Million USD invested in Vietnamese start-ups
With the objective of supporting Vietnam to become a developed country, a capital venture with up to 1 million USD established by Lotte Accelerator and Vietnam Silicon Valley Accelerator is expected to bring more benefits for Vietnam’s start-up community.
Recently, Lotte Corporation has announced the Strategy cooperation between Lotte Accelerator and VSVA to facilitate the development of venture capital in Vietnam, thus creating chances for investors to look at potential projects after the process of portfolio evaluation. Many economic experts said, the cooperation between VSVA and Lotte Accelerator is expected to create a new corridor for leading enterprises both in Vietnam and abroad to invest in Vietnamese start-ups through the cooperation between start-up accelerators.
Representatives of Lotte Accelerator and VSVA signed the MoU to invest 1 million USD for Vietnamese start-ups.
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Meanwhile, CEO of Lotte Accelerator Rhee Jin Sung said, there are 2 reasons to invest in the Vietnam’s start-up ecosystem. Firstly, Vietnam has a high growth rate of economy with stable business environment. Secondly, Lotte expects to cooperate with high potential start-ups in Vietnam. “This cooperation will take Lotte to a new direction for development” – Mr. Rhee Jin Sung said.
Moreover, the establishment of a venture capital with 1 million USD to invest in the Vietnam’s start-up ecosystem in a period of 5 years is the first step, as according to Mr. Rhee Jin Sung, depending on the feasibility of start-ups’ projects, the investment fund can be adjusted to a higher amount. Besides, despite not having specific requirements on certain fields, but Lotte expected start-ups will pay more attention to the Lotte’s business fields such as retail or trade.
The Head of Vietnam Silicon Valley Thach Le Anh said, the fund from VSVA for start-ups will be just the beginning. Each start-up after being approved by VSVA for investment will received 20 – 30,000 USD for 10% of start-up’s share in return. Despite investment fund for start-ups is considered as a high risk investment, but the participation of Lotte will somehow reduce the difficulties in attracting fund for start-ups, while this also allowed VSVA to access high potential start-ups. VSVA has multiple methods to search, support and train start-ups. With this being said, when VSVA decides to invest in certain field, there will be a lot of discussion to come to a final decision. “VSVA often choose founder capable of communicating in English, as for enterprises to develop, founders need to continuously call for investment and must have sufficient communication skills to work with investors” – Mrs. Anh said.
Starting up for 2 years in field of garment, Director of Truong Phuc Limited Company (Hung Yen province) Nguyen Dinh Lap said, the company was founded with capital of 100 billion VND, for which the majority was lent from bank with high interest rate. At present, as the company is planning for expansion, demand for capital is very high. So the presence of venture capital as above will support enterprises to have opportunities to realize plans for development and production expansion.
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Vietnam news in brief - August 24
Read The Hanoi Times to stay up to date on developments in Vietnam.
- Growing number of FDI firms moving to Vietnam
- Vietnam Gov’t committed to facilitating Adani Group’s US$2-billion port project
- Vietnam Railway proposes US$87 million for Hanoi–Dong Dang railway upgrade
- Vietnam’s North-South high-speed railway to be designed for 350km/h
- Vietnamese gov’t urged to address impact of global minimum tax
- Samsung plans drastic investment increase in Vietnam over next three years