In an effort to deepen relationships with local startup ecosystem players in Cebu and Davao and complete the ecosystem assessment of the two cities for the Startup Genome Project, the Department of Trade and Industry-Export Marketing Bureau (DTI-EMB) organized the conduct of a Focus Group Discussion (FGD) in Cebu and Davao on 18 and 20 July 2018, respectively.
Startup Genome Project aims to increase the success rate of startups and improve the performance of startup ecosystems across more than 30 countries, including the Philippines. The DTI-EMB facilitated the Philippines’ first-time participation in the Startup Genome Project, which released the 2018 Global Startup Ecosystem Report in April this year. The 2018 GSER featured strategic start-up, investment and policy insights from over 10,000 founders in 45 cities, including Manila.
Attended by some 100 startups, technology business incubators (TBIs), accelerators, business support organizations (BSOs), academe, and government agencies, the FGD was facilitated by Startup Genome Director of Research Arnobio Morelix and Manager of Research Pranav Arya in Harolds Hotel in Cebu City and The Pinnacle Hotel and Suites in Davao City.
With assistance from DTI-VII OIC Assistant Regional Director Ma. Elena C. Arbon and DTI-XI Industry Development Division Chief Marie Anne J. How, the FGD focused on the challenges Cebu and Davao startups face, the strengths of their ecosystems, and the recommended solutions to address their key concerns.
“In addition to getting a better understanding of the local startup scene and ultimately work together with you to increase your exposure and improve your performance, this FGD also aims to elicit your commitment to be Ecosystem Partners in the research through sharing of your expertise and supporting data collection, learn from your insights to complete the Ecosystem 360 Rubric, and ask you to complete the Organization Assessment,” Morelix said.
Morelix also reported to the participants the Manila Ecosystem Findings, which he also presented to Trade and Investments Promotion Group (TIPG) Undersecretary Nora K. Terrado, DTI-EMB Director Senen M. Perlada, EMB-Knowledge Processing Division (KPD) Chief Vic Soriano, EMB-KPD Assistant Division Chief Angie Brosas, Kaye Mendoza of EMB-KPD, and Brian Jay Ambulo from the Office of TIPG Undersecretary.
Based on Startup Genome’s analysis, Manila is currently in Activation Phase in terms of experience levels, ecosystem size (startup output), and resource attraction. While Manila’s overall startup experience is close to Activation Phase average, the ecosystem needs more sizable exits, the Report said.
The Report also noted that output growth in Manila shows that the ecosystem is expanding rapidly and that overall global resource attraction is higher than the phase average.
However, Manila ecosystem needs to improve in terms of funding and number of experienced engineers. It added that Manila has not been able to create a series of $100M+ exits in the ecosystem, which are a must for resource attraction. Focus must be on driving valuations and achieving multiple $100M+ exits to enter next phase, the Report said.
The Report also pointed out that market reach is the single metric most closely related to ecosystem production of scaleups and exits. Manila startups, the Report noted, have lower global market reach than most of their peers in the Activation Phase.
“Startups with higher global market reach early on see their revenue grow two times faster and are more likely to become scaleups,” Morelix stressed, adding that global market reach is driven by global connectedness.
“Notably, ecosystems’ focus should be on building connections with top ecosystems,” he said.
The Report concluded that Manila startups have more potential to strengthen global market reach.