The Philippines has emerged as a compelling destination for startup founders in Southeast Asia (SEA), offering a blend of strategic advantages that set it apart from regional powerhouses such as Singapore and Indonesia.
From cost-effective operations to a dynamic pool of young talent, the Philippines presents an attractive alternative for entrepreneurs seeking to establish and scale their ventures. If you are still on the fence about building your startup in the Philippines, here are reasons why the archipelago should be on the radar of any startup founder considering where to base their company in SEA.
Competitive labour costs and a young talent pool
One of the most significant advantages the Philippines offers over Singapore and Indonesia is its cost-effectiveness, particularly regarding wages. Labour costs in the Philippines are significantly lower than in Singapore, where the high cost of living drives up salaries. While Singapore offers a highly developed infrastructure and a stable business environment, the expense of maintaining a workforce there can be prohibitive for startups, especially in the early stages.
In contrast, the Philippines provides a more affordable alternative without compromising on talent. The country has a young and growing workforce, with a median age of around 25.7 years in 2024. This young demographic is tech-savvy, adaptable, and increasingly well-educated, thanks to a strong emphasis on higher education in fields such as engineering, IT, and business management.
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While Indonesia also has a large and youthful population, the Philippines stands out for its high proficiency in English, the business world’s lingua franca. This linguistic advantage makes it easier for startups in the Philippines to operate globally and tap into international markets.
Market readiness and economic growth
The Philippines’ market readiness is another compelling reason for startups to consider establishing themselves in the country. The Philippines is experiencing rapid economic growth, with a GDP growth rate that has consistently outpaced many of its regional neighbours. This growth is driven in part by a burgeoning middle class that is increasingly embracing digital technologies and services.
With a population of over 115 million people, the Philippines represents a sizable domestic market. The country’s middle class is expanding, with increasing purchasing power and a growing appetite for new products and services. This demographic shift presents a wealth of opportunities for startups, particularly those in the tech, fintech, and e-commerce sectors, which are poised to meet the needs of a young, connected, and digitally literate population.
In comparison, while Indonesia also offers a large market, its regulatory environment can be challenging to navigate, particularly for foreign startups. Singapore, on the other hand, though business-friendly, has a smaller population and market size, which can limit growth potential for startups focused on consumer-oriented products.
Access to local and global investors
Another key factor that makes the Philippines an attractive destination for startups is the growing availability of both local and global investors. The country’s startup ecosystem has been gaining traction, with increasing interest from venture capitalists, angel investors, and private equity firms. In recent years, the Philippines has seen a surge in startup incubators, accelerators, and coworking spaces, creating a vibrant environment for innovation and entrepreneurship.
Also Read: Uncovering deeper opportunities for fintech investment and venture creation in the Philippines
The Philippine government has also been actively supporting the startup ecosystem through various initiatives, such as the Innovative Startup Act, which provides tax breaks, grants, and other forms of assistance to startups. This supportive environment has helped attract global investors who are keen to tap into the country’s growth potential.
While Singapore has long been a hub for venture capital in Southeast Asia, the high costs associated with operating there can limit returns for investors, particularly in the early stages of a startup’s growth. Indonesia, with its large market, also attracts considerable investment, but the challenges of scaling in a diverse and geographically dispersed country can be daunting.
Exploring opportunities at Echelon Philippines
Join us at Echelon Philippines 2024 for an insightful panel discussion titled “Why Philippines: The Advantages of Launching and Setting Up Your Business.”
Moderated by Ranvir Singhsachakul, Director of Marketing and Business Development at MessageSpring, this session will delve into the unique opportunities and competitive advantages that the Philippines offers to entrepreneurs and businesses. Our distinguished panel includes Jay Fajardo, Executive Director of Ideaspace; Ron Baetiong, Founder and CEO of Podcast Network Asia; Bela Gupta D’Souza, Founder of edamama; and Afansiy Petrov, Business Development Manager at inDrive.
Presented in partnership with Brainsparks, Echelon Philippines 2024 is a groundbreaking event that unites the collective expertise of the Philippines and Southeast Asia startup leaders, visionary entrepreneurs and forward thinking investors to drive the next phase of growth.
Don’t miss this chance to gain valuable insights from industry leaders on why the Philippines is the ideal destination for your business venture.
The post Forget the rest: This is why you should build your startup in the Philippines appeared first on e27.