The Philippines has a relatively young but rapidly expanding start-up ecosystem. This can be seen in the improvement in its position in the Global Country Rankings, placing in the 52nd spot globally. With a favorable business environment and increasing digital adaption, the Philippine start-up scene was expected to sustain its growth potential.
Startup and investment landscape
The business environment in the Philippines had a reputation for having among the highest number of days required to start a business and the most steps needed for start-ups to register their business. Improvement was seen in recent years following the Startup Innovation Act in 2019, which provided incentives and a streamlined process for starting a business. This, alongside a thriving digital economy and a young median population, fueled strong interest among entrepreneurs to build new tech and tech-enabled enterprises. As of October 2021, there were 700 start-ups, from just 237 in 2017. Over a quarter of these were in digital services, although funding was highest in the fintech sector, followed by e-commerce, blockchain, and media and entertainment.
The potential of the Philippine start-up scene was evident in the increasing funds raised, further contributing to the start-up ecosystem's total value, estimated at two billion U.S. dollars in 2021. Most start-up deals were in the late-stage venture capital (VC) while four percent exited. As of 2020, there were 50 angel investors, 40 venture capitalists, 35 incubators and accelerators, and 200 coworking spaces in the Philippines.
Raising unicorns
As of 2022, the Philippines has produced three unicorns – or start-ups with a valuation of over a billion U.S. dollars. The first one was Revolution Precrafted, primarily engaged in pre-crafted properties such as homes and pavilions. The company earned its unicorn status in 2017 and had no succeeding funding rounds. The second unicorn was Mynt, earning its double unicorn status in November 2021, after raising funding of 475 million U.S. dollars. Owned by Globe Telecom, Mynt focuses on digital financial services with GCash as its main product. GCash was the leading mobile wallet app in the Philippines with over 60 million users. The country's most recent unicorn was Voyager Innovations - the owner of the mobile payment app Maya, which had 44 million users in 2021. The Philippines also boasts of potential unicorns such as GrowSari (a B2B platform for small stores), Kumu (an online entertainment app), Great Deals E-commerce, and PDAX (crypto trading). These companies have revenue-generating products and were all in their seed funding stage.
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