A new report from Gobi-Core Philippine Fund, the Philippine-focused venture capital fund of Gobi Partners, has revealed that 2024 marked a turning point for the Philippines, with the ecosystem rebounding after volatile funding rounds in 2023.
The report found that the total funding amount for 2024 reached over $1 billion, almost 4 times larger than last year. Total deal volumes grew nearly four times compared to 2023, despite deal count increasing by only around 14%.
The growth was largely driven by a shift towards larger, growth-stage funding rounds mostly in FinTech compared to the previous year which saw mostly bridge rounds focused on survival, the report said.
In addition to this shift in funding focus, the study said 2024 also saw a rise in debt financing, signaling that startups in the Philippines are increasingly stable and capable of taking on loans — a departure from the earlier reliance on equity rounds that are common in early-stage companies.
However, the increase in debt financing also suggests ongoing challenges in securing equity funding, as the broader market conditions continue to affect access to venture capital.
The transition from bridge financing to growth-stage capital further highlights the maturation of the Philippine startup ecosystem, with startups scaling operations and preparing for regional expansion, the report noted.
As the Philippines navigates its path forward, the report underscored the urgency of closing the gap with regional peers like Vietnam and Thailand, where sectors such as AI, semiconductors, and digital infrastructure are flourishing.
From Singapore’s deep-tech dominance to Malaysia’s rise as a semiconductor hub, neighboring ASEAN countries are carving out distinctive industry niches.
The report highlighted specific areas where the Philippines can lead, including AI integration and talent pipeline development, positioning the country to stay competitive within the evolving ASEAN landscape.
“This report is more than an analysis; it’s a roadmap for action. We envision technology as a nation-building tool, with the Philippines embracing innovation not just to catch up but to leap ahead. Our insights provide stakeholders a clear path to make the Philippines a true startup hub,” said Carlo Chen-Delantar, partner of Gobi-Core Philippine Fund.
With a young tech startup ecosystem, the venture capital firm Philippines offers significant growth potential, characterized by low competition and ample opportunities for new players to emerge as industry leaders.
The nation’s rising middle class, expansive BPO sector, and significant Overseas Filipino Worker (OFW) population create a skilled and cost-effective workforce, making it easier for startups to scale quickly, the report added.
Google’s e-Conomy SEA 2024 report found that the Philippines’ digital economy has been continuously rising, with a 20% increase in gross merchandise value this year.
“These position the nation well for a tech-driven future, if the ecosystem receives the strategic support it needs,” the company said.
In conclusion, the report calls for comprehensive policy support, including startup visas, tax incentives, and simplified regulatory processes, to create a truly inclusive ecosystem.
