In late 2024, the HCMC Innovation and Startup Center (located in District 3) is nearing completion, poised to become a connection for resources and a catalyst for innovative startup activities. In the north, the National Innovation Center (NIC) has established dual facilities in Hoa Lac Hi-tech Park and Hanoi, functioning as miniature ecosystems designed to support startups by linking them with investment funds and providing access to shared resources.

These initiatives aim to cultivate a fertile environment for the emergence and growth of innovative startup ventures, generating novel and transformative value for both the national economy and society.

“The innovative startup space transcends the provision of mere facilities, services, or networking opportunities; it actively fosters and incubates high-growth startups. The innovative startup center model aspires to establish a dedicated innovative startup hub within HCMC, injecting fresh incentives into regional development,” shared Director Nguyen Viet Dung of the HCMC Department of Science and Technology.

According to the Global Startup Ecosystem Index Report 2024, published by StartupBlink, Vietnam’s startup ecosystem has regained positive momentum this year, maintaining its 5th position in Southeast Asia and continuing to be recognised for its substantial potential. In 2024, Vietnam ranks 44th out of 133 nations and territories in terms of innovative startup strength. However, this marks only the initial phase of converting potential into tangible opportunities.

Currently, Vietnam boasts approximately 3,800 startups, predominantly concentrated in major urban centers such as Hanoi, Da Nang City, Hai Phong City, and HCMC. Among these, 11 startups are valued at over US$100 million, with two achieving unicorn status (valuations exceeding $1 billion), namely Momo and Sky Mavis.

Minister of Science and Technology Huynh Thanh Dat highlighted Vietnam’s rise to 44th globally in startup ecosystems, up from a less dynamic position. Venture capital attraction has surged, with deal activity rising 27 places to 50th globally. This improvement reflects a better investment climate and higher quality of innovative startups, driving significant breakthroughs.

This continuous internal ecosystem enhancement not only pushes domestic startups but also enhances Vietnam’s attractiveness to international businesses. With generative AI becoming a global competitive arena, Thundermark Capital (based in New York, the US) identifies Vietnam and Singapore as the two Southeast Asian representatives within the world’s top 30 in AI research.

“AI, particularly generative AI, demands significantly greater computational infrastructure than traditional AI, presenting a considerable barrier for Vietnamese businesses accessing this technology,” explained Dr. Tran The Trung, Deputy Director of AI Product Block at FPT Smart Cloud cum Director of the FPT Research Institute.

Generative AI is projected to contribute $14 trillion to Vietnam’s digital economy by 2030. Dr. Le Viet Quoc, known for his contributions to prominent Google AI projects such as Google Translate and Google Search, acknowledges the Vietnamese government’s proactive policies promoting startups and technology investment, creating favourable conditions for AI businesses to thrive and compete internationally.

The achievements of Vietnam’s efforts to cultivate a supportive and secure environment for technology businesses is proved by significant partnerships. These include Google’s strategic shift of its Asia regional headquarters from Singapore to Vietnam, coupled with substantial investments in future workforce development, including 40,000 Google Career Certificates scholarships and training for 200 Vietnamese startups. The establishment of an AI center in Vietnam by semiconductor giant Nvidia further underscores this trend.

An ecosystem that attracts major technology players generates synergistic benefits, not only cultivating a high-quality workforce but also creating substantial opportunities for aspiring AI entrepreneurs and fostering borderless competition.

Entering this global arena with shared standards requires Vietnamese technology businesses to develop resilience and expertise. Vietnamese AI firm VinBrain has secured contracts across Vietnam, the US, India, Myanmar, and Australia. Collaborating with hospitals, they’ve amassed a 4.26 million-image dataset from diverse global sources for AI training, enabling internationally competitive products and showcasing Vietnam’s AI competence.

Another typical example is FPT Smart Cloud, which is prioritizing sovereign AI development based on five pillars: infrastructure, data, platform, human resources, and ecosystem. Their $200 million NVIDIA partnership for an AI Factory (in March 2024) emphasizes infrastructural independence and data ownership, fueling AI research and development. A new 5,000-person Generative AI Research Center in Quy Nhon City further strengthens these sovereign AI efforts.

As Vietnam continuously strives internally to cultivate a fertile ground for the innovative startup ecosystem, encompassing human capital, policy frameworks, and market dynamics, it is simultaneously attracting international partners who recognise the nation’s technological potential.

National competitiveness now hinges not solely on human capital but on the synergistic combination of human intellect and AI. A strategy promoting sovereign AI will bolster Vietnam’s national competitiveness by enhancing labor productivity and driving automation, while also safeguarding data and human resources from dependence on the technologies of larger economies, ensuring digital sovereignty for Vietnam.

CEO Le Hong Viet of FPT Smart Cloud