Vietnam joins "golden triangle of startups" in Southeast Asia
VOV.VN - Lianhe Zaobao newspaper in Hong Kong (China) has recently published analysis outlining the nation’s advantages, such as a strong domestic market and abundant science and technology human resources, with local startups growing rapidly in recent years.
As a result of this growth, the country has joined Indonesia and Singapore to become the third pillar of the “golden triangle of startups” in Southeast Asia.
The article cited a speech given by Vietnamese Minister of Planning and Investment Nguyen Chi Dung at the Startup Investment Forum held in December, 2022, saying that in recent years, more and more foreign direct investment (FDI) target Vietnamese startups.
During the initial nine months of 2022, the nation’s innovative startups alone attracted approximately US$500 million in investment capital, with the investment level of each transaction also higher compared to the previous year.
Over the past two years, startups attracted nearly US$2 billion in foreign investment, indicating that Vietnamese startups are increasingly appealing to international and regional investors.
In 2021, local startups raised US$1.4 billion in investment capital, a figure 56% higher than the figure of US$894 million recorded in 2019.
The Vietnam National Innovation Center estimates that Vietnamese startups' ability to attract capital will maintain an upward trend in the year ahead.
According to the media outlet, 39 investment funds have pledged to invest US$1.5 billion into the nation in the 2023 to 2025 period, duly bringing the total investment of Vietnamese startups up to US$5 billion in this period.
According to Vinnie Lauria, co-founder of Golden Gate Ventures, in the first 10 years of the Southeast Asian startup ecosystem, Singapore and Indonesia were both the primary growth drivers that led the region.
Most notably, Vietnam became the third pillar of the "golden triangle of startups" in 2022, bringing a successful combination of top technology talent to the table. In line with this, the Vietnamese inherent startup culture, as well as the domestic market, has been rapidly developing in the country.
Luu Can Binh, an investment partner of Vertex Ventures SEA & India Fund, also offered a positive assessment of Vietnamese development prospects over the coming years, noting that the Vietnamese startup ecosystem boasts explosive power.
Along with the advantage of an abundant technological talent reserve and a strong individual's sense of entrepreneurship, factors such as stable domestic politics, a young and highly-educated workforce, developing infrastructure, digital skills and innovation capacity, as well as the support of the Government, all serve to create a beneficial ecological environment for local startups.
The article quoted Dr. Le Hong Hiep - a Senior Fellow at the Vietnam Studies Programme and the Regional Strategic and Political Studies Programme of the ISEAS – Yusof Ishak based in Singapore, who especially appreciated Vietnamese startups in the fields of financial technology (Fintech), e-commerce, and educational technology, adding that these companies will attract the most sustainable foreign investment.
The Vietnamese Government has therefore made efforts in order to support startups, although there remains plenty of work left to further improve the investment environment and legal framework as a way of lowering risks for startups, while simultaneously encouraging tech talents to set up local companies.
Meanwhile, Binh said that it will have to wait until the domestic startup ecosystem is more mature to expand its vision to the regional market before Vietnam can surpass Indonesia or Singapore to become the leader of the "golden triangle of startups".