The article cited a joint research by Ho Chi Minh City-based venture capital ESP Capital and Singapore's Cento Ventures which showed start-up investment in Vietnam hit US$246 million this year through June on 56 deals.
It added that investment is expected to top $800 million by the end of the year, which would represent a rise of at least 80 percent over last year's $444 million .
The article said a total of about $5.9 billion was invested in Southeast Asian start-ups in the first half of 2019. When it comes to the investments that can be tracked to a destination country, Vietnam accounted for 17 percent of start-up investments in the region, up from 5 percent for all of 2018, following Indonesia at 48 percent and Singapore at 25 percent.
Start-up investment in Vietnam began to rise last year, with the online retail, payments and education sectors attracting huge capital injections.
The article reported that among start-ups that raised the lion's share of funding last year was e-payment app Momo, which pulled in about $100 million from American private equity company Warburg Pincus, making it one of the largest single rounds ever raised by a Vietnamese start-up.
This year, e-commerce platform Tiki received a large injection of funds, according to research by ESP-Cento, though the company has yet to disclose the funding. Tiki was reportedly set to raise $75 million in March from investors led by Singaporean private equity company Northstar Group.
In addition, payment solution company VNPay raised $50 million from Singaporean state fund GIC, while gaming operator VNG received $29 million from Temasek Holdings.
The article continued that smaller Vietnamese startups are also being established. Luxstay, a room sharing start-up like Airbnb, raised $4.5 million in May and point-of-sale system operator KiotViet received $6 million in August, according to start-up database Crunchbase.
Backed by a large population of some 96 million and a healthy economic growth rate of 6.7 percent in this year’s second quarter, more overseas investors are paying attention to Vietnam. Home-grown tech-driven services in sectors, such as e-payments, ride-hailing, e-commerce and logistics, are booming.
The joint report of ESP Capital and Singapore's Cento Ventures noted that Vietnam is in an important period when key components of a strong digital economy are beginning to shape up.
It said that Vietnam’s digital economy will benefit from its young population, of which 60 percent are aged under 35, and a still-growing mobile and internet penetration rate. The research said that over 10 million more consumers will go online by 2023.
The article affirmed that Vietnam also has a highly educated workforce. The country's pupils ranked eighth globally in the PISA international science test, higher than Hong Kong's and Republic of Korea's. Coupled with a relatively low labour cost, Vietnam has long been a software outsourcing hub in Asia, producing large homegrown IT companies such as FPT.
Overseas-educated entrepreneurs are also helping to shape the start-up ecosystem in Vietnam. Silicon Valley-based education startup Elsa, run by Stanford-graduate Vietnamese CEO Vu Van, has about half of its 40 staff in HCMC to grow its English-learning app business in Vietnam.
Government support, through accelerator and incubator programs, has also been contributing to the country's start-up ecosystem, ESP Capital's general partner Le Vy was quoted as saying.
Southeast Asia's start-up space has been led by Indonesia and Singapore, which claim six of the eight regional unicorns - unlisted start-ups valued at $1 billion or more. Vietnam, however, "certainly has the potential to establish itself as Southeast Asia's next leading start-up ecosystem," ESP-Cento research noted.
