Navegar, the largest private equity firm in the Philippines with over $300 million under management across two funds, is eyeing major investments in fast-growing businesses in the country over the next two years.
Nori Poblador, Navegar’s co-founder and managing partner, said the Manila-based firm is optimistic about the continued post-pandemic recovery of the country’s economy and plans to ramp up its investments, despite macroeconomic concerns.
“The underlying factors that have propelled the country's economic growth over the last 10 years remain intact, and excluding 2020, GDP has grown consistently at five percent or above, often ranking among the highest in Southeast Asia. The future looks even brighter with annual GDP growth projected to climb to 6.5 percent to 8.0 percent between 2024 and 2028, per the Development Budget Coordination Committee,” he said.
The driving force of this steady and robust performance is strong domestic consumption, underpinned by a large, well-educated, and youthful population of 114 million that continues to grow at a rate of 1.7 percent annually. This year, consumer spending is expected to be further boosted by higher employment levels, personal income tax cuts, and minimum wage increases.
In addition, he cited the government’s support across fiscal policy, infrastructure, and various industries has created a stable business environment, drawing more interest and raising confidence among investors.
“Now is the time to provide the right support to the entrepreneurial community and help them drive progress,” he said.
Navegar is a firm believer in the country’s entrepreneurs and their ability to not only build successful, resilient companies but also affect positive change in society at large—creating jobs, championing innovation, and fueling the economy over time.
Since its inception in 2013, Navegar has played an instrumental role in fueling the growth of some of the nation’s most prominent market leaders, including restaurant operator The Bistro Group, NASDAQ-listed outsourcer TaskUs, e-commerce enabler Great Deals, and logistics company Royale Cold Storage by offering capital and strategic guidance.
Javier Infante, Navegar’s other Co-founder and Managing Partner and a seasoned entrepreneur himself, stated, “In the face of the pandemic, we witnessed many of our portfolio companies weather the storm and emerge even stronger with improved operations, enhanced products and services, and greater profits. Beyond investing capital, our aim is to equip our companies along their unique journeys, providing resources and guidance to overcome challenges of all sizes.”
For instance, Navegar assisted e-commerce enabler Great Deals in resource planning and establishing financial systems, allowing it to onboard numerous brick-and-mortar brands facing the surge in demand for e-commerce. Ultimately, consumers benefitted from a better online shopping experience, characterized by wider product selection, seamless transactions, and faster delivery times.
Paul Manuud, President of The Bistro Group, adds, “Navegar’s partnership was pivotal in helping us advance our financial capabilities.
This enabled us to manage costs and stay profitable while dine-in was severely limited. Once the economy reopened, we embarked on a record year, opening 40 new stores and adding exciting brands to the portfolio, including Randy’s Donuts, Olive Garden, and Ember.”
Meanwhile, Cloudstaff, with the firm’s backing and in-house outsourcing expertise, pursued rapid expansion plans and built custom remote working solutions that enabled more SMEs in the U.S., the U.K., and Australia to operate efficiently. As the company grew, so did its Filipino workforce.
Infante remarks, “Even as we encounter more uncertainty in the near term, we’re confident that good companies, grounded in sound business fundamentals and armed with capable leadership, will endure and ultimately flourish, especially those with the right support.”
“In the coming years, we expect to see more of these companies rise into the limelight, presenting an excellent window for investments that can catapult them to new heights and help them deliver substantial impact,” he closes.
Amid economic volatility and a tighter fundraising backdrop, Navegar has noticed a spike in interest from companies seeking experienced strategic partners that can both fund their growth and provide hard-won advice for navigating today’s complex world.
Poblador shares, “With stable capital and strengthened balance sheets, businesses can capitalize on valuable growth opportunities, positioning themselves for success well into the future. The Philippines holds enormous potential, and we stand ready to invest in and support more exceptional companies moving our country forward.”
In 2022, the Philippines recorded deal activity of US$6.8 billion, making it its busiest year for mergers and acquisitions in nearly a decade, according to Bloomberg. Looking forward, Navegar anticipates the high demand for capital to continue, even as investors place more importance on business performance and valuations.