Vietnam is potential market for digital start-ups

According to many experts, Vietnam is considered as one of the potential market for digital start-ups.

The world has witnessed the transformation of enterprises in digitalizing their business operations. In developed country such as Singapore, cashless payment contributes to 60% of the total number of transaction.

In Vietnam, at the conference digital enterprises 2017: Digital era and start-up nation held in Hanoi, report of Vbiz showed, as of 2017, Vietnam has a total of 210 newly established websites with e-commerce related contents. Evidently in 2014, 70% revenue of Tiki.vn coming from selling books, but at present, this number has reduced to 30%, and the remaining come from other business activities. The number of orders in this e-commerce website is from 15,000 – 20,000 orders per day, with an average increase of 12% per month. Meanwhile, Shopee after 2 years of establishment has more than 2 million turns of download with 10,000 orders per day and growth rate of users and orders increase 20% per month.

It is estimated that the revenue from e-commerce and retail sector in 2017 will reach 2.08 billion USD, with the growth rate of 20% per year. This report also showed that revenue from the online advertisement market in Vietnam in 2017 is 76 million USD, in which 36% of the revenue is generated through smart phones. The rate of Vietnamese convinced by advertisement in internet reached 82%.

These numbers have motivated enterprises to transform and digitalize their business operations. This is also an opportunity for start-ups if they can grasp the market demand for development. According to Nielsen Vietnam marketing research company, out of the recent 10 young billionaires in the world, 4 of them are working in IT sector. Vietnam has one of the highest rate in using smart phones in the world, with 80% in cities and 60% in rural area. However, this is just the beginning, as the most important things are how enterprises can take advantage of this number, and whether they can develop solutions to encourage customers to use their products.

According to experts, in this digital era, transformation does not just come from technologies, but also from human. As such, start-ups are the driving force to facilitate the digitalization process in Vietnam. However, start-ups have to understand that in a maximum period of 18 months, if they can successfully introduce products to the market, then they should change project. This comes from fierce competition in the industrial revolution 4.0.

For a start-up to be successful, capital is always the prerequisite. In Vietnam, the number of local and foreign investment fund for innovation start-ups is increasing. Foreign investment funds such as Cyber Agent, 500 Start-ups, Golden Gate Venture, and others have opened representative offices or partners in Vietnam. Among local investment funds, only FPT Venture is focusing in start-ups investment. Many local investors such as big companies and private investors also express interests in investing for innovation start-ups. As such, the creation of a legal framework for innovation start-ups investment, as well as supporting policies for this activity is necessary, which timely meets the current practical demands. Therefore, it is vital to have a decree to specify investment for innovation start-ups./.

VNF/Hanoitimes