Startup ecosystem’s growth to continue

CEBU, Philippines — The Philippines' startup ecosystem continues to register notable growth, particularly in regional hubs like Central Visayas, buoyed by a wave of entrepreneurial activity and government-backed innovation programs.

Yet, despite these advances, policymakers are raising red flags over what they describe as a critical disconnect between technological innovation and commercial viability.

Frederick Amores, regional director of the Department of Information and Communications Technology (DICT) in Central Visayas, has expressed concern over the persistently low participation of local startups in government-led mentorship and coaching initiatives—support systems designed to prepare early-stage ventures for investment and scale.

“The technology coming out of the region is promising,” Amores told reporters during the recently held forum hosted by The Freeman.

According to Amores, the key question remains: are these startups truly investible? Many lack market orientation and a clear business case.

While national agencies such as the Department of Trade and Industry (DTI) and DICT have rolled out a suite of capacity-building programs—including venture pitching bootcamps and investor-readiness seminars—engagement has been tepid.

He said these programs remain underutilized, despite being widely promoted within startup networks.

“The DTI [Department of Trade and Industry] has robust frameworks for founder training and capital readiness, but founder turnout remains disappointingly low,” Amores said.

“There’s even a dedicated initiative on preparing pitches for venture capital, yet participation is minimal,” he added.

The Philippine government has, in recent years, increased its support for early-stage enterprises through the Innovative Startup Act, startup grants, and partnerships with academic institutions and accelerators. Yet experts argue that unless founders internalize basic principles of business development—such as crafting viable exit strategies—the full potential of these programs will remain unrealized.

Amores recounted a telling exchange with a startup founder who was unfamiliar with the concept of an exit plan. “When asked about an exit strategy, he said, ‘Why would I exit? This startup is my baby.’ That kind of thinking reveals a fundamental gap in understanding what investors look for.”

Exit mechanisms—ranging from IPOs (Initial Public Offerings) to strategic acquisitions—are central to venture capital decision-making. A lack of awareness around these issues, Amores said, hampers investor confidence and limits the growth trajectory of otherwise innovative ventures.

Despite a regular calendar of startup conferences, hackathons, and pitch competitions in the region, enthusiasm for backend development—particularly financial modeling, market alignment, and investment strategies—remains muted.

Analysts see this as a growing pain in an ecosystem still maturing. “The Philippines has made strides in fostering a startup-friendly environment, especially outside Metro Manila,” said a Cebu-based venture advisor who requested anonymity. “But to go from prototypes to profit, founders must embrace the full spectrum of what it means to build a business—not just a product.”

The DICT and DTI are expected to reassess their outreach strategies, with renewed emphasis on incentivizing participation and integrating more hands-on mentorship into early-stage funding schemes. — (FREEMAN)