The Philippine startup scene showed signs of stabilizing in 2025, even as funding remained difficult and investors stayed cautious, according to a new report by Kickstart Ventures and DealStreet Asia.
The report said startup funding in the Philippines slowed further in the second half of the year. Only nine deals were recorded from July to December, down from 14 in the first half. The amount of money raised also dropped sharply to US$33 million, compared with US$86 million earlier in the year. Investors are putting in smaller amounts and being more selective about where they place their money.
Despite this, the broader Southeast Asian startup market appears to be leveling off after years of decline. Regional deal activity ticked up slightly in the second half of 2025, a sign that the funding downturn may be easing, even if investment levels are still far below the highs seen in 2021.
Kickstart Ventures said the market is now in a “consolidation phase,” with investors shifting away from aggressive growth and focusing more on strong business fundamentals such as good governance, clear profits, and sustainable operations.
One major challenge for Philippine startups is the lack of late-stage funding. There were no disclosed Series C or later-stage deals in the country throughout 2025, continuing a slowdown that began in mid-2024. This means more mature startups are struggling to raise large amounts of capital locally. In contrast, other Southeast Asian markets saw a pickup in late-stage deals, showing investors are still willing to fund bigger, more established companies elsewhere in the region.
Fintech remained the strongest sector in the Philippines, accounting for the most deals and funding value in 2025. However, fintech investment weakened across Southeast Asia overall, posting one of its slowest years in more than six years. Meanwhile, climate and sustainability-related startups gained more attention regionally, making up a growing share of total deals.
Industry analysts said the data reflects a tougher environment with higher scrutiny, where funding is concentrated in fewer sectors, markets, and stages. For founders, this means fundraising will likely stay challenging, but those with solid business models and clear paths to profitability may be better positioned as the market gradually stabilizes.
