Venture capital into local startups reached record high of $1.4 billion

The report reveals that venture capital going into Vietnamese startups reached a record high in 2021 amidst market uncertainties and upheaval caused by COVID-19. The total funding amount reached a new high of $1.4 billion, a 1.6x growth compared to the prior record of $874 million set in 2019.

Accordingly, the total number of funds invested in Vietnamese startups climbed by 60 per cent, equally distributed among countries. Singapore was the most active investor in 2021, followed by Vietnam and the US. Japanese investors have also gradually resumed their activities in Vietnam after a two-year slowdown.

Investor appetite has been accelerated by an increased interest in sectors that have benefited from the pandemic.

Moreover, the ease of video conferencing has made travel restrictions no longer a barrier to the investment decision-making process.

Riding the acceleration of digital adoption, Vietnam celebrated the emergence of two unicorns, MoMo and Sky Mavis, in 2021.

Their success doubles down on the country's growing status as a rising tech hub in the region. The future looks promising for the Vietnam tech scene as a dozen of companies with valuations of over a few hundred million dollars are in the wings to become unicorns in the coming years.

With regards to the scale of deals, the total amount of $10 million deals exceeded $1.2 billion, a 255 per cent increase over the previous year, spreading over 17 deals.

While seed funding soared to a new high in both deal count and value, later-stage funding has returned to the pre-COVID level with five mega deals made in payments, retail, and gaming.

Given a solid pipeline of early-stage companies and the positive environment created by the Vietnamese government, the country's startup ecosystem is poised to enter a more mature stage.

Moving forward, there are ample opportunities in the areas of e-commerce and fintech in Vietnam as they become more integrated into customers' daily lives. At the same time, investors will also keep a close watch on promising Vietnam's emerging sectors, including creator economy, upskilling platforms, and Web3 with the rising popularity of crypto and blockchain.