DTI to give startups a boost to become small enterprises

Startups can now have the needed boost to launch their business ideas to become real small and medium enterprises through the Department of Trade and Industry’s Launchpad program.

“Launchpad seeks to bring these startups to a certain level of traction so they can become real SMEs that can compete in the global market,” said Provincial Director Maria Elena Arbon of the Department of Trade and Industry during the program launching at Quest Hotel in Cebu City on Thursday.

Arbon said the Launchpad program is a mentorship program to help these startups to become full-fledged enterprises in the future.

She said all startups have the potential to eventually become small or medium enterprises (SMEs), given the right opportunities for growth.

According to the 2015 Philippine Roadmap for Digital Startups, a startup is defined as any business idea less than five years old, registered with the financial regulatory authorities of any country, provided that majority of its team is operating and residing in the Philippines.

The DTI is currently working on a database that will identify Cebu-based startups.

Arbon, however, said that among 350 participants during the recent Slingshot PH conference in Cebu City, 200 of them were startups.

Arbon said that startups would need mentorship more than funding, as funding would come once these businesses would gain traction and would have already attracted a market.

Startups vs. SMEs

Senator Benigno Paolo “Bam” Aquino IV, who was present during the launch, said that while startups can be considered already a part of the SME world, they have different needs.

“The difference between startups and traditional SMEs is the former’s ability to scale at a faster rate while needing less capital to do so,” he explained.

Aquino, who heads the Senate committee on trade, commerce and entrepreneurship, said that once these startups scale up, this would translate to more income and more jobs.

Aquino is also the author of the Startup Bill, which seeks to impose a two-year tax exemption on startups as well as provide financial subsidy and other forms of support, among others.

The senator said that once a better space for startups to thrive is created, more investments will pour into the country.

Launchpad is patterned after the Philippine Software Industry Association’s (PSIA) Spring.ph program for startup founders in Metro Manila and is the first of its kind to be implemented outside the area.

PSIA Director and Spring.ph co-founder Arup Maity said 10 to 15 startups from Cebu will be chosen to undergo a six-month mentorship program with them.

Maity said there are three criteria for choosing startups such as: a complete team composed of a hacker (developer), hustler (businessman), hipster (designer); the startup must be ready to go into market within six months; and it should be tech-based.

The Launchpad event will be a one-day affair in September, with interested startups given five minutes each to pitch their ideas and another 15 minutes for additional questions.

Maity said program organizers will conduct briefings for university and non-university teams two weeks prior.

Launchpad will also help the local business community understand more about startups and how they can help startups, leading to a startup and industry meetup in September as well.

Startups participating in the program will have weekly coaching sessions with Spring.ph mentors via Skype starting October.

Maity said they are hoping to bring the program to Davao and the rest of the country as well.

TAGS: Department of Trade and Industry, DTI, Enterprise, entrepreneurship, MSMEs, program, SMEs