Why IPOs are a distant dream for Vietnamese startups

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Hello reader,

You don’t have to live in Vietnam for very long to realize that national pride runs deep among its people.

The love for all things Vietnam could even extend to companies large and small. This was quite the culture shock when I first got here: I come from Ireland, after all, where everyone essentially hates Ryanair and complains about whatever bank they use.

Vietnamese companies that expand overseas are often especially loved, as they’re seen as representing the country and its people abroad.

However, as today’s featured story shows, an enthusiastic and large cheering section isn’t enough for Vietnam’s tech companies to make their overseas IPO dreams come true.

Today we look at:

• Why IPOs are often a bridge too far for Vietnam-based startups
• Evermos, an Indonesia-based social commerce startup that’s Evermos plans a listing
• Other newsy highlights such as TikTok shifting its ecommerce focus away from Europe to zero in on the US and Ola Electric’s reported layoff plan ahead of its IPO.

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IPO? Oh, no

Image credit: Timmy Loen

Getting to the finish line of an international IPO is tough sledding for Vietnam’s tech startups, according to Niraan De Silva, CEO of fintech unicorn VNLife.

Speaking at Tech in Asia’s Saigon Summit 2024, De Silva said going public abroad is difficult due to the lack of interest in emerging Vietnamese tech firms, while a domestic IPO would be “too complex” for even his company.

• Hard to stand out: VNLife is one of Vietnam’s few unicorns and runs VNPay QR, an interoperable cashless payment network that serves more than 30 million users and over 400,000 merchants in the country. While the firm has spoken to potential US backers, De Silva said “there is genuinely a lack of interest” in emerging Vietnamese firms and pointed out how the US has listings that raise US$2 billion to US$3 billion.
• Not so sweet home: Regarding domestic IPOs, De Silva cited issues with regulations as a big hurdle for tech firms. Vietnamese law, for example, requires that a company seeking to go public must be profitable for at least two years and not be loss-making at the time of the listing. The investor base’s preferences also pose a challenge, as local backers greatly prefer retail and real estate bets and lack experience with complex business models.
• Uphill battle: VNG Corporation, another Vietnamese tech giant, withdrew its application for a listing in the US earlier this year and opted to “file a new registration statement in the future.” Before that, EV maker VinFast made its US stock market debut in 2023 via a blank-check or SPAC deal. However, the company’s share price has fallen by more than 50% since then.

Read more: VNLife boss deems IPO ‘too complex’ for Vietnam-based firm

Evermos’ IPO ambitions

Don’t just dream of startup success, build it.

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