Starting a business is less a dream than a nightmare for many entrepreneurs. Formidable hurdles stand in their way, like insufficient capital and the difficulty of finding a ready market for their product.
Even those with promising ideas are not spared these growing pains, which can drive them to throw their hands up in despair.
But with the help of business incubators and accelerators, they have better shot at success. These entities provide the funding, training, marketing assistance, and facilities to get promising start-ups off the ground. (Incubation typically takes years to complete, while acceleration is shorter but more rigorous.)
In the Philippines, a number of incubation and acceleration programs exist. The Department of Science and Technology, for instance, runs a Technology Business Incubator (TBI) program, which offers start-ups technical assistance, legal services, business development and marketing support, as well as office space. It is hoped that the program will produce businesses that are financially viable and able to compete in the market.
IdeaSpace Foundation, Inc. is one the leading nonprofit organizations in the business incubation and acceleration scene in the Philippines. Founded in 2012, and backed by the businesses of tycoon Manuel V. Pangilinan, including PLDT, Inc. and Manila Electric Company, IdeaSpace is on a mission to help budding entrepreneurs transform their ideas into successful and scalable businesses. Diane Eustaquio, executive director of IdeaSpace, told BusinessWorld in an interview that the large companies supporting the foundation are committed to encouraging start-ups to flourish.
IdeaSpace runs an intensive, holistic acceleration program. Entrepreneurs who want to participate in the program can apply on the foundation’s Web site. It doesn’t really matter whether their products are software or hardware (though software products like apps afford the opportunity to build and test fast). It is recommended, however, that they have synergy with the companies supporting the foundation and that they will hopefully be able to do business with them down the line, Ms. Eustaquio noted.
And, of course, the entrepreneurs must be very serious about their ventures. “Commitment is one of the things that we look for in the entrepreneurs,” Ms. Eustaquio said.
Only 100 teams make it past the application round. They get further whittled down to 50, and then to 20, through a series of screenings. These 20 teams undergo a five-day bootcamp then a six-week incubation phase. Only 10, however, are admitted to the acceleration program, which runs from July to October. But the 90 ventures that are not admitted still gain something valuable. “They’re winners in a way because they gain so much feedback,” Ms. Eustaquio said.
The 10 teams, Ms. Eustaquio said, first take a self-discovery exercise to understand themselves, including their strengths and weaknesses. They receive mentorship from various experts in the fields of finance, marketing, law, human resources, communications, and more over the fourth-month period.
They also receive P1 million worth of assistance, including cold cash worth P500,000 and office space in Makati City (or housing support if they are based outside Metro Manila).
Ms. Eustaquio said they are particular about how the teams spend the funds put at their disposal. “Part of the objective of IdeaSpace is after the program is over, we’re able to turn over these entrepreneurs to investors, who have confidence that these entrepreneurs know how to use other people’s money.”
The program culminates in a Demo Day, held in October, where the teams formally unveil themselves and their products to the public, including potential investors.
Since IdeaSpace began, it has benefitted over 400 entrepreneurs, Ms. Eustaquio said. Among them are the people behind Nyfti, maker of handmade three-fold bicycles suitable for city use, and those behind Investagrams, an app and a Web site that offers analytics and education tools for Filipinos already investing or wanting to dip their toes into investing in the stock market. Some of the alumni of IdeaSpace are already raking in millions in revenue a year, Ms. Eustaquio said.
Their entrepreneurial dreams are now a reality. This is what IdeaSpace asks of them in return – “Pay it forward,” Ms. Eustaquio said.