Startups, alternative financing, fintech and angel investors are a few examples of the dominant threads in the finance industry; which is making its mark in countries around the globe, yet seems to be missing the Philippines. In a recent forum organized by the Cebu Business Club, Department of Science and Technology-Information and Communications Technology Office (DOST-ICTO) Deputy Executive Director Monchito Ibrahim said that local businessmen should invest more in innovators and digital startups as they are the next big thing. According to Ibrahim, neighboring countries have been taking away the country’s innovators since local startups are seeking help elsewhere, specifically from accelerator companies and foreign investors, due to the lack of support from the Filipinos.
1337 Ventures is an example of a technology accelerator that Filipinos turn to for help. Ibrahim further added, that there actually a number of Filipino angel investors and mentors, like Kickstart and Ideaspace. But in order for startups to succeed, the country needs more of them.
An angel investor is a person who gives financial support to startups, usually friends or family members of the entrepreneur. Bikesh Lakhmichand, founder of 1337 Ventures explains that a person only needs $1000 to become an angel investor. He added that 1337 Ventures will be adding about 12 Philippines startups to their Asia portfolio.
Lakhmichand, who was also present at the forum, urged the businessmen in Cebu to invest in Filipino startups, yet he emphasized that this endeavor is not for the fainthearted. He added that those planning to be an angel investor should be ready to face the risk of losing money, but should focus more on helping others prosper. Lakhmichand also said that from the startup case studies they had done, only 2% of startups succeed into big firms, while most of them belly up only after 3-6 months of their establishment.
The Philippine Roadmap for Digital Startups is aiming that, by 2020, there will be 500 startups with an increasing valuation worth $2 billion. It was recorded by ICTO last year that the country has approximately 100 startups with funding of $40 million. Roadmap targets are boosting the number of highly skilled jobs from 1,700 to 8,500, and from 250 to 1,250 startup founders.