Most the Vietnamese firms that have expanded beyond borders, have been in the field of information technology (IT) – be it the software giant FPT, or smaller startups like the the mobile content distributor Appota, digitial advertising company CleverAds and e-commerce firm Peacesoft.
Very few, non-IT firms have shown strong regional and global ambitions – observed entrepreneur Luu Hai Minh, who runs a successful nano-tech business in Hanoi.
Minh, who is the chairman of Orange Informatic Communication JSC and the CEO of Nhat Hai New Technologies JSC, spoke to DEALSTREETASIA on the sidelines of the recent conference on investment opportunities in the US market. According to him, non-IT firms that were in field of hi-tech development could make it big in the global market.
Minh, who started with a IT related business and then expanded to the sector of nano-technology, shared his point of view about the potential of Vietnamese firms and the causes that hinder them from expanding abroad
Excerpts from the interaction:
As an experienced entrepreneur, can you tell us why many Vietnamese companies are unable to find ways to larger foreign markets?
Vietnamese companies are not large enough to compete with other companies in their markets. The leaders of US tech giants such as Google, Facebook develop strongly to become billionaires within just a couple of years because they have the courage and the resources, to do so.
The Vietnamese tech businesses has been unable to rise to that level, even after receiving government support, because they want to do something easy. Thus, it reduces their competitiveness.
Vietnamese companies can consider foray into foreign markets by developing hi-tech products. My company, for example, is collaborating with American companies on microbiology and nanotech for curing diseases like cancer.
How can a Vietnamese firm compete with local companies in a foreign country?
It is better to co-operate with businesses in the host country when we are expanding there, rather than competing with them.
What is the biggest weaknesses of Vietnamese firms?
The biggest weakness of Vietnamese companies is the inability to adopt change. They find it hard to launch a new product within a month, while American partners can do that.
To achieve success, you have to change. I had more than 20 years working in the IT industry before I decided to turn to nano-technology. With my knowledge in IT, switching to a higher tech field is not so difficult.
Is this kind of hi-tech hard to develop in Vietnam?
That is totally wrong notion. I have worked with local scientists and technology developers who are brilliant and professional, so the human resource is not an issue. However, the problem is the limit that the government and the community puts on their research. I have been to the US, Russia and Israel and I compare and see that Vietnamese people are capable of doing anything, given that we support them.
Many entrepreneurs say that the US market is really strict and hard to access. What is your opinion?
The US is a multi-ethnic market, doing business there is easier than any other market. The notion of it being hard to approach does not lie in the targeted market but in the preparation of Vietnamese firms. If they have a well-planned strategy for expansion, then they will be able to remove the obstacles.
A company should learn about a market and do a math if its intention to penetrate that market is feasible. If not, it has to develop itself until it is large enough to expand. My advice for Vietnamese firms which want to go beyond Vietnam is understanding laws in the host country and have a well trained staff.