Vietnam’s development over the past decade has been nothing short of remarkable, and with the government announcing the goal of having more than one million businesses in operation by 2020 – nearly double the number of enterprises in 2015 – the country is making a huge push to promote innovation and create a favourable ecosystem for start-ups and investment. And while Hanoi and Da Nang have emerged as burgeoning tech hubs, it is Ho Chi Minh City that holds the strongest claim to the title of Vietnam’s Silicon Valley.
Ho Chi Minh City University of Technology is the second-largest university in Vietnam, and it has been vital in shaping the growing group of engineers, coders and tech-savvy entrepreneurs behind the city’s startup culture. This young, skilled and highly motivated workforce, along with the city’s relatively low cost of doing business and rapidly growing middle class, has helped HCMC’s startups attract interest and huge investment from overseas.
‘There’s a lot of buzz about startups here right now,’ says Eddie Thai, a venture partner at 500 Startups Vietnam, the HCMC branch of the renowned Silicon Valley venture capital firm. A significant proportion of these, says Thai, are in the e-commerce industry, while many more are taking technology that exists elsewhere and applying it to emerging market problems – for example Nong Nghiep An Giang, an app that helps farmers track crop prices.
In terms of infrastructure, Saigon Hi-Tech Park, 15 kilometres east of HCMC, is home to about 50 firms from all over the world. These include Intel, which invested more than US$1 billion to open its largest-ever chip-assembly plant there in 2010, and Samsung, which has invested more than US$2 billion in its operations in HCMC since 2014.
Last year, work on the US$21.5 million Saigon Silicon City Center officially began. The development hub will serve as an incubator for Vietnamese startups. In addition, the government has pledged to offer legal and financial support to as many as 2,600 startups over the next 10 years.
The People: Le Hong Minh
Gaming, chat and e-commerce platform VNG has arguably been Vietnam’s biggest startup success story to date, becoming the country’s first unicorn – denoting a private company valued at more than US$1 billion – in 2014, and the man driving that success is founder, chairman and chief executive Le Hong Minh.
Hooked on video games from age 15 (when they were first introduced to Vietnam), Le originally pursued a career in finance, studying at Monash University in Melbourne before returning home in 2001 to work for private equity and venture capital firm VinaCapital. His love of gaming remained, however, and he partnered with friends to set up a small internet cafe for online gaming in 2003.
What started out as a side business soon evolved into something much more substantial, and he launched VinaGame as an online game developer and distributor, finding breakthrough success with the game Swordsman Online the following year. Building on this, Le launched more games and expanded into music, e-commerce and social media, rebranding the company as VNG in 2009 to better reflect the increasing diversity of its services. As well as dominating Vietnam’s online gaming market, VNG has also been behind mobile messaging and call app Zalo, social network Zing Me and online learning platform Zuni.
A keen triathlete and marathon runner, Le is showing no signs of slowing as he turns 40. In May, VNG announced that it had signed a memorandum of understanding to list its shares on Nasdaq, which would make it the first Vietnamese company to file for an IPO overseas. vng.com.vn
The Product: Timo
Banking in Vietnam is notoriously slow and paperwork-heavy, one of the reasons that only about a third of the people in the country have a bank account. Offering a 21st-century solution to this problem is Timo, the country’s first digital bank, which launched in early 2016 in Ho Chi Minh City.
Unlike traditional banks, Timo has no physical branches, save for ‘Timo Hangouts’ – coffee-shop-style spaces where prospective users can open an account and receive an ATM card in a matter of minutes. Through Timo’s partnership with Vietnam’s VPBank, users can then enjoy no-fee cash withdrawals at more than 15,000 ATMs nationwide, while they can also send, receive and manage their money through Timo’s smartphone app.
‘The idea is to reinvent the banking experience here, and how you interact with the bank on the ground if you have to, and how we can limit that and take everything into the digital space,’ says Cameron Warden, Timo’s chief executive.
With the commencement of a three-year partnership with Sun Life Vietnam Insurance Company, says Warden, Timo has now begun offering life and health insurance to customers, while it also offers access to loans, investments and other financial services through its app.
Following the successful launch of the first Timo Hangout in Ho Chi Minh City, where it signed up about 44,000 users in under a year, the company has since added three more locations across Vietnam and plans to roll out the platform across Southeast Asia in the near future. timo.vn
What to Watch
A rising star of Vietnam’s fintech industry, MoMo is a mobile wallet that lets users send and receive payments, settle about 100 types of bills and perform many other banking tasks, thanks to partnerships with domestic banks and foreign payment networks such as MasterCard and Visa. momo.vn
Vietnam’s answer to Amazon, Tiki sells and delivers more than 300,000 products in a wide variety of categories. The company attracted significant investment in 2016, with VNG acquiring a 38 percent stake in the company for US$17 million. tiki.vn
Ticketbox is Vietnam’s first online ticketing platform. As well as selling tickets to various events, the company also provides marketing services. It has recently expanded to Singapore and Thailand. ticketbox.vn