How Creating a Better Way to Pay Taxes Led to Tech Start-up Triumph: Ginger and EJ Arboleda, Co-Founders of Taxumo, on Start-up Success

Through Taxumo, every small business owner has not just an online solution to paying taxes, but also a dedicated partner in their corner.

Everyone loves a tech start-up. From Airbnb to Uber, the stories of tech startups are revered, studied, but rarely repeated. Undoubtedly, humble beginnings play a role in our fascination with these companies–they start small then scale to mammoth proportions within years. Big brain strategies are another draw; keen market insight or industry disruption are often a part of their formula for astronomical success. In the Philippines the banner of tech start-ups has been taken up by a handful of young businesses. Among these is Taxumo, a start-up business that has created a better way of paying taxes, and, in the process, become every small business owner’s best friend and partner.

Speaking to Ginger and EJ Arboleda, the no-frills, down-to-earth husband and wife team who are the founders of Taxumo, The Business Manual takes a deeper look at what it takes to create a successful start-up business. The greatest surprise? Ginger and EJ eschewed the usual talk of tech start-ups about disruption and innovation or Taxumo’s 80,000-strong subscriber base of small businesses. Instead, they focused on topics such as cooperation with government, serving the business community, and giving back.

What Is Taxumo?

Among Filipino tech start-ups in 2024, few are more celebrated than Taxumo, a company created by Ginger and EJ Arboleda. Almost from the start, they were the first start-up business to be part of the Board of Investments’ Investment Priority Plan. Taxumo won a Bronze award in the 2023 KMC Startup Awards for Startup of the Year, and won accolades at the 2018 Rice Bowl Awards. EJ Arboleda, CEO and Co-Founder of Taxumo, was also awarded the 2022 Mansmith Innovation Award.

And yet, awards aside, what is Taxumo? Unlike other tech companies that often describe themselves as the Uber of X (the Uber of motorcycles, the Uber of fitness, the Uber of house cleaning), Taxumo doesn’t fit in the pre-fabricated box of what a start-up business should be. It is the rarest of things: a new idea, an actual innovation. 

Ginger explains, “So the first challenge—I think the biggest challenge—when we were entering the market was defining the product category kasi [because] there was nothing like this before. People would know about professional services from CPAs [Certified Public Accountants]. They would know about the BIR system, but nothing like a tax software provider. Like what does it actually do?”

In her own words, she describes Taxumo as “a SaaS [Software as a Service] company, and what we do is we automated the preparation, filing, and payment of taxes for SMEs and small businesses and self-employed professionals.” 

Oversimplifying: a better way to pay taxes. Or, if you prefer, a tech solution to pay taxes online in a country where paying taxes can often be tedious, difficult and sometimes costly.

The Call of Entrepreneurship

The origin story of Taxumo began with Ginger Arboleda, who is something of a self-confessed serial entrepreneur. Aside from Taxumo, she runs Manila Workshops; she is also the co-founder of the Philippine chapter of Sheryl Sandberg’s Lean In foundation, and remains active as an influencer in the online parenting community where she is known as Mommy Ginger.

It was with Manila Workshops, an events management company that creates learning events for aspiring entrepreneurs, where she encountered a problem paying taxes.

“I got a letter from the BIR. I had to pay penalties,” Ginger explains. “At that time, I had an accountant, so sabi ko, ‘What’s going on? Why do I have all these penalties?’ And then, nakalimutan daw niya [he said he forgot about it]. He missed filing it. And that’s when I said, “I need to know more about this.” 

“Because of my love for learning,” Ginger continues, “sabi ko ‘Hindi pwedeng I start a business and then hindi ko alam the intricacies of tax filing and compliance.’ [I said, ‘I can’t start a business and not know the intricacies of tax filing and compliance’.]  And that’s when it [Taxumo] started.”

How Do You Solve a Problem Like Paying Taxes?

It was at this point that EJ, who was working in IT at the time, entered the picture.

Ginger recalls, “So EJ saw me always stressed out… and he said, ‘What’s that? Let me take a look at it as well.’ And he has a background in IT, so he created sort of like a system that worked on my computer, and that was the beginning of Taxumo.”

Now that Ginger and EJ had a working prototype of Taxumo, they worked together on the fledgling company during weekends and in their spare time. But questions remained: Was there a market for a service like this? Would people trust a digital solution? Did they even want to pay taxes at all?

Getting feedback from the Manila Workshop community, the couple began to realize that they were on to something. But before they got ahead of themselves, they took a step back and verified their conclusions with data—a hallmark of the duo’s management style.

“We were able to objectively verify that people DID want to pay their taxes,” EJ explains. “We eventually also verified that a lot of them would even trust a tool (as opposed to a person) like Taxumo. We identified the type of people who needed us and saw that it’s actually a pretty big market, so we knew we were onto something big.”

At the same time, the vision for Taxumo was born.

“So when you get into business, you usually start with your passion, your hobby,” Ginger says, “And then, what you don’t realize is that there are other things that you need to tend to, like compliance and tax. 

“What our vision really for our company is, [is] that when you want to start a business, the first thing that you do is open a Taxumo account.”

Growing a Start-up Business

With an early version of Taxumo released, growth soon followed. And to achieve further growth, the company pursued a funding route that was, in some ways, typical of tech start-ups.

“When it started getting traction, when we saw that we were getting signups, like 12% week on week growth, we saw that this thing has legs,” EJ recounts. “We joined competitions. We joined incubator programs, and that allowed us to slowly validate the different steps of the business, [to] slowly grow the business.”

Taxumo quickly gained prominence in the tech start-up scene, becoming a part of the first batch of the ISIP Social Impact Accelerator Program. Despite this early success, the duo questioned if acquiring venture capital funding was the way to go. And eventually funding came in the form of private equity or angel investors.

“We found they were a better fit for our vision,” Ginger explains, “because they weren’t so focused on making a quick exit. They were also interested in solving the problem systematically and actually creating a growing self-sustaining company.”

To date, Taxumo has had two rounds of funding – a seed and a bridge round.

Challenges of a Start-up Business

Since its inception in 2015, Taxumo has faced a number of challenges, some of them unique to the start-up business Ginger and EJ created.

On top of the list is working with the BIR—but not for the reasons most people would assume. While conventional thinkers would be wary of working with government, EJ is quick to point out that the BIR has been a supportive partner.

“The BIR is actually quite supportive of what we’re doing,” EJ explains. “After all, we’re helping reach a market that is traditionally categorized by them as ‘hard to tax.’ Now because we exist, we are able to help collect from these entities.”

The challenges, instead, stem from procedures. After all, there is no other company that does what Taxumo does. It is the first of its kind in the Philippines. 

“The rules and procedures that exist don’t say how the BIR can work with a partner like us,” EJ says. “So it was a gray area for a while. Fortunately, we were able to work with USAID and in a joint effort with the BIR, a formal structure was created that defines how the bureau can work with us.”

Start-up Business Challenges During the Pandemic

For many online businesses, the pandemic proved to be beneficial, with many experiencing explosive growth. As an online business, Taxumo also experienced rapid growth. 

EJ explains, “A lot of people actually had to pay taxes still, obviously, so they were looking for ways on how to do it from home. So that’s why we acquired a lot of customers during that time. So we had, I think, 200% growth during the pandemic”

This growth was not just a temporary period. It had long-lasting effects on the habits of consumers. 

“I think from that time onwards, people now are a lot more open to digitizing a lot of processes, especially taxation and compliance in their companies,” EJ says.

At the same time Taxumo was experiencing unprecedented growth, Ginger and EJ also noticed a disturbing trend. “We were looking at the data, the aggregate data,” EJ recalls. “We were seeing that people were actually earning less.” 

This led them to reassess Taxumo’s mission.

“We actually had to review why we are here. What are we trying to do? And we had to go back to our ‘why’ and we saw that, at that end of the day, we’re here to help businesses. We’re here to make life easier for these business people.

“So [what] we actually did during the pandemic was we slashed our prices. 80% off. And it was completely free for medical professionals, the frontliners… But even with that, we still grew [200%]. We found that by going back to that ‘why,’ it allowed us to be more flexible with the solutions we were offering. It was good because we were also able to reach people [who] believe the same thing as us, who share the same values.”

Managing Taxumo as a Couple

Another challenge–and strength–of Taxumo is its leadership. As any married couple will attest to, marriage isn’t easy. Add the daily challenges of managing a start-up business to the mix and the difficulty is multiplied. How do Ginger and EJ cope with the challenges of leading Taxumo as a married couple?

Speaking about Ginger’s management style, EJ says, “Ginger is more of the workaholic so she doesn’t stop. So I had to tell her, ‘Hey, I wanna take a step back muna [for a while]. I wanna stop muna. I wanna watch my anime or whatever.’ And then you do your thing.”

Speaking about EJ, Ginger says, “And EJ’s very logical. He’s all about the numbers. You have to prove to me this is worth it. Data, etc. So that’s where our argument usually stems from, but we sort of like… me, I tempered down my emotions, really, saw where he comes from. And he also sees where I’m coming from.”

Both of them talk about how setting boundaries between work and family is important in their relationship.

“So what we needed to do was we had to be very direct with our boundary setting,” EJ explains. “We actually have scripts like, ‘Okay, Ginger, I will now wear my CEO hat because this is something I have to say.’”

Tips for Entrepreneurs

Knowing that the “why” of Taxumo is supporting entrepreneurs, Ginger and EJ Arboleda were eager to share tips for those who want to build their own start-up business.

1. See taxes as part of the game.

As a natural starting point for tips for entrepreneurs, EJ spoke about considering taxes as part of a start-up’s business plan. He says, “I think people try to avoid that topic because it’s an unfamiliar topic, number one, and it’s a very uncomfortable topic, number two. And I think that if you wanna go into business, you have to face those uncomfortable, unfamiliar topics head on, because you never know. They might be the ones that would lead to the failure of your business.”

Entrepreneurs should ask themselves, EJ continues, “If I grow this much, is this something that’s going to be sustainable for me?” 

2. Have confidence in yourself.

As an entrepreneur who has started multiple ventures, Ginger talks about how entrepreneurs should never lose confidence in themselves—a message that resonates with her experience as a woman entrepreneur.

She says, “I think for me, being a female entrepreneur, it’s more about confidence, really. There were a lot of times when I would doubt myself, and I would second-guess my decisions. But we’ve noticed that mayroon talagang times na [there are times when] if you sort of like just go along with your gut… I mean, logic is nice. Data is nice. But sometimes, if sinamahan mo ng puso at tsaka gut [if you combine your heart and your gut], you’re gonna be on the right track.”

3. Give first.

While much has been said about tech start-ups and their potential for growth, what truly sets Taxumo apart is how it has found its reason for being: serving small business owners and self-employed professionals. The tech start-up promise, the funding, the business growth is all there for Taxumo, but what really counts is how the company supports these businesses for them to achieve their own goals and growth.

EJ says, “What I eventually learned—and this is something I actually learned from Ginger—is give first. Give first and then eventually, it somehow pays itself back. I can’t really explain it. It’s like the concept of karma, but somehow, it does work, you know. So be less concerned about making sure that you get yours and, I think, be more concerned instead about being able to give and being able to make the change you want to make. 

“And I think if you focus on that, the return will be automatic. Magically, I would say.”

Text VINCENT SALES

Photography KIM ANGELA SANTOS

Videography EXCEL PANLAQUE

Art Direction MARC YELLOW assisted by ANDREA SANGCO

Sittings Editor RJ LEDESMA

Project Manager ANTHONY MENDOZA

Shot on Location KLIQ STUDIO