Hundreds of millions of US dollars invested in Vietnam startups
Amid the Covid-19 pandemic, many startups in online education, health care and goods delivery have received huge capital from foreign funds.
Startup Marathon raised 1.5 million USD from Forge Ventures, Venturra Discovery, and iSeed, and angel investors. Marathon will become a partner supporting the best teachers to teach thousands of students online across the country.
Loship, the Vietnamese on-demand e-commerce platform that started as a review app, recently announced that it had raised 12 million USD in pre-Series C funding. The round was co-led by BAce Capital, an Ant Group-backed venture firm, and the direct investment unit of Sun Hung Kai & Co Limited.
Founded in 2017, Loship offered one-hour deliveries for a large range of products and services, including food, ride-hailing, medicine and B2B supplies. The company says it has more than 70,000 drivers and 200,000 merchants, and serves about 2 million customers in Hanoi, Ho Chi Minh City, Da Nang, Can Tho and Bien Hoa.
Loship’s new funding will be used to expand into new cities and grow verticals like B2B deliveries for small food and beverage businesses and retail stores.
Got It is also a successful startup that successfully raised more than 25 million USD of investment. Got It has become one of the most well-known apps among its kind, once reaching second place on App Store’s most downloaded list.
Vietcetera, a startup in the field of information and digital media in Vietnam, raised 2.7 million USD in a pre-series A funding round led by North Base Media, according to Tech in Asia. Founded in 2016, Vietcetera says its platform has reached more than 20 million users per month, mainly from the Vietnamese market.
Recently, Forbes announced the Forbes Asia 100 to Watch ranking, which introduces a list of small companies and startups that are on the rise in the Asia-Pacific region. Vietnam has four startups in this list: Hoozing, Logivan, Lozi and Med247.
Med247 is the only representative of Vietnam in the biotechnology and healthcare industries. The platform provides round-the-clock offline to online medical services through a mobile app and links to full-service clinics. The company raised 1 million USD to expand its scale through partnerships.
Hoozing is an app that provides user reviews, pricing tools, and digital payment options to speed real estate rentals and sales. CEO Hai Le said that despite the pandemic, Hoozing still earned about 1.1 million in revenue in 2020. The startup that was established in 2015 is expected to be profitable by the end of the year with a revenue of 2 million USD.
Logivan is a startup founded in 2017 to solve the problem of the fragmented traffic network in Vietnam. Logivan allows companies to locate trucks and book trips easily. This startup has more than 60,000 drivers working for Coca Cola, Olam and Wilmar. To date, the company, led by CEO Linh Pham, has raised about 8 million USD from Insignia Ventures Partners and K3 Ventures.
According to the Vietnam Innovation and Technology Investment report, some sectors such as HRTech (HR technology) and PropTech (real estate technology) continue to attract investment capital, while fields such as EdTech (education technology), MedTech (health technology), and SaaS (service software) are on the rise due to the change in behavior of consumers and businesses after Covid-19.
In the context of Covid-19, Vietnam is still an attractive destination for investors, particularly those from South Korea and Singapore.
Le Diep Kieu Trang, co-founder of Alabaster Venture Fund, said: “Investment activities are based on the following factors: capital, technology and people. For capital and technology, we bring in from abroad; for people, we put our full trust in human resources in Vietnam. Vietnam is one of the few countries that has good technical human resources, along with abundant basic labor resources.”
Giving advice to startups, Hoang Nam Tien, Chairman of FPT Telecom, said that startups need to work devotedly and for many hours a day on their passions.
He said that it is difficult for a startup to succeed in Vietnam. He cited his case as an example. "I used to drive a Lexus car, but after a trip to Germany, when I tested a BMW car and was introduced to that car’s FPT technology, the first thing I did when I returned to Vietnam was to immediately sell the Lexus and buy a BMW, although the BMW was cheaper," said Tien.
"When I was questioned when FPT would make products with its own name, I realized that we may succeed overseas but fail in Vietnam. Many of our applications are brought back to Vietnam but they are not used by local customers and are not accepted by the local market," he said.
According to Tien, to conquer the Vietnamese market, startups need to sell what customers need, not what they have. Another important factor when starting a startup is making a difference, he said.
Chairman of BestB Capital Investment Fund Pham Anh Cuong said that although Vietnamese startups have very good ideas, there are many problems in the cooperation process. The first is that most startups lack the ability to manage, and lack practical experience in the business environment.
In addition, startups are optimistic about the market, thinking that they are the first and can quickly approach the market without knowing that in doing business, competitors have many ways to copy and modify ideas. Therefore, in order to attract investment capital, startups need to change and be more agile.
Startup Sky Mavis with the game Axie Infinity has surprised the Vietnamese startup community when it reached a huge total market capitalization - US$2.4 billion - after three years since its release, a record time in the Asian technology world.
Foreign investment into Vietnamese startups is predicted to increase although the COVID-19 pandemic has left negative impacts on the economy, according to experts.