Many new venture capital (VC) firms have entered the Vietnamese startup ecosystem and are excited about the upcoming opportunities in the country. The things that seem to be driving investor interest are favorable demographics and scalable business models. The number of Vietnamese startups have now reached 1,400.
Vietnam is still a large, young, and fast-growing economy. This is because digital numbers- like internet penetration and smartphone penetration- have grown to massive scales, and because some pioneering founders have been successful and proven the potential of the Vietnamese market. Compared to other countries in the ASEAN (Indonesia, Thailand, Malaysia, Singapore, Philippines and Vietnam), Vietnam appears to have a strong advantage of ready technical talent, energy, resourcefulness, and potential of market growth.
The increase in the attractiveness of Vietnamese startup companies is partly due to external factors and partly due to local market shifts. Vietnamese startups have become compelling to other foreign corporate entities, including South Korea’s Yello Mobile, which invested in marketing agency CleverAds and price comparison site Websosanh; Singapore’s internet company Garena, in July leading a series B round for Foody Corporation – which later in the month grabbed a series C funding from US-based VC firm Tiger Global Management; and Tokyo-based outsourcing company Transcosmos, which acquired 30 per cent of e-commerce platform Hotdeal in a deal inked last month.