Artificial Intelligence (AI) is transforming the business landscape in the Philippines, with many startups integrating this technology to drive innovation across various sectors. These companies leverage AI to solve complex challenges, enhance customer experiences, and improve operational efficiency, positioning the Philippines as an emerging hub for AI-driven solutions in Southeast Asia (SEA).

One notable example is Packworks, a Filipino B2B marketplace that has secured government backing to develop an AI-powered precision marketing model. This model is designed to offer sari-sari stores, small neighbourhood retail shops, customised recommendations and promotions from fast-moving consumer goods (FMCG) partners.

By utilising AI, Packworks aims to enhance the decision-making process for these small retailers, enabling them to offer more relevant products to their customers and optimise their inventory management. This initiative supports local businesses and strengthens the integration of AI in everyday commerce in the Philippines.

Another startup is Lhoopa, which leverages AI and data analytics to address the affordable housing crisis in emerging markets. With an impressive US$80 million in raised funds, Lhoopa has successfully sold over 2,500 affordable homes across 58 cities in the Philippines.

The company’s AI-driven approach helps streamline the housing development process, from site selection to pricing strategies, making affordable housing more accessible to low-income families. Lhoopa’s ambitious goal is to provide over 15,000 additional homes in the next three years, demonstrating AI’s significant impact on the region’s social and economic development.

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Beppo is another key player in the AI startup ecosystem in the Philippines. Recently, the company received pre-seed financing to acquire JuanTax and five bookkeeping firms. Through its AI-powered platform, Beppo focuses on automating accounting and tax compliance for Filipino businesses and self-employed individuals.

By simplifying complex financial processes, Beppo is helping small and medium-sized enterprises (SMEs) and freelancers in the Philippines to improve their financial management, reduce errors, and ensure timely compliance with tax regulations.

These startups exemplify the potential of AI to revolutionise industries in the Philippines, from retail and real estate to financial services. As more companies adopt AI technology, the Philippines is poised to become a key player in the global AI landscape, driving innovation and economic growth in the region.

The remaining challenges

While the prospect seems promising, what challenges do startups implementing AI in the Philippines face?

One significant obstacle is the lack of a robust infrastructure to support the development and deployment of AI technologies. Many AI applications require high-speed internet, advanced computing resources, and access to large datasets, which are still limited in many parts of the country. This infrastructure gap makes it difficult for startups to fully leverage AI’s potential, limiting their ability to innovate and scale solutions effectively.

Another challenge is the scarcity of skilled talent in AI and related fields. While the Philippines has a strong pool of IT professionals, there is still a shortage of AI, machine learning, and data science experts. This talent gap can slow down the development of AI technologies and make it harder for startups to attract the right people to build and grow their businesses. Additionally, the competition for AI talent is fierce, both locally and globally, which can drive up costs for startups already operating on tight budgets.

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Funding is also a significant hurdle for AI startups in the Philippines. While investors have shown growing interest in AI, many startups still struggle to secure the necessary funding to develop their technologies and bring them to market.

Shaping the future of AI in the Philippines

So, how can we best support AI startups in the Philippines?

To find answers, join us at Echelon Philippines 2024 for a dynamic panel discussion titled “AI Leapfrog: Build an AI-first Tech Ecosystem for a Global Competitive Advantage”.

This session, taking place at the SMX Convention Center in Manila on 26-27 September 2024, will bring together industry leaders and innovators to explore how the Philippines can harness the power of AI to leapfrog traditional development stages and establish itself as a competitive force in the global tech landscape. It will delve into strategies for creating an AI-first ecosystem, addressing challenges such as infrastructure, talent development, and investment, while highlighting opportunities for growth and innovation.

Moderated by Mario Domingo, Global Chief Technology Officer at UBX Philippines Corporation, this panel will feature insights from prominent figures such as Charles Rim, General and Founding Partner at Access Ventures LLC, and Kevin Quah, CEO and Co-founder of Tictag. These experts will share their experiences and perspectives on building AI-driven businesses and ecosystems, providing valuable takeaways for entrepreneurs, policymakers, and tech enthusiasts alike.

Don’t miss this opportunity to engage with thought leaders and be part of the conversation shaping the future of AI in the Philippines and beyond.

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