Asia and the Pacific’s next tech start-up “unicorn” may spring from Viet Nam, as the groundwork to build a strong ecosystem capable of supporting these businesses is well underway, according to a new report by the Asian Development Bank (ADB).
The Government of Viet Nam’s long-term objective for the sector is to attract knowledge, organisations, individuals, and entrepreneurs to contribute to economic development and create successful start-ups.
ADB’s report, Viet Nam’s Ecosystem for Technology Startups, looks at the progress of start-ups in the Southeast Asian country.
An example of government support is Project 844, which aims to develop up to 600 enterprises by 2025, 100 of which will have collectively raised at least VND2 trillion (about US$85.44 million).
This is supported by the National Technology Innovation Fund and two new projects, "Supporting Students in Starting a Business up to 2025” and “Supporting Women’s Start-ups in 2017–25”.
“The Government of Viet Nam recognises that tech start-ups are the new engines of growth for the country,” said ADB Economist Aimee Hampel-Milagrosa, one of the report’s lead authors. “To facilitate this, it has started to put together key ingredients, such as financial and policy incentives, to create and build the next generation of Vietnamese start-up unicorns.”
In 2021, the top five start-up sectors that received the largest funding were financial technology, or “fintech” (26.6 per cent); e-commerce (20.3 per cent); educational technology, or “edtech” (17.2 per cent); health technology, or “healthtech” (7.8 per cent); and software as a service (6.3 per cent).
The report looks at healthtech and agriculture technology, or “agritech”, because they have a high social impact and potential to contribute to more inclusive and sustainable development.
While financing was a common constraint to the growth of start-ups, angel investors and venture capitalists were found to be eager to invest. Another obstacle to growth is insufficient human capital. However, universities and research institutes in Viet Nam work with provincial authorities and central ministries to establish units to support start-ups. They are also organising start-up events for students to promote the culture of entrepreneurship among young people.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members, with 49 from the region. — VNS