Vietnam's start-up sector is closing the gap with regional leaders Indonesia and Singapore with new investment, according to a Nikkei Asian Review article (Illustrative photo: VNA)Hanoi (VNA) – Vietnam's start-up sector is closing the gap with regional leadersIndonesia and Singapore with new investment, according to a Nikkei Asian Reviewarticle.
The article cited ajoint research by Ho Chi Minh City-based venture capital ESP Capital andSingapore's Cento Ventures which showed start-up investment in Vietnam hit 246million USD this year through June on 56 deals.
It added that investmentis expected to top 800 million USD by the end of the year, which would representa rise of at least 80 percent over last year's 444 million USD.
The article said a totalof about 5.9 billion USD was invested in Southeast Asian start-ups in the firsthalf of 2019. When it comes to the investments that can be tracked to adestination country, Vietnam accounted for 17 percent of start-up investmentsin the region, up from 5 percent for all of 2018, following Indonesia at 48percent and Singapore at 25 percent.
Start-up investmentin Vietnam began to rise last year, with the online retail, payments andeducation sectors attracting huge capital injections.
The article reportedthat among start-ups that raised the lion's share of funding last year wase-payment app Momo, which pulled in about 100 million USD from American privateequity company Warburg Pincus, making it one of the largest single rounds everraised by a Vietnamese start-up.
This year,e-commerce platform Tiki received a large injection of funds, according toresearch by ESP-Cento, though the company has yet to disclose the funding. Tikiwas reportedly set to raise 75 million USD in March from investors led bySingaporean private equity company Northstar Group.
In addition, paymentsolution company VNPay raised 50 million USD from Singaporean state fund GIC,while gaming operator VNG received 29 million USD from Temasek Holdings.
The article continuedthat smaller Vietnamese startups are also being established. Luxstay, a roomsharing start-up like Airbnb, raised 4.5 million USD in May and point-of-salesystem operator KiotViet received 6 million USD in August, according to start-updatabase Crunchbase.
Backed by a largepopulation of some 96 million and a healthy economic growth rate of 6.7 percentin this year’s second quarter, more overseas investors are paying attention toVietnam. Home-grown tech-driven services in sectors, such as e-payments,ride-hailing, e-commerce and logistics, are booming.
The joint report of ESPCapital and Singapore's Cento Ventures noted that Vietnam is in an importantperiod when key components of a strong digital economy are beginning to shapeup.
It said thatVietnam’s digital economy will benefit from its young population, of which 60percent are aged under 35, and a still-growing mobile and internet penetrationrate. The research said that over 10 million more consumers will go online by2023.
The article affirmedthat Vietnam also has a highly educated workforce. The country's pupils rankedeighth globally in the PISA international science test, higher than Hong Kong'sand Republic of Korea's. Coupled with a relatively low labour cost, Vietnam haslong been a software outsourcing hub in Asia, producing large homegrown ITcompanies such as FPT.
Overseas-educatedentrepreneurs are also helping to shape the start-up ecosystem in Vietnam.Silicon Valley-based education startup Elsa, run by Stanford-graduateVietnamese CEO Vu Van, has about half of its 40 staff in HCM City to grow itsEnglish-learning app business in Vietnam.
Government support,through accelerator and incubator programs, has also been contributing to thecountry's start-up ecosystem, ESP Capital's general partner Le Vy was quoted assaying.
Southeast Asia's start-upspace has been led by Indonesia and Singapore, which claim six of the eightregional unicorns - unlisted start-ups valued at 1 billion USD or more.Vietnam, however, "certainly has the potential to establish itself asSoutheast Asia's next leading start-up ecosystem," ESP-Cento researchnoted.-VNA
The article cited ajoint research by Ho Chi Minh City-based venture capital ESP Capital andSingapore's Cento Ventures which showed start-up investment in Vietnam hit 246million USD this year through June on 56 deals.
It added that investmentis expected to top 800 million USD by the end of the year, which would representa rise of at least 80 percent over last year's 444 million USD.
The article said a totalof about 5.9 billion USD was invested in Southeast Asian start-ups in the firsthalf of 2019. When it comes to the investments that can be tracked to adestination country, Vietnam accounted for 17 percent of start-up investmentsin the region, up from 5 percent for all of 2018, following Indonesia at 48percent and Singapore at 25 percent.
Start-up investmentin Vietnam began to rise last year, with the online retail, payments andeducation sectors attracting huge capital injections.
The article reportedthat among start-ups that raised the lion's share of funding last year wase-payment app Momo, which pulled in about 100 million USD from American privateequity company Warburg Pincus, making it one of the largest single rounds everraised by a Vietnamese start-up.
This year,e-commerce platform Tiki received a large injection of funds, according toresearch by ESP-Cento, though the company has yet to disclose the funding. Tikiwas reportedly set to raise 75 million USD in March from investors led bySingaporean private equity company Northstar Group.
In addition, paymentsolution company VNPay raised 50 million USD from Singaporean state fund GIC,while gaming operator VNG received 29 million USD from Temasek Holdings.
The article continuedthat smaller Vietnamese startups are also being established. Luxstay, a roomsharing start-up like Airbnb, raised 4.5 million USD in May and point-of-salesystem operator KiotViet received 6 million USD in August, according to start-updatabase Crunchbase.
Backed by a largepopulation of some 96 million and a healthy economic growth rate of 6.7 percentin this year’s second quarter, more overseas investors are paying attention toVietnam. Home-grown tech-driven services in sectors, such as e-payments,ride-hailing, e-commerce and logistics, are booming.
The joint report of ESPCapital and Singapore's Cento Ventures noted that Vietnam is in an importantperiod when key components of a strong digital economy are beginning to shapeup.
It said thatVietnam’s digital economy will benefit from its young population, of which 60percent are aged under 35, and a still-growing mobile and internet penetrationrate. The research said that over 10 million more consumers will go online by2023.
The article affirmedthat Vietnam also has a highly educated workforce. The country's pupils rankedeighth globally in the PISA international science test, higher than Hong Kong'sand Republic of Korea's. Coupled with a relatively low labour cost, Vietnam haslong been a software outsourcing hub in Asia, producing large homegrown ITcompanies such as FPT.
Overseas-educatedentrepreneurs are also helping to shape the start-up ecosystem in Vietnam.Silicon Valley-based education startup Elsa, run by Stanford-graduateVietnamese CEO Vu Van, has about half of its 40 staff in HCM City to grow itsEnglish-learning app business in Vietnam.
Government support,through accelerator and incubator programs, has also been contributing to thecountry's start-up ecosystem, ESP Capital's general partner Le Vy was quoted assaying.
Southeast Asia's start-upspace has been led by Indonesia and Singapore, which claim six of the eightregional unicorns - unlisted start-ups valued at 1 billion USD or more.Vietnam, however, "certainly has the potential to establish itself asSoutheast Asia's next leading start-up ecosystem," ESP-Cento researchnoted.-VNA
VNA
