CHIKKA: World's First Mobile Instant Messenger Developed by a Filipino Engineer

Chikka is a pioneer in wireless applications services development, the world’s first mobile instant messenger (IM) that runs on Short Message Service (SMS), having created in 2001 by Dennis Mendiola, a Filipino engineer-cum-businessman by profession. Filipinos love to talk, especially small talk. We even coined a term for it: “chikka”. We chat, we e-mail, and we send text messages. In fact, we send 150 million text messages every day. No wonder we are the SMS capital of the world. Mendiola knows this very well as the founder, former chief executive officer and currently chief imagination officer of Chikka Holdings Ltd., the company behind the success of Chikka. This company has since developed multi-platforms, including mobile-interactive TV, SMS-enabled auction sites, mobile matchmaking, and mobile versions of Internet Relay Chat (IRC). Chikka leads in bringing innovative mobile applications in the country. And more and more foreign carriers and mobile content providers are looking at the Philippines for consumer-friendly applications that they can adopt and deploy, making us probably the world’s most advanced texting nation. Management and Strategic Planning Expert Mendiola was only in his mid-thirties when he started Chikka. Certainly, his educational background and work experience are impressive. Mendiola graduated summa cum laude in B.S. Economics from the University of Pennsylvania (Wharton). He also completed B.S. Electrical Engineering (Moore) and MBA (Harvard Business School) where he graduated with honors. He began his career as a management consultant at McKinsey & Co. in New York. Then he went into investment banking at Bankers Trust in Singapore and Morgan Stanley in Hong Kong. At the time when the Philippines was touted as the next Asian tiger during the administration of President Fidel Ramos, Mendiola went home to try to make a difference, enlisting with Richard Gordon’s brigade of volunteers trying to revitalize the abandoned U.S. naval station in Subic. He was tapped to head corporate finance and strategic planning at the Subic Bay Metropolitan Authority. In 1996, he decided to set up his own venture capital company, becoming the managing director and founding partner of Next Century Partners, Ltd., a private equity fund manager that channels funds from investors like American billionaires Roger Sant and Edward Bass for investment in profitable enterprises in Asia.

Birth of Chikka Text Messenger In the late 1990s, Next Century Partners rode the internet wave and got involved in e-commerce in 2000, investing in Ajonet Holdings. But there was another trend developing, one that appeared to eclipse the Internet in the Philippines: “mobile technology.” Mendiola and his partners started talking about their idea of enabling messaging between online Filipino communities anywhere in the world using their mobile phones. It made a lot of sense as the number of mobile phone subscribers was outrunning the number of internet users in the country. But at the same time, overseas Filipinos – contract workers and immigrants in more advanced countries have greater access to the internet. There has to be a way to connect the wired and wireless. Quickly, Mendiola and his partners formed a new company that would build the backend and mobile interface that will allow Filipinos to use their SMS-enabled GSM phones to communicate with internet users. Code development began immediately the same year. The new company was called Chikka Holdings, Inc., named appropriately after the Filipino slang for small talk. The holding company was incorporated in the British Virgin Islands in 2000. It is 40 percent owned by the employees and 60 percent by institutions such as venture capital firms Sitestar Corp. of the U.S., Pacific Northstar, and Discovery Fund Venture Capital. Chikka Asia, Inc. was set up as the regional operating arm based in the Philippines. Soon, it developed the world’s first mobile IM, dubbed Chikka Text Messenger. The application unified the users GSM phone number and Internet IM account, allowing instant messaging via the cellphone. The idea caught on, and it also quickly became popular among overseas Filipinos, who were now able to send text messages from the internet to any Globe or Smart mobile phone. Chikka has since positioned itself as a Wireless Applications Service Provider (WASP). In just three quarters from its commercial launch, Chikka had already achieved cash flow and accounting breakeven levels, ahead of schedule. Today, Chikka has sustained profitability and is now expanding internationally. Chikka’s Affiliate Technology-Based Consumer Services

Meanwhile, Mendiola began investing in and launching other technology companies. He founded the Incredibly Fast Internet Company, a holding company for several internet-based businesses. In June 2000, eRegalo was formed to tap into the billion-dollar remittance and gift market by overseas Filipinos. Crushcow.com, on the other hand, introduced mobile matchmaking, which was previously limited to an internet application. Another company, Bidshot.com, lets mobile auctioneers bid on items via SMS and be alerted on the status of their bid, all done anonymously. It is the world’s first SMS-enabled auction site. It also pioneered SMS-interactive TV in the world, enabling any cable system operator to launch their own mobile interactive cable channels with the option to link or open their communities to each other. Mendiola subsequently launched other affiliates, including Sagent, a leader in “natural language,” or the SMS counterpart of “artificial intelligence.” It features a technology it calls M-brace, which is the usual 1-800 number, except the numeric digits are text or SMS short codes. The company is also behind Paysetter International, which pioneered the “virtual wallet,” sending and receiving actual cash via SMS with one’s GSM number linked to his bank account. Paysetter has partnered with Globe Telecom to give the country its first variable peer-to-peer (P2P) secure credit reloading system dubbed “Share-a-Load, now commonly referred to as “Pasa Load” or Pass-a-Load. Chikka to the World Chikka is primed for an international rollout. Its strategy for international expansion involves the licensing of its mobile instant messaging technology to carriers or content providers and partnerships with foreign companies licensing other mobile applications for Chikka. The company has already launched Lounge, a mobile version of IRC, with Chinese carrier Unicorn in China, plus selected countries in Southeast Asia, Europe and the U.S. It will launch its mobile instant messaging service in China, called Chikka China. And it is talking with local partners in India. In the U.S., it has partnered with Cingular and is testing its mobile instant messaging service with T-Mobile and AT&T. It licensed its mobile instant messaging technology to Thailand’s DTAC and Indonesia’s Indosat. It extended its SMS-based newsletter service to SingTel in Singapore and SmartTone in Hong Kong. Chikka may mean small talk, but for Mendiola, it’s big business.

Acknowledgement: NEGOSYO – Joey Concepcion’s Inspiring Entrepreneural Stories, ABS-CBN Publishing, Manila, Philippines

pinoy stories- blog #9