To be young and in business
Youth unemployment is at a crisis stage. According to the International Labor Organization, 73 million youth worldwide—about 13 percent of the total youth population—are looking for work.
Locally, the situation is more worrisome. Unemployed young people account for 15.7 percent of the population, or almost half of unemployed Filipinos placed at 2.924 million.
Unemployment figures inevitably swell as batch after batch of graduates leave school to join the ranks of new job entrants. A study revealed that only over 40 percent of new graduates will find jobs within a year of graduation; another 40 will be employed the following year; while the remaining 20 will be idle for the next two years.
But what if, instead of beating worn-out “Job Street,” graduates take the less-traveled road of sariling sikap, sariling kayod?
By taking the entrepreneurial route, youngsters don’t put further pressure on the precarious unemployment situation. Rather, they generate jobs for others, thus building their communities.
The Small Enterprises Research and Development Foundation (Serdef) gathered the thoughts, experiences and insights of four young entrepreneurs. These “upstarts with startups” talk about their business models, their motivations and inspirations, the up and downside of being young and in business, and the support they want to receive.
They are: Ifore Yu, 30, founder and CEO, of Chicken Charlie, a home-grown fried chicken franchise; Philip Adrian Jara, 24, who runs FTW Apparel, an online seller of sling bags and backpacks; Noreen Marian Bautista, a social entrepreneur and social entrepreneurship advocate; and Kathleen Yu, 23, founder and CEO of Rumarocket (www.rumarocket.com), a talent management platform that helps companies “hire smarter.”
What are your business motivations and role models?
Kathleen: I’ve always wanted to build something that people would find value in. I am driven by the uncertainty that comes with setting up my own business and doing things my way. In a corporate environment, we follow rules already established. We learn considerably less when given a strict framework; and as someone who has always enjoyed learning by exploring and making mistakes, I am naturally drawn to an entrepreneurial environment.
Noreen: I’ve always wanted to contribute to society and never saw myself pursuing a corporate job long term. When I realized, through my college entrepreneurship subject, that such thing as “social enterprise’ exists, I decided this was what I wanted to do.
I grew up in a household where my parents did community service in the weekends, and I became immersed as well. I had this sense of wanting to contribute to the country which I know has immense potential despite the negative news. It’s probably also because my generation grew up watching superhero cartoons, thus giving an idea we can change the world.
Adrian: I never liked paper work and rote jobs. I was bored when I did my OJT. You get a different thrill if you build your own product—from materials you source yourself and designs that come to you as inspiration. I wanted to generate jobs and showcase Filipino ingenuity. The owner of My Philippines Lifestyle is a friend. I saw from his example it was possible to develop your own brand and be rewarded for it.
Ifore: I never imagined myself in a corporate setting. I wanted to hire young people, source local materials, build my own products, and bring them to global markets (instead of the other way around).
My father is the closest to a role model I can think of. He has been a businessman all his life. I draw a lot of inspiration from him, but never direct help for my business.
What barriers face young people when starting a business?
Noreen: Lack of financial capital is one. But I think the bigger barrier is fear of starting and failing. I overcame this because I surrounded myself with people who are doing similar things—young entrepreneurs, seasoned entrepreneurs, those who know what risk-taking really is. I like reading entrepreneur stories and biographies.
The challenge is to be able to learn fast and to subsume the ego while doing it. The tendency for young people is to keep grabbing opportunities where they can secure the spotlight, but they must remember to deliver a solid idea first before trumpeting it. Being an entrepreneur does not mean the freedom to do anything you want. It is hard work.
Ifore: Fear of failure. Access to finance. They ask you for a track record, for security. But young people have yet to build a credit standing. I was lucky to have had some savings—from my own buying-and-selling ventures while in college. This is why I was able to self-finance Chicken Charlie from startup to expansion.
Kathleen: The biggest barrier I overcame was the mindset I had that because I was young, I was not capable to start certain things. But when you stop to think about it, age shouldn’t matter when it comes to taking risks. In fact, younger people have the luxury of time to learn and grow from their mistakes.
Lack of experience can be both an advantage and a disadvantage. On one hand, you are willing to try new and unconventional things; but it also means you might not have enough understanding of industry standards and norms, compared to older competitors.
Adrian: When you are young and new in business, buyers do not immediately trust you to deliver. This is especially true in an online business setting where scammers proliferate.
Suppliers take one look at you and you know they’re thinking “Bata lang ito.” You have to prove you’re no pushover and mean business. Some suppliers insist on quantity. I tell them about my plans, so they can decide if they’ll risk with me.
What’s the upside to being young and in business?
Adrian: When you’re young, you have time; use this to make your future. You can adopt technology fast and have the stamina to make things happen.
Ifore: A young entrepreneur is hungry. Mas gutom, mas may energy. Mas kaya ang pressure. Change happens at a dizzying speed. When you’re young, you keep pace. You pick up technology fast.
Kathleen: It is difficult to build a support system of friends who understand what you’re doing. The upside is you get to make friends with older people who have more mature outlooks on entrepreneurship; if you listen, you’ll learn a lot from them. There are also opportunities available from international grants like the Thiel Fellowship to local events hosted by Ideaspace Foundation.
Noreen: Social media and IT has significantly brought down the barriers for starting up for young people. We need to learn how to use these tools and learn how we can create value by leveraging technology. Young people have the advantage of being at home with IT.
What can policy do to promote youth entrepreneurship?
Ifore: I imagine meetups between investors and startups where young entrepreneurs can pitch their ideas and get help translating their dreams to reality.
Noreen: I was told that the best thing the government can do is to ease the regulatory way for a business and get out of the path. Lower tax rates, easier business registration and tax compliance will go a long way.
Kathleen: Set up government or private grants in schools to support youth startups. Put up “accelerator” or “incubator” programs in-campus.
Adrian: Doing business must be facilitated, starting from registration. It is so frustrating for young business wannabes who are so used to “click-and-go” to be dealing with so much bureaucratic delay. What about a full registration process online? Financing support is another. Local governments can run short courses on production skills on which a business may be based on.
Do you think entrepreneurship can be learned in school? What aspects of your own education helped you in starting and running your business?
Adrian: Yes, if theories are backed up by hands-on learning. A type of learning where students put up a mini venture, mentored by professors, entrepreneurs, and counselors.
Personally, my vocational course (on photography) was more useful to me than my college course. I was able to show products online in an artistic way.
Kathleen: Yes, but it requires deliberate effort to develop more open-ended curriculums that encourage critical thinking and decision-making. However, I think risk-taking cannot really be taught but fostered by taking away the negative implications that come with making mistakes. That way, young people learn early to embrace failure as something productive.
Ifore: It can be encouraged, not learned. It is more of an attitude than a skill. You learn more in the field, in the streets, when you start doing things and making mistakes.
Noreen: Yes, especially if teachers emphasize learning by doing. The classroom setup will work only up to a point. Expose the students to real-life entrepreneurs. Design programs that allow them to prototype ideas, test them in the market, and pitch them to possible investors.
What is the best business advice you have ever received?
Kathleen: It’s better to learn from other people’s mistake than your own. Be observant, and weigh all possible options before making a decision.
Ifore: Grab opportunities when young. If you fail, you can always start again.
Adrian: Entrepreneurship is like a roller-coaster ride, and you should be ready for the bumps ahead. Make sure that the value of your product will exceed the price you set for it.
Noreen: Just start, go after that idea, work hard, and never allow your ego to get in the way.
For more stories on entrepreneurship, visit www.serdef.org.