PH startups face 40% funding drop in 2023

The Gobi-Core Philippine Fund, a collaborative venture between venture capital powerhouses Gobi Partners and Core Capital, partnered with Alibaba to publish a comprehensive report detailing a concerning downtrend.

• It all boils down to this: According to the report, similar to the overall investment climate in Southeast Asia, the Philippines' startup funding landscape has been experiencing significant headwinds. There's been a 21% drop in deal numbers and a staggering 40% decrease in raised capital by Philippine startups from 2022 to 2023.

• What can this be attributed to: These dwindling figures are credited to a complex interplay of adverse market conditions.

• Basis and framework: The report also delves into the journey of 33 startup founders in the Philippines - largely representing the e-commerce industry and at stages ranging from seed to series C.

• Insights from the survey reveal: Half of the startups have reached breakeven, with an average timeline of four years. A majority of these founders, approximately 57%, express that Philippine startups are in dire need of funding opportunities.

• Founders struggle to raise funds: Founders have a keen awareness of the lengthy fundraising process at each stage. While it took these founders roughly four months to secure angel funding post-establishment, the leap from seed to series A stage stretched to approximately 14 months.

In parallel, a separate report by AC Ventures and Bain & Company identified a similar pattern in Indonesia's VC funding landscape, predicting a potential 80% plunge in deal value in 2023 compared to the previous year.