Eighteen venture capital funds Monday committed a combined $425 million for Vietnamese startups over the next three years.
The investment pledges were made by both domestic and foreign investors at the ventures forum in Hanoi.
Some notable deals struck included South Korea’s DT&I Investment Fund agreeing to invest $1.4 million in Propzy, a startup app that allows users to find, and rent or buy properties, in the second quarter of this year.
Vietnam’s leading investment fund VinaCapital agreed to sign a strategic cooperation agreement with two South Korean funds to set aside $100 million to invest in the country’s startups in the next three years.
The European Chamber of Commerce in Vietnam (EuroCham) declared that members would contribute 3 million Euros for Vietnamese startups.
Founder of Singaporean venture capital fund Golden Gate Ventures, Vinnie Laura, told the local press that foreign investors were drawn to Vietnam because of its “good macro policy, rapid growth, a young population, and especially the fact that education and science are highly regarded.”
Speaking at the forum, Deputy Prime Minister Vu Duc Dam pointed out that Vietnam still has many things to do to attract foreign investment into its startups.
The country needs to continue improving its business environment, enacting policies on science, education, land and capital to encourage businesses to invest in enterprises and in training human resources, he said.
“We must constantly, constantly innovate to create opportunities for everyone, not only business opportunities but also opportunities to improve ourselves and contribute to the country and people.”
A report released in January by Topica Founder Institute (TFI), a startup accelerator program in Vietnam and Thailand, said Vietnamese startups received a combined $889 million through 92 investment deals in 2018.
This was three times the mount this community received in 2017 with the same number of deals, and six times that in 2016, TFI noted.
Particularly for early stage investments, which are “Seed” or “Series A” fund rounds, a report last year by Singaporean consultant firms KrAsia and Bain & Co showed that Vietnam attracted about $150 million in the early stages in 2018, double that of 2017.
The report predicted that in the coming years, Vietnam’s early-stage startups will continue to attract large investments of around $205 million, $320 million and $440 million in 2019, 2020 and 2021 respectively.
However, the Ministry of Planning and Investment said recently that Vietnam’s startup ecosystem, although registering rapid growth, is relatively young and not closely connected. Factors that contribute to the success of startups, including infrastructure, institutions, policies, finance, investment capital, markets and culture, must continue to be improved step by step, it said.
The Vietnam Venture Summit 2019 attracted more than 100 domestic and foreign investment funds, including many big names like CyberAgent Ventures (Japan), Mekong Capital (Vietnam), VinaCapital Ventures (Vietnam), and representatives of international corporations such as Google (U.S.), Visa (U.S.), BCG Digital Ventures (U.S.), and Lotte (South Korea).