Vietnam, one of the youngest and fastest growing economies in Asia, has attracted a new wave of venture capital money to its burgeoning startup ecosystem, as 33 VC firms pledged to invest over USD 800 million in local startups in the next three to five years during the Vietnam Venture Summit 2020 this week.
With foreign investors spanning from Korea, Japan, Singapore, Indonesia, and Vietnam, the commitment is expected to be a signal that Vietnam has “matched up with heyday levels of investment in 2019 and before”, according to a statement released by the summit.
In 2019, Vietnamese startups bagged USD 861 million from a total of 123 venture deals, with a 92% year-on-year growth compared to 2018, according to a report by Vietnam-based early-stage VC Do Ventures. However, amid COVID-19, the inflow of money decreased by 22% in the first half of 2020 to USD 222 million. Investor interest has nevertheless grown in emerging industries like HR tech and property tech, according to the report.
VCs remain overall optimistic towards the country’s investment landscape. Vy Le, general partner of Do Ventures, told KrASIA in an interview in October that startups would “bounce back soon.”
“According to our recent survey on 50 active funds in the region, Vietnam is the top destination for investment in the next 12 months,” she said. “Investment sentiment remains quite positive. Surveyed funds expect to invest in 117 to 200 deals in the next 12 months. Nearly 80% of the investors have planned to deploy 1 to 5 deals.”
Vietnam is currently home to two unicorns—gaming and entertainment giant VNG Corporation and digital payment firm VNPAY, which is reportedly backed by SoftBank and Singapore sovereign wealth fund GIC.