Vietnamese tech startups corner $890m investment in 2018

The Vietnamese technology sector has attracted nearly $890 million in funding in 2018, a three-fold increase from the previous year, according to the latest report from Topica Founder Institute (TFI).

Deal volume remained flat with the tech space recording 92 transactions in 2018, same as the number in 2017.

The top 10 deals contributed $734 million to the total tally, including big-ticket funding for Topica Edtech Group, the operator of (TFI), by private equity firm Northstar, e-commerce player Sendo and the $100-million IPO of media company Yeah1, as well as other undisclosed investments.

Fintech, e-commerce, travel tech, logistics and edtech attracted the lion’s share of the funding, TFI said. In the ride-hailing market, local players including FastGo, Vato and the recently announced Be Group also closed investments to challenge regional companies Grab and Go-Jek. Be is understood to have snapped up a large round, said to be running into hundreds of millions of US dollars.

While seed to Series A investments still accounted for the majority of the funding landscape, the number of acquisitions and pre-IPO deals slightly increased over the period to 9 transactions.

The funding environment has seen an increasing participation from homegrown venture capital firms, which announced their pool of $500 million of late, including Vingroup Ventures (a planned $300 million fund), VinaCapital Ventures ($100 million), VietCapital Ventures, Startup Viet Partners, Teko Ventures and several undisclosed groups of VCs.

Meanwhile, existing local VC funds like ESP Capital, 500 Startups and VIISA continued to ramp up their activities with 32 deals closed in 2018, representing 60 per cent of the total pre-seed and seed investments.

2018 was also a significant milestone for the Vietnam startup ecosystem as the country had a tech listing which marked the biggest exit in the industry. TFI said VinaCapital reaped $127 million on the initial $3 million investment.

Vietnamese startups attracted $291 million funding in 2017, up 42 per cent over 2016, per TFI data.

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