After years of working in corporate and investment banking, Edmund Solilapsi knew how capital flowed—or didn’t—for small businesses. He had structured complex credit facilities, analyzed mid-market portfolios, and managed institutional risk. But the one thing he kept seeing? Small and medium enterprises (SMEs) with real growth potential—but no access to the right kind of financing.
“The system wasn’t built for them,” Solilapsi tells Financial Adviser PH. “The tools were either too rigid or too extractive. We needed something more nuanced—something that fit the realities of SMEs while still being scalable.”
That realization led him to co-found ARQ Capital, a financing platform that has become a game-changer for underserved SMEs in the Philippines.
From Finance Expert to Problem Solver
Before launching ARQ SME Business Development Company, Solilapsi had spent most of his career in structured finance and private equity. He saw firsthand how the risk frameworks of traditional institutions excluded even the most promising SMEs.
His big insight? The problem wasn’t a lack of viable businesses—it was a mismatch between available capital and how SMEs actually operate.
“I didn’t set out to build this company,” he admits. “But repeated exposure to SME financing challenges made the opportunity impossible to ignore.”
Building from the Ground Up
Rather than diving headfirst with a fully formed product, Solilapsi and his team took a methodical approach to launching ARQ.
“We began by validating the concept—speaking to SME owners, running pilot deals, and testing repayment structures,” he explains.
That hands-on, iterative approach allowed them to refine their model before scaling. They invested personal funds into setting up lean operations and only raised outside capital after proving the model worked.
This phase also helped ARQ identify which types of SMEs were truly ready for structured financing—and which ones weren’t.
Designing a Scalable Financial Model
Unlike traditional banks that demand collateral, or equity investors who want control, ARQ offers a middle ground: structured, flexible capital tailored to an SME’s growth stage and cash flow cycle.
To scale this model, the team focused on:
Systematized underwriting
Portfolio performance tracking
Investor alignment with impact-focused goals
They also invested in a custom risk tracking platform to monitor performance across clients and optimize repayment structures.
“Once we saw consistent deal flow and solid repayment performance, it became clear this could be both sustainable and scalable,” says Solilapsi.
From Financier to Growth Partner
Today, ARQ Capital is more than just a funding source—it’s a strategic growth partner. The firm supports SMEs not only with capital, but also with governance improvement, business planning, and even M&A readiness.
For Solilapsi, that shift has been deeply fulfilling.
“Traditional finance roles are often transactional. Here, we’re building long-term value with our clients,” he shares. “It’s far more complex—but also far more rewarding.”
