraising advice all entrepreneurs should know?
- Traction: Show, don’t tell, and focus on your traction versus your idea alone. Show what you’ve done to validate your value proposition and how customers have responded.
- Have a big enough problem or market: Most investors aren’t looking for "lifestyle" businesses that are modestly profitable. They’re usually willing to take bigger risks for something that can be game-changing.
- Be Transparent: Be clear about your ask and what you will use the funds for. Surprisingly, many people still pitch without knowing how much they’re looking to raise, why they need that much money, how far it will get them, or what they will use it for if after they raise the amount.
- Get ready to pitch hundreds of times: Practice makes perfect, and even the "best" startups face countless rejections. Be patient and persistent.
What does the future of the Philippines' startup scene look like to you?
Accelerated growth. I wouldn’t be surprised to see several local unicorn startups and dozens, if not hundreds, of formidable local players in the tech startup space. Consumers and businesses are hungry for solutions, not only in e-commerce but also in media and content, agriculture, medicine, AI, and many others. I’m quite confident that tech sector will continue to create thousands of jobs and become a real engine for our economy in the next decade.
See more Gen.T honourees from the Finance & Venture Capital category of the Gen.T List 2021.