Raising Capital in the Philippines: What You Need to Know

An In-Depth Guide for Startup Founders and Entrepreneurs

Introduction: Why Capital Matters — and Why the Philippines Is Unique

Raising capital is one of the most important — and often most difficult — stages in building a startup. Whether you’re a first-time founder looking for seed money or a scaling business pursuing Series A, securing funding can determine the trajectory of your venture.

In the Philippines, this challenge is amplified by a unique set of factors: a growing but still young startup ecosystem, a historically conservative investment culture, and a regulatory environment that’s still adapting to the needs of innovation-driven enterprises. But the tide is turning. The country has seen a surge of investor interest, especially from Southeast Asia, and a rise in local angel investors and venture capital funds.

This guide unpacks the landscape, explores key funding sources, and shares what you really need to know about raising capital in the Philippines.

Part 1: Understanding the Funding Stages in the Philippines

Before diving into where to get funding, it’s critical to understand the funding lifecycle most Filipino startups go through:

1. Bootstrapping / Personal Funds

• Most startups in the Philippines begin here. Founders use savings or family support.

• Common in regions outside Metro Manila (e.g., Cebu, Davao).

2. Friends & Family

• Informal, trust-based capital. Usually under ₱500,000.

• Not all founders have access, leading to early inequality.

3. Angel Investment / Seed Funding

• Tickets range from ₱500,000 to ₱5 million.

• Often comes from successful founders, professionals, or niche angel networks like Manila Angel Investors Network (MAIN).

4. Venture Capital (Series A and Beyond)

• Usually starts at $500,000 (₱25 million and up).

• Few local VCs do large-scale investing; most are regional SEA firms (e.g., Gobi Partners, Kickstart Ventures).

5. Private Equity & Strategic Investors

• For mature startups with strong revenue.

• Often comes from conglomerates, telcos (e.g., PLDT, Ayala), or family offices.

Part 2: Key Sources of Capital in the Philippines

Let’s break down the main funding channels available to founders in the Philippines:

1. Angel Investors

• Examples: MAIN (Manila Angel Investors Network), StartupPH Angels, IdeaSpace alumni.

• What they look for: Clear problem-solution fit, traction, coachable founders.

• Common Deal Sizes: ₱500,000–₱5 million.

• Pros: Flexible terms, mentoring included.

• Cons: Limited deal flow outside Metro Manila.

2. Venture Capital Firms (VCs)

• Top players in the Philippines:

  • Kickstart Ventures (connected to Globe Telecom)

  • Gobi-Core PH Fund (SEA regional focus)

  • Foxmont Capital Partners

  • UBX Ventures (by UnionBank)

  • Future Now Ventures

• Focus: Scalable tech, fintech, SaaS, logistics, e-commerce.

• Requirements: Product-market fit, growth metrics, solid founding team.

• Typical Ask: Deck, data room, cap table, traction KPIs.

3. Startup Accelerators & Incubators

• Examples:

  • IdeaSpace: Offers ₱1 million equity-free support + mentorship.

  • QBO Innovation Hub: Runs multiple early-stage programs.

  • Founders Launchpad, Brigada Angels, KMC Startups.

• Great for early-stage validation, connections, investor intros.

4. Corporate Venture Arms

• Large conglomerates are investing in startups:

  • Ayala Group (AC Ventures)

  • PLDT/Smart (PLDT Capital)

  • Globe (917Ventures)

• They offer not just funding, but access to distribution, data, and customers.

5. Grants & Government Support

• DOST-PCIEERD: R&D, prototyping, commercialization grants.

• DICT & DTI: Digital Startup Development Program (DSDP).

• PhilDev Foundation, USAID, Embassy programs: often offer grants for social enterprises, agri-tech, health, etc.

Part 3: How to Prepare Before Fundraising

1. Validate Your Product and Market

• Investors want proof that people actually want your solution.

• Show traction: paying users, MRR, retention, feedback loops.

2. Get Your Financials in Order

• At least 12–18 months of financial projections.

• Know your burn rate, CAC, LTV, and break-even timeline.

• Clean up your cap table — avoid over-dilution early.

3. Have a Killer Pitch Deck

Must-haves:

• Problem & solution

• Market size (Philippines + SEA if applicable)

• Business model

• Team background

• Traction

• Ask (how much, at what valuation, and why)

4. Build Relationships Early

• Start investor conversations before you need money.

• Attend networking events: Philippine Startup Week, Geeks on a Beach, Founders Circle.

• Warm intros from trusted ecosystem builders work best.

Part 4: Investor Expectations in the Philippines

While Philippine investors are becoming more startup-savvy, they still differ in some key ways:

1. More Conservative

• Many investors prefer proven revenue over risky ideas.

• Business fundamentals > Visionary pitch.

2. Due Diligence Heavy

• Expect scrutiny on legal docs, financials, and founder reputation.

3. Slow Decision Cycles

• Fundraising timelines can be long (3–6 months or more).

• Follow-ups and patience are essential.

4. Hybrid Metrics

• Many want social impact + returns. Especially for agri-tech, fintech, edtech.

Part 5: Common Mistakes Founders Make

1. Raising Too Early

   • Without PMF or revenue, you risk poor terms or rejections.

2. Overvaluing the Company

   • Asking for ₱100M on a ₱2M revenue base hurts credibility.

3. Unclear Use of Funds

   • “Marketing” or “Growth” is too vague. Be specific: ads, hires, tech build.

4. Ignoring Legal & Compliance

   • Investors want proper business registration, tax compliance, NDAs, and contracts.

5. Poor Investor Fit

   • Not all money is good money. Align with investors who believe in your stage and vision.

Part 6: Raising Capital Outside Metro Manila

While Manila still dominates the investment scene, founders in Cebu, Davao, Iloilo, and Cagayan de Oro are starting to catch up.

• Cebu: Strong tech/BPO presence, with growing startup support (e.g., Cebu Innovation Network).

• Davao: Focus on agri-tech, logistics, and green energy.

• Funding Gaps: Many founders still bootstrap due to limited regional VC presence.

• Solution: Online investor pitching (Zoom, LinkedIn), joining national accelerators remotely.

Part 7: What Happens After You Raise?

1. Accountability

• Monthly updates are expected.

• Use tools like Notion, Slidebean, or KPI dashboards.

2. Governance

• Many investors ask for board observer seats or quarterly check-ins.

• Have proper governance even if you’re small.

3. Burn Management

• Spending capital wisely is key.

• Don’t raise just to raise — aim for 18–24 months runway.

Part 8: Real-World Stories

✳️ Example: Edamama

Raised $20M+ from Gobi Partners, Kickstart, and more. Started with a narrow niche (mother and baby products) and executed flawlessly.

✳️ Example: ChatGenie

Began as a startup in QBO; now used by thousands of Philippine MSMEs via chat-commerce integrations.

✳️ Example: Great Deals E-Commerce

Scaled logistics and fulfillment for brands like Unilever and Nestlé, backed by Navegar and Fast Logistics.

These examples prove that even in a challenging environment, Philippine startups can raise — and scale.

Conclusion: Build First, Fund Next

Raising capital in the Philippines is hard — but far from impossible. While there are fewer players and a slower pace compared to Singapore or Jakarta, the fundamentals are improving: more angels, stronger founders, and better support systems.

Success doesn’t begin with a check — it begins with traction, clarity, and a commitment to building something valuable. Focus on solving a real problem, build community trust, and investors will follow.

Build boldly. Raise smart. And don’t forget — the best capital is the one that aligns with your mission.