
Building a startup in a developing country: The pitfalls and opportunities - francistan
http://francistan.me/2011/08/06/building-a-startup-in-a-developing-country-the-pitfalls-and-opportunities/#.TldausP0nts.hackernews
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b1twise_
I'm a foreigner living in the Philippines, and I'm aware of a number of small
tech businesses run by other foreigners here. Visa issues keep these
businesses fairly low-key--foreigners technically aren't allowed to work on
the easier visas to obtain. They tend to use their local knowledge to employ
Filipinos as contractors efficiently. It can take time to find quality
contractors, but it can save a lot of money.

Cost of living is low, but internet access and infrastructure issues can be
problems. I pay quite a bit for 3mbit internet. I've had two power outages
today. If you show up here and don't adapt, you will get frustrated and miss a
lot of the benefits.

There are a lot of colleges here pumping out CS grads who are underqualified.
They tend to look for work in call centers instead of programming. Filipinos
don't spend money on the web, so targeting products at them is tough.
Advertiers are aware of the fact that Filipinos don't spend money online, so
ad supported businesses are not feasible. You need to earn in
Dollars/Euros/Yen and then spend locally in Pesos.

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phektus
Us Filipinos are not very entrepreneurial. Talk to any random middle-class
student here and you'll be told that the first thing that motivates them to
study is so they can get a good job in a multi-national company. Most local
tech startups that I'm aware of were founded (and funded) by people with a
rich family background. Add the state of the government to the mix and you'll
get an environment that is totally not conducive to small tech businesses.

As a Filipino I'd like to see more of my country men venturing into
realistically sustainable tech business setups rather than trying to emulate
Silicon Valley. The environment there is vastly different from ours. We need
to play to our strengths (English proficiency plus currency exchange plus OK
3rd-world level I.T. education) and work from there. I'm pretty sure there'll
be innovations so we can use our strengths in a startup context.

~~~
gexla
I'm a U.S. citizen living in the Philippines. I work out of an office of a
local startup (currently one Western guy and a local.) I think that after the
parents have spent a lot of money sending their kids through college they
would rather their kids work for a large corporation and work their way up the
career ladder. This is the case even if a startup would be willing to offer a
lot more money. The perception of a good job is more important than the money.

Being an Asian nation, class can be somewhat of a factor here as well. If some
employees are from a higher class than the others, then communication can be a
problem.

The education here isn't great and the tech students generally aren't up to
par in the technical fields. There are probably a handful of students in each
of the top schools in the country which are decent. I imagine that school
probably isn't a good indicator of skills. You would probably need to find
employees who have developed their tech skills through their own passion.

The same reason why mobile is hot here is probably the same reason why there
aren't a lot of early adopters and computer tech savvy students. In some cases
students might have been lucky to grow up with electricity, let alone a
computer and internet connection. For a lot of people here, their phones are
their computers. There are internet cafes everywhere, but that's not like
having your own system to hack away on.

Though mobile is huge, the Philippines is very poor, so few people are
carrying around smart phones. Most people don't even do a lot of calling
because it's more expensive. So pretty much all the phones are used for is
texting. The cell providers here have some great offerings for mobile micro
payments, but I never see people using those services.

The economy is generally horrible, so it's hard to see what you might do to
make much money here other than exploiting cheap labor to serve Western
markets.

Overall, they have a long ways to go. But the people generally seem content
here with what they have. This is no race, they will get where they want to go
at their own pace. And there's nothing wrong with that. Maybe the U.S. could
learn something from the Philippines, and that's probably why I'm living here.
;)

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sekou
It might be pertinent to point out that the Philippines is one of the Goldman
Sachs deemed "Next 11" countries. (<http://en.wikipedia.org/wiki/Next_Eleven>)
I hope to see amazing changes in these countries in the next few decades.
While being a pioneer might be difficult now, it may be very beneficial in the
long term.

