An abundance of inexpensive engineers coupled with a fast growing economy makes the nation a highly attractive spot for startups, according to an article titled “Silicon Valley Talent Is Helping Grow Vietnam's Startup Hub” published on February 14 by Bloomberg.

The article cites a report published in July, 2022, by KPMG International Ltd and HSBC Holdings Plc which states that the number of startups in the country nearly doubled between the beginning of the COVID-19 pandemic to mid-2022,

Some of the world’s largest investors, including Sequoia Capital, Warburg Pincus LLC, and Alibaba Group Holding Ltd., are backing those offering promising solutions.

In 2021, the country drew a record US$2.6 billion through 233 private deals, up from US$700 million via 140 deals the year prior, according to a Google, Temasek Holdings Pte., and Bain & Co. report. 

In addition, local firms are also competing against businesses from throughout Southeast Asia, accounting for 13% of the total venture funding flows into the region after Indonesia and Singapore in 2021, according to Do Ventures.

The newswire stated that the Vietnamese Government aims to turn Ho Chi Minh City into a magnet for tech funding and is striving to grow its digital economy, particularly as it represents 40% of the southern city’s gross domestic product.

Last month saw the Government order city officials to prioritise attracting foreign investment to high tech projects, while also offering other incentives to lure global talent and international firms to establish innovation research centres.

Industry insiders say Ho Chi Minh City has the makings of the next Silicon Valley-lite: a heavy math and science educational system, a decades-old software outsourcing industry that’s created an abundance of inexpensive and talented engineers and the benefits of Vietnam’s economic expansion, which last year was one of the fastest across Asia.

Source: VOV/Bloomberg