AI, semiconductors, and the green economy sectors are big opportunities that Vietnamese startups can explore, said experts at the Vietnam Venture Summit 2023.
The Summit, hosted by Vietnam’s Ministry of Planning and Investment and co-organised by the Vietnam National Innovation Center (NIC) and Golden Gate Ventures, kicked off on Monday with the theme ‘Innovating Through Adversity: Strategies for a Transformative Vietnam’.
“I see greenfield opportunities all around. It’s also exciting for me to see how software and AI can change the world,” said Binh Tran, co-founder and general partner of Ho Chi Minh City-based VC firm Ascend Vietnam Ventures (AVV). “As an early-stage investor, I’m seeing these companies do something new, and unproven,” he added.
Meanwhile, Thai Van Linh, senior advisor at VC firm Openspace Ventures, and also the CEO of Skills Bridge, said that there are many opportunities in manufacturing that Vietnam is very strong in. “A lot of the factories in Vietnam are already automating using AI to make processes more fluid,” she added.
In September, the US and Vietnam cemented their economic relationship with the Comprehensive Strategic Partnership. The move is seen to boost collaboration across a wide range of areas including economic trade, investment, technology, digital, education, energy, healthcare, and national security. The semiconductor sector is likely to get a shot in the arm with both nations keen to see the SE Asian country develop as a hub for high-tech industries.
Tran of AVV, however, indicated that there are also challenges for young Vietnamese startups because those sectors require a very different kind of leadership. “The best organisation to be able to do that successfully is one that’s very agile,” he added.
Looking ahead, the five key sectors predicted to dominate Vietnam’s growth are healthtech, fintech, tech-enabled logistics, green economy and edtech, according to the joint report by NIC and Golden Gate Ventures.
Experts at the event believed that these five sectors together create an ecosystem of digital innovation that is aligned with the country’s ambition to become a developed nation by 2050.
Healthcare spending per capita in Vietnam has tripled over the last five years given the rising consumer class and an influx of expatriates. In May this year, healthtech firm Buymed raised $51.5 million in its Series B funding following investments from the US International Development Finance Corporation (DFC) and UOB Venture Management.
Meanwhile, the transaction value of the fintech sector is set to grow at 15% CAGR over the next four years. Meanwhile, in the tech-enabled logistics segment, asset-light models have become the game-changer.
At the Vietnam Venture Summit, 30 international ecosystem players committed to accelerate Vietnam’s 2030 ambition of expansion and internationalisation. However, there were no significant capital commitments from venture capital investors for the tech ecosystem this year. Last year, 41 venture capital firms had committed to invest $1.5 billion in Vietnam over three years.
The commitment represents a major increase from 2020 when 33 participating VCs committed over $815 million for the 2021-2025 period. At the inaugural event of the Vietnam Venture Summit in 2019, investors committed $425 million to support Vietnamese startups between 2019 and 2021.
“In a year that proved challenging for most economies, Vietnam shifted its economic development into high gear, cementing itself as the new epicentre of Asia’s growth,” said Vinnie Lauria, founding partner, Golden Gate Ventures.
Golden Gate Ventures is a global venture capital firm powering technology and innovation from Southeast Asia. The firm has invested in startups such as Coda Payments, Carro, Chợ Tốt (Carousell Group), Xendit, Appota, Paper.id, Tititada, Multiplier, Rukita, and Locofy.