Integral tech direction will help fundraising efforts

After a slowdown in fundraising in 2024, what is the outlook of venture capital fundraising into Vietnamese startups?

Justin Nguyen, general partner at Monk’s Hill Ventures, a venture capital firm investing in early-stage tech companies in Southeast Asia

We are cautiously optimistic that 2025 will be better than 2024. The macroeconomic environment looks more stable, with the US elections now over and inflation and interest rates holding steady, creating a more predictable climate for investors.

In addition, Vietnam’s strong fundamentals continue to be attractive. The country’s robust economic growth, coupled with its fast-expanding middle class, makes it one of the most promising consumer markets globally. Domestic consumption already contributes to over half of Vietnam’s GDP, and by 2030, it’s on track to become a top 10 consumer market.

At the same time, many investors are still sitting on significant dry powder from the funding winter, waiting for the right opportunities. As certainty returns, we expect more capital to be deployed, especially into startups with strong execution and scalable models.

How does Monk’s Hill Ventures realign the investment strategies to support Vietnamese startups to grow this year?

Our investment strategy remains unchanged. As early-stage and long-term investors, short-term market fluctuations don’t matter to us as much.

We take a first-principles approach, focusing on the core fundamentals of each business and market, and the fundamentals of this region, Vietnam in particular, look good.

The recent funding winter has also filtered out the noise, revealing the most resilient and interesting startups that solve real and meaningful problems.

For example, we recently invested in Vucar, an innovative used car C2B platform in Vietnam. Their AI-driven pricing engine allows vehicle owners to get an instant, accurate quote for their used car, which they can then immediately sell to Vucar’s network of used car dealerships, streamlining the transaction for both sides.

Innovations like this, driven by a focus on solving tangible problems, are setting the stage for transformative startups to redefine traditional industries and unlock significant value for investors and consumers alike. In short, we think there’s never been a better time to invest.

What are some areas you are specifically looking to put money into in this country?

We believe the increasing shift of global supply chains to Vietnam and growing foreign direct investment into the country, especially its manufacturing sector, will drive rapid technology adoption among local companies. In order to stay competitive and meet global standards, local companies must make technology an integral part of their business. This creates opportunities for startups developing solutions in supply chain optimisation, digital transformation, and enterprise technology to serve this demand.

Another area where we see vast potential is what we call rural-tech startups. Over 60 per cent of Vietnam’s population live outside of major metropolitan areas, and they represent a massive underserved market. The next wave of billion-dollars startups could emerge from solutions designed to serve this market.

More startups wanted to aid innovation Changing policies related to innovation startup funds is expected to diversify the capital market for the startup business community.

Agritech startups offer suite of solutions Agritech startups are gaining the attention of venture capitalists, constantly securing new funding to scale up operations in Vietnam.