The Philippines’ strong economy plus the growing support from tech incubators in the country are good signs for budding domestic startups, according to according to senior executives from Philippine telco Smart Communications and its tech incubator firm Ideaspace Foundation.
Smart co-founder and chief wireless advisor Orlando B.Vea notes that the Philippines posted over 7 percent growth rates in recent quarters, and that the economic climate and large Filipino market present an opportunity “to create and foster the growth of more world-class tech companies.”
Meanwhile, incubators like Ideaspace have helped new startups by organizing competitions and mentoring selected startups. Globe Telecom‘s Kickstart and LaunchGarage have also lent a hand in contributing to the startup space.
With that said, can we now say the Philippines’ startup ecosystem is no longer in its nascency?
Before we dive in to this question, let’s first ask: what are the characteristics of a startup ecosystem that’s in its ‘early stages?’
The World Startup Report takes six factors into consideration when analyzing the development of a startup ecosystem: entrepreneurial culture, people (the pool of skilled and talented labor force), market (the consumers that the startups can tap), capital (availability of investors and its willingness to invest) , infrastructure (access to electricity and internet and the cost it takes to access) and regulations (policies in place to protect both consumers and startups). A fully-blossomed startup ecosystem must have high rankings in all of these categories.
In the report, the US earned the highest rankings for market, capital and culture (four on a scale of one to four). People and infrastructure ranged between three to four. So this might represent the ideal of a developed startup ecosystem.
The Philippines: the two sides of the coin
Meanwhile, a nascent startup country is one that needs to develop many or all of these factors.
According to the World Startup Ranking, The Philippines still faces challenges that need to be addressed: lack of funding, skilled individuals moving out of the Philippines, poor infrastructure, and more.
But despite these challenges, the same report emphasized the potential that lies in the Philippine startup scene such as a huge local market, low competition, e-commerce growth.
Ideaspace president Earl Martin Valencia says tech companies can significantly boost the country’s economy and it’s time for startups to reach their potential. “Someone can now support your startup from the idea stage to the expansion stage. [...] We have to sustain our momentum.” Valencia says.
The bright side: startup activities here and there
Vea says the Philippines has seen “a spike of energy” in the developer and startup communities in the past two years. He adds:
We are seeing more activity among incubators, accelerators, angels, superangels, and VCs than ever before. There’s a startup conference or even a developer event or a hackathon almost every weekend.
Likewise, the recent Geeks on a Beach held in Boracay was one of the bigger – if not the biggest – startup events to come to the Philippines. According to Smart, over 300 participants attended the event, ranging from developers, technopreneurs, and investors.
So, while the Philippines’ startup arena still lags behind those in its developed neighboring countries, a strong talent pool resides here. Recent years have also proved how startups are really starting to grow in the Philippines. People are already recognizing the potential of the country, and this may be good enough for us to say that the Philippines, too, can become a developed startup ecosystem.
Maybe instead of asking, “Is the startup scene in the Philippines still in its nascency,” we should ask instead, “how soon will it take the startup scene in the Philippines to develop?”
(Editing by Paul Bischoff and Josh Horwitz )