Vietnam’s startup ecosystem: a hub of innovation and grit
Guerrilla warfare, unicorns and tummy time
As I sit on my tiny plastic stool, sipping on a deliciously sweet and thick Vietnamese coffee, I watch the hustle and bustle around me. Little old ladies are setting up Bánh Mì carts on the corner, selling the best pork sandwich you’ve ever tasted for just AU$2.00. Nearby, a Grab driver naps, stretched lengthwise along his motorbike before rush hour hits. A group of local men sit outside, enjoying their morning coffees and cigarette bongs, and what I’ve come to call tummy time.
Tummy time
A method of cooling off in extreme heat and humidity by pulling your shirt halfway up, exposing your stomach.
As far as I can tell, tummy time is native to Vietnamese men and is widely accepted on the streets, in bars, and in restaurants.
Vietnam is a stunning country with a rich and complex history, one that has shaped its people into resilient, hardworking, and innovative individuals. As one of the world’s few remaining communist states, it’s also transforming rapidly into a hub for early-stage startups. Today, Vietnam's entrepreneurial spirit is thriving, reflecting not only the country’s history but also its hunger to innovate and modernise.
Vietnam's thriving startup scene
Though relatively new, Vietnam’s startup ecosystem is one of the fastest-growing in Southeast Asia. It’s no surprise that with a tech-savvy young population and an increasing influx of foreign investments, Vietnam is now on the global startup map.
According to recent reports, the country is home to more than 3,000 startups, and that number is rising rapidly. In 2022 alone, Vietnamese startups attracted more than $1.4 billion in investment, making it the third-largest startup ecosystem in Southeast Asia, behind only Singapore and Indonesia. What’s driving this growth?
Strategic location: Vietnam's proximity to major markets like China, Singapore, and Thailand gives it an edge in Southeast Asia (SEA). With China and the U.S. focusing on their domestic markets, there’s a huge opportunity for Vietnamese startups to capture regional demand.
Young, educated workforce: Over 70% of Vietnam’s population is under 35, and this tech-savvy, youthful demographic is hungry for innovation. Vietnam’s universities are producing more engineers and tech talent, and many are eager to launch or join startups instead of taking traditional career paths.
Government support: The Vietnamese government has set ambitious goals to transform the country into a regional tech hub by 2030 through the creation of the National Innovation Center. With policies that are aimed at nurturing the local startup ecosystem, offering tax incentives and support for entrepreneurs.
Growing AI and tech capabilities: Vietnam has been positioning itself as a leader in artificial intelligence (AI). Home to the largest population of AI researchers in SEA, Vietnam is making significant strides in areas like machine learning, blockchain, and fintech. With the Vietnamese government's backing, this focus on AI is likely to propel its startups into global competition.
Vietnam’s unicorns and promising startups
While the startup scene is relatively young, Vietnam already has its share of unicorns (startups valued at over $1 billion USD). Companies like VNG, an online gaming and e-commerce firm, and Momo, a mobile wallet platform, have achieved unicorn status, demonstrating that Vietnam has the potential to produce global tech giants. VNG, for instance, is a homegrown success story with its flagship product, Zalo, a messaging app with over 100 million users. These startups are just the tip of the iceberg, with many others on the rise, particularly in sectors like fintech, e-commerce, manufacturing, and logistics.
One of the most promising startups is Sky Mavis, the creator of Axie Infinity — a blockchain-based play-to-earn game that has garnered massive global attention. This company’s success has put Vietnam on the map as a key player in the blockchain and gaming industries.
The future of Vietnam’s startups
Vietnam’s startup scene is still developing, but it’s full of promise. The country’s unique blend of entrepreneurship, youthful energy, and government support make it an exciting place for innovation.
However, like any emerging market, Vietnam faces challenges. Many startups struggle with accessing early-stage capital, and local investors tend to be risk-averse compared to their counterparts in places like Singapore or Silicon Valley. While government policies are supportive, there are still regulatory hurdles that can slow down innovation.
Despite these challenges, the future looks bright for Vietnam’s startups. The entrepreneurial spirit, deeply rooted in Vietnam’s history, combined with the growing presence of venture capital and foreign investment. With its strategic location, talented workforce, and focus on AI and tech innovation, Vietnam is poised to be a key player in Southeast Asia’s tech ecosystem.
As I finish my coffee and watch the city come to life, it’s clear that Vietnam is a country on the rise — not just in terms of tourism or economic growth, but in becoming a hub for innovation. The same resilience that won wars and built cities is now driving a new generation of Vietnamese entrepreneurs to conquer the global stage.
What a great post Jess! The history and development of the entrepreneurial ecosystem is fascinating and the current growth drivers and challenges so interesting. Keep writing!