Only thorough preparation can drive IPO fortunes in US

Vietnamese companies like VinFast want to make more waves in the US

The launch of the Vietnam Private Capital Agency (VPCA) last week, aiming to raise $35 billion in private investments for startups and innovation by 2035, marks a pivotal moment for Vietnam’s investment landscape and opens new opportunities for Vietnamese companies seeking to list in the US, such as on the New York exchange (NYSE) or Nasdaq.

According to data shared at the launch event, only three initial public offerings (IPOs) were recorded last year, raising a modest total of $7 million.

“Over the past two decades, Vietnam’s stock market has experienced significant growth in market capitalisation. However, following the pandemic, IPO activity has significantly slowed and shows no signs of recovery. Southeast Asia presents a unique narrative that resonates with these investors, who recognise the region’s potential. With the right planning and execution, the dream of going public in the US is well within reach,” said Vy Le, chair of the VPCA.

To date, VinFast remains the only Vietnamese company listed on the Nasdaq Global Select Market. During the pandemic, an additional 30 foreign companies from the Asia-Pacific region successfully listed on Nasdaq. These listings, primarily from Taiwanese and Chinese enterprises, included several special purpose acquisition companies.

The establishment of the VPCA is expected to address these challenges by offering a platform that unites investors, industry partners, and entrepreneurs under a shared vision of growth and innovation. The agency’s four pillars of activity may translate into tangible benefits for Vietnamese venture capital and private equity, including building a thriving community, leading with insight, delivering essential support services, and cultivating expertise through education.

Vietnam’s dynamic economic growth and thriving entrepreneurial sector has made it a prime destination for venture capital and private equity as evidenced by investment alliances from the VPCA to Openspace Ventures fund and DSG Consumer Partners fund investing in Every Half Coffee Roasters, a startup Vietnamese coffee last month.

However, for Vietnamese companies aspiring to go public in the US, understanding the listing requirements and receiving tailored guidance is essential.

“Attracting US investors, particularly for Vietnamese companies, hinges on early preparation. Before the pandemic and recent securities law changes, successful rule 144A IPOs allowed firms to access the US market and attract American investors directly, often leading to oversubscription and demonstrating strong demand for international companies. US listing is seen as a gold standard and enhances a company’s visibility and credibility, even if it’s based outside the US,” said Tina Le Dinh, managing partner of law firm A&O Shearman Vietnam.

“An IPO in the States may not suit every company, but US investors are still keen on emerging markets like Vietnam. The essential factor is thorough preparation, through strong financials, effective investor relations, or a compelling growth narrative. This readiness can attract international interest, regardless of whether a US listing is pursued,” Dinh added.

The process takes time, often more than two years, and requires careful planning.

“Contrary to common perceptions, listing in the US is not as difficult as many might think. As long as companies meet disclosure requirements, they don’t even need to be profitable. US investors, particularly in the tech sector, are eager to back companies with compelling, long-term growth stories,” said Vinnie Lauria, founding partner at Golden Gate Ventures.

With more listing venues available than ever, companies now have the flexibility to explore dual listings across different markets. However, Kobe Ge, regional head of China Capital Markets at the NYSE, noted that the most important factor is access to capital.

“It is essential to consider which market offers the greatest liquidity, not just for the IPO itself, but for future follow-on offerings and stock pricing. The US market often provides the largest pool of capital and liquidity, which can be critical for a company’s long-term growth,” said Ge.

“Preparation must start early, even during Series B or C fundraising rounds, if a US listing is the ultimate goal. The decision is very case-specific. It depends on the company’s circumstances, its obligations in its home market, and whether it needs to list domestically first. The appeal of the US is clear, with greater capital access, more sophisticated investors, and better valuations,” Ge added.

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Attracting US investors for a successful IPO journey The US market often provides the largest pool of capital and liquidity, which can be critical for a company’s long-term growth. Teresa Woo, senior vice president at global financial services company BNY, shared with VIR’s Luu Vy how Vietnamese companies capture the attention of US investors and ensuring a successful initial public offering.