Startup Ecosystem in Vietnam

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By: Dezan Shira & Associates
Editor: Koushan Das

Vietnam currently has around 3,000 startups involved in sectors such as fintech, food tech, healthcare, and e-commerce. In 2017, 92 startups received investments worth US$ 291 million, 42 percent higher compared to 2016, while the number of startups increased by 45 percent. The industry still lags in terms of funding and scale when compared to startups in Southeast Asia, but there is huge room for growth.

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Last year, the startup deal value in Vietnam stood at US$ 291 million, with local investors accounting for US$ 46 million, and foreign investors accounting for US$ 245 million. The number of deals rose from 50 in 2016 to 92 in 2017, with 61 percent of the projects receiving investments less than US$ 1 million. Foreign investors were involved in only 28 deals, while local investors accounted for 64 deals.

The top six deals alone amounted to US$ 198 million, according to Vietnam Startup Deal 2017, a report compiled by the Topica Founder Institute. Major deals included Sea Group acquiring an 82 stake in Foody for US$ 64 million, and other startups for US$ 50 million. In addition, invested US$54 million in Tiki.

Fintech, food tech, and e-commerce received majority of the investments, with e-commerce accounting for 21 deals, worth US$ 83 million, food tech accounting for two deals worth US$65 million, and eight deals in fintech worth US$57 million. Other sectors that received investments were media, logistics, and online travel.

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Government support

To encourage entrepreneurship, the Vietnamese government has established a number of funds at State and provincial/city level to support startups. In addition, they have also collaborated with countries and banks, to develop funding and innovation programs, to provide loans, technical training, and business mentoring. Some of the programs are as follows:

  • SpeedUP is a VND 11.75 billion (US$ 520,520) fund, which has been started by Ho Chi Minh City’s Department of Science and Technology. The fund invests in 14 startups, with investments ranging from VND 350 million (US$ 15,500) to VND 1,282 billion (US$ 56,792).
  • is an online platform launched by Hanoi’s People Committee that has details about startups and investors and aims to connect investors with entrepreneurs.
  • Vietnam – Finland Innovation Partnership Programme is a program financed jointly by both governments. It is currently in its second phase through 2014-2018 and has a budget of EUR 11 million. The fund’s investments focus on innovative companies that are aiming for international growth and currently includes 18 innovative companies and 5 high growth startups in their portfolio.
  • Saigon Silicon City Center is a 52-hectare complex, which is being built to support tech-focused startups and international firms. It is expected to attract investments worth US$ 1.5 billion by 2020.
  • Mekong Business Initiative is a partnership program between the Asian Development Bank and the Government of Australia that focuses on alternative financing, including venture capital, angel investments, and fintech in Cambodia, Laos, Myanmar, and Vietnam.
  • Mobile Applications Laboratory (mLab) East Asia was launched by Ho Chi Minh City and has an incubation program that focuses on mentoring, training, access to equipment, and financing.
  • National Technology Innovation Fund (NATIF) is a government agency and financial institution under Vietnam’s Ministry of Science and Technology that provides grants and preferential loans for R&D, innovation, and technology transfer.
  • National Agency for Technology, Entrepreneurship, and Commercialization Development (NATECD) is a national platform under Vietnam’s Ministry of Science and Technology that provides training, mentorship, and financial aid to startups.

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Startup regulations

In 2016, the Prime Minister approved the “Supporting National Innovative Start-up Ecosystem to 2025” Project, or Project 844, through Decision 844/QD-TTg/2016. It focuses on supporting the national innovation startup ecosystem through 2025 and developing a legal system and a national e-portal for startups by 2020. In addition, it will also provide funding support to 200 startup enterprises.

In January 2018, the Law on Supporting Small and Medium-Sized Enterprises came into effect, with detailed provisions for support to start-ups in areas such as technology transfer, training, trade promotion, investments, preferential loans, and incentives for venture capital funds.

Decree 38/ND-CP, which came into effect in March 2018, focuses on innovative start-up investments. It identifies and recognizes start-up investment activities as a business and provides legal status to innovative start-up companies and funds. In addition, one of the regulations stipulates that the State can also invest in a startup, maximum to 30 percent of the total investments.

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ASEAN ecosystem

Southeast Asia currently has a population of around 630 million people and is the seventh largest economy worldwide. Driven by young demographics and a growing number of internet users, the region has seen a rapid rise in startups.

 According to Tech in Asia’s data, investments in the region’s startups grew from US$ 2.52 billion in 2016 to US$ 7.86 billion in 2017, despite a decrease in the number of deals. Singapore and Indonesia continue to lead in the region, with e-commerce, fintech, and gaming emerging as the most attractive sectors.

Amongst all the member states, Singapore continues to be a gateway for startups to expand into the surrounding markets, mainly due to its business environment, strong intellectual property regulations, government support, and workforce talent.

It currently has around 2,400 startups, worth over US$11 billion. The country has established Startup SG, which has consolidated all local startup schemes under one name. Support programs include mentorship, financing, grant support, investments, research, and enhancing capabilities and programmes of incubators and accelerators. In addition, the government also established SGInnovate, a government-owned firm nurturing Singapore’s deep tech start-ups, businesses founded on breakthrough science or engineering.

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The major challenges facing the startup community in Vietnam are the lack of talented workforce, funding, lack of scale, and slow regulatory reforms. In addition to financial support through funds and preferential loans, the government needs to increase investments in training and education to build a skilled workforce.

It also needs to continue with its regulatory reforms, as it will lead to a friendly business environment for investors and developers. This will not only attract the much needed foreign investments but also the talented workforce from the surrounding region, which will help the firms to achieve reasonable scale.


Vietnam, driven by its growing internet penetration, smartphone adoption, and young demographics, offers huge potential for startups, especially ones focusing on fintech, e-commerce, and food technology. These sectors have been the top priorities for investors in the last few years.

Other sectors with potential include micro-financing, online travel, and logistics.


Vietnam Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Eurasia, including ASEANChinaIndiaIndonesiaRussia & the Silk Road. For editorial matters please contact us here and for a complimentary subscription to our products, please click here.

Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout the Vietnam and the Asian region. We maintain offices in Hanoi and Ho Chi Minh City, as well as throughout China, South-East Asia, India, and Russia. For assistance with investments into Vietnam please contact us at or visit us at


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