Entering into co-operation with NGOs is a suitable option for startups to mobilise capital amidst difficulties because of COVID-19.
|The workshop titled “Taking advantages of NGOs/INGOs’ resources to flourish the national innovative startup ecosystem” was organised on December 23 |
“Since the pandemic broke out, it has been growing harder to mobilise capital,” said a representative of Ve Xe Re, a local startup offering online bus ticket booking. Due to the pandemic, fewer and fewer have been travelling by bus, resulting in pitiful performance for the company.
Generally, startups have no assets to mortgage and so are unable to access loans. Tuoitre.vn quoted a representative of Ve Xe Re as saying, “We can only count on investment capital. Although we have finished the entire online procedures for the capital mobilisation, they still require us for a face-to-face meeting. Notwithstanding, the travelling restriction during COVID-19 has hampered us from approaching the capital.”
The problem was highlighted at the workshop titled “Taking advantage of NGOs/INGOs’ resources to nourish the national innovative startup ecosystem” hosted by the Ministry of Science and Technology on December 23.
Speaking at the event, Charlotte Reypens, senior expert specialised in startup and entrepreneurship at UK innovation foundation Nesta said that as capital mobilisation from investment funds is growing difficult, startups could look for the resources of domestic and international non-governmental organisations (NGOs and INGOs).
She said the organisations are looking to work with startups which specialise in new solutions as they could help NGOs handle their work more effectively. Moreover, organisations could learn new things this way.
In Vietnam, such collaborations are still a novelty. Nevertheless, there are some cases of success such as Danang-based Hekate, a startup offering a chatbot. With the support of UNDP Vietnam, Hekate has been constantly rolling out new solutions to better the public services in Danang city said Tram Anh, managing director of the startup.
“With these chatbot solutions, people in Danang could easily approach the city’s public services and legitimate news sources,” said Nguyen Thi Tram Anh, managing director at Hekate.
According to information published at the event, about 15-20 per cent of startups focus on community solutions. Therefore, in comparison with investment funds, support from NGOs may not fit most startups.