Best practices to get funded in Vietnam

What are VCs in Vietnam looking out for when it comes to startups? At our recent Saigon Summit, we heard from three investors on why they’re excited about Vietnam and their advice for founders looking to raise funds in the country.

Below is the video and a summary of the session, which featured Binh Tran, co-founder and general partner at Ascend Vietnam Ventures; Justin Nguyen, general partner at Monk’s Hill Ventures; and Tuyet Vu, advisor at Vertex Ventures Southeast Asia and India. The panel was moderated by My Tran, principal at Jungle Ventures.

Watch the full video here:

Session summary

Vietnam as a market:

• Positive macro factors: The economy is rapidly growing, with young and connected population, as well as infrastructure development in recent decades.
• Unique advantages: There’s increased availability of tech talent (especially in software development), attracting globally competitive engineers.
• Software renaissance: Due to increased capital and talent, Vietnam is witnessing a software renaissance similar to what happened in the US in the ’90s.
• Consumer readiness: Vietnam has surpassed the US$4,000 GDP per capita mark, indicating increased consumer spending power.

Investment evaluation criteria:

• Tuyet Vu: Focuses on industry, problem statement, product or service differentiation, and team capabilities. Emphasizes clarity and convincing arguments for each of these elements.
• Binh Tran: Looks for ambition, self-belief, and resilience in founders. Prioritizes founders with a competitive edge and tolerance for pain or failure.
• Justin Nguyen: Values founders who are open to feedback and exhibit humility alongside conviction in their vision.

Pitching tips:

• Justin Nguyen: Emphasizes storytelling in pitches, focusing on the founder’s story, vision, and why they are uniquely qualified.
• Tuyet Vu: Values clarity and simplicity in pitch communication, reflecting the depth of the founder’s understanding of the problem and solution.
• Binh Tran: Stresses building relationships with investors beyond a transactional approach.

Valuation considerations:

• Justin Nguyen: Valuation at early stages should focus on the funding needed to reach the next milestone and the equity stake needed to achieve a return for investors.
• Tuyet Vu: Founders should consider the value-add they seek from investors beyond just money, recognizing the partnership aspect of investment.
• General consensus: Valuation is influenced by market conditions and the availability of liquidity through M&As and IPOs.

Other key points:

• VCs are looking for large-scale, scalable markets.
• For companies with global ambitions, an international legal setup can facilitate fundraising.
• The current M&A and IPO landscape in Vietnam affects VC investments, particularly portfolio construction and fundraising.

This summary was written with the help of AI.