Lack of awareness, shifting leadership hinder Philippine startup growth

Cities struggle to support startups due to limited policy know-how.

While Iloilo has emerged as a standout in fostering startup growth, many local governments across the Philippines are falling behind due to a lack of policy awareness and shifting political leadership, according to QBO Innovation Hub’s 2024 Startup Ecosystem Mapping Report.

“For cities like Iloilo, it is very forward thinking,” said Karla Legaspi, Head of Community and Engagement at QBO Innovation. “I believe a big advantage that they have is that the public sector, specifically the local government unit, is driving this movement, partnering with their private sector partners, private partnering with community groups and also hearing from the entrepreneurs themselves what they need, and incorporating this in local policy.”

Iloilo’s local ordinance supporting startup and innovation growth is cited as a key enabler for founders. The city's collaborative and policy-driven approach is providing entrepreneurs with both structural support and a platform for long-term scaling.

But this isn’t the case everywhere. “For other localities, we see that there might be a lack of awareness for other cities or municipalities and the government units that's driving their policies around business, they might not be more aware of tech ready or scalable startup business policies that may be implemented in their locality,” Legaspi said.

She also pointed to a second major challenge: “Maybe it is a matter of the changing administrations... changing priorities between administrations.”

These two factors—limited awareness of startup-enabling policies and political turnover—are stalling progress in other regions, despite growing entrepreneurial activity.

Legaspi emphasised the broader potential of supporting local startups. “These local founders... are providing local employment. They are looking for expansion and have a growth mindset,” she said, adding that startup activity also boosts the Philippines’ international reputation.

“Cities... that are doing the work in promoting innovation are getting us recognised, not just for the talent and ingenuity of the Filipinos... but having and standing on our own as global, innovative entrepreneurs,” she added.