Vietnamese e-wallet Momo has raised US$200 million in a Series E funding led by the Japanese bank Mizuho, becoming the latest unicorn in Vietnam along with VNG, VNLife and Sky Mavis.

MoMo is expected to be the latest unicorn in Vietnam. Photo: MoMo

The fresh investment included the participation of Ward Ferry, Goodwater Capital and Kora Management. The deal will make the Vietnamese unicorn cross $2 billion valuation, according to Nguyen Manh Cuong, MoMo’s Executive Vice Chairman and Co-CEO.

“We will use the capital to expand financial services to millions of micro, small and medium-sized enterprise merchants across the country, and further invest in Vietnamese companies that could strengthen MoMo’s ecosystem, as well as enlarge its user base in tier 2 and 3 cities, and rural areas,” he said.

Connecting startups with large enterprises

Despite the complicated developments of the Covid-19 pandemic, investment for Vietnamese startups including the latest investee MoMo has increased unprecedentedly in 2021. 

More than $1.3 billion has been poured into Vietnamese innovative startup community, the highest amount ever, Minister of Science and Technology Huynh Thanh Dat told a recent forum within the National Innovation and Entrepreneurship Festival (TECHFEST) and Ho Chi Minh City Innovation Week (WHISE) event last week.

Vietnam is home to about 3,000 innovative startups, including some enterprises valued at over $1 billion and another eleven with a valuation of over $100 million. This year has been a successful year for startups in the fields of fintech, e-commerce, food & beverage, games and blockchain.

The country’s startup ecosystem was ranked 59 out of 100 global economies based on three pillars of quantity, quality and business environment according to StartupBlink, a global comprehensive startup ecosystem map and research center. Hanoi rose five places against last year while Ho Chi Minh City climbed 49 places to rank 179^th.

Sharing the country’s experience, Nadav Eshcar, Ambassador of Israel to Vietnam, said that one of the strategic factors that the Israeli government offers to its startups is to spend a large amount of capital from the state budget for research and development (R&D) activities.

The country spent up to 4.9% of its GDP on R&D and established an innovation agency to coordinate all the activities that support the development of the national innovation ecosystem, Eshcar added.

The Vietnamese Minister Dat said the participation in the Vietnamese creative startup ecosystem is increasingly active with more than 1,000 organizations such as coworking zones, investment funds/investors, and incubators.

He also emphasized: “Now is the time to accelerate and promote the linkage between domestic and foreign resources to create a driving force for the development of the ecosystem as a place to connect the supply and demand for innovation”.

Elaborating more about the open innovation startup ecosystem, Deputy Minister of Science and Technology Tran Van Tung said the Vietnamese startup ecosystem has only connected startups with some startup facilitators, and some investors. 

By 2021, drawing on the experiences of other countries, the country needs to expand the participation of large enterprisesto the ecosystem, Tung said.