The world's largest corporations all had to start somewhere—and some of them started at home. Four successful businesses lead the way for the next living-room CEOs.
What do companies like Human Nature, Café Mary Grace, OLX.ph, and Cupcakes by Sonja have in common with Apple and Google? They all started in someone’s home. Global enterprise relies more on home-based businesses than you might think: In the United States, for example, surveys as of March 2014 showed that 52 percent of all businesses were home-based; similarly, in the United Kingdom, the total also stood at 52 percent just last year. In the Philippines, there is a lack of hard data on home-based businesses, but with 743,250 micro-enterprises registered with the DTI, you can bet that more than a few are based at home.
And why not? Working from home has become even easier with technology leveling the field in many industries. A far cry from the cottage industries of the past, home-based businesses can be just as professionalized and efficient as their larger counterparts, and—given proper planning, lots of hard work, and the right breaks—can be the humble springboards from which great enterprises are launched.
It doesn’t even matter that some of these home-based businesses are “accidental,” in that they started as a hobby that proved profitable, while others are startups launched from home to cut down on operating expenditures. Still others never move out of the house, simply because they don’t need to.
Whichever the case, these four businesses are worth a second look—particularly as they’ve proven that something special, something big, can definitely be built from home.
OLX.PH
TAKING ON THE GIANTS CAN PAY OFF IN SURPRISING WAYS
It quickly became a household name, but Sulit.com.ph started in a bedroom, with only P2,400 in capital.
For RJ and Arianne David, the “low goal” was to create multiple websites for clients, an experiment started in 2006. They discovered, however, that it could generate revenue, alongside traffic, because companies began advertising onsite.
Arianne was working at a bank at the time, and she and RJ had made a pact to be wise about making any leaps. “We were both supporting our parents, [so it wasn’t until] we reached a decent profit that I resigned,” she says. That was 2007.
The couple juggled the work of several people, from system administration to finance, to marketing and sales, to business development, and human resources—until they finally hired their first team member in 2008. “We would have grown faster if we had been able to get team members with the specific skills that we lacked,” says RJ. Now they have more than 100 employees.
Here was an upstart brand going against established players with money, including eBay, Buy&Sell, 88DB and Auction.ph, and gaining a following. The Davids tinkered with site engine optimization (SEO), rich site summary (RSS) feeds, and engaged with users via forums. Their accidental Google rule-breaking brought them to the top search results and the attention of their peers, who accused Sulit of “black hat techniques” such as abusing SEO. “I don’t think it’s abusing [SEO]—we [just made] it very easy for our users to do SEO for us,” says RJ.
"Look for something that you believe you have—an advantage—it won't be money, because you will be dealing with big guys. If you believe you have a certain unfair advantage being the little guy, then go with it."
In 2009, South Africa-based Naspers Group acquired an initial 51 percent of the Davids’ company, Netpreneur Connections Enterprises Inc. (NetCon), which owned Sulit. The following year, Naspers bought a majority stake in Buenos Aires-based OLX (an abbreviation of “online exchange”), which set the wheels in motion for a merger with Sulit. Currently, the Davids own 17.5 percent of NetCon.
RJ says “carrying the brand equity” of OLX, which is present in 107 countries, is the best long-term strategy, and so they have tried to “remove [their] emotional attachment to the [Sulit] brand” and embraced the new direction. “Other competitors are coming in heavily and we need to defend the market.”
The key to survival, says RJ, is flexibility: They outgrew their competition, simply because they’ve kept up with the changes in the market, with a little help from Naspers. “Without their advice, we would be out of the market,” he admits. “We’re learning [from each other]. We’re dividing the task and quickly getting the results, and we’re applying it on the site.”
SMALL BUT WILY
RJ David's tips for the startup 'trep:
BE A QUICK STUDY
A new entrepreneur can learn from existing business models. “I’m not a category-defining entrepreneur... technically, the business model is an existing one that we just tweak on the local market.”
SIDESTEP GOLIATH
“Don’t go head to head with [big] companies like [Naspers] because they can outspend you. Look for something that you believe you have—an advantage—it won’t be money, because you will be dealing with big guys. If you believe you have a certain unfair advantage being the little guy, then go with it.”
BE SMART
Conduct your business intelligence, so you can spot and exploit an advantage. For example, research on user behavior and interface design helped the Davids realize that showing the number of users online—just below the “Sell Your Item Now” button—led to more ad postings on Sulit.
CUPCAKES BY SONJA
CLEAR VISION AND BOLD CHOICES MAKE SONJA OCAMPO AN INDUSTRY TRENDSETTER
Sonja Ocampo wanted "to do her own thing"—and for her, that "thing" was clear: she wanted to open her own patisserie, with a following as large and loyal as the famous bakeries she used to know in New York City.
She was aiming high, having studied culinary and pastry arts in NYC, where she ended up working with celebrity chef David Bouley and at the famed Magnolia Bakery. Back in the Philippines, she had partnered with some friends in a restaurant business, but also took to experimenting with cupcake flavors at home. After bringing some of her cupcakes to a birthday party, orders poured in. “Word kind of spread after that,” recalls Ocampo. “My cupcakes got to [lifestyle columnist] Celine Lopez, who wrote about them…and then after that, Ayala [Land] contacted me.”
"From the day I said I was going to make cupcakes, it just happened fast. I was baking at home, but then I realized, I did not just want to bake at home."
Luck favors the prepared, so the saying goes, and Ocampo pitched her patisserie concept to Ayala—who quickly offered her a premium space in Serendra in Bonifacio Global City. She accepted at once.
“From the day I said I was going to make cupcakes, it just happened fast. I [started] baking at home, but then I realized that I did not just want to bake at home…There was no bakeshop that you can see the whole process. I really wanted that when you enter the store, you can see it, you can smell it, they frost it in front of you—you just want [customers] to be transported in that way,” she explains.
The eye-catching Cupcakes by Sonja, styled after New York shops, opened in 2006, quickly setting off a trend. Cupcakes became all the rage, as many new shops sprouted up all over the city.
The original, however, took seven years before opening a second branch in 2013. Ocampo was adamant about branching out only at the opportune time, with the right partners, for the right reasons. “It’s being able to grow creatively and reach more people,” she says of her recent partnership with entrepreneurs Anne and Freddy Gonzalez, the couple behind Havaianas Philippines and Aloha Boardsports. The three partners are currently setting up Cupcakes by Sonja branches rapidly—totaling 11 to date.
“It took a while because my heart is really in the business. It was 24/7 of my life. Our kitchen has been open [almost] 24/7 for the past eight years. I only had Good Fridays to close,” says Ocampo. “[But] I was able to find the right people [to partner with], and it’s great because I also get to grow.”
OUT OF THE BOX!
Sonja Ocampo gives advice to would-be home-based business mavericks:
JUMP IN
“I really don’t say no. I love challenges!”
TEST YOUR PRODUCT
“If you have an idea, act on it, and get as many people to comment on it. If you put it in a bazaar, and people don’t like it, they can give you suggestions to make it better... Know who your customers are and find out if your product needs tweaking.”
WORD-OF-MOUTH WORKS
Good reviews in periodicals and blogs tempered early criticism about her new products and premium price point. “People would come, they’d ask to feature it, sort of spreading the word for me, then it was okay,” says Ocampo. “Work on your product, stay focused, and people will find out.”
HUMAN NATURE
TWO SISTERS DECIDE TO CHANGE LIVES FROM THEIR LIVING ROOM
Human Nature (Gandang Kalikasan Inc.) began humbly, but it always had lofty goals: to make eco-friendly and sustainably produced cosmetics and toiletries, while incorporating Gawad Kalinga's vision to help disadvantaged Filipinos. The succes that met the company—measured not just by profit. but by the number of lives changed—exceeded expectations.
While working as volunteers for Gawad Kalinga (GK) in the U.S., sisters Anna and Camille Meloto, together with Anna’s husband, Dylan Wilk, saw the trend of natural and organic products and dreamt of a way to make these products, while also involving GK communities.
Human Nature was meant to be a model client, using only all-natural ingredients bought at fair prices from GK farmers who engage in sustainable practices. “We have experimental farms that propagate [plants like] sunflowers, soy, and passionfruit, which we could then buy,” says Anna.
The Melotos bootstrapped the entire enterprise, working from home, and doing everything—from bottling the products and slapping on labels to selling and delivering the first batches—themselves.
However, they realized that they could have more impact along the value chain if they also engage resellers for their products. Dylan noted that public schoolteachers with a monthly salary of P6,000 could augment their income via Human Nature. “Most salaried workers in the public school system, and in the rank-and-file [of public and private companies] don’t earn enough... They always need a sideline,” says Anna.
"The problem that we identified was poverty and unemployment in the Philippines. So if we were to employ a lot of people, it needs to be a big business.
When the three launched Human Nature in 2008, they also began a dealership program. For as low as P799, resellers could get a starter kit of products and marketing materials.
To date, there are 30,000 individual dealers in the Philippines alone. These are mostly women, aged 25 to 40, each one of whom, Anna says, could earn as much as P30,000 monthly from direct selling.
Human Nature didn’t stay home-based for long, as the fledgling company moved to its first office in February 2009.
It’s a far cry from the small business the sisters initially envisioned. Quoting her husband, however, Anna points out, “If you really want to help, you can’t keep it small, because the problem is so big that the solution can’t be small also. The problem that we identified was poverty and unemployment in the Philippines. So if we were to employ a lot of people, it needs to be a big business.”
REACHING OUT
Though it's still growing, Human Nature has never forgotten its roots
30
number of Human Nature branches
10
businesses enrolled in Human Nature’s social enterprise mentorship program
30,000
bottles produced and sold monthly by Bayani Brew, a small enterprise created by a nanay from Bulacan, one of the businesses Human Nature mentors
P750
minimum wage Human Nature pays its employees, compared to the government-mandated P466
P850
minimum wage target by year-end
70
percentage of operating expenses that go to employee benefits
MARY GRACE
HOW A STAY-AT-HOME MOM TURNED HER NAME INTO A BRAND
Between having her first baby at 23 and her fifth child at 32, Mary Grace Dimacali didn't have much time to nurture a career. She admits to feeling a "bit of angst" back when her batchmates from college started taking up their masters and climbing the corporate ladder. Nevertheless, she felt that being present for her children was worth the sacrifice.
Her husband, Hector, was a good provider, but she needed a creative outlet for herself. “It was about being able to make something with your own hands,” she explains. So, when her eldest turned five, she started selling fruitcake for the Christmas season. “It allowed me to be an entrepreneur during the –ber months,” she says. From there, she moved on to cinnamon buns and other baked goodies, eventually finding one particular product that clicked with her customers. “I wanted to make something that Filipinos love—that was the ensaymada.”
Though her recipe for the buttery, feather-light pastries, dusted with a generous helping of quezo de bola, was a winner, Dimacali was also tireless in pushing her wares. “I like to sell. I brought these products door-to-door in our village.” From knocking on neighbors’ doors, Dimacali moved on to bazaars in 1994. Long lines for her ensaymada rolls and a roster of repeat customers encouraged her to open her first kiosk, in Glorietta mall, in 2001.
Dimacali’s dream, however, was to manage her own café; she wanted the perfect setting for people to enjoy her comfort food. Five years later, she opened the first full-service Café Mary Grace in Serendra. Her son, Gabriel, by then newly graduated from college, found the spot, and became the first of her children to join the business.
Neighbors, bazaar buddies, and a posh new clientele were drawn to the café, to the comfort and familiarity of oven-fresh ensaymada with a chaser of hot tsokolate. What differentiated the café was the brand’s homey, personal touch that Mary Grace was able to retain despite its growth. “Little did I know [the bazaar regulars] were my evangelizers. While we were developing a loyal clientele, I was also building an emotional connection with people, so that when the first café opened, bang! They knew that Mary Grace was not just a name—they knew that person. They know her voice. They know her commitment to deliver with quality and bring it to your doorstep. So the café became a success,” she says.
"I bloomed where I was, as a mom foremost of all. Who would think that something good would spring from humble beginnings at home, in a little kitchen?
Today, Mary Grace has 15 cafés and nine kiosks in eight cities, with an additional five branches to open by yearend. Customers still gamely scribble compliments on slips of paper tucked under the glass covers on the tables: “I think Mary Grace took a piece of my heart. Or maybe I gave it willingly,” says one. “Mary Grace has been a part of our lives. I love you to the moon and back!” says another.
In the meantime, Dimacali looks back on her journey and beams, “I bloomed where I was, as mom foremost of all. Who would think that something good would spring from humble beginnings at home, in a little kitchen?”
KEEPING IT PERSONAL
How to grow without losing your touch.
CELEBRATE YOUR VALUES
The tenets of the business are stamped on each box: Family, Faith, Hearth and Home. The brand pays tribute to the Virgin Mary by subtly portraying her in the logo. “She’s feeding people. That’s what motherhood is all about,” says Mary Grace Dimacali.
HANDLE COMPLAINTS
Each café has prominent signage: “In case we fall short of delighting you, please do let us know immediately,” together with a mobile number. “Comments get to me right away.”
PAY IT FORWARD
Larger branches of Café Mary Grace have a “Women’s Can-Do Corner” displaying items created by female entrepreneurs, for sale. Says Dimacali, “Café Mary Grace is all about women with the entrepreneurial spirit: women who tend to their homes, as well [as]...become someone with her own homegrown talent and her own common sense and knowledge gained from experience.”
Originally published in the May 2014 issue of Entrepreneur Philippines, with some sidebar articles removed for brevity. * Note that some information contained herein needs updating. For example, in 2016, the Davids exited OLX Philippines, which was later acquired by Carousell, and founded Innovation Love (a play on innovation lab).
Photos by Jason Quibilan. Styling by Belle Camarsi, assisted by Geralyn Dadap. Grooming by Jan Edrosolan and makeup by Cats del Rosario (for Sonja, Camille, Anna and Mary Grace). Grooming and makeup by Tricia Miranda (for RJ and Arianne).