2018 seems to the perfect time to move to Manila for start-ups, entrepreneurs and startup job seekers. Here is a precise guide for those looking forward to moving to this startup ecosystem to translate their entrepreneurial dreams to reality. Manila is the capital of the Philippines and has been an innovation-friendly city from the beginning. The Philippines was ranked 57th in the world in the Global Competitiveness Report 2017-18, and its business environment is getting revived faster than ever with an increasing number of foreign startups and investors moving to Manila.
The Philippines has found itself as one of the top countries for being one of the fast-growing economies. The economy in Manila is growing at a rate of more than 6% as of 2017. Manila has more than 500 startups which are growing with the support of the local government agencies, a rich network of investors, and other ecosystem partners. The economy in Manila is characterized by its primary industries like retail, technology, tourism, and real estate which together with the other sectors contribute to its GDP of $108 billion.
Manila’s population of 13.5 million comprises of the locals as well as a growing proportion of foreign nationals are moving to Manila for getting their hands on some of the best business resources in the region. The city’s frameworks are developing continuously to become more adaptable to modern business needs.
What Sets Manila’s Startup Ecosystem Apart?
Manila has made it to the list of top startup ecosystems in the Global Startup Ecosystem Report 2018 and is getting international recognition for its entrepreneurial culture. According to the report, Manila’s ecosystem is valued at $120 million. The tech sector in this ecosystem is especially growing at an impressive rate. Moving to Manila can be more beneficial for tech-based startups as compared to those based in the other sectors.
70% of the jobs created in Manila are in the micro, small, and medium enterprises. This is one of the many reasons why the startup ecosystem in the city is vital to the regional and national economy.
Affordable Labor Costs in Manila
There is no doubt that cheap labor can help businesses lower operation costs to a large extent. Entrepreneurs looking forward to starting a business in a city with affordable labor do not even need to think twice before moving to Manila. The labor costs are the lowest in the region but at par with other regional ecosystems in areas of quality and hard work.
Manila has Minimal to Zero Language Barrier
A factor that keeps startups, entrepreneurs, and startup job seekers from moving into a new country is the language barrier. Manila does not pose this problem as most of its population is English speaking which makes it very easy for expats moving to Manila to adapt themselves to the place. The frequent use of English is a significant advantage that facilitates the smooth running of the business by international entrepreneurs.
Startups in Manila Love to Co-Work
The best way to beat the skyrocketing real estate prices and at the same time find brilliant networking opportunities is to share your workspace with other professionals. Just like most top ecosystems around the world, startups in Manila too have their own share of co-working spaces which are designed to ensure maximum productivity while at the same time creating an active community of entrepreneurs. ASPACE, Bullish, PenBrothers, and the Office Project are some of the forerunners in providing co-working offices in Manila. Startups in Manila jumping on the bandwagon of co-working offices get more than just a space to run their business. The co-working spaces offer everything from concierge services to phone and internet connections to even incubator and accelerator programs.
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A Government that is Welcoming to Investors
The absence of any particular policies or funding programs from the government may sound like a deal breaker for startups planning to move to Manila. However, the fact that the government encourages the movement of foreign investors makes up for it. The Special Investor’s Resident Visa has been rolled out to attract international investors. Investors entering the country with this visa can reside in the Philippines for an indefinite period as long as all the eligibility criteria are met.
Manila’s Growing Tech Prowess
The advancement in the tech sector has given rise to multiple startups belonging to different niches. The tech sector in Manila got its first unicorn company when Revolution Precrafted raised an undisclosed amount of more than $1 billion in its Series B round of funding. It is a real estate based startup has already created ripples with its plans of developing designer homes that are pre-fabricated. 400-450 technology-based startups are already present in Manila, and the numbers are increasing with the surge in international investments in the tech startup scene.
The sub-sector strengths of Manila in the tech niche include:
A Springing Fintech Sub-Sector for Startups & Entrepreneurs in Manila
The fintech segment in Manila may be still waddling in diapers, but it is touted to grow with the increasing awareness of banking among the people in Manila. The fact that only close to 30% of the residents of Manila have a bank account is a boon for the fintech startups in Manila. B2C startups dealing with services that are credit and investment based have a vast unexplored consumer base in the Philippino capital.
The fintech sub-sector witnessed total transactions valued at a $5.5 million in 2017 which is a clear indicator of how much more scope of growth there is.
An Established Enterprise Solutions Sector for Startups & Entrepreneurs in Manila
Enterprise solutions related startups make up for the maximum successful companies in Manila’s ecosystem. The sub-sector’s impressive exit deals and funding rounds that have attracted foreign investors are a testament to its growth. Since 2013, startups from the Philippines have been claimed winners of Seedstars World, the globally popular startup competition, twice with the startup Serve Happy Jobs representing the country this year. This competition is for startups in the emerging markets and offers attractive prizes of funding and other forms of support to winners. Qwikwire Billing stole the spotlight in the sub-sector with its announcement of expanding overseas owing to a recent undisclosed investment received. The billing and invoicing startup had already raised half a million through JFDI.Asia and 500 Startups before this announcement was made.
A Rapidly Growing AI & Machine Learning Sub-Sector for Startups & Entrepreneurs in Manila
The national government of the Philippines has taken a special interest in developing this sub-sector. The Philippine Development Plan 2017-2022 laid out in this direction seeks to increase collaborative research and development initiatives to ensure that the country’s technological readiness and frameworks are up to date. Manufacturing, agriculture, and health are three main areas that are prioritized in the emerging technologies’ module of the plan. As for artificial intelligence, the government plans to increase the efficiency of its manufacturing industries by introducing AI in some of its processes. AI and machine learning based applications are also growing in the private sectors primarily in the financial industry through banks and brokerage firms.
The ecosystem’s debut in the Global Startup Ecosystem Report 2018 can be attributed to the efforts of the various ecosystem partners like 1000 Angels, Department of Trade and Industry, QBO, and Brainsparks. The Department of Trade and Industry is a Startup Genome Member and offers support to the local startup ecosystem through its various services and the Startup Ecosystem Development Program.
Several elements of Manila’s startup ecosystem are still evolving with the help of private and government agencies. Moving to Manila is ideal for tech entrepreneurs who want to grow and learn in an entrepreneurial set up whose potential is still raw. The city’s offerings in terms of growth is exciting and something undoubtedly worth exploring by joining the community of startups in Manila.