Last update: 16:00 | 11/09/2017
A report from the Ministry of Information and Communication (MIC) released in 2016 showed that about 1,000 startups are registered every year in Vietnam. However, only 10 percent of them now exist.
Nguyen Viet Dung, director of the HCMC Science & Technology Department, said there is a long distance between the idea of starting a business to commercializing products. The lack of capital, experience and supporters, plus the limited knowledge about laws, are the biggest hurdles for entrepreneurs.
A report from the Ministry of Information and Communication released in 2016 showed that about 1,000 startups are registered every year in Vietnam. However, only 10 percent of them now exist.
The VCCI 2015-2016 startup index report showed that the fear-of-failure index of Vietnamese entrepreneurs is at 46.5 percent. The majority of people starting up businesses are afraid of failure and don’t want to take risks.
Some startups have given a push to the movement with their initial success, while many young entrepreneurs want to ‘make things happen’. However, most of them are first-generation technology startups, but they cannot use a perfect startup ecosystem and receive support from predecessors.
Huynh Lam Ho, CEO of Haravan, an omni-channel sale business, commented that startups in Vietnam have had more difficulties because of the lack of readiness of the infrastructure. The education system, for example, still cannot provide students with necessary skills to start up businesses.
Huynh Kim Tuoc from the Saigon Innovation Hub (SIHUB) said that at universities, students are not taught about starting up businesses, while university students are the ones most eager to do business.
Chair of VNG Le Hong Minh spoke about investments in startups at the 2017 M&A Forum.
In 2016, roughly $1.5 billion worth of capital was poured into startup projects in SE Asia, but less than $100 million went to Vietnam. The remaining flowed to Indonesia and Singapore.
Six companies in Indonesia and Singapore have received $5 billion worth of capital so far this year, of which $2.5 billion has been injected into Grab, while each Vietnamese startup receives several thousand dollars on average.
VNG, a Vietnamese conglomerate, also found it difficult to successfully call for $200-300 million and VNG had to contact five ministries to have one small transaction approved.
An expert said investment funds complain there are too many required procedures they have to follow when they want to pour money into good projects.
HCMC is running SpeedUp, a program on supporting startups that provides businesses up to VND2 billion for every project.
The HCMC Young Entrepreneurs’ Association has announced a plan to support 1,000 innovative startups and call for investment capital for 100 startups with total investment capital of VND500 billion.