Co-founder at Brainsparks Incubator
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Disclaimer: all content within the Startup Ecosystem Summary and Editor’s Guide sections is written by and reflects the personal perspective of the guest editor. The guest editor is not responsible for content within the Country Snapshot and Community sections, as much of this content is compiled from external sources and does not necessarily reflect the guest editor’s view.
The startup ecosystem of the Philippines is still in the nascent stage but is rapidly evolving. The ecosystem started becoming active around 2010 with more founders getting involved in the tech community and starting companies around this time. In 2012, the ecosystem started booming when the two major telecom companies started their incubator/VC arms. Globe Telecom of the Ayala group started Kickstart Ventures, and SMART Communications of the MVP Group started Ideaspace. Both were established to support early-stage tech startups in the Philippines, and have sparked growth in the ecosystem.
One of the factors that hindered growth in the past was government regulation. Previously it was very hard for foreign investors to own and invest in locally registered startups due to very old foreign ownership laws. There were also no tax incentives or benefits for startups, nor were there any grant or funding programs directly for startups in the Philippines. Fortunately, Republic Act No. 11337 or the “Innovative Startup Act” was signed into law on April 26, 2019, addressing many of these barriers for the ecosystem to push forward: quick and subsidized company registration, office space, grants and a dedicated government venture fund, startup visa programs, and more.
There’s recently been a strong movement of early-stage startups pushing into Series A (Qwikwire, Edukasyon) and Series B (Storm Technologies) stages, which has encouraged a lot more foreign interest in investing into the ecosystem. Several venture capital firms from the region and from the US and Europe are starting to take the Philippines’ startup ecosystem seriously for deal-flow. Venture firms like Golden Gate Ventures, Spiral Ventures, OpenSpace Ventures, Sequoia Capital and other firms have been taking a closer look at PH startups for deal-flow.
Additionally, in the past 4-5 years, various government agencies have been slowly becoming more active in the startup space. Spearheaded by 3 government agencies, the Department of Trade and Industry (DTI), the Department of Science and Technology (DOST), and the Department of Information and Communications Technology (DICT), the Philippine government has been making changes and running programs to support the startup ecosystem. This has been a continuous process even as President Duterte has taken office. He has signed into law Republic Act No. 11337, or the Innovative Startup Act, which will push these efforts even more.
All signs show good potential for the year 2020 onwards as the Philippines is steadily catching up with its neighbors in Asia. With the three items in place: 1. Innovative Startup Act put into law, 2. New interest of VCs from the region and outside, and 3. More local startups that are moving forward towards Series A/B, the near future looks good for the ecosystem. Things are starting to take off.
Editor’s choice of the industries with the most potential for technology disruption and growth.
Editor’s choice of the country’s top 10 emerging tech startups.
Editor’s pick of which ‘Featured Startup’ is especially worth following and why.
Editor’s perspective of the maturity level of talent in the ecosystem.
Editor’s commentary on how the country’s culture and history have impacted the ecosystem.
The Philippines has one of the most “Westernized” cultures in the region. The strong influence of Spain and the United States can be seen as the Philippines was colonized by both countries for many years. This is also one of the reasons why there are many similar words in Filipino and Spanish, and why even if there are around 170+ dialects in the country, almost everyone in the Philippines can speak English in some capacity.
Due to our history and strong influence from the USA, the startup ecosystem in the Philippines is quite enamored by stories of Silicon Valley and tries to embody the same mechanics and pricing. That’s recently changed as the valuations and costing have corrected to reflect the local economics. Our stages of investing might be the same, but the amounts are much lower even compared to our neighbors in Southeast Asia, such as Singapore, Malaysia, and Indonesia.
Because of our past, the Philippines has also always been friendly to foreigners, and this is no different when it comes to foreign founders or startups. We have several foreign startups that have their operations in the Philippines because of the low cost of labor and great English communication skills. There are also a lot of foreign founders who have started successful local startups that serve the local market, such as Coins.PH headed by Ron Hose, Edukasyon.ph, founded and run by Henry Motte-Munoz, and many others.
Interested in becoming more involved in this ecosystem and connecting with local ecosystem leaders? Let us know.
First Asia Venture Capital (Makati City): Family office VC investing in seed to Series A tech startups. Industry agnostic, but interested in Edtech, IoT, and Fintech. (Source: First Asia Venture Capital)
Future Now Ventures (Metro Manila): A VC firm with a presence in Manila, U.S., and Australia. Its technical strong suits are based around cloud - SaaS, PaaS, IaaS, mobile, social media and eCommerce. More often than not the firm is involved with ventures that are a hybrid of any number of these, or that could be in the future. (Source: Future Now Ventures)
Gideon Venture Capital (Taguig City): A firm based in the Philippines. It typically looks to lead investments in a company's Seed or Series A, with co-investments in a company's later rounds. (Source: Gideon Venture Capital)
Gobi Core Philippine Fund (Metro Manila): A joint venture between Core Capital and Gobi Partners launched in October 2018. The Fund offers Philippine startups region-wide expertise and a network that will help them expand to other Asian markets. (Source: Gobi Core)
Golden Gate Ventures Philippines (Singapore): An early-stage venture capital firm investing across Southeast Asia. Since 2011, the firm has invested in over 30 companies across more than 7 countries in Asia. The firm invests in internet & mobile startups across many sectors, including e-commerce, payments, marketplaces, mobile applications, and SaaS platforms. (Source: Golden Gate Ventures)
Kickstart Ventures (Makati City): A corporate venture capital firm spun out of Globe Telecom betting on visionary founders in the early-to-growth stages of company formation and expansion. (Source: Kickstart Ventures)
Manila Angels Investor Network (MAIN) (Makati City): Largest and most active Angel Investor Club in the Philippines. (Source: MAIN)
Narra Venture Capital (Metro Manila): In the Philippines and around the Asian continent, Narra seeks companies that take advantage of the synergy with advanced technology companies. These companies are in software services, electronic manufacturing services, design services, and information systems that are more customized for developing regions. (Source: Narra Venture Capital)
OpenSpace Ventures (Singapore): Openspace Ventures makes investments in early-stage technology companies based in Southeast Asia. The firm has more than US$225 million assets under management. (Source: OpenSpace Ventures)
Spiral Ventures Asia (Singapore): A firm focusing on early and growth stage investments across Southeast Asia, including several portfolio companies based in the Philippines. (Source: Spiral Ventures Asia)
AIM-Dado Banatao Incubator (Makati City): The incubator is headquartered within the AIM building in Legazpi Village, Makati City and is open to non-AIM students and graduates. It supports early-stage startups and focuses on communications, agriculture, health, AI (artificial intelligence), IoT (Internet of Things), among others. (Source: Fintechnews.sg)
Brainsparks (Makati City): Founded in 2014, Brainsparks is the first and only founder-focused incubator in the Philippines that “turns dreamers into founders.” Their flagship programs are IGNITE, the largest international innovation conference in the Philippines, and Brainsparks 20, their incubation program that does things differently: 1. No Cohorts, open incubation, 2. No equity requirement up front, and 3. No cash investment up front, but assists in expenses for the startups. Also invests in pre-seed and seed stage startups. (Source: Brainsparks)
Cerebro Labs (Makati City): A tech business incubator and accelerator for pre-seed and early stage startups across all verticals. Selected startups undergo rigorous training and mentoring sessions to help them launch their products or services. The headquarters in Makati City also serves as a fully-equipped and convenient coworking space. (Source: Fintechnews.sg)
Impact Hub Manila (Taguig City): An incubator and coworking network that offers different programs for both local and global opportunities. Its program, KICK, is an intense, 6-8 week incubation program designed to scale and grow business ideas into sustainable ventures. (Source: Fintechnews.sg)
Launchgarage (Quezon City): Started as a startup acceleration program in 2012 launched by Philippine-based venture capital firm Kickstart Ventures and local applications engineering firm Proudcloud. The company now provides a venue for open collaboration, knowledge sharing, events, and acceleration at its coworking space facility in Quezon City. Launchgarage targets fintech, agritech, and aquatech startups, and BPO enterprise software applications. (Source: Fintechnews.sg)
QBO Innovation Hub (Makati City): Touted as the first public-private partnership (PPP) designed to develop, grow, and scale a competitive startup ecosystem in the Philippines. It provides business incubation from ideation to exit. QBO was launched in August 2016 by its founding partners Department of Trade and Industry (DTI) (through its Export Marketing Bureau), IdeaSpace Foundation, the Department of Science and Technology (DOST), and J.P. Morgan. Its programs include incubation, consultation, investors pitch, specialized workshop, coworking space, among others. (Source: Fintechnews.sg)
SPrInG.PH (Taguig City): The “Software Products Incubation Group” of the Philippines Software Industry Association (PSIA), launched in 2011 to help the local software development industry create and commercialize at least 10 globally-recognized software products in various categories. Spring.ph now almost has 50 companies (representing PSIA member and non-member companies) and 24 product teams. Among Spring.ph’s activities are monthly coaching sessions and forums, quarterly workshops and launchpad events. (Source: Fintechnews.sg)
Startup Village (Makati City): An incubator-accelerator launched in February 2017 in Makati City by founder and entrepreneurship professor Jay Bernardo. It is a program of the LET’S GO Foundation (Leading Entrepreneurs Towards Sensing Global Opportunities), a non-profit, non-stock organization that Bernardo founded in 2001 in order to support small and medium scale entrepreneurs. Its program, called The Gift, is a 14-week, once a week training program, designed to bring the best out of a starting entrepreneur. (Source: Fintechnews.sg)
UPSCALE Innovation Hub (Quezon City): An innovation hub at the University of the Philippines (UP) launched in January 2017 by the Department of Science and Technology (DOST) through the Philippine Council for Industry, Energy, and Emerging Technology Research and Development or DOST-PCIEERD. The hub features two programs: the Industry-Government Network for Innovation and Technology Entrepreneurship (UP Ignite), and the DOST-UP Enterprise Center for Technopreneurship. The Technology Business Incubator (TBI) is one of the programs of the DOST-PCIEERD that aims to assist startup technology-based businesses at the development stage. (Source: Fintechnews.sg)
xchange (Pasig City): An incubator for early-stage social enterprises in the Philippines. It invests in organizations – both for-profit and non-profit – whose core mission is the creation of value for marginalized communities in the Philippines. Beyond capital, xchange seeks to contribute its expertise in enterprise management and finance, built over decades of firsthand experience. Some of xchange’s portfolio of startups include Kickstart Ventures-backed Bagosphere, and 500 Startups-funded mobile phone engagement platform engageSPARK. (Source: Fintechnews.sg)
IdeaSpace (Makati City): Founded in 2012, IdeaSpace claims it has already enabled 74 tech startups and close to 500 startup founders. Its startups benefit from funding, education, market runway, and expert mentoring. The incubation program is kicked-off with a 5-Day Bootcamp followed by a 6-week Remote Incubation Phase. The Acceleration Phase runs for 4.5 months. Pitch days are open to partners, investors, and the community. (Source: Fintechnews.sg)
Acceler8 (Makati City): Acceler8 by UnionSPACE is a hybrid instant office and coworking space with centers currently in Salcedo Village and Legaspi Village in Makati City. (Source: Acceler8)
UPSCALE Innovation Hub (Quezon City): An innovation hub at the University of the Philippines (UP) in Diliman, Quezon City launched in January 2017 by the Department of Science and Technology (DOST). (Source: UPSCALE)
Technology Business Incubator Summit (Metro Manila): Aims to showcase the government's support for startups through its firm plans and programs, foster communication between startups and public/private agencies, as well as share the best practices from other ASEAN countries related to business incubation and supporting startup communities. (Source: DOST)
Go Lokal Program: A retail concept store showcasing quality and innovative Philippine products crafted, designed, and produced by the country's micro, small, and medium enterprises (MSMEs). It serves as a marketing platform for our MSMEs to gain access to the lucrative local consumer market, and ultimately, to the global export market. (Source: Go Lokal Program)
Kapatid Mentor Me Program: The Mentor ME (micro entrepreneurs) program is a coaching and mentoring program where large corporations teach small businesses about different aspects of business operations. (Source: Kapatid Mentor Me Program)
P3 Program: A government initiative to help the smallest entrepreneurs around the country by providing cheap loans with only 2.5% interest every month. The program will provide alternative capital sources quickly and easily for them to grow and grow their business. The program also aims to combat the 5-6 lending schemes typically run by small business owners. (Source: P3)
Shared Service Facilities: Aims to improve the competitiveness of small businesses by providing them with machinery, equipment, tools, systems, skills and knowledge under a shared system. (Source: Shared Service Facilities)
Slingshot Philippines: The first government-initiated platform in the Philippines that gathered industry stakeholders from both government and the private sector during the Philippines hosting of the Asia-Pacific Economic Community (APEC) Summit in 2015. It inspired and energized support for the growing startup community in the Philippines as well as brought stories straight from innovation hubs, experts, and game-changers in the Asia Pacific Rim. (Source: Slingshot Philippines)
SME Roving Academy: A continuous learning program for the development of micro, small and medium enterprises (MSMEs) to become competitive in the domestic and international markets. (Source: SME Roving Academy)
StartupIsland.PH: A program initiated by the Department of Trade and Industry 7 with the local community, to encourage, equip, connect and support startups within the region through mixers, mentoring & matching. (Source: StartupIsland.PH)
Go Negosyo: Go Negosyo hopes to demystify entrepreneurial success and popularize entrepreneurship as an alternative to unemployment, job-seeking or migration. (Source: Go Negosyo)
MSU-IIT (Iligan City): MSU-IIT is known for its excellence in science and technology and its passion for extensive research and community involvement. (Source: MSU-IIT)