Manila Named One of the 'World's Fastest-Growing Startup Ecosystems'
Manila’s startup ecosystem got a special citation in this year’s Global Startup Ecosystem Report (GSER) by Startup Genome. The city ranked 36th globally in GSER's inaugural ranking of the world’s top 100 emerging startup ecosystems.
“Manila brims with entrepreneurial potential,” writer Sofia Kousa says in the entry about the Philippines. “The capital of the Philippines—reputed to be the world’s densest city—is filled with talent and innovative minds. In the last decade or so, the government took initiative and started improving the state of the startup economy. They created a five-point plan to foster the ecosystem and encourage entrepreneurial success.”
The write-up goes on to mention government efforts to help the startup community, including the Youth Entrepreneurship Act, which promotes finance and startup skills; the Philippine Innovation Act; and Innovative Startup Act, which encourages an innovative entrepreneurial culture.”
Because of these collective efforts in helping to change the ecosystem, the expectation is that the Manila startup ecosystem will grow rapidly in size. That is why, in our 2019 Global Startup Ecosystem Report, we highlight Manila as one of the fastest-growing startup ecosystems worldwide.
The GSER 2020 puts the value of Manila’s startup ecosystem at $1.6 billion, with a total early stage funding of $102 million over the last two and a half years. It is among the startup ecosystems in its activation phase, together with Busan, South Korea, Calgary, Canada, Frankfurt, Germany, and Taipei, Taiwan.
Among Manila’s strengths as a top emerging ecosystem are its market reach (or the early-stage startup access to customers allowing them to scale and go global), as well as talent and experience (or the access to talent by early-stage startups). These place Manila among the top 20 ecosystems for Bang for Buck and among the top 30 ecosystems for Affordable Talent.
The GSER 2020 also identifies fintech and ecommerce as Manila’s ecosystem sub-sector strengths. Fintech companies account for almost 15 percent of Manila’s startups, with a transaction value reaching approximately $10 billion in 2019 and is expected to grow by 24 percent in 2020, while taking into account the expected impact of COVID-19.
The report highlighted some of the country’s notable fintech startups: First Circle, an online lending company that raised $28 million in 2018; Coins.ph, a mobile wallet used to access financial services, which was acquired for $72 million; and Voyager Innovation, which is involved in delivery of digital services and was acquired for $215 million.
On the other hand, the e-commerce industry is growing at a CAGR (Compound Annual Growth Rate) of 26.4 percent, which is one of the fastest rates in Southeast Asia.
The report also mentioned the steady rise of startup incubators in the country, including notable ones like IdeaSpace, which has received a total of 4,386 entries for its annual program entry; Impact Hub Manila, which offers programs for local and global growth opportunities and promotes sustainability; and BrainSpark, which helps startups connect with other players within the ecosystem emphasizing collaboration.
“The DTI is committed to sustaining the growth of our thriving startup ecosystem in Manila and the whole country during this pandemic and beyond,” said Department of Trade and Industry Secretary Ramon Lopez in a statement. “We continue to implement enabling policies and strategic support programs for enterprises, particularly as we aggressively promote the digitalization of business operations and the digital transformation of our MSMEs and large enterprises.”
Making it to the top of the GSER list are:
1| Silicon Valley (US),
2| (tied) New York City
2| (tied) London
6| (tied) Tel-Aviv/Jerusalem
6| (tied) Los Angeles
Meanwhile, here is the Top 10 ranking for Emerging Ecosystems (where Manila ranked 36th):
4| Greater Helsinki
6| (tied) Barcelona
6| (tied) Madrid
10| Research Triangle (US)
The GSER is the world’s most comprehensive and widely-read research on startups with 250 ecosystems studied. The GSER 2020 is published by Startup Genome – a world-leading policy advisory and research organization for governments and public-private partnerships committed to accelerating the success of their startup ecosystem – in cooperation with the Global Entrepreneurship Network (GEN). The DTI is a member of the GSER Global Network.