The biggest deals include a $100-million funding round by U.S. investor Warburg Pincus in payment app MoMo, a $15-million investment in English learning app ELSA by Vietnam Investments Group and U.S-based Susquehanna International Group, and $6 million into gifting platform Got It by local digital gaming group VNG.

The other four investments, in hotel booking platform Go2Joy, med-tech startup Genetica, online real estate platform Citics, and livestreaming platform GoStream, were all worth less than $3 million.

According to Thai Van Linh, CEO of consulting firm TVL Group and senior advisor to venture capital fund Openspace Ventures, the startup ecosystem in Vietnam is making exciting progress.

Vietnamese tech firms have been thriving mainly thanks to the advance of digitization and consumers moving online, buying and selling on social networks or simply communicating online, Linh said in an interview with VnExpress.

"In the first quarter’s major deals, the role and impact of foreign funds have been quite evident, despite fears that the pandemic would deter their involvement."

Last year, was a time of reflection and creativity, with many businesses having to conduct comprehensive reassessments of their operations, products and services to look for new ways to bring value to the customer, she said.

"Venture capital funds have also undergone a similar process. They looked from different perspectives to find potential in each startup notwithstanding the obstacles ahead. To that end, many funds have invested in businesses with a large customer base or consistently growing revenues."

Long-term growth has also been also an important factor, she said. With more than 55 percent of its population aged below 35, Vietnam not only has a young population but is also very open to change and willing to try new products and adopt new technologies.

There have also been a number of major events that are creating the foundation for the development of startups and confidence among foreign funds to participate.

Vietnam has entered into several foreign trade agreements that make it easier for startups to expand their customer base to overseas markets, while the consistent development of infrastructure would help increase the productivity of logistics operations and improve people's living standards, she added.

The Vietnamese diaspora abroad has been moving back to the country, bringing with it the experience cquired by working for global companies.

More Vietnamese students are choosing to return home, bringing with them international perspectives on innovation and growth.

This demographic is being utilized by large corporations to create an abundant supply of human resources for startups, Linh said.

Increasing foreign attention

Interest in Vietnam among foreign venture capital funds has steadily increased over the last 10 years though many still have their main offices elsewhere in the region, Linh said.

"Their headquarters may be in Singapore and they only fly to Vietnam once a month or once a quarter to explore. Some major investment funds in established markets such as the U.S. have established regional offices focusing on the Asian market."

Singapore-headquartered Openspace, which manages more than $425 million, has opened a representative office in Vietnam. "We believe the next unicorn startup will come from Vietnam, the Philippines or Thailand," Linh said.

"If a founder tries to build a startup based on an ongoing trend, it is already too late compared to incumbents in that market."

Instead, they have to have a product ready, build a customer base, and run it smoothly before a trend emerges, she said.

Asked about imminent startup trends, she said that does not matter and now should be considered a time to explore and experiment.

"I meet many business owners who are doing this. Covid-19 may have adversely affected their business, but then they come up with new ways to change. And now, they are setting on a new path."

Linh, who is also a judge on the business reality TV series Shark Tank Vietnam, said startups should not only think about money when tying up with investors but also consider other ways in which the latter could contribute, such as with strategic guidance and introduction to partners.