Technology as favorable choice among Vietnamese startups

In the digital era, advanced technologies have wider implementations in various aspects. Many startup businesses in Vietnam have chosen technological products and services as their development direction and have achieved impressive results so far.

Young people are studying proper hardware to apply for the digital transformation ecosystem in SHTP-IC. (Photo: SGGP)

Six years ago, when Elsa Speak started its first funding round, not many investors thought it could reap such a success among so many existing applications for English language learning. However, at present, the app has been used by 13 million people in 101 nations.

“We began with identifying our vision, and searched non-stop for the most suitable technology for that”, said Elsa’s Founder and CEO Van Dinh Hong Vu. In 2021, Elsa was successful in its Series B funding round to attract US$15 million from Vietnam Investments Group and SIG. It is planning to expand its Latin American market and establish its own Business-to-Business (B2B) platform for wholesaling purposes.

Being able to attract $578 million from Alibaba and other investors (B Capital Group, Monk’s Hill Venture, Zamrud, Geopost/DPDgroup), Ninja Van is valued at over $1 billion and included in the list of billion-dollar startup businesses and individuals in Southeast Asia. It is going to use the additional capital for technological and infrastructure upgrades, cost optimization, operation quality improvement.

FoodMap is another noticeable name as it has just succeeded in attracting an investment of $3 million. Launched in 2020, this e-commerce platform now offers products from over 200 farms and agricultural manufacturers in Vietnam.

The open workspace of M_Service startup unicorn boosts creativity

Among the 800 startup unicorns in the world, four come from Vietnam, namely VNG, Sky Mavis, VNLife and M_Service. VNG and Sky Mavis develop and distribute online games. The other two work in the fields of payment portals and e-wallet, a branch of Fintech.

"The Vietnamese startup ecosystem is at the turning point to shine in the region thanks to the three factors: its ability to expand the international market, its capacity to create hi-tech products and services, and its maturity to become an investor for the next startup generation”, said Le Hoang Uyen Vy – Co-founder of Do Ventures.

Vietnamese startups can now enjoy a rich capital source from both large domestic corporations or trading boosting organizations and international investors like VSV Capital - Vietnam Silicon Valley, Mekong Capital, 500 Startups Vietnam, Vietnam Investment Group, IDG Ventures Vietnam, Nextrans. The fields that attract most investors are financial technologies, e-commerce, online education, business solutions, logistics solutions.

(Photo: SIHUB)

The good news is in 2021, major businesses in Vietnam began to form a startup ecosystem to pour capital or non-profit financial support to young startup enterprises. For instance, the Innovation Fund of Vingroup delivered VND10 billion ($442,000) without any commitments or stocks in return to help Vbee startup in its pioneering development of text-to-speech technology using AI. Another example is the 22-milion-dollar investment of VNG startup unicorn in Telio – a B2B e-commerce platform.

Huynh Kim Tuoc, Managing Director of Saigon Innovation Hub (SIHUB) under the HCMC Department of Science and Technology, stated that startups should not stop at just introducing high quality products or a methodical startup plan. They have to prepare themselves for the initial public offering process (IPO).

In the last 2 years, SIHUB has hosted many IPO-related events for startups to increase their own values and scales after having such an impressive growth rate. Despite so many challenges, IPO does create more motivations for startup to further develop.

“It is high time we stressed the importance of startup being able to approach the domestic IPO capital flow in order to contribute to the national economy; identified the missing pieces in the current innovative startup ecosystem to continue helping startups successful in the Series funding rounds; and provided favorable conditions for the startup community to discuss necessary support for IPO-oriented activities of startups with economic experts, policy makers”, said Managing Director Tuoc.

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