The Philippines is Experiencing a Renaissance in Innovation; it's Time for the West to Look Beyond Duterte's Drug War
Grow Your Business, Not Your Inbox
In recent years it seems that every headline coming out of the Philippines entail humanitarian crises: a war on drugs, government officials embroiled in corruption scandals, and ecological disasters. Yet in spite of this, resilience and cleverly executed technological advancements by Filipino startups are ensuring that locals continue to thrive at a quickening pace.
It’s only a matter of time before the Philippines regains its strong GDP and becomes a larger player within the ASEAN group of countries.
Filipino Businesses are Reimagining the Logistics Industry
One of the best examples of technological innovation in the Philippines can be found within the logistics industry. With over 7,000 islands, more than a dozen spoken dialects, and a population nearing 104 million, logistics is a vital business that holds the country together.
An example of logistical innovation in the Philippines is QuadX, founded by Fernando “Dino” Araneta, the youngest son of logistics baron Carlos Araneta, founder of Filipino shipping giant LBC.
After university, Dino went to work full time for the family business, eventually becoming President / COO of LBC Express in 2009. His first four years at LBC Express resulted in over 30% growth per year --more recently, QuadX, the startup Dino founded in 2013, surpassed last year’s $17.2m revenue in May, earning $20m in just the first half of 2018. It is on track to more than triple last year’s revenue in 2018.
QuadX currently handles payment and/or delivery for a third of all ecommerce transactions in the Philippines, and projects it will increase that share to half by the end of this year.
The secret to QuadX’s explosive growth is an opportunity that stems from idiosyncrasies of the Philippine economy: while there are over 820,000 micro-businesses in the country and 67 million Filipinos online, only one in seven Filipino households have a bank account and less than 3% have a credit card. This makes QuadX's cash on delivery (COD) ecommerce services massively popular, equipping micro-entrepreneurs with the ability to sell to anyone regardless of distance, and providing many Filipinos the ability to shop online for the very first time.
QuadX’s three primary services are CheckMeOut--a multi-payment platform paired with delivery; Xpost--an online fulfillment platform for nationwide delivery; and ShippingCart--providing quick and easy cross-border deliveries from the US to the Philippines.
All three are performing far above expectations: CheckMeOut grew from 370,000 deliveries in 2017 to a million in just the first half of 2018; ShippingCart’s earnings are 56% higher than this time last year; and Xpost--QuadX’s newest service--reported first half revenue in 2018 is 4.5 times higher than the entire previous year.
Paying It Forward
In spite of Dino’s many successes including leading LBC to record growth, driving the meteoric rise of QuadX--a 4-year-old startup that’s taken in over $37 million in the last 12 months, and being a 42-year-old billionaire --his main goal is still years distant: to “move the needle,” as he says, meaning to take Philippine ecommerce from its current 1% of all retail transactions to 5% or more.
In the meantime, Dino continues to pay his success forward to help others get their start. An employee once went on record to say; “He has always promised his people 'I'll take care of you and your families, you take care of the business.' So we don't have to worry about getting the bills paid, and we can really focus on the business .. he's really a gentle person, and when he says something, he really means it.”
And his attitude toward empowering others doesn’t end there. He’s baked a sense of ownership into the fabric of his organizational culture, cultivating a community of highly invested workers.
The success Dino has had in business has also shone a light on other achievements and innovation incubators he’s helmed, such as starting Ronda Pilipinas, the annual world-class 4-day cycling competition sponsored by LBC; cultivating business innovation by serving as a judge on The Final Pitch, a competitive reality TV show; and his work promoting innovation through Impact Hub Manila.
Only One Piece of a Bigger Puzzle
It’s important to note that Dino is but a single example of what is driving the Philippines’ GDP. Recent economic success and growth within the Philippines is enough to make even Silicon Valley blush, and it is equally important to consider what’s going right for them in Western media. This is one country that’s growing fast and is on track to regain its once glowing reputation as a powerhouse within the ASEAN community.