Paul Pajo – The Evolution of the Tech Movement in the Philippines

Hi and welcome to another episode of Outsource Accelerator. My name is Derek Gallimore and today I am joined by Paul Pajo. He and actually we are speaking live from a Hackathon here in Manila Philippines. So, the Hackathon movement started a few years ago now. But Paul Pajo was actually an early adopter of the Hackathon movement and actually started these Hackathons in Manila Philippines as early as 2013.

This podcast is fantastic because it explores the evolution of the whole techie movement. The Hackathon movement and the ecosystem that surrounds that. And Paul is incredibly experienced in this and he talks about the maturation of the regions of the Philippines and how quickly they’re catching up with Manila but also how quickly Philippines and Manila is actually keeping up or even keeping pace with Silicon Valley. So really a fantastic episode here and there’s a lot to learn so I hope you enjoy. If you want any of the show notes or contact details of Paul Pajo it is at outsourceaccelerator.com/podcast/episode32. Enjoy.

Derek: Okay, so I’m joined today by Paul Pajo. Hi, Paul.

Paul: Hi, hi Derek.

Derek: And we’re actually at a hackathon today. It’s Sunday and it’s based in Makati and there’s, how many teams are there here?

Paul: I think by our count we have 17 teams now. I think we have 18 or 19 who haven’t like signed in but we should be like 17 at least.

Derek: And there’s a lot of people here drinking a lot of coffee. Have they been working through the night?

Paul: Yeah, they stayed overnight for the fun.

Derek: So, I want to just. Our audience is typically not from the Philippines and they are looking into business and outsourcing and so I wanna explore the climate for Hackathons and what the budding tech environment in Manila. So, you’re at the coalface of that. You run these hackathons.

Paul: Yes.

Derek: What are you seeing from the coalface in terms of the development grassroots of these hackers and coding capacity of.

Paul: So, let’s provide some context. So, we started Angel Hack five years ago. So, we had the first Angel Hack we had like 250 developers and we were one of the few groups who organized it so I have another hat I actually work for Smart which is a telecommunications company and we have a developer network called Smart Devnet. So, we help Angel Hack which is the biggest Hackathon ecosystem in the world do their hackathon. So basically, what that means is every year they have a global series of Hackathons. And for example, like today there might be other hackathons happening in other cities at the same time. So, I think this year we might be in 50 countries and in about 90 plus cities. So, when we started it wasn’t anywhere near that number we were just a few like there were just a few hackathons happening in 2013 and then but that’s why we had 250 developers. And when you’re the only one doing it. Everyone comes to you, right? Then.

Derek: And you’re early adapters for that?

Paul: Yeah. So, we started as my developer networks in 2012 in Davao. So even, that’s where Duterte, the president of the Philippines was Mayor before they invested in. So, we started in the province and there was a good pick up. In fact, some of the early winners of our Angel Hack were from Davao. It’s kind of strange you’d, think you think a small city like that compared to Metro Manila would have a smaller chance, right? But, apparently me the techy in the provinces are at par. So, what we’ve seen is the last three years. Every time we have a hackathon even if I try to find a date to make sure I’m the only event happening. It doesn’t work out because now there are so many events happening in Metro Manila at the same time so like.

Derek: You mean like a tech convention. That’s for purely Hack.

Paul: Yeah, some hack, some technology related event or some event that it might not be hackathon but all the developers will go there, right? So, for example yesterday was Saturday we had Google Developer Conference and they had a thousand registrants

Derek: Wow

Paul: So, good luck for me

Derek: It’s like a competition.

Paul: Yeah. Going from UST which is about an hour and a half away from Makati, right? If it was in Makati they can probably like go in and out like they probably already register in the morning also at the hackathon then come back here, right? But because it was in different places in the city so they had Ignite where they had startups with, they invited 26 VCs half of them from Japan. So, most of the startups and their developers were there. We have Google Dev and their Amazon Web services.

In another part of the city, in Ortigas and then we had social media day. So, all the devs from startups who are into digital media was in. So, it was like I said.

Derek: It’s huge.

Paul: Yeah. So, from 2013 I went from 250 to 180, 150 and now we’re at 100. So even if I had a hundred that’s still cool because that means I’m 100 registrants.

Derek: Yeah, yeah, yeah

Paul: Because there’s just too many things happening now.

Derek: it’s showing and thriving economy.

Paul: So, in a way it’s I can really say we were part of this. And I think helping build this ecosystem has allowed other organizers a lot other communities to look into it and see that this is something they want to do on a continual basis. It’s something profitable to them in terms of skills, skill building learning new tech and giving back to the community. So, it’s just bubbling there’s a lot of things that’s going on in the Philippines right now. What we have right now was nowhere near where we were five years ago.

Derek: Right. So, you’ve seen an explosion in events. Is there an explosion in people attending this event?

Paul: Yeah, so I was telling you like we had Ignite yesterday. So basically, that was a pitching competition they had 10 companies but they had 76 venture capitalists from outside. So you don’t even, even the local Angels VCs were there then I was telling you before the podcast, right? That’s the most number of VCs I’ve seen in you know in per square meter. Ignite on a beach has the same number but because they’re in a beach it’s a bigger is a bigger area, right? Then Ignite beats go up in that sense

And then there were other startups who are not even part of the pitching competition because they knew it was going to be, Ignite was going to be the epicenter for the VCs yesterday. So, there were a lot of companies out there who were not even part of their roster. But you know it was business matching it was networking so everyone was there.

Derek: So, it’s a huge beauty. So, the people that are attending all these hack events. What is the cross-section of demographic? Are they all students going to college? Or are they working for firms?

Paul: Yeah, normally I’ll have a few student teams maybe if I had like 150 there would be like 1 or 2 student teams. But most of them are professional developers who are in working in their own companies but they want to they want to participate in a hackathon, number one to try out new technologies. Number two, meet the developers and then number three they try out new technologies. And maybe like normally when we have even like this are global and regional or even local sponsors provide API software development kits, credits. So, for example for this hackathon, Amazon very nicely gave two hundred dollars’ worth of credits to all the developers so that’s cool for them, right? I mean every attendee gets these kinds of credits to Radix and all these other sponsors are gonna give away free credits and then of course.

Derek: So, it’s well supported, yeah?

Paul: Very well supported. So, we have a special API prices like Paymaya the local payment gateway here and they are offering a 10,000 Peso API price just about maybe for your listeners, two hundred dollars. You just have to use an API then have chance to win two hundred dollars, I mean what could be nicer than that for a developer.

Derek: And so, a lot of our audience are looking at outsourcing and they’re business people probably from the U.S. or UK. I’m trying to demonstrate that there’s a huge pool of skill here and talent. Are these people on the job market? Are they doing startups? Are they trying to fund startups like Silicon Valley? Are they on Upwork? Are they accessible to the job market?

Paul: Well, it’s all profession, they’re probably professional developers some of them but they’re probably doing some freelancing on the side. And the same time some of them, they joined this competition and they see that their colleagues actually have a chance of going to Silicon Valley or getting funded. Then they start dreaming and they start you know wanting to do something on their own. So, I’ve seen quite a few who have evolved meaning they start from like a startup weekend, a startup of machine and Angel Hack. And then before you know it they’re actually a full-blown startup. They’re servicing people, they’re setting up companies.

Derek: So, the communities are creating quite a fertile ground?

Paul: Yeah. So, it’s a complete ecosystem. I can say there are no gaps in the ecosystem but in some places, it’s thinner. So, I think like pre-series A or two where you have a prototype and it’s about to get traction. There’s a lot of people waiting for that on that there are a lot of VCs because that’s the cheapest part to invest in, right? But there’s a cheaper part of that which is the idea to prototype but it’s more, it’s a lot more riskier than that but because you have no demonstrable traction but it’s a numbers game, right? If you get more people to actually invest in the idea of the prototype then I think the funnel will be bigger. So, the company I work with we have we have our incubator accelerator called Idea Space. We fund 10 startups a year. But we have 600 startups applying every year.

Derek: Wow

Paul: And the shortlist is 25 but we only get to fund 10. And we are a big conglomerate so there’s 50 startups that doesn’t get funded man. And like feel free man, invite all the people listening to this podcast to come and even try to invest in this because they’re already vetted, we’ve sorted them out. 25 out of 600.

Derek: Wow

Paul: I think the numbers isn’t bad man I think if you’re applying to Harvard or Yale. Then that’s a better number

Derek: So, you’re seeing an explosion in people attending these hackathons.

Paul: Yes.

Derek: And events. How does that correlate in terms of the transition into actual startups and maybe proportionally what are you seeing in terms of success for startups?

Paul: Yeah. So, a startup by definition is you want to do a business that’s never been instantiated in the universe ever.

Derek: Wow

Paul: So yeah, meaning that’s a startup, right? I mean, no one knew that an Uber would work like if you tell people I run a transportation business without owning a single car. People will think you’re nuts, right? But that’s what Uber does. Or I’m gonna sell room nights without ever owning a single hotel. That’s what AirBnB does. So, that’s the nature of startups. So, normally a startup has two co-founders. You have a business co-founder and then non-technical co-founder. The one who has the idea, the one who has seen the pain points and is able to create a model in his mind and say this is a pain point I really like to solve, right? And this is I’m gonna incorporate and then once they’ve laid down the idea they need someone to program that right in to software. That’s when you bring in the technical cofounders. So, here’s the thing. There’s ecosystem where they do a lot of pitches like weekends, like LSM, the artifact is a PowerPoint or a pitch.

But here in a hackathon the artifact is a prototype in an app which is what you need because in the end you can pitch all you want and then all you’ll have is you have is a hard disk full of PowerPoint or keynote presentations. But here you actually see a prototype or an app solving a specific problem. So, you combine it together.

Derek: And you said there is explosion in startups or startup communities and when you said you had 600 applicants yeah, in terms of.

Paul: Yeah, yeah, that means it’s just an ongoing thing, we’re having more pitching events, we’re having more incubator accelerator happenings. We have, we now have banks like Union Bank having regular yearly like they’ll have a hackathon in Luzon, Visayas and Mindanao, different parts of our country. So, that’s never happened before. Normally the ones who supported this before were Telcos. But now, more and more I’m getting calls from nonprofits. They wanna do Hackathon for the advocacies

Derek: Because it’s a different theme you’re tackling.

Paul: Yes.

Derek: What is the theme at this Hackathon here today?

Paul: So, normally at Angel Hack we don’t have a theme. It’s very developer-centric, we want the developers to show off what’s good but what we want is for the prototype or the app to be fundable because at the end they have to pitch at the Accelerator program in the US, right? So, it has to be awesome meaning it’s an awesome idea solving a problem that the developer thinks is something that should be solved. But it should be fundable. So that’s, that’s it. We have some we have some themes like maybe solve traffic in the Philippines, connectivity, tourism. You know, just a guide but we don’t normally give them a theme but other Hackathons. I’ve been in other Hackathons It’s about climate change, customer experience, women empowerment and all this very specific, disaster management. And there’s a very specific theme but for Angel Hack, we normally don’t have a theme except for the developers to show off how good they are in coding.

Derek: Nice and in terms of your experience you have three close experience of the quality and technical prowess of the people here. How do you think they compare to well we’re sitting in Manila today how do they compare to people sitting in the Davao and how do they compare to people sitting in Silicon Valley or New York Hackathons for example both in terms of you know sort of technical maturity, and technical understanding?

Paul: I think Silicon Valley is a step. You know, maybe they’re a step ahead in terms of they have a clear proximity to the technologies that are being developed. So, you can look at this as a time machine where in whatever happens in Silicon Valley we’ll probably understand it, get it, maybe one to two years later. But in terms of embracing that technology by the time that technology hits the Philippines or the forums like maybe Stack Overflow where you can ask all these questions will be already developed, right? So, the Filipinos will be able to have better resources.

Derek: It’s very quick to catch up, huh. Previously with all the education systems you would use to have to go to Harvard and they hold all information but now anywhere in the world a 10-year-old with a laptop start coding.

Paul: Yeah. And kudos to those we mentioned, Harvard, MIT, Berkley, you know. They have a program called edX where all the technology, all the lessons or that’s the SD case they post it online anyway so. So, it’s a very egalitarian way of spreading information and we’re beneficiaries to it. I’ve never had a complaint for the last five six years of people who go to the U.S. and they say you know what we really don’t understand this technology. So esoteric only Americans or Europeans can understand it. I’ve never had that complaint. It’s always like this is new technology. It will take time for me to understand it. But you know in the end they’ll figure it out. Right. So, and it’s maybe later by a year or two but we’ll get there.

Derek: Thank you Paul. It’s fantastic.

Paul: Thanks, Derek

Hope you enjoyed that. That was a fantastic chat with Paul Pajo and he is really super clued up on the tech scene and super connected. So, if you do want to reach out to Paul Pajo you have his contact details in the show notes that is at outsourceaccelerator.com/podcast/episode32.

And if you have any questions for us please just reach out to us direct e-mail us at [email protected]