Vietnam Tech Startups Boom

Well-known for its relatively low-tech textile and agriculture industries, Vietnam is fast becoming a regional technology hub. Multinationals such as Samsung and Intel already have multi-billion dollar presences here (See: Vietnam’s High-Tech Hub: More Than Just Silicon Dreams), and Vietnam tech startups are now joining the scene in a big way.

Though there are no concrete statistics on tech startups in the country, Japan’s SoftBank Group Corp. estimates that there are about 1,500 currently in operation. If correct, this would mean Vietnam has more startups relative to population than regional neighbors China, Indonesia, and India.

Travel the streets of modern-day Vietnam and it should come as no surprise that the tech sector is growing. Internet cafes abound and everyone from toddlers to the elderly clutch iPhones or the latest Samsung tablet. Roughly 44 per cent of Vietnam’s population of about 90 million use the internet, and many of those people access the web through mobile technology. The country therefore is a ripe target for app developers and techies, and both domestic and foreign investors are taking notice.

Last year FPT, the largest tech company in Vietnam, announced the creation of FPT Ventures, a venture capital fund aimed at fostering Vietnam tech startups. The fund will channel over US$3 million per year to companies with valuations below $1 million, providing funding of at least $50,000 per startup. This equates to seed money for up to 60 startups per year.

On the international side 500 Startups, a Silicon Valley-based seed-fund and accelerator which has invested in over 1,000 companies around the world, entered the country last year and in August publicised its funding of three Vietnam startups with plans to invest $10 million in 20 more companies this year. Goldman Sachs and Standard Chartered PLC meanwhile recently raised their investment in MoMo, an e-wallet startup, by $28 million.