Viet Nam is becoming an attractive destination for foreign investors in innovative and creative start-ups, attendees said at a workshop in Ha Noi on Friday.

The workshop, under the Viet Nam-Finland Innovation Partnership Programme Phase 2 (IPP2), discussed funding and finance for start-ups.

Sharing experiences from Finland, Marko Saarinen, a representative from the Embassy of Finland, said that Finland had created platforms for open and transparent exchanges to promote partnerships with stakeholders.

Accordingly, the IPP programme has contributed to supporting policies for small and medium-sized businesses and start-up ecosystems. IPP currently focuses on building resources for programmes, universities, businesses and entrepreneurs in the field of start-up development.

Jouko Ahvenainen, an international expert in the IPP2 programme, said that there were many business models and it was difficult to call for initial capital and gain profit immediately.

There were many new funding models and technology to support innovative start-ups, and Viet Nam had good opportunities to use new technology and models, he said.

There were also various financial support sources such as personal sponsors, venture capital funds and fund management companies, he added.

However, the financial aid agencies still lack information, which made it difficult to assess the disbursement, he said.

Moreover, it was difficult for banks to decide on a loan because they do not have enough information about the businesses.

“Therefore, the market needs transparent data sets to reduce risks for investors as risk assessment was important in the decision-making process," said Ahvenainen.

Phan Hoang Lan, leader of the IPP2 research group, said that the most important characteristics for investment in start-ups was the risk factor and the unpredictability of investment.

Among 10 investment businesses, nine might ‘die’ and nobody is able to predict which businesses will succeed, she said.

“Therefore, those who invest in start-ups must be very understanding about starting a business and having money to invest,” said Lan.

Therefore, it was necessary to have policies to support and share risks for investors including tax and reciprocal investment policies, Lan said.

Lan also said start-up supporting organisations should support businesses at the initial stages and take risks.

Secondly, administrative procedures should be minimised for start-ups.

Te IPP2 programme is a development co-operation programme between the two governments of Viet Nam and Finland, implemented by the Vietnamese Ministry of Science and Technology and Finnish Ministry of Foreign Affairs in the 2014-18 period with a total budget of 11 million euros (US$12.8 million). — VNS