LEVERAGING on the Philippine startup ecosystem, Geeks On A Beach (GOAB) 2023 seeks to add more deals in an effort to reach another $1 billion in investments.
In 2021 and 2022, Tina Amper of GeeksPH said the startups in the country received more than $1 billion in total funding deals for each year.
This was 27 times higher than the $40 million collected in 2010.
A new closed funding deal was the goal of the revival of GOAB 2023 after a five-year hiatus.
The two-day international conference is ongoing at the Bellevue Bohol Pavilion in Panglao Island, Bohol on Nov. 23-24.
GOAB 2023 gathered around 500 participants composed of startup founders, entrepreneurs, software engineers, technologists, venture capitalists, corporates, government representatives and other stakeholders.
Deals are venture capital transactions where startup companies raise capital from external sources.
Amper said the success of startups translates to more entrepreneurs and more employment that will contribute to the country’s economic growth.
Outlook
During the GOAB 2023 morning’s plenary session, Franco Varona of Foxmont Capital said in the coming years, the Philippines has a positive outlook in terms of optimizing the entry of funding from various local and foreign investors.
His presentation, the PH Venture Capital Report 2023, showed that the Philippines has a high rate of digital penetration despite the rapidly increasing population, and this was evident in its abrupt growth during the Covid-19 pandemic.
Over the past two years, the country achieved a record amount of capital invested into Philippine startups, with the majority flowing into e-commerce and fintech companies the likes of GCash, Maya and Growsari.
“If you think about it, pre-pandemic you’re probably paying your bills over the counter with cash. That was only three and a half years ago. Today, how many of you do that? Probably only a small amount,” he said.
This year, $700 million in investment so far has been poured into the country’s startup industry, and Varona said the Philippines is close to hitting for the third time in a row the $1 billion investment mark.
In the latest Southeast Asia Economy Report 2023 of Google, Temasek, and Bain & Company, Varona said Indonesia had seen an 80 percent drop in funding for its startups from the second half of 2022 to the first half of 2023, while the Philippines saw only a 15 percent drop in its funding over the same period.
“If you really think about it, a larger amount of capital is coming to the Philippines versus Indonesia, which I think may be the very first time it’s happening,” Varona said.
Race
Among the emerging digital trends in the Philippines was the growth of digital finance services that addressed the lack of access and the high friction and cost of the country’s traditional finance services aspect, including the integration of digital banks, e-wallet, payment providers, online lending and B2B (business-to-business) providers.
In Southeast Asia, there is an ongoing race to become the top digital bank business model with the Philippines bannering six digibanks with potential such as the Overseas Filipino Bank, Tonik, Uno Bank, Maya Bank, UnionDigital Bank, and Gotyme Bank.
Unicorn
During the panel discussion with startup founders, Roland Ros, chief executive officer (CEO) and founder of Kumu; ER Rollan, CEO and founder of GrowSari; and Steve Sy, founder of Great Deals E-commerce, said the biggest challenge in the startup industry is understanding the whys and the type of mindset to have in starting a company and building a startup.
Ros said sacrificing everything for the motherland is worth it to grow into a unicorn and become a sustainable business.
A unicorn refers to a start-up valued at $1 billion or more.
“The next unicorns of startups will come from the Philippines,” Rollan said.
Sy said that for every challenge there is an opportunity. He cited e-commerce as fast paced, and said the challenge is to adapt to the growing e-commerce technology.
“As an entrepreneur, you don’t get much sleep, but getting up and thinking of upscaling, growing your revenue with minimal expenses. The key to startups is an efficient scale/upscaling for all founders,” he said.
GeeksPH, the organizers with the collaboration of the Department of Information and Communications Technology (DICT), said the GOAB event also capped the nationwide 2023 Philippine Startup Week celebration as it held activities that brought together the local startup community and highlighted the various sectors, entities and Filipino high-potential startups contributing to the growing Philippine startup ecosystem.
Over 1,000 startups
DICT Secretary Ivan John Uy formally opened GOAB 2023 on Thursday, Nov. 23.
Uy, in his speech, shared that the country’s startup community has grown to registering more than 1,100 startups, 60 incubators and accelerators, 50 venture capitalists, and more than 200 co-working spaces nationwide that enabled collaboration.
He noted the Philippines’ notable ranking as shown in the Global Startup Ecosystem Report: 25th globally and 10th in Asia in terms of talent affordability; 20th in Asia in terms of funding; and 30th in Asia for Bang-for-Buck, Talent and Experience, and Performance.
The value of the country’s startup ecosystem, as the Secretary reported, has jumped from $1.03 billion in the second half of 2018-2020 to $3.5 billion in the second half of 2020-2022.
“Our local startups have also grown in scale to cater to various sectors such as e-commerce, fintech, service platforms, health-tech and logistics, representing the diverse talents and innovative spirit of our nation’s technopreneurs,” Uy said.
He said the DICT will provide “the necessary support for our local startups to thrive.”
Uy added that the DICT has launched various programs aligned with Republic Act 11337 or the Innovative Startup Act of 2019, to accelerate the country’s digital transformation and nurture the growth of the country’s startup community.
One of these programs is the Digital Startup Development and Acceleration Program, a comprehensive program centered on mapping initiatives, awareness activities, acceleration projects, funding, and inter-agency collaborations geared toward providing startups with a competitive advantage on the global stage, Uy said.
GOAB 2023 explored startup innovations in FinTech, EduTech, HealthTech, AgriTech and ClimateTech.