Attracting Angels: Earl Valencia on S&T Investment

Earl Valencia set up the IdeaSpace Foundation to encourage innovation in the Philippines, where startup founders still face barriers to opportunities and angel investment.

Earl Valencia
Co-founder & President
IdeaSpace Foundation


AsianScientist (Apr. 27, 2016) – Part and parcel of setting up a startup company is to experience failure—something that Earl Valencia is all-too-familiar with. Valencia has had two failed attempts at getting his PhD in engineering—he got into MIT’s PhD Program in Nuclear Engineering but ended up not going, and then left the PhD in Systems Engineering program at the University of Southern California to pursue his MBA.

Yet, as the saying goes, “failure is not the opposite of success—it’s part of it.” In his native Philippines, Valencia identified the need to drive technological innovation and entrepreneurship, and also saw how startups were struggling to secure angel funding. And so, he founded IdeaSpace, a non-profit incubator and accelerator based in Manila, with US$12 million in funding.

Seeking to encourage, develop, and nurture innovation and entrepreneurship, IdeaSpace provides support programs for science and technology entrepreneurs, both in the Philippines and the region. So far, Ideaspace has funded 28 science and technology companies that focus on the needs of emerging markets, ranging from mobile apps to hardware based development technologies, in the past three years.

Valencia, who is now based in the US in an advisory role, tells Asian Scientist Magazine about how his expertise in both business and science naturally translated into the setting up of the Foundation; the future of startups in the Philippines; and the number one reason why startups fail.

  1. How did the idea for Ideaspace come about?

    It was an idea that me and my co-founder Marthyn Cuan thought about when he visited Silicon Valley and I was still in Cisco. We both saw the lack of idea stage capital in a place like the Philippines, where only the top one percent get access to opportunities and angel investment. A few months after that conversation, I was on a plane back to Manila and we decided to start a non-profit called IdeaSpace, with the guidance of First Pacific CEO Manuel Pangilinan and executive director Ed Tortorici as our sponsors.

  2. How did your previous experience working with Cisco help you in setting up Ideaspace?

    Being in the Business Incubation team of Cisco in the San Jose HQ trained me to see how ideas can be turned into billion dollar businesses. I was the Deputy Program Manager for the Cisco I-Prize, then the global idea competition of the company. I also ran the internal innovation platform, called the I-Zone, where we look for ideas to solve our internal problems. In these two roles, I was constantly exposed to start-ups that want to partner with us from all over the world, and was extremely lucky to get this foundation together with my engineering background and MBA from Stanford.

  3. What does your new role as part of the science and technology advisory council of the Philippines entail?

    I recently joined the Science & Technology Advisory Council in New York, a non-profit organization that aims to serve as an advisor to stakeholders including the Philippine government, academics, business, grassroots organizations and local communities, as a board advisor. I am hoping to encourage more policy development in the Philippines with regards to science and technology, and be able to tap into the intellectual capital of the diaspora here in New York and the East Coast area of the US.

  4. What are some of the challenges that local startups are facing? How is IdeaSpace helping to overcome them?

    Meritocracy with regards to opportunity was missing, meaning that capital typically is locked to those who already have the family connections to get investments or opportunities to grow the business. Thus, the cycle is that the rich get richer and the poor get poorer.

    IdeaSpace believes that everyone should have an equal chance to get early stage financing. Under our incubation program, we remove the names and affiliations on the first round to make sure that they do not introduce bias in evaluation.

  5. Valencia and attendees at the Association of Southeast Asian Nations MBA Summit on April 16, 2016 at Harvard Business School in the US. Credit: Earl Valencia
    Valencia and attendees at the Association of Southeast Asian Nations MBA Summit on April 16, 2016 at Harvard Business School in the US. Credit: Earl Valencia
  6. Can you tell us more about the initial batch of startups? Which ones stand out and why?

    IdeaSpace start-ups are quite unique because we are at the intersection of emerging market issues and technology. A few come to mind: Wattsmart, a way for small and medium enterprises and households to monitor their energy consumption in real time, and which now just got a contract to deploy to hundreds of sites.

    I would also like to highlight TimeFree, which is a time-saving system used by major banks and airlines to inform customers of their place in the queue.

    And finally, FAME, a hardware device for tracking small planes and vessels that cannot afford expensive radar systems.

  7. Why are public-private partnerships important to startups?

    Especially in emerging markets, it is important that there should be the right policies to make start-up development easier—such as encouraging public universities to have technology and entrepreneurship courses; having start-up incorporation; getting shared services free; and taking out roadblocks for people to try. I think it is the duty of governments to unleash the full potential of the population.

  8. Besides the innovation hubs planned at Intramuros and the University of the Philippines Diliman, how many others do you plan to build and where?

    We are now encouraging different infocomms technology councils in the provinces to work with the private sector, such as IdeaSpace, and with the Department of Science and Technology and Department of Trade through their GoNegosyo (Go Business) centers to open their own regional or university incubators. We have seen these being discussed and expect to have 10-15 new business incubators to be opened all over the Philippines within the next 12 months.

  9. In your opinion, what is the number one reason why startups fail?

    Most start-ups fail when the start-up founder’s ego overtakes the mission of the organization. This is the trap that most founders will have—and it sometimes even starts with some of them not wanting to share ideas with investors or collaborators.

    I believe that if you should start companies because you want to accomplish a mission—to solve a problem. And if you anchor yourself to that, then you would be open to hiring people better than you, sharing your ideas to find the right partners, and getting outside capital because you need to grow your mission.


Copyright: Asian Scientist Magazine; Photos: Earl Valencia.
Disclaimer: This article does not necessarily reflect the views of AsianScientist or its staff.

Coming from a design background, Filzah brings a fresh perspective to science communications. She is particularly interested in healthcare and technology.

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