If you are planning to launch a startup soon, you should probably read this.
The trend of startups in the Philippines is at its peak and it’s an intense battle among newly-established businesses as to who has the most unique and original ideas, and who are those that are potentially profitable.
However, not many startup owners feel the love and support from their own country, and that is why they prefer to tap into foreign markets in order to get sponsors, solicitors, and investors.
Aside from the fact that startup companies don’t get a lot of support from the government and Filipino investors, technology in the country is also not as advanced as those abroad.
That makes it all the more difficult to assure the success of a startup, no matter how huge the potential of it being a billion-dollar corporation is.
To understand more about this growing trend, let’s start by talking about what startup companies are.
So, What Are Startups?
Startups are not the typical brick-and-mortar businesses.
Startups usually take advantage of the technologies we have today in order to create business models that are unique and original.
In the Philippines, there are more than 300 startups from 2012 up to to now, and these companies are not limited to mobile applications.
There are so many startups that are centered on electricity, finance, biotechnology, and so much more.
Image Credit: Tekes
The Nitty Gritty Of The Startup Trend
Capital is a huge challenge for people who decide to leave their jobs and start a business.
There are a lot of ways to raise capital.
One is investors, another is venture capital funds, third is through joining startup competitions, which will extend monetary help and other forms of assistance to you and your startup, and equity-free funding.
However, not all of these are easily found in the Philippines.
According to Inquirer.net, a 2017 Philippine Startup Survey of 106 startup founders, done by PwC Philippines found that 61 per cent of the current startup companies in the Philippines want to “enter new territories” outside of the country because they believe it would make their company grow “in the next three to five years”.
Some of the foreign markets that Filipinos have been tapping on are Indonesia, Malaysia, Thailand, and Vietnam.
According to PwC Philippines Chairman and Senior Partner Alexander Cabrera, startup owners admitted to exploring outside the country for support, but they will not abandon the Philippine market.
Many of these startup owners believe that the Philippine market is not yet ready for the products and services they are offering so they would invest somewhere else and wait till the time is ripe for the country.
Startup owners are “obsessed with the potential of their products” going not only regional, but also global.
To further explain this, Jose Roberto “Robbie” Antonio, the founder of the real estate startup, Revolution Precrafted, the first Unicorn in the Philippines (Unicorns are startups given a valuation of at least $1 billion), said that lack of funding is the biggest reason why there are not a lot of Unicorns in Southeast Asia.
Most of the Unicorn startups are found in Europe and the United States.
Antonio was at the recently-held Association of Southeast Asian Nations (ASEAN) Business and Investment Summit and he noted that only 9 out of the 1,000 Unicorns in the world are located in Southeast Asia, and it is not because the region has fewer brilliant people – it is because startups in Asia have more difficulties accessing funds.
Antonio himself had to go abroad to talk to institutional investors because access to funding in the Philippines is not as easy as it is in the United States or other foreign countries.
He then urged Philippine startup founders to go abroad and look for more funding options in order for their companies to make it big in the market.
He also noted that it is not necessary for startup founders to head to the U.S. or Europe because neighboring countries can help founders in terms of funding.
Antonio has mentioned Indonesia and Malaysia, which have more early-stage venture capitals than the Philippines.
Some Tips For Getting Funding
And to help you make that pitch for your startup, here’s a list of what investors usually look for before you win them over:
- The founder must be very confident about how big his or her business could get.
- The founder must also be knowledgeable about all the aspects of the business.
- The business itself. Investors will, of course, look at how profitable it could get and what are the possibilities of it expanding.
- The business should be marketable and should most likely catch the attention of consumers.
- Lastly, the timing. Now, timing is everything. You have to keep up with the changing times and offer products and services that people need now and in the future.
Know your market, keep your startup unique, and keep trying.
Quitting should never be an option.
Featured Image Credit: www.investollo.com