Total funding into Vietnamese startups was estimated at $250 million in 2016, 67 per cent, when compared to about $150 million in the 12 months ended December-2015, according to data complied by Topica Founder Institute (TFI), an indicator that last year may well be a period of transition.
While new investments in 2016 represented a significant increase deal value, the volume of transactions remained at par with 2015. It signifies that the median deal size has improved, and more later-stage funding occurred.
Put simply, data indicates that 2016 was a better year than previously imagined for Vietnamese startups. This also comes at a time when much of this region had witnessed a funding slowdown last year
The accelerator, in an earlier report for the year 2015, had said that this period had seen capital deployed across 67 deals, a 130 per cent year-on-year. To put these numbers and the growth in context, TFI data also shows that the 12 months ended December 2011 saw only 10 deals.
The programme, which annually tracks funding rounds into local startups, has indicated that the real value for capital deployed into Vietnamese startups in 2016 could be higher as there were also undisclosed investments.
In August 2016, it had said 24 deals from angel to series C financing were made since the beginning of that year.
Throughout the year, Vietnamese startups witnessed a healthy dose of activity in financing, attracting six-to eight-digit investments from a spectrum of different investors, including both local and international angel investors, venture capital funds, private equity companies, impact investing firms and large corporations, according to data compiled by DEALSTREETASIA.
The majority of more than 60 per cent of deals tracked by this portal were venture capital funding rounds – these include angel investments, capital deployed by accelerators and VC money. Corporate M&A accounted for some 30 per cent, while the remaining were private equity investments.
PE firms are beginning to get active in the Vietnamese tech space, and the 12 months of 2016 reflected this. Standard Chartered Private Equity, which has stakes in retail, agriculture and entertainment companies in Vietnam, injected $25 million in e-wallet app MoMo. Goldman Sachs also participated in this round with $3 million.
Meanwhile, South Korea’s UTC Investment bought a majority stake at VNPT EPay for a reported amount in the range of $34-38 million, marking the biggest transaction of the year, according to data by DEALSTREETASIA and the TFI.
The $17 million acquisition for 38 per cent stake at e-commerce startup Tiki by domestic unicorn VNG Corporation was easily the highlight of the Vietnam’s funding landscape last year. DEALSTREETASIA has learnt that other 8-digit investments included Mekong Capital’s into F88 and Unitus Impact’s into Topica Edtech Group, the operator of TFI.