2. SME Software and Infrastructure as a Service
Portfolio Companies: Etaily, Mochi, Snack, None Away, Britana, Peddlr, Zaapi, Otis, Pemo, One Lot, Locad
“X as a service” refers to any business model in which a company provides clients with services, without requiring them to own the underlying infrastructure or house them on premise. Perhaps the most well known application of this term is in software, with global companies such as Google, Dropbox and Salesforce serving businesses the world over through the power of the cloud. Whereas SaaS is typically the first billion dollar sector to rise in mature markets such as the US, Israel, Canada, and Australia, it has taken a backseat in emerging economies—that is, until now. We feel that we are at an inflection point of SaaS in the Philippines. Following the golden triangle of eCommerce, fintech, logistics, we have strong conviction that SaaS will be one of the next industries to take off, thanks to stronger digital rails, mobile penetration, and digital behaviors that have endured from the pandemic. In a 2022 survey conducted on Filipino businesses by OpenGov Asia, more than half of the respondents reported implementing more cloud-based IT solutions following the peak of the pandemic. SMEs, which account for 99% of registered businesses in the country, are particularly seeking SaaS that enables process optimization, workforce flexibility, and technology stack enhancement.
Contenders that can offer solutions in these areas with a superior user experience or a more affordable price tag have the right to win, whether they take a localized approach or seek to go global from day one. See our latest SaaS report for an in depth look at this theme.On the other hand, while infrastructure as a service (IaaS) is typically used in the context of cloud computing service providers, we take a more liberal definition and see the applicability of this business model to eCommerce enablers and managed service providers as well. A business that saves its clients the hassle of having to buy hardware outright or build a business unit in house, while charging recurring revenue on an as-needed/on-demand basis, delivers tremendous value by enabling the latter to operate on a lean, asset-light basis and free up precious capital for other areas of the business.
