Forget Manila – CEO says startups should head to the Philippine provinces

Most entrepreneurs in the Philippines are scattered across Manila. Some are gravitating towards the specialist Area 55, a growing cluster of startups located in Metro Manila. Bryce Maddock, the CEO of TaskUs, argues for the completely opposite approach: you should set up your office in the provinces.

Maddock did so himself way back in 2009, creating the first TaskUs office in Imus, Cavite, a province on the outskirts of Metro Manila. His reasoning at the time was industry specific. TaskUs provides customer care and back-office support to tech companies in the United States, thus making it a part of the booming business outsourcing (BPO) industry, for things like phone banking or tech support, in the country.

The perks of the provinces

According to Maddock, the BPO boom is as much a curse as it is a gift – at least if you’re headquartered in Metro Manila. Companies in the capital have staff turnover rates of 80 percent to 90 percent. “BPO employees can often walk across the street and start working somewhere else,” Maddock explains.

The TaskUs location in Cavite, was designed to prevent high attrition, Maddock says, and in turn provide stable teams for their tech clients, which now include Tinder and Groupon. The turnover at TaskUs is at 30 percent, which he claims is among the lowest in the entire BPO industry.

Bryce Maddock (top right) with a TaskUs employee and his family.

The provincial location also reduces the working hours lost to traffic, which a recent New York Times article named as one of the biggest impediments to the nation’s economic growth.

“For people working at Manila-based BPOs, commute times can be as long as two hours each way,” Maddock says. “We asked ourselves, ‘what if we brought this work to the people?’”

The ensuing experiment to have TaskUs based in the countryside has resulted in an average commute time of twenty minutes, Maddock claims. To him, the difference in commute times is important not just for its economic impact, but for the value it provides his employees.

“We are saving our employees thousands of hours every day – hours that they get to spend with their families, instead of in the back of a jeepney,” Maddock says.

See: India still leads global outsourcing sector, Philippines a close second

Reducing the brain drain, one Filipino at a time

Of course, the provincial location is not without its trade-offs. People who believe that outsourcing takes economic advantage of Filipinos could argue that the TaskUs presence in Cavite allows them to do so with a much more captive demographic – Filipinos in the provinces have even fewer work alternatives than their compatriots in the capital.

Maddock disagrees with this idea on two accounts. For one, he cites the fact that historically most well-educated Filipinos had to go abroad to earn a good wage. The BPO industry allows Filipinos to earn a similar salary while remaining in the country, thereby reducing the brain drain of Filipino professionals to other nations. “Filipinos can now work for a successful American corporation during the day, and be home to tuck their daughter in to bed at night,” Maddock points out.

Get away from the capital