Eighteen funds have committed to pouring US$434.8 million into startups over the next three years while many cooperation agreements between the Ministry of Planning and Investment, funds, and startups have been inked at the Vietnam Venture Summit held recently in Hanoi.

At the signing ceremony (Photo: VIR)

Representatives of DT&I, startup Propzy, and the Ministry of Planning and Investment (MPI) signed agreements at the summit. Accordingly, the South Korean fund DT&I will begin pouring US$1.4 million into Propzy, the startup providing solutions for no-intermediary real estate transactions within this quarter.

The MPI representative also signed a memorandum of understanding with Golden Gate Ventures to support startups and the Vietnamese innovative startup ecosystem. 

Another memorandum of understanding was inked by the MPI representative and SG Innovate to create and develop startups in professional technology.

Additionally, Golden Gate Ventures also announced a total investment of VND10 trillion (US$434.8 million) into Vietnamese startups within the next three years. This is a very large amount for startups in every round of investment.

The representative of the European Chamber of Commerce (EuroCham) also revealed the newly-established fund of the European Union valued at €3 billion (US$3.39 billion) for startups, while VinaCapital announced signing agreements with two South Korean funds to prepare US$100 million for Vietnamese startups in the next three years.

According to the report of KrAsia and Bain&Co, Vietnam attracted around US$150 million in 2018, twice as much as in the year before. In the time coming, startups in the early stage of investment will receive a huge investment of US$205 million, US$320 million, and US$440 million in 2019, 2020, and 2021, respectively.

This means the Vietnamese startup ecosystem has been developing significantly both in quantity and quality. The country had only 400 startups in 2012, but the figure quadrupled to 1,800 startups in 2015 and continued to grow rapidly to 3,000 firms last year.

Accordingly, there are more than 40 venture funds doing business in Vietnam, twice as many compared to 2015. Numerous domestic corporations have also joined the sector, including FPT, Viettel, Vingroup, CMC, CenGroup, investing significant amounts of capital and opening more than 60 co-working spaces across the country.

At the summit, representatives said that the Vietnamese startup ecosystem is still in its nascent stage compared to other regional countries, and lacks connectivity, while the elements of success for startups, such as infrastructure, institutional policy, finance, investment capital, market, and startup culture, are still being gradually perfected. However, Vietnam's startup scene has proved attractive for international and regional venture capital funds.

In addition to the networking activities of the last forum, the government has been building specific policies and strategies to proactively link with foreign investors who are interested in the Vietnamese market, as well as to perfect the startup ecosystem and facilitate business.

The Vietnam Venture Summit is taking place on two days, on June 10 in Hanoi and June 12 in Ho Chi Minh City, with the participation of government leaders and heads of ministries and agencies. The event confirms the government's commitment to welcoming investment from international and local innovative startup funds.

The summit gathered over 100 local and foreign investment funds, including a lot of international well-known funds such as Softbank Vision Fund, CyberAgent Ventures, Mekong Capital, 500 Startups Vietnam, DT&I, IDG Ventures Vietnam, and VinaCapital Ventures, as well as representatives of international corporations like Google, Visa, BCG Digital Ventures, One Championship, Lotte, and successful startups like Razer, Trusting Social, WeFit, Luxstay, Minet, GOI-IXE, and Plasma.