In the first 10 months of 2019, Vietnamese startups received US$750 million in funding in 29 deals while the country’s startup ecosystem is among top three largest in ASEAN, according to Chu Ngoc Anh, minister of Science and Technology.

Chu Ngoc Anh, minister of Science and Technology at the event. Source: VGP.

These include an investment of US$300 million into fintech firm VNPay, the largest deal for a fintech firm in ASEAN in 2019, said Anh at the Techfest Vietnam 2019, the biggest annual event for the innovative startup community in Vietnam, on December 4.

The growing in investment size for Vietnamese startups over the past few years makes the target of having tech unicorn, startups with valuation of over US$1 billion, right in Vietnam a real probability, Anh stressed.

In 2019, Techfest was first held abroad in countries with advanced startup ecosystems, such as the US, South Korea, Singapore, presenting opportunities for Vietnamese startups to access the world’s major venture capitals.

The events also create a platform for stakeholders in the innovative startup ecosystem to share knowledge, experiences and network, at local, national and regional levels.

This year, Techfest focused on providing consultation for policymakers to mobilize both domestic and international resources efficiently, aiming to advance the development of Vietnam’s innovative startup ecosystem.

A joint research by ESP Capital and Cento Ventures suggested Vietnam “certainly has the potential to establish itself as Southeast Asia`s next leading startup ecosystem.”

Investment is expected to top US$800 million by the end of the year, which would represent a rise of at least 80% over last year's US$444 million, stated the report.

"Vietnam is in an important period when key components of a strong digital economy are beginning to shape up," the report noted. It added that Vietnam's digital economy will benefit from its young population, of which 60% are aged under 35, and a still-growing mobile and internet penetration rate. The research said that over 10 million more consumers will go online by 2023.

Vietnam also has a highly educated workforce -- the country's pupils ranked eighth globally in the PISA international science test, higher than Hong Kong's and South Korea's. Coupled with a relatively low labor cost, Vietnam has long been a software outsourcing hub in Asia, producing large homegrown IT companies such as FPT.

Notably, aggressive market entry by big regional startups such as Singapore's ride-hailing operator Grab has also created more opportunities by offering higher salaries to tech professionals.

Grab entered the Vietnamese market in 2014, while Indonesian rival Go-Jek joined last year. Grab has a research and development center in Ho Chi Minh City with over 100 engineers. The company said it would commit US$500 million for investment in Vietnam over the next five years.