Vietnamese startups nab $855 mln in 2022: Nextrans

Startups in Vietnam secured 85 funding deals worth $855 million in 2022, according to South Korea's venture capital company Nextrans.

Such figures dropped from 165 deals worth $1.44 billion a year ago, indicating that venture capital became more cautious in investing in startups due to economic headwinds, said Nextrans.

While early-stage activity remained robust, total investment value dropped significantly in 2022 due to the absence of late-stage funding, highlighting the need for more scalable businesses, the firm stressed.

E-commerce accounted for the biggest portion of $161.6 million in 17 deals, or 31% of the total investment; followed by fintech with 13 deals worth $138 million, or 26%; and logistics & transportation with $75.5 million in six deals, or 15%.

Other notable sectors were edtech, medtech & healthcare, foodtech, electric vehicle, proptech, software as a service (SaaS), media, blockchain, and travel.

Startups are increasingly opting to secure financing from banks and private credit players to prevent down rounds, while valuations are under pressure, Nextrans noted.

A prominent deal was ride-hailing service Be Group’s $60 million loan from Deutsche Bank. Other non-startup deals were pawnshop F88’s $60 million debt facility from CLSA Capital Partners in November 2022 and $10 million financing from Lendable, and conglomerate Vingroup’s automobile arm VinFast’s $135 million loan from Asian Development Bank.

At the Vietnam Venture Summit 2022 last December, 39 venture capital funds vowed to pour $1.5 billion into innovative startups in Vietnam in 2023-2025, as part of the country's effort to attract funds totalling $5 billion in the period.

Vietnam has about 208 venture capital funds, including 40 domestic ones. Notable angel investors are Vietnam Silicon Valley Accelerator with support from the Ministry of Science and Technology, CLAS Expara Vietnam Accelerator initiated by Microsoft Vietnam, and Vietnam Startup Acceleration Fund invested by FPT and Dragon Capital Group, according to a report by BambuUP, a Vietnamese innovation connection platform.