Stakeholders from the Philippines’ startup community have launched an umbrella organization aimed at improving cooperation and collaboration across different sectors. Dubbed StartupPH, the initiative was launched at the fourth Geeks on a Beach (GOAB) international conference held in Panglao Island in Bohol, last week.
GOAB is an annual conference where stakeholders from the startup community–including founders, investors, government representatives, among others–meet and network around a common theme, which is how to further improve the startup community in the country amid limitations in access to capital, as well as stringent foreign ownership rules in local corporate entities.
A framework for cooperation
In the 2015 edition of the conference, attendees pledged to develop a framework for cooperation among stakeholders, including the private sector and government. The main goal was to establish local startups as the next “sunshine industry” after the business process outsourcing industry, which boomed to a $22 billion industry that now makes up around 7.5 percent of the country’s gross domestic product.
The plan was to launch 500 startups by 2020 with a total investment of US$200 million and a total market capitalization of US$2 billion.
Sadly, nothing solid materialized from that endeavor.
“In real terms, nothing happened,” said Mon Ibrahim, innovation consultant at the Department of Science and Technology, during a breakout session at GOAB. “We were waiting for the community to organize themselves so we can work better with them.” Jojo Flores, Co-founder at tech accelerator, Plug and Play Innovation Center, told Tech in Asia that the plan remained mostly just that–a plan. “The roadmap is there but nothing is happening on the execution side.”
Flores adds that government and regulatory bodies prefer dealing with a formal entity when it comes to matters of policy and providing assistance to startups. “The government … can’t deal with a Facebook group,” he said, referring to informal collectives of startup founders and investors who mostly coalesce around social networks and local events.
A more solid partnership across stakeholders
During this year’s conference, the startup community stakeholders made good with their plan to better solidify partnerships within the community through StartupPH, which will serve as an umbrella organization that caters to the needs of founders, investors and other parties with stakes in the community. StartupPH will “unite [the community’s] efforts and create a more efficient and structured program for startups and the startup ecosystem.”
In operational terms, the organization will be able to lobby for better policies and benefits for startups, including support for measures to reduce tax liability and support for foreign ownership. In fact, government is already warming up to startups, noting their potential in introducing game-changing innovations.
Senator Paolo Benigno “Bam” Aquino, a staunch advocate of entrepreneurship, has introduced a bill during previous sessions of Congress, which will exempt startups from paying taxes during their first two years of operation. The Start-Up Business Bill has since evolved to cover additional measures to support foreign ownership or equity. The senator’s office works closely with members of the startup community in seeking inputs and feedback.
“We want to ensure that [that bill], when passed into law, is a law that is relevant, is a law that truly helps and supports the digital startups and innovative startups, and is a law that you can truly benefit from,” he said during the GOAB welcome dinner. “The only way that we can ensure that this law is not a waste of time and effort is to really get from you – what do you really want to see in this law? What support do you really need in this law?”
To this end, an organization that represents the community’s interests will be helpful in lobbying for laws and regulations that will be more entrepreneurship and investor friendly.
The takeaway
The Philippines’ startup community may be relatively young, compared to more advanced counterparts like in India, Singapore and Israel. However, this group has already produced several success stories and innovations, mostly in solutions that cater to the needs of emerging markets. By launching StartupPH, the local community gets better representation in ensuring all stakeholders work toward improving the quality and quantity of startups and investments.