Within the past few years, the ASEAN region has consolidated itself as a hotspot for startups. Thanks to several factors, it has become an epicentre where businesses can take advantage of the region’s rising middle class, almost blanket access to the internet and welcoming economic and legal initiatives. These initiatives are present in many Southeast Asia countries, but the Philippines and Malaysian tech startups sector is exciting as they continue to flourish.
We look at the top 5 Philippines tech startups to look at in 2023
While the Indonesian economic landscape has the largest market, with a population of 270 million, many Malaysian and Philippines tech startups look very promising. These countries have some advantages regarding promoting a startup ecosystem, specifically from a government-enabling and private funding perspective.
Government and private initiatives
Several recent government and private developments in both countries are worth mentioning. In the Philippines, the Innovative Startup Act aims to strengthen, promote and develop a healthy ecosystem where up-and-coming businesses have opportunities to grow and evolve. Implemented in 2019, the Act provides grants and business development support to emerging startups. It also enables government entities to provide funding through two of its departments, the Department of Science and Technology (DOST) and the Department of Information and Communications Technology (DIST).
Startups that have benefitted from these initiatives are Cropital and Avion School (through a Y Combinator investment of 125 thousand USD). Another big player is the Manila Angel Investors Network (MAIN). A group of over 70 angel investors in the country, its latest significant investment of USD 1.2 million has been in Kumu, a live-streaming app. Finally, the Department of Trade and Industry has its Shared Facilities Program, an initiative where early-stage startups can access shared facilities.
In Malaysia, the National Technology and Innovation Sandbox is a program that provides funding and support for startups in the technology and innovation sectors. It also includes funding for research and development and mentorship and coaching services for startups and entrepreneurs.
The Ministry of Science, Technology and Innovation (MOSTI) launched the programme as a part of the post-COVID revitalisation initiative called the National Economic Recovery Plan (PENJANA). A crucial part of this is an investment fund called Penjana Kapital, which has been integral in the USD 200 million investment round of the Automotive services company, Carsome.
Top startups in the Philippines and Malaysia
As previously mentioned, Philippines-based Kumu has seen great success in the latest investment rounds. The platform connects users, content creators and influencers in real-time. It focuses on live streams, where users and brands can sell their items online. Developed in 2017 by Roland Ros, Rexy Dorado, Andrew Pineda, and Clare Ros, Kumu boasts over 25,000 live stream broadcasts per day and 3 million registered users with an average screen time of an hour per day.
In April 2020, Kumu raised approximately USD 5 million in a series A round. The company has received USD 95.2 million in funding as of early 2023.
Another high-flying startup in the Philippines is PayMongo, a fintech startup that offers businesses a payment processing platform. The company has secured Series B funding from Silicon Valley giant Peter Thiel. With this latest round, the company has amassed almost USD 46 million.
Acudeen is a fintech startup based in the Philippines that offers invoicing services to small and medium enterprises. Founded in 2016 by Mario Jordan Fetalino, Acudeen’s significant advantage compared to other services is its use of blockchain technology. It allows secure and transparent transactions between buyers, sellers, and investors. Acudeen offers a more efficient solution for small and medium enterprises.
It is foolish to mention Malaysia and not talk about Grab. Starting as a ride-hailing platform, the company has had a meteoric expansion to become the region’s first decacorn. While its headquarters are now in Singapore, it began in Malaysia and is one of the country’s biggest success stories.
The new super-app covers a wide range of sectors, from financial services to deliveries to vehicle rentals. Founded in 2012, Grab has expanded to nearly all of Southeast Asia except Laos, Brunei, and East Timor.
Another vital player in the Malaysian scene is Carsome. Founded in 2015, as mentioned earlier, the platform has become Southeast Asia’s biggest online used car marketplace. It has a presence in Indonesia, Thailand, Singapore, and Malaysia. It disrupts the traditionally used car market and creates a more transparent consumer buying and selling process.
As the Philippines tech startups prepare to take their place on the world stage, Malaysian tech startups are maturing and hoping to follow in the footsteps of the behemoth Grab in dominating the region. Expectations for 2023 show it to be a promising year for many of the tech companies in both countries, thanks to all these dynamic and ever-evolving factors.