The Global Startup Ecosystem Report (GSER2019) ranked Manila’s startup ecosystem in high spots in five categories, according to innovation policy advisory services, research services and content provider Startup Genome.
Manila ranked 5th in the activation ecosystem for connectedness category, which measures the “sense of community” and help that startups receive from investors, experts and fellow founders.
The country’s capital was identified as one of the top Activation Phase Ecosystems globally, along with Taipei City, Busan, Calgary and Frankfurt. It ranked 10th in the global ecosystem for bang for buck category, which identifies companies who get more value for the average funding amount startups get in the ecosystem. It measures how many software engineers startups can hire in one year given the ecosystem’s average salary for startups.
The city also ranked 5th in the exit growth index which outlines the tech startups that sprouted from the ecosystem from 2015 to 2016 and 2017 to 2018, and 6th in the output growth index which assesses the ecosystem’s annualized growth rate from 2014 to 2018.
The capital ranked 9th in the funding growth index which captures the index of growth in early-stage funding in tech startups from 2014 to 2015 and 2016 to 2017. The indices were calculated on a scale of 1 as the lowest and 10 as the highest.
Meanwhile, the report stated that Manila’s software startup output stands between 400 to 600 from the global average of 1,010, with ecosystem value at $378 million from the global median of $5 billion.
The report highlighted financial technology (fintech) as Manila’s subsector strength, which it said comprises 15 percent of startups in the city. Fintech transaction value reached $5.7 billion in 2018, the report said, and is seen to hit $10.5 billion by 2022.
“In late 2018 and early 2019, we’ve seen how local and international investors have noticed the potential of Philippine startups and it’s caused an inflection point in terms of deals,” Adrià Villarroya Viñas, Program Lead for Startup Development at QBO Innovation Hub said in the report.
Citing investment benefits in the city, the report said that Manila has experienced tech talent built around the Philippines’ universities and strong English-language skills, which “gives founders an experienced set of employees to access.”
The report noted the growth of startups in the country. It mentioned financial technology lender First Circle which raised $26 million in 2018, as well as Indonesian ride-hailing company Go-Jek’s acquisition of Coins.ph this year for $72 million, and the $215 million fundraising for Voyager Innovations in 2018.
The report also noted the robust startup support in the country through the Youth Entrepreneurship Act which promotes finance and startup skills, and the Philippine Innovation Act and the Innovative Startup Act of the Philippines which encourages an innovative entrepreneurial culture.
GSER2019 is based on primary and secondary data from over 10,000 founders and more than a million companies across over 150 cities nationwide. The country’s Department of Trade and Industry is a member of Startup Genome.