Entrepreneur.com.ph

Description: Offers on- and off-line marketing solutions to suit various industry needs
Start-up Capital: P120,000
Projected 2006 Sales: P40 million

David Drilon and friends Frances Huang and John Flores started coming out with interactive books under their first I.T. venture, Nubooks Interactive, in 1994, when the Internet was just making itself felt in the Philippines. They worked from home using their own PCs, earning P15,000 per project. After several years and several changes in ownership and offering, Nubooks Interactive evolved into a multi-media service company that lists Jollibee Foods Corp., HSBC, SM Prime Holdings, and First Philippine Holdings as among its top-paying clients. "Our aim (for Nubooks) was to provide 'interactive books' to the education sector, but I think it was a bit too early for them to catch on," says Drilon.

Noting that corporate presentations then used slide shows and transparencies, the group saw an alternative source of income. "We shifted to help enhance communication through multimedia. This turned out to be a hit, and we later branched out into creating web sites."

The three entrepreneurs turned in quite a profit in their first three years. In 1997, after Huang signed off and another friend, Dindo Magallanes, signed on as a partner, the group had a rebirth of sorts. To give the company a more stable image, they used their previous earnings to move into an office in Greenhills, bought original software, new PCs and hardware, and changed their name to Fuel Media.

The newly named company offered both offline and online marketing communications services, ranging from the traditional annual reports to the newly emerging websites. "We grew to about 10 employees who were all kept sufficiently busy with our workload," says Drilon. "We also made it a point to deliver the best, most creative work possible. We wanted to be more than credible."

Indeed, Fuel Media quickly became known as one of the first companies to provide a specialized end-to-end service, attracting big clients such as Ayala Group of Companies, San Miguel Corporation, and Glaxo-SmithKline.

Fuel Media did so well that in 1999, Doy Vera, founder of Smart Communications, bought into it, renaming it k2 Interactive (Asia) Inc. and bringing in investors from Hong Kong and the United Kingdom. The new company opened satellite offices in Hong Kong, Malaysia, and Singapore. It bought Macs for its creative team and PCs for its technical staff and agents. To drive down costs, it bought original, open-source software such as PHP and mySQL for their Web-based applications. The Philippines, specifically the Ortigas business center, became its Web development hub.

"It was hyper-growth time. In just one year, we had expanded to six partners and about 110 employees. And since we had competitive pricing, English-speaking employees, and offices all around Asia, we did really well during the dotcom boom," says Drilon.

The dotcom bust in 2001, although admittedly shaky, was not too devastating because "we saw it coming and began closing our international offices. Several investors, however, divested." Another thing going for it is the Philippines' dotcom lag - Web-based business has not really penetrated the country yet.

This allowed the company to recover slowly in 2003, with Drilon as the group managing director. It kept about 30 employees and refocused on the local market. Knowing that Internet usage was about to grow, Drilon simply grouped the services according to niche markets: k2-IMC for integrated marketing for brand and consumer-specific requirements; k2-ICC for corporate and investor communication services; and k2-ITS for electronic solutions for integrating enterprise applications. The company recently added k2Spark, its very own research and development hub.

Fortunately, as a pioneer in the industry, k2ia continued to get several clients through word-of-mouth. "Everything's being done on a per project basis today, which makes our work a very collaborative effort. The fact that we can provide more than the usual tri-media sets us apart in the industry," says Drilon. "Our business turned around in 2005, with net profits hitting P30 million. This year is looking very good, as well, and we're hoping to gross P40 million by year end." Not bad for a former home business operator.