The Vietnam government has rolled out a slew of initiatives – including a state-backing funding programme – to give a fillip to the country’s nascent but growing startup ecosystem.
According to information on the national startup ecosystem support scheme (from the official website vpcp.chinhphu.vn), the investment and M&A activities in Vietnamese startups are expected to touch a total value of VND2 trillion ($89.3 million) by 2025.
Following the initiatives of other governments in the region, especially the Indian action plan launched earlier this year, Vietnam has announced initiatives, in order to “create an enabling environment for high growth businesses” particularly in the areas of new technology and intellectual property creation.
Specifically, Vietnam expects to support 1,000 startup companies and projects, of which 50 should be able to garner investments from venture capital funds and be eligible for M&As. These projects are seen to constitute a value of VND1 trillion ($44.65 million) by 2020, according to the government announcement.
These figures are expected to double within five years, translating into $89.3-million worth of investments, the government forecast without clarifying how it got the numbers.
Besides the direct funding scheme, here are the three major initiatives the Vietnamese startup action plan constitutes:
An innovation support portal and service centre
The country will launch the National Innovative Startup Portal, which will provide information on technology, patents, policies, human capital, investment and networking. The portal aims to become a facilitator in connecting startups with resources, including business partners, innovation support agencies and events.
In addition to that, service centres will also be established with the focus on financing the development of infrastructure. These centres will be located near universities and financial organisations.
Vietnam hopes to get more private sector engagement in sponsoring infrastructure development costs in these centres, as well as hosting mentoring and networking events.
Bringing more exposure via the VSV
One important component of this goal is the operation of the Vietnam Silicon Valley (VSV) project, which aims to help local startups with early stage funding and mentorship. In terms of creating a Vietnamese version of the Silicon Valley, the VSV is only at the tip of the process. However, it is still a critical project for Vietnam to continue its “technology commercialisation”, said the Government Office.
Another notable intention of the Vietnamese policy-makers in order to help startups interact with the world is to pay for licenses of international training programmes and ecosystem building experience.
Support for incubators and accelerators
The scheme states that the country’s development funds can be used for financing startup incubators and accelerators alongside innovative companies. These entities might consider making borrowings with zero interest rate from the government agencies, while the state will probably join in investment rounds in startups.
Support for startups, incubators and accelerators will also include necessary renewed legal norms.