The report provides information and analysis of Vietnam's innovative startup ecosystem, compares and evaluates it against several ecosystems in the region and the world, and offers recommendations for further development in the next phase. The report will be published annually.
According to the report, Vietnam's innovative startup ecosystem has gone through three development stages. The period from 2013 to 2016 saw significant growth in both quantity and quality, with 1,800 enterprises, 21 incubators, and seven business support organisations. This was when many investment funds recognised the great potential and expressed interest in investing in Vietnam's startup ecosystem.
The period from 2017 to 2020 marked the era of globalisation. During this time, the government intensified efforts to develop the innovative startup ecosystem by providing financial support through business acceleration programmes and offering venture capital to newly established enterprises. Programmes focused on supporting different stages of startup development.
During this period, businesses learned how to attract and utilise financial resources from domestic and international investors. In 2019, Vietnam ranked third among ASEAN countries in terms of the growth rate of its innovative startup ecosystem, behind only Indonesia and Singapore. The proportion of venture capital investment in total funding for creative enterprises in the region also increased from 5% in 2018 to 17%.
From 2021 to the present, it has been marked by many challenges and a slowdown. However, the ecosystem has recovered and is making impressive progress. Specifically, in 2021, Vietnam recorded a record amount of venture capital investment, with 1.4 billion USD.
Currently, Vietnam has around 3,800 innovative startup enterprises, primarily concentrated in major cities such as Hanoi, Da Nang, Hai Phong, and Ho Chi Minh City. In the central provinces and cities, the number of startups is relatively evenly distributed.
Most innovative startups in Vietnam are in the early stages of their development life cycle, with relatively low business valuations. Except for a few companies that have established their names or received investments ranging from several hundred thousand to tens of millions of USD, the majority of Vietnamese startups are still in the nurturing stage, with valuations under 1 million USD.
The report outlines several directions for developing the innovative startup ecosystem in the coming period, including continuing to perfect the legal framework and incentive policies for stakeholders in the ecosystem; mobilising and effectively utilising public sector resources; promoting cooperation among different components of the ecosystem; and attracting and coordinating comprehensive resources.
