Adapting to the Philippines: insights from local SaaS entrepreneurs
A week before France’s president Hollande landed in the Philippines, we had another Frenchmen visiting the country. Though the latter flew in from Singapore rather than France.
Nevertheless, we were equally honored to have Florian Cornu making some time in his packed schedule to share his SaaS insights in a private session with our portfolio companies as well as with interested attendees at a public event.
Below is a guest post from Florian Cornu, where he shares some of the take-aways from the two events .
“It’s on February 19th, Chinese New Year day, that more than 50 entrepreneurs met to discuss about SaaS at Kickstart Ventures in Makati, Manila, Philippines.
There are no holidays in the Cloud. And certainly not at #Area 55.
We started with a closed-door session gathering the SaaS companies in Kickstart’s portfolio, with a more in-depth discussion around growing the business, user acquisition, and the every-day challenges of running a SaaS business.
The session was then opened to the public… when more than 50 joined. We were at first surprised to see such an audience for such a specific startup niche (SaaS) on a public holiday (but eh… entrepreneurs don’t care about public holiday).
While I (Florian, co-founder at SaaS Business Asia) shared about our researches, the 100+ attendee conference hosted in Singapore on Jan 29th and the reasons we believe SaaS in Asia is unique, the most part of the meetup was about engaging with the audience: listening to their questions and having a conversation with those who are actually doing business in the Philippines.
The opportunity is large, but building a significant SaaS industry is not One Size Fits All, especially in emerging markets.
There are 4 insights we grasped during the session:
- B2B sales are not about landing page optimisation issue. Selling to businesses in the Philippines means getting to the right person inside the companies, integrating the solution into their processes and onboarding the operational teams. 2 to 6 months sales cycle is standard.
- One price does not fit all. While SaaS companies usually have a simple pricing page… selling to businesses here involves tweaking it. The model varies between subscriptions, transaction fees and performance incentives. Software is not charged one-off anymore, but based on value they provide over time to their customers.
- Softwares are online, payments are paper-based. We’re all dreaming of providing beautiful and efficient softwares from the cloud, with a seamless experience from A to Z… then comes the time to be paid. Of course it is known that credit card penetration in the Philippines is below 5%. But for sure corporations have modern payment methods available. Forget it, cheques are king! One of the entrepreneur told us one of their client gave them a cheque for 3 years upfront (so much for monthly subscriptions!) and another one about receiving a series of post dated cheques.
- The Philippines business environment is “consolidated”. A few groups control many of the most successful businesses in the Philippines. Succeeding with one of the companies within such a group is an entrance door for the rest of the group if properly managed.
A big thank you to Christian Besler, Co-founder and VP of Kickstart Ventures, for making this meetup happen!
We here in Kickstart are strong believers of the SaaS business model and we continue to invest in companies that build disruptive platforms and services. Got an interesting Startup in the SaaS space? Send us note!