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2021 is predicted to be a record year for Vietnam’s technology investment attraction, with a value exceeding $1 billion, despite the Covid19 pandemic.
Sharing at the international conference “The Great Bay Area of Guangdong – Hong Kong – Macau: Potential and opportunities for Vietnamese Startups”, Mr. Nguyen Viet Dung, Director of Ho Chi Minh City Department of Science and Technology suggested that in the past 2 years, despite the pandemic, Vietnamese startups still have optimistic signals.
Indeed, in the fourth quarter, Vietnam attracted more than 2 billion USD of venture capital, of which Ho Chi Minh City accounted for 60% of the value and 70% of the number of deals. “This is a large number in the context of the pandemic,” Mr. Nguyen said.
Many startup competitions and events were held; this has demonstrated the rising demand for innovative ideas to cope with Covid-19. On the other hand, these events have brought forward a significant number of viable initiatives for the Government, demonstrated the adaptive dynamism of startups during the epidemic.
The event attracts start-up support units, experts, investors, startups, and leading organizations in the field of Entrepreneurship and Innovation in Vietnam.
The bright spot on innovation and technology investment was also shared at the conference by Ms. Le Hoang Uyen Vy, Co-Founder & CEO of Do Ventures Fund.
According to the fund’s representative, before 2018, the investment capital for technology startups in Vietnam was about 15 to 100 million USD per year and 2018 is considered the peak period with 450 million USD. Nonetheless, this trend continued with the number soared to almost double the amount in 2018 with $874 million worth of investment in the 2019 calendar year.
In 2020, however, due to the impact of Covid-19, technology startup investment decreased by half compared to the previous year, but the first 9 months of 2021 witnessed a rapid recovery with investment reached 600 million USD. Despite the Covid19 pandemic and its consequences, 2021 is predicted to be a record year for Vietnam’s technology investment attraction, with investment value exceeding 1 billion USD.
Additionally, in the first 9 months of the year, the number of Series A investments reached a record number of 73 deals.
“Vietnam should be mentioned as the new technology center of the world,” Ms. Le said.
The representative of Do Ventures Fund divides the development stages of Vietnamese startups into 3 phases. The first generation of startups, from 2000 – 2006 were groups with distinctive growth models. They grow and be at the top of their field, then expand into different areas. “A prominent example is VNG, who started in the game segment, then expanded to media, payment, chat applications …”.
The second generation of startups, from 2007 to 2014, namely, tiki, batdongsan, Foody, Topica, nhaccuatui… started in a more competitive environment than their predecessors, and needed more time to dominate the market.
The 3rd generation is from 2015 to present. Having to compete with many domestic and international competitors, this generation of startups have soon developed regional and global visions and strategies, they understood that for sustainable development, consistent expanding and adapting are crucial. Many founders have had experience working in developed markets such as Elsa, Sky Mavis… these are some examples of many companies that have taken part in international startup and technology networks.
“These 3rd generation startups will be the key players in the growth engine of Vietnam’s startup ecosystem,” Mr. Le shared.
At the thematic discussion session “Promoting the export journey of Vietnamese startups”, Mr. Linh Han, CEO of VSV Capital suggested that, through her working experience with many Vietnamese startups, not many Vietnamese entrepreneurs have a global mindset. They usually start by working at IT companies in Vietnam. They often focus on domestic, the market they understand best.
Experts in the discussion said that in the current era, the orientation and promotion of the export trend for Vietnamese startups is one of the most important elements in the process of promoting national economic development in general, and innovation in particular.
The workshop on “The Great Bay Area of Guangdong – Hong Kong – Macau Potential and opportunities for Vietnamese Startups” by Sunwah Innovations (belonging to Sunwah Hong Kong Group) in collaboration with the Department of Science and Technology of Ho Chi Minh City. The event is within the framework of the National Startup Day and Ho Chi Minh City Innovation and Entrepreneurship Week (Techfest – WHISE 2021) – an annual activity for startups, organized by the Ministry of Science and Technology of Vietnam.
Phong Van. “Vietnam to Become the New Technology Center of the World – Opportunities and Potential.” VNEXPRESS, 2022, startup.vnexpress.net/tin-tuc/xu-huong/co-hoi-de-viet-nam-thanh-trung-tam-cong-nghe-moi-cua-the-gioi-4402630.html. (Accessed Mar. 1, 2022)
Translated by: Pham Hoang Hung