Illustrative image (Source: VietnamPlus) The report, launched by HSBCand KPMG, cited start-up data platform Tracxn as showing that Vietnam was hometo just 1,600 start-ups at the start of the COVID-19 pandemic, but that totalhas jumped to more than 3,000 now, including four unicorns.
Driving the country’s digitaleconomy are a large and young population willing to test and adopt newtechnology consumer services, supportive government policies, and a surge inoverseas funding.
Although Vietnam’s per capitaGDP remains relatively low compared to others in the region, its economy isexpanding faster than any other market. Growth is predicted to hit 5.5% in 2022and 6.5% in 2023, near pre-COVID-19 expansion levels, according to World Bankestimates.
The report said VNG, a Ho ChiMinh City-headquartered super-app provider, is Vietnam’s longest-standingsuccessful start-ups to date. Launched in 2004 as a gaming business, but withofferings including chat app Zalo, which now has more than 60 million users,and e-wallet ZaloPay, it reached unicorn status as far back as 2014.
Riding the surge ine-commerce, deliveries and online media boosted by the pandemic, VNLife,operator of B2B mobile payment provider VNPay, became Vietnam’s second unicornin 2020.
Venture capital deals surgedto 1.1 billion USD in 2021, up from 301 million USD in 2020 and 330 million USDin 2019. By year-end, two more companies were also unicorns: game developer SkyMavis and the country’s most widely used e-wallet MoMo.
“Vietnam has emerged as a hubfor start-ups, closely competing with the likes of Indonesia and Singapore. Witha young, energetic and educated population, high smartphone and internetpenetration, and strong government support, Vietnam should maintain itsposition as a compelling destination for tech entrepreneurs and investors,making the country a thriving environment for potential unicorns,” said Tim Evans,CEO of HSBC Vietnam.
While e-commerce accounts forless than 5% of all retail sales, its value rose by more than half in 2021.
Luke Treolar, head ofstrategy at KPMG Vietnam, said similar high growth rates can be expected forthe next several years, adding if that happens, the country will have SoutheastAsia’s second biggest digital economy, behind Indonesia, by the end of thedecade./.
VNA
