Having witnessed the Philippine startup ecosystem gain momentum in the last five years, Jojo Flores, co-founder of Silicon Valley-based incubator and accelerator Plug and Play, said they are now more keen in investing into local startups.
“We are looking for companies in four particular areas, fintech (financial technology), Internet of Things or IoT, also in media technologies, and lastly brand and retail technologies,” Flores said.
In an interaction with DEALSTREETASIA, Flores shared the rationale behind Plug and Play’s investments, his perspective on the country’s current startup space, his personal advice to startup investors and founders in relation to business ideas or product development. Edited Excerpts.
Please take us through Plug and Play’s journey.
We started in January 2006 and we accelerate and incubate startups. How we do that? We first connect them with money, then we work with a network of close to 200 venture capital firms around the world. Second is we connect them with businesses for business development. So we work with almost 400 corporations around the world.
You can imagine that Plug and Play is a big networking platform that can connect the startups with money and large businesses. So fast forward into today, in any given time, I have about 350 startups in Plug and Play that we incubate and accelerate. Since the beginning, we have probably accelerated and helped over 2,000 startups around the world.
Our startup communities have raised in excess of $3.5 billion in VC funding.
How much is Plug and Play willing to invest in Philippine startups?
We do a lot of seed and angel investing. Depending on the startup we invest anywhere from as low as $10,000 to $150,000. And we invest in about 40 to 50 companies per year but this is around the world. But hopefully many of those we’ll get in our portfolio are Filipinos.
Do you have a priority of places when it comes to investing?
We’re not prioritizing based on geography but the idea and the team. That’s why we’re encouraging our companies to have a more global scale of their ideas. Something that should work in the Philippines but the very least should work in the region. It’s not just solutions that address local problems.
Also read: Philippines, APEC form new startup conference ‘SlingshotMNL’
How do you find the startup climate here in the Philippines?
It’s growing. I started looking in 2010 when we started our pitching competitions here and it has grown a lot. I think because of significant institutional groups which got involved like IdeaSpace Foundation from First Pacific, Kickstart Ventures Inc which is from Ayala. So these institutional groups that come in create more buzz in the whole ecosystem.
What do you look for in a tech startup?
The ideas that come up are really important. I like to have problems that are real and big problems. I like to see creative solutions. And I like to see in a founder’s team some domain expertise.
How much fund does Plug and Play have at present?
What we have is the evergreen fund that has no limit. But if you would do the math, if we invest in about 50 companies at an average of $20,000 a year, we invest in about $1.5 million in a year.
Just how important is the collaboration between public and private companies in boosting the startup community?
We now have new activities that did not existed five years ago. SlingshotMNL for example is a newly-launched conference for tech startups. And there is also Innovation Hub, patterned after Silicon Valley. All these things have helped develop the ecosystems as well as the startups, there’s more happening right now.