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Deputy Prime Minister of Vietnam Vu Duc Dam giving a speech at Vietnam Venture Summit 2020.
As many as 33 venture capital firms spanning South Korea, Japan, Singapore, Indonesia and Vietnam have pledged over US$800 million to support Vietnam’s startup ecosystem over the next three to five years.
The pledge-signing ceremony was held at the Vietnam Venture Summit 2020, organised as part of The Vietnam Tech and Startup Week, in Hanoi.
The VC firms who pledged investments include VinaCapital Ventures, Do Ventures, Nextrans, ThinkZone, NextTech, VietCapital Ventures, CyberAgent Ventures, Smilegate Investment, FEBE Ventures, Genesia Ventures, Monk’s Hill Ventures, Vertex Holdings, 500 Startups, and Quest Ventures, among others.
Also Read: Vietnam’s mobile commerce is set to open up avenues for startups
As per a press statement, the commitment marks the return of uptake in investments within the Vietnamese startup ecosystem.
According to an industry report by Do Ventures, US$861 million was invested in 123 deals within Vietnam, more than double the number in 2018. However, the pandemic put an end to this increase.
Investment proceeds in the first half of 2020 decreased by 22 per cent, from US$284 million in the same period last year to US$222 million, due to travel restrictions and uncertainties in global financial markets.
Therefore, the US$800 million pledged should result in resumption in increased investments into Vietnam.
This summit comes on the heels of the US-China trade war as Vietnam sees a shift of manufacturing and Foreign Direct Investment (FDI) into the country.
With US$100 billion in electronic goods exported yearly and an annual GDP growth rate of seven per cent for the past decade, Vietnam is poised to take advantage of manufacturing firms moving south.
It is a key manufacturer for some of the greatest phone producers, such as Google, Samsung and LG.
Also Read: How to bridge the tech talent gap in a post-pandemic world
Recently, Chinese acoustics manufacturer Goertek, announced that its production of Apple’s Airpods wireless headphones will move to Vietnam, as a result of the trade war.
Ed Grefenstette, CIO at Dietrich Foundation, said: “We look towards past experiences in China to draw parallels and access opportunities in Southeast Asia. While talent used to be a bottleneck in Vietnam, we are seeing extraordinary best practices being adopted from around the world here.”
Vietnam, with its strong pipeline of tech talent, fostered by years of education and retraining by the government, is ready for the shift for talent demand.
Among the delegates at the event were leaders from global tech firms such as PayPal and Google, industry veterans from Vietnamese startups such as VNG and Tiki and investors from VCs such as Softbank Ventures and Sequoia Capital.
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Image Credit: Vietnam Venture Summit
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