Why Cebu is a Top Bet for Startups and Outsourcing to the Philippines

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Today we learned one more reason to love Cebu City, Philippines. It's one of the best possible alternatives to Silicon Valley, if you ask writer Josh Steimle over at Entrepreneur. And it's a global contender for social enterprise, if you talk to entrepreneur Ravi Argawal.

"Since it’s affordable, it’s a great place to build products, test them and then scale them to the global market at a low cost to your company," writes Steimle. He adds that being an "economical and beautiful" place that offers plenty of outdoor activities, Cebu is a great place to live.

The other cities on Steimle's list are Santiago in Chile, Shenzhen in China, Hong Kong, Berlin, and Dubai. But while he cites those cities' vibrant startup accelerator communities and campuses along with friendly business laws, no such details are given about Cebu.

Which may leave one asking: Could Cebu really be a Silicon Valley alternative?

It's a complex question that requires an in-depth answer for various scenarios, but we offer here an overview of why our Australian company put up roots in Cebu.

Startup Community

When a city has activities named "Startup Weekend", "Geeks on a Beach", and "Tech Talks", you know a startup community is stirring. Cebu not only hosts these activities, but also offers a co-working space for techpreneurs.

In terms of business and knowledge process outsourcing to the Philippines, Cebu attracts both large multinational corporations and small newbies.

Business Laws

While the Philippine government must step up its support for both local and foreign startups, it does offer perks to companies that offer outsourced business and knowledge processes. When qualified, a BPO may be wholly foreign owned and enjoy a tax holiday. On the other hand, a Senate bill exempts qualified startups from paying all national and local taxes on its first two years of operation.


Being the second most populous metropolitan area in the Philippines, Metro Cebu is exhibiting growing pains in the form of increasingly heavy road traffic. This is why you see road widening projects all over the metro, as well as condominiums under construction and new IT centres. However, it is consider a respite from its larger cousin, Metro Manila. While the latter is landlocked, Metro Cebu offers its residents access to both mountains and beach within half an hour.

Cost of Doing Business

Cost of doing business in Cebu is relatevly cheaper than that of other cities on the list. 

Can I test the waters first?

So big question: how do you decide to make the jump or not? If you're a small and/or young company, the best way is usually to work virtually with freelance professionals or with managed outsourced operations. Working with one or two virtual assistants — be they web developers, booking specialists, researchers or sales coordinators — allows you to encounter potential road blocks, such as cultural differences and logistical issues, without compromising your goals and key tasks or breaking your bank.


Topics: Outsourcing & Offshoring


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