Philippine startups raised over US$1 billion in investments in 2022 for the second consecutive year amidst a slowing economy, according to a report released by local VC firm Foxmont Capital. This marks a seven per cent rise over the total investments in 2021.
In comparison, worldwide VC investments shrunk by 37 per cent in 2022, with a 27 per cent decrease in Southeast Asia.
The under-US$5 million deals dominated in 2o22 in the Philippines. However, there had been tremendous growth in later-stage deals in the year, reflecting the overall maturing state of the startup ecosystem.
With 17 deals, Foxmont Capital was the most active VC fund in the Philippines last year.
In 2022, many regional funds also forayed into the Philippines, including Do Ventures, Reefknot Investments, Alpha JWC Ventures, East Ventures, TNB Aura, QUest Ventures, and January Capital.
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According to the Foxmont Capital research, 2023 also looks promising, with 17 investments already made into Philippine startups in Q1.
Since 2020, the Philippine share of venture capital amongst neighbouring countries has grown over 4x. Over the past two years, most investments were made into Filipino startups in e-commerce and fintech.
Other highlights of the Foxmont Capital report
- Digital finance is a rapidly growing opportunity owing to new regulations for digibanks and other non-banking financial players.
- Sari-sari stores are following patterns across the region and becoming gateways to the digital economy, becoming both a distribution channel for end-consumers and B2B customers
- The growth is exponential for homegrown direct-to-consumer brands that have worked towards omnichannel presence through the help of e-commerce platforms, social commerce and other e-commerce enablers.
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