“The internet here is freaking awesome. The internet is way faster than Australia.”
Vietnam’s internet faster than Australia? That’s a sentiment you’d perhaps expect to hear from someone in Seoul, South Korea. But not from a businessman like Lê Mai Tùng sitting in his office in Sài Gòn.
Tùng is founder and CEO of the startup Pinbike. Startups are simply new business ventures built around an idea, an innovative concept, that can be scaled up to generate lots of money in the process. Pinbike is like Uber , but for motorbikes and taxis, connecting drivers with riders. His company just launched its ride sharing platform earlier this month.
“The people, engineers here are talented and of course the cost is way lower than in other developed countries. So if you have a good idea and you want to develop it cheaply, you can come to Việt Nam,” Tùng says.
Tùng was born in Phan Rang and raised in Sài Gòn. He studied and worked abroad in Sydney, Australia for seven years and it was during this time that he came to recognize the advantages for startups in Việt Nam: There’s an abundance of talented Vietnamese developers, and a rising standard of living means more disposable income.
The 32-year-old wanted to leverage his background in software engineering and entrepreneurship by coming back to Việt Nam to start his company. And he is not the only one doing this.
“Việt Nam is happening,” Tùng says. It is a big market with 100 million people, and a lot of problems haven’t been solved, so problems means opportunities”
For ambitious entrepreneurs like Tùng, the opportunities abound. Việt Nam is a young country, with a median age of 30. Việt Nam’s consumers are tech savvy and eager to adopt new types of web and mobile-based services.
Quang Mai Duy, a co-director at Founder Institute in Sài Gòn, echoes Tùng’s excitement about Việt Nam’s potential. But he says the country’s startup ecosystem still needs a lot of underlying support. Founder Institute helps entrepreneurs launch technology companies by providing startups with training and mentorship.
“In Silicon Valley you can just go out of your building and meet any mentor,” Duy says.. But in Việt Nam it's really hard. People don't talk so much, don't share. That needs to change. And also the supporting from startup to startup. Startups in Việt Nam like working alone, they don't do partnerships, they don't do sharing, and that should be changed too.”
He and other experienced entrepreneurs from Founder Institute serve as mentors for startups in Việt Nam.
“Training the founders and also help them in concept, and development, and everything that the startup have from the very beginning to the end of the journey,” he explains “We help them about the idea, pitching, fundraising, publicity, everything.”
In the past three years, Founder Institute has graduated 28 startups in Việt Nam who have then gone on to raise roughly $10 million worth of funding. Duy has noticed some trends: 45% of these startups have founders who have worked overseas or studied abroad, and he is seeing a rising number of Việt Kiều, Vietnamese from the diaspora, return to Việt Nam.
“A good thing is that many Việt Kiều, Vietnamese going back to do business in the country,” Duy says. “You can see overseas Vietnamese going back and setting up the local team to do the startups.”
Duy cites success startups, like Misfit Wearables, a company providing sensor technology you wear. Misfit was started in both the U.S. and Việt Nam by a Việt Kiều. It has since gone global, with its CEO, development and operations team based in Việt Nam and headquarters in California. Earlier this month, Misfit was bought by the giant watchmaker Fossil for 260 million dollars.
“You guys [Việt Kiều] bring back the knowledge that you achieved in the States to help the guys in Việt Nam, that’s good.” He says, “For those guys wanting to come back to Việt Nam, you definitely need relationships. You need to contact the local people.”
Building those local connections is key says Anh-Minh Đỗ, Tech in Asia editor. He has spent eight years in Sài Gòn and has a theory why Vietnamese nationals often do better than Việt Kiều in Việt Nam.
“Most of the time when you look at the Vietnamese companies that have done well, they’re mostly run by Vietnamese, not by Vietnamese Americans,” Đỗ says “I think it’s because Vietnamese Americans don’t really understand Việt Nam from the market point of view, or the country point of view, or the culture point of view. They don’t understand how to tackle the market and that’s where the educated Vietnamese excel, but when you look at who are the educated Vietnamese, they’re the ones educated abroad and they come back and they run the company.”
Flappy Bird is a case study proving this. The mobile game that inexplicably saw a sudden rise in popularity and grabbed international headlines in early 2014. Nguyễn Hà Đông, a Vietnamese national and creator of the addictive game, said in an interview that it earned him roughly $50,000 of in-app ad revenue daily.
“Đông created Flappy Bird and eventually it’s quite a boom to the region and also the global market,” Duy from Founder Institute says.
As startups begin to grow and gain exposure through successful funding, other parties take notice and begin taking action.
Anh-Minh Đỗ, Tech in Asia editor explains: “And then you also have quite a few investors that are rising, angel investors especially. People who started out 10 years ago and now they’re rich, 10 to 20 percent of their personal wealth can be allocated into investing into businesses and such. And maybe it’s that they are not so keen on taking on real estate, they’re not so keen on just sticking it under their bed or in a bank anymore. It’s like they need to now think more opportunistically investing into startups, startups that are sexy and intriguing, potentially interesting, potentially lucrative in the long run”
Technology is definitely sexy and investing in startups is only becoming more attractive. And it seems that investors aren’t the only ones who see Việt Nam as a market in its beginning stages. Tùng, the PinBike’s CEO, says he has seen government officials recently step up their game to provide much needed guidance and funding to encourage innovation, unleash private investment, and improve education.
“For the past two years, I’ve recognized they’ve been actively supporting startups,” he observes. “They create the Vietnam Silicon Valley Project that gives funding to prominent startups. They work as an accelerator so they can do some funding. And now they have a special group from Ministry of Planning, a special interest group that works closely with startups to survey startup needs and difficulties so they can adapt their policies, about tax, about paperwork, to force startup growth.”
And although government officials are beginning to come around, Tùng says there are still legal hurdles to overcome.
“The most annoying thing is the tax,” he complains. “When you register a company it just costs me 15 minutes online in Australia, but it costs me two weeks and I haven’t [been able t] finalize my tax paperwork. They want to take my money but they make it so hard that I can pay my tax.”
Việt Nam’s startup ecosystem is taking shape, promising to generate huge financial gains if opportunities are seized.
Tùng says he wants to see more business minds: “I’m thinking what is missing in Việt Nam startups to scale globally or even regionally to Southeast Asia is the business people who can see the opportunity, who can see the problems that can be solved using technology.”
PinBike’s, and Việt Nâm's future success depends on all players. So whether they’re a government official or an entrepreneur, the game demands they stay ahead of change, anticipate risks, and seize opportunities.
Success won’t be limited to just Việt Nam.
But if you can make it Vietnam, you can make it anywhere.
Written for the web by Brian Lâm
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Follow Pinbike’s journey:
Official Website: http://pinbike.me/
Facebook: https://www.facebook.com/PinBikeMe/?pnref=lhc
App Store Download: https://itunes.apple.com/vn/app/pinbike/id1048966316?mt=8
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Resources:
100 million Vietnamese population: https://www.techinasia.com/tag/vietnam/
Misfit Wearables Acquisition: http://www.pcmag.com/article2/0,2817,2495077,00.asp
Flappy Bird $50,000 Daily Earnings: http://www.theverge.com/2014/2/5/5383708/flappy-bird-revenue-50-k-per-day-dong-nguyen-interview
Vietnam Silicon Valley Project: https://www.techinasia.com/silicon-valley-project-vietnam-government/