Gobi Partners (Gobi-Core Philippine Fund), a venture capital firm, has released its flagship study, “Philippine Startup Ecosystem Report 2025: The Next Wave of Innovation,” which benchmarks the country against the ASEAN-6 bloc and identifies key growth opportunities in artificial intelligence (AI) and digital transformation.
The report highlights a significant slowdown in funding but calls for stronger governance and a coordinated talent policy to maintain the country’s competitive edge.
Funding Decline Amid Shift to Operational Discipline
The report indicates that 2025 saw a cooler funding cycle for Philippine startups. Total capital raised fell 32% and deal volume dropped 54% year-on-year from 2024 figures. Founders have responded to tighter global liquidity and this slowdown by shifting focus toward profitability, operational discipline, and sustainable growth.
The study attributes the funding slowdown not only to global market conditions but also to governance lapses and corruption scandals, which it states have eroded investor confidence. To rebuild trust and accelerate capital formation, Gobi Partners recommends establishing policy “green lanes,” institutional safeguards, and targeted fiscal incentives for firms adhering to strong ESG (Environmental, Social, and Governance) standards.
The Emerging “Intelligent Era”
Gobi Partners traces the Philippine startup journey through three phases, culminating in the emerging “Intelligent Era,” defined by the widespread adoption of AI, automation, and intelligent data use across industries.
Sectors poised for AI-driven transformation include Fintech, Logistics & Healthtech, Creative Industries, and BPO & Knowledge Services. The report stresses that this transition requires coordinated national investments in talent pipelines, reskilling, and policy alignment to preserve the country’s competitive advantage.
Call for Action and Inclusive Growth
Despite the funding challenges, the startup ecosystem remains a key economic driver, contributing an estimated 3% to nominal GDP and generating close to 200,000 jobs nationwide.
The report serves as a strong call for collaboration among policymakers, founders, investors, and academia to strengthen the Philippines’ position in the regional technology economy.
Thomas G. Tsao, Co-Founder and Chairman of Gobi Partners, framed the opportunity in regional terms: “At Gobi, we view innovation as a force for inclusive growth across Asia. The Philippines has the talent, resilience, and creativity to shape the next chapter of Southeast Asia’s innovation story.”
Adding urgency to the findings, Carlo Chen-Delantar, Partner and Head of ESG & Circular Economy at Gobi Partners (Gobi-Core Philippine Fund), stated: “This report is a call to action. The Philippines stands at a crossroads; the choices made today in policy, capital, and talent will define whether we lead or lag the region’s digital transformation.”
Access the full report here.