Leadership Lessons January 31, 2023

How to Build a Billion Peso E-commerce Business, According to Great Deals Founder Steve Sy

From getting out of a 12-year debt to starting a business, Great Deals E-commerce Founder Steve Sy shares how these challenges have made him into the great businessman that he is today.

Starting a business from scratch is no easy feat, especially if there’s a large debt looming above your head. And in the case of Great Deals E-commerce Founder Steve Sy, he had PHP32 million to pay—all while managing a business, raising a family, and keeping sane.

But with perseverance, a sharp business acumen, and the foresight of what works, he was able to pay off his 12-year debt. What’s more, during the pandemic—a time when most businesses would crack under pressure and close down permanently—Great Deals flourished and was able to raise USD$30 million (around PHP1.65 billion) in funding equity.

The success story of this e-commerce company, however, was a big risk, given that Sy could have rested on the security of his family business. But the desire to be his own boss and make a name for himself has forged him into a powerful entrepreneur with an equally formidable business—that to this day boasts of an extensive clientele of some of the biggest brands in the country.

Here’s how he did it.

How to Build a Billion Peso E-commerce Business by Steve Sy The Business Manual

From Family Business to Entrepreneurship

Born into a Filipino-Chinese family meant that Sy had a family business that his parents wanted him to run. But Sy had other plans, having been newly married at that time. “We do have a textile [family] business in Divisoria, and as the eldest son, typically, they always tell us to go and take care of the family business,” Sy begins.

“But when I got married, there’s a verse in the Bible that quotes, ‘The man leaves his father and mother and be united with his wife,’ and I would like to practice that principle,” he continues. “I told my parents I need to be separated not only physically, [but also] mentally, financially, emotionally. So, I said [that] I would like to start on my own journey in my own business career. I think that was the main reason I didn’t go back to the family business when I got married.”

This wasn’t a problem for his parents, given that he could easily pass the reins to one of his 6 siblings. “Maraming kapalit. It’s much easier for them to [say], ‘Okay, next in line,'” he laughs.

With the path now clear, the next step was to decide what business he wanted to create. This, however, came with so many possibilities. And of all the industries that Sy could have dabbled into, he set his sights on e-commerce.

The Humble Beginnings of Great Deals E-Commerce

The thing is, e-commerce was a foreign concept back in the early 2000s, as physical stores were the in-thing and technology was still building traction. But for Sy, it was an avenue for him to sell—based on his past experiences and a foundation built on always making money.

“Even during college, I was already selling watches and T-shirts even before I graduated,” he explains. “I did have a side hustle when I was in college and I think what keeps me burning to always do business is [that] we were trained that way at a very young age to always look for business opportunities [and] do some side hustle.”

“Of course, I had a goal during that time—I would like to earn my first million at age 20. That was my main goal aside from going to the best school,” he continues. “[And] when I did, I think I had that realization when I was looking at my passbook, [at the] one million, I said ‘Wow… but then, is this it?'”

“So at a very early age, I had this realization that it’s not all about money. Because after the next 5, 10, [or] 100 [million]… what’s more to life?”

With that realization, Sy changed his perspective. Instead of using money as his benchmark, he explored many business opportunities until he found his niche. “I continued doing business—from trading, from importation to setting up my own insurance agency and then selling it and then setting up a cell phone accessory business,” he shares.

“That was the point when I found out about e-commerce. That was around 2012—the infancy stage of e-commerce.”

Of Challenges Faced and a Looming Debt to be Had

While being in the family business meant having a sense of stability, it also came with a fixed system and your parents being your boss—not a lot of wiggle room especially if the nature of the business didn’t align with your interests.

But creating a business from the ground up was much riskier and it came with its fair share of challenges. Although Sy was able to make his first million, the expenses that he incurred were much too great—and so, he too ended up with large debt. “Those were hard times talaga, I would say,” he laments. “I was aged 27. Di ba sabi ko nga at age 20, I will make my first million. One of my goals financially is to [also] have five million in my bank before getting married.”

“I reached those goals, but by then, at age 27, I was in debt for 32 million pesos,” Sy continues. “I didn’t know what to feed my family. Sa totoo lang, I was ordering NFA rice for my kids and some friends would just give us some milk so that I can have my two daughters during that time to be healthy enough. Those were hard times and it took me 12 years to pay off my debt.”

Emotionally and mentally, the financial struggle took a toll on Sy. “The first three years, four years, you know, first year maybe… laban pa, laban pa. [Fight on, fight on.] But then you get depressed. Really. And then you see a lot of your friends—batchmates [who] have gone up in life, but you’re still waiting for your chance. Doon na-dedevelop yung endurance. Doon na-dedevelop yung advesity quotient.”

Steve Sy’s Eureka Moment in E-commerce

Having developed a resilience and adversity quotient for himself made Sy a much stronger person. “When big storms come, it’s nothing new because you’ve gotten through bigger storms. So yun yung preparation for me before I could reach the, I would say, the so-called promise land of the e-commerce business.”

“Yun yung kagandahan. [That’s the beauty of it.] You only need to be hopeful of the future so that you’ll have this burning desire to keep improving. And paying off my debts. It took me 12 years, but I did it,” Sy says triumphantly.

For Sy, his first foray into the e-commerce industry meant being a seller himself—that is, as a wholesale dealer of cellphone accessories. “At that time there were [also] deal sites. I was supplying them [with] cell phone accessories [and] power banks for their deals. That’s where it started. And then Lazada came in. I became a merchant in Lazada just to move my slow-moving products.”

This was where the entrepreneur got his big break. “I remember this. November 1, 2014. I had a few thousand power banks in my warehouse and, of course, that was my first time joining a Lazada double-double event. Boom! In just one day, all of the power banks got sold and I was amazed,” he enthuses.

“That was my lightbulb moment. Sabi ko, ‘What kind of animal is e-commerce that all of my stock for Christmas is gone already [and] I [now] have to restock?'”

Following a very successful sale, Sy wanted to reap the benefits of e-commerce, but this was a decision that was backed by weighing the risks first. “’Okay, I want to learn how to do e-commerce and this e-commerce will be the future.’ That was my mindset. That was my goal during that time. I explicitly remember there was a conscious decision [behind this]. When Alibaba bought Lazada in 2016, I knew that mababayaran na ako ni Jack Ma.”

“Lazada was just a startup during that time. You can’t put all your eggs in one basket, right? But when Alibaba bought it, sabi ko, ‘Okay, I can go full blast. 100%,'” he reveals. “I closed all of my offline stores and concentrated online because I said I have limited resources.”

Great Deals: A One-stop-shop for All Things E-commerce

Great Deals E-commerce first started out in 2014 but during this tumultuous time, Sy didn’t have a lot of capital to work with. Thus, he had to be smart with his finances. “For the first four years, it was bootstrap,” he explains. “Bootstrap means you don’t get external funding. You don’t get an investor. You try to grow your business through the cash flow, through your profit, through your earnings. You bring it [in and] pour it back into the business.”

This business model has served him well and years after, Great Deals has grown into so much more. From being an e-commerce seller, Sy now adds e-commerce enabler to his skillset, as he is the one working behind the scenes—helping brands establish their market presence and grow their sales online. What’s more, Great Deals E-commerce is one of the fastest-growing startup companies in the Philippines with around PHP1.65 billion of equity funding as of 2021.

“We’re an e-distributor, so we distribute products online,” he explains. “We’re [also] an e-retailer. We manage the online shops. So when you manage an online shop, number one, what do you need? You need digital content. So we create this content whether it’s photos, videos, livestreams… we’re the ones doing it for the brands.”

“Number two is we do take care of the online shop itself,” he adds. “From store management [to] the campaigns, the fulfillment, the warehousing, the customer service… all of it. When people ask Lazada, it’s us answering.”

And this all comes with data and analytics. “We do have those analytic dashboards so that we can make decisions and help grow our brand partners in their online space,” he explains. “We are the ones taking care of all of these things. [But] the two things we don’t take care of are the platform and the last-mile delivery. So we partnered with different last-mile delivery [providers]. Everything in between, we’re the ones taking care of.”

This makes Great Deals the kicking-off point for many businesses that want to sell online, or in his words, “end-to-end enablement”. The entrepreneur says, “Great Deals is gonna be the best partner for them to grow their business online. And we have proven time and time again with all of the brands that we’re handling, with the growth of the industry, and [how] we’re growing much faster than the industry itself.”

On Overcoming Adversity and Powering Through it All

From losing a lot of money, dabbling into different business ventures, and being in debt for 12 years, Sy’s storied history is proof that not all business stories are seen with rose-colored glasses. A lot of these stories are paved with hardship, stress, sadness, and frustration. But the main factor that helped him overcome these? Resilience and a strong support system.

“I really had a very supportive wife. Di ako iniwanan ng misis ko. Siyempre pagbaon ka sa utang, you know, all of the lifestyle, it changes. So, really thankful for that,” he says, adding that despite the lifestyle changes and hardships, his wife stayed with him through it all.

“I [also] have very good friends and churchmates that have been so supportive emotionally [and] mentally, that [I was] able to move on. The Bible has helped me a lot also in terms of having the hope that one day, alam ko, mababalik ‘to ng Panginoon [the Lord will return the favor] and [I’ll] even have much, much more.”

Alluding back to his difficulties in securing capital, he says, “I was in debt so when I was doing my business, I was coming from a negative start. A negative financial start. [But remember that] there will be people that will lend you money, even [a] small amount.”

“The important thing is you’re able to be a good steward of it so that you can make it grow. Multiply it,” he continues. “Di ba sabi nga sa parable of the talents, [if] you’re given three gold coins, multiply it. So this is the same principle. Whatever is given in my hand, I try to be a good steward and multiply it [by] doing business.”

To date, Sy no longer has financial worries, as Great Deals has been growing in leaps and bounds. “Sometimes when I sign POs [purchase orders of] 30 million pesos, sabi ko, grabe, ‘before, I didn’t know how to pay off my debt of 32 million.’ Ngayon, isang cheke na lang sinasign. How God has been good,” he praises.

Opportunities in the E-commerce Industry

While the e-commerce of the early years has changed significantly compared to the e-commerce of today, Sy believes that there are many more opportunities and areas to explore in this unicorn industry. “Right now, it’s still less than 3% of total retail sales. So, in terms of market, we haven’t tapped the full consumer behavior ng Pinoy in that space,” he explains.

“I always say up to now, up to today, e-commerce is still a sunrise industry. When I say sunrise, [it’s] because [in] the whole total retail sales of the Philippines, only less than 3% are in the e-commerce space. Compared to China’s 40%, we can still grow 10 times more, and [even so] we’re still way, way smaller,” he continues

“In terms of opportunity, yes, there are now more sellers, but there are [also] more buyers or digital consumers that are coming in. And they need to be satisfied with their needs. That’s the opportunity [we want to take].”

With that in mind, Sy tells aspiring businessmen and entrepreneurs to study, explore, and learn as much as they can about the industry. “The more you learn about e-commerce, the better your business will be. I’ve seen a lot of newfound millionaires because of this industry, [myself included]. Kasama na ako doon. This industry has helped me change for my family, my employees, my company, and [that is the] impact of what this industry can do.”

For Sy, on a macro scale, the e-commerce boom will likewise pave the way for many more opportunities for the country and its businesses. “In terms of digitalization, we still have ways to go in digitalizing the Philippines. All industries can be digitalized. So if your industry is not yet digital, you have the opportunity to digitalize your industry.”

When asked about future plans for Great Deals, the entrepreneur has big plans in store. “In terms of work for Great Deals, I’m already up to this,” he laughs, gesturing up to his neck. “We have so many ambitions for our company, but I’d just like to reiterate it’s more of ‘there’s something that can be digitalized.’ That is, for me, a criterion in going into that business.”

Steve Sy on Having an Entrepreneurial Mindset

But for a seasoned entrepreneur such as himself, we ask: what makes a good entrepreneur? “I think there’s no right and wrong answer. You know, what’s important is where you’re at peace,” is all he says.

“For me, I know, myself—that I want to be my own boss. I think I cannot have a boss. I think yun yung personality ko. I always want to be in the driver’s seat, taking control of things,” he says confidently. “That was my journey, and each of us will have our own journey. So it’s important for us [to know] whether you want to have a good boss first so that you learn the ropes or you want to, you know, be an entrepreneur at the onset. You know, kanya-kanyang journey, kanya-kanyang path that you can take.”

And while being a businessman and entrepreneur came second nature to Sy, he believes that everyone can be an entrepreneur. “It can be learned. I think it’s more of the influence. For us, at a very young age, we were influenced already, seeing our parents doing business in Divisoria, you know, doing their trade.”

“I think the important thing, as I’ve been sharing, [is that] a lot of us go through desert experiences—hardships that help us become better people [by] producing enduring characters. Those are the things that help me in terms of building Great Deals,” he adds.

As for choosing an industry to do business in, Sy goes back to the Filipino people. “We have a mission to uplift Filipino lives through the digital economy, so it needs to be something digital. If it will disrupt an industry or enable an industry to become digital, that’s where I invest because that’s the way of the future.”