Venture capital funds are private equity investment vehicles that seek to invest in firms that have high-risk/high-return profiles, based on a company's size, assets, and stage of produc
THEORETICAL OVERVIEW
Definition of venture capital funds
Venture capital (VC) funds are pooled investment funds that manage the money of investors who seek private equity stakes in startups and small - to medium - sized enterprises with strong growth potential These investments are generally characterized as very high-risk/high-return opportunities In the past, venture capital investments were only accessible to professional venture capitalists, but now accredited investors have a greater ability to take part in venture capital investments Still, VC funds remain largely out of reach to ordinary investors Venture capital is a type of equity financing that gives entrepreneurial or other small companies the ability to raise funding before they have begun operations or started earning revenues or profits Venture capital funds are private equity investment vehicles that seek to invest in firms that have high-risk/high-return profiles, based on a company's size, assets, and stage of product development Venture capital funds differ fundamentally from mutual funds and hedge funds in that they focus on a very specific type of early-stage investment All firms that receive venture capital investments have high-growth potential, are risky, and have a long investment horizon Venture capital funds take a more active role in their investments by providing guidance and often holding a board seat VC funds therefore play an active and hands-on role in the management and operations of the companies in their portfolio.
Venture capital fund structure
Typically, the GP of a venture capital fund is a legal entity established and run by people employed by the VC firm In any limited partnership, the GP manages the partnership
As a result, the GP has unlimited liability for the partnership’s business operations In other words, the GP assumes full responsibility for any business debts or legal liabilities
With a venture capital fund, an LP is the investor who supplies the capital These LPs can be individuals or legal entities Often, LPs are institutional investors, such as pension funds, college endowments, trusts, insurance companies, health care systems, family offices, and sovereign wealth funds Sometimes, venture capital firms also make investments into outside venture funds as LPs
LPs have limited liability in the partnership because they don’t take part in directing its business operations and remain passive investors When a limited partnership has debts or legal liabilities, the amount that LPs are responsible for is typically limited to their investment stakes in the partnership, and does not extend to their assets outside the partnership (The GP, on the other hand, would be on the hook for the full amount.)
There are the actual startups and investments that a venture fund is making For a startup to be deemed venture - worthy they generally have to operate in a large market, have promising economics, and the ability to create a massive return for their investors (and their LPs)
Figure 1: Venture Capital Fund Structure
Venture capital investments are considered either seed capital, early-stage capital, or expansion-stage financing depending on the maturity of the business at the time of the investment However, regardless of the investment stage, all venture capital funds operate in much the same way
Like all pooled investment funds, venture capital funds must raise money from outside investors prior to making any investments of their own A prospectus is given to potential investors of the fund who then commit money to that fund All potential investors who make a commitment are called by the fund's operators and individual investment amounts are finalized
From there, the venture capital fund seeks private equity investments that have the potential of generating large positive returns for its investors This normally means the fund's manager or managers review hundreds of business plans in search of potentially high-growth companies The fund managers make investment decisions based on the prospectus' mandates and the expectations of the fund's investors After an investment is made, the fund charges an annual management fee, usually around 2% of assets under management (AUM), but some funds may not charge a fee except as a percentage of returns earned The management fees help pay for the salaries and expenses of the general partner Sometimes, fees for large funds may only be charged on invested capital or decline after a certain number of years.
Stages of venture capital financing
Venture capital is one source of financing for startups and is an important source of funding for startups that do not have access to other capital or the ability to generate sufficient operating cash flows through revenue from launch Venture capital is offered with the expectation of generating a return on investment, typically through an exit event such as an initial public offering (IPO) or acquisition of the company Smaller ventures sometimes will first rely on family funding, loans from friends, personal bank loans, or crowd funding Larger projects or more experienced entrepreneurs may turn to “angel” investors or venture capital companies that specialize in financing new ventures There are five common stages of venture capital financing:
The seed stage is when a startup approaches an angel investor or a venture capital firm to seek funding for their idea or prototype At this stage, the startup may not have a commercially available product yet and is instead focused on convincing the potential investors why their ideas are worthy of venture capital support The entrepreneur must convince the investors why the ultimate product or service will be viable and successful in the market The potential investor will then investigate the technical aspects of the product or service, and the economic feasibility of the idea Seed-stage financing is usually modest in comparison to later stage financing An initial seed investment round made by a venture capital firm typically ranges from $250,000 to $1 million The financing may go towards product development, market research, and/or building a management team
If the idea or product appears to warrant further investigation or investment, the new company will advance to the startup stage Startups typically have a sample product available at this stage but will need funding for further product development Additionally, a management team will be formed, and a business plan prepared The startup will also use funding to conduct initial market research on the product The venture capital firm wants to see results of market research in order to determine whether the market size is big enough and if there are enough consumers to buy the product Investors also want to create a realistic forecast of the investment needed to push the venture into the next stage Venture capital funding at this stage might also include spending money on acquiring additional management personnel, fine-tuning the product, or conducting additional research
This stage is also known as the first stage or second stage capital Though called
“first stage,” this stage usually only comes after the seed and startup stages At this stage, the product or service has been developed and is being sold in the market This is the first opportunity the investors have to see how the product
9 fairs with its competitors in the market Funding received at this stage will often go towards manufacturing, sales and additional marketing The amount invested here can be significantly higher than prior stages At this stage, the company could also be moving toward profitability, depending on its share of the marketplace If the startup and its product can hold their own against the competition, the venture capital firm will probably give a green light for the next stage
The fourth stage also called second stage or third stage capital At this stage, the startup should be growing, the product selling, and the company taking in significant revenue The goal of funding at this stage is to scale the business and expand market share The venture capital funding could be used to invest in overseas manufacturing facilities, start a new marketing campaign, or take steps to reduce production and other costs The funding should help enable expansion into additional markets, such as other cities or countries, and also increase diversification and differentiation of product lines The venture capital firm will then evaluate if the management team has made the expected cost reductions and how the startup fares against the competitors
Bridge or pre-IPO stage are also the other names for the fifth stage This is commonly the last stage of the venture capital financing process The primary goal of this stage is for the startup to go public so that investors can exit the venture and make a profit Funds received at this stage are generally used for activities such as merging with or acquiring other companies, taking measures to eliminate competitors or keep new competitors from the market, or financing the steps involved with an IPO
ACTUAL STATE OF VENTURE CAPITAL FUNDS IN
Activities of venture capital funds in Vietnam
The late 1990s witnessed the seed stage of the venture capital industry in Vietnam in response to the demand for investment of startup companies, as the accessibility to bank loans posed numerous obstacles and many small enterprises having insufficient assets faced difficulties securing loans However, in this period, searching for sources of capital was a challenging task for startups due to the private investment sector being relatively new and not clearly regulated by laws
The early stage started in the 2000s, when the market-based economy model began to be widely adopted and implemented in Vietnam, accelerating the development of venture capital industry to facilitate the increasing capital needs of startups Mekong Capital, IDG Ventures Vietnam, VIISA and other representative names took shape and invested in a diverse range of fields, namely real estate, consumer goods, technology, services and other areas It is also notable that the Vietnamese government began to consider promoting venture capital funds as an indicator of long-term economic growth and developed policies to encourage their establishment, regulate venture capital activities and created government-backed funds to boost entrepreneurship The government’s support was one of the prominent reasons why this period saw the substantial increases in the number of venture capital funds and the foreign funds entering the Vietnamese market, albeit with numerous limitations that investing in startups in Vietnam had to face due to lack of experience Starting from the mid-2000s, the Vietnamese venture capital market began to gain momentum, driven by a growing interest in technology startups and the increasing availability of funds However, this boom was followed by a slowdown in the late 2000s due to the global financial crisis, the lack of clear regulations for venture capital activities, the immaturity of the startup ecosystem, the lack of exits for investors and other factors The business environment also had disadvantageous factors such as
11 discrimination against the private economic sector, inadequate legal framework for venture capital and intellectual property protection and other factors
In the growth stage, which began in the early 2010s to present, venture capital funds in Vietnam have continued to experience strong growth Along with the significantly rising number of startups (as of 2019, Vietnam had about 3,000 innovative startup companies according to the Ministry of Science and Technology), venture capital funds are also expanding in terms of both quantity and quality with the increasing participation of new entrants and domestic investors
According to Cento Ventures, the amount of invested capital and the number of technology deals done have grown six-fold from the first half of 2017 to 2019, and in 2019, venture capital investments of the Technology sector in Vietnam reached million before jumping to a new peak of $1.442 million in 2021 The report also revealed that the number of venture capital firms investing in Vietnam increased from 16 in 2013 to 88 in 2019 Additionally, there has been a rise in the number of angel investors and crowdfunding platforms, which has further fueled the growth of the startup ecosystem
Figure 2: Vietnam Tech Investment Report H1 2019
One of the incentives behind this surge was the Vietnamese government’s support to encourage the social startup ecosystem, especially the innovative ones, and to promote the venture capital market, including tax incentives, preferential loans, and the implementation of a legal framework, has opened up more opportunities for private investment activities to attract investment capital from
Figure 3: Vietnam Tech Investment Report H1 2019
Figure 4: Vietnam Innovation & Tech Investment Report 2021
13 both domestic and international investors For example, in 2013, the government introduced the Law on Investment, which allowed the establishment of venture capital funds with legal status This law provided a legal framework for the operation of venture capital funds and facilitated the entry of more investors into the Vietnamese market The project "Supporting the national innovative startup ecosystem until 2025" also emphasized the importance of building a sustainable venture capital market as a foundation to promote the application of innovative technology in enterprises in particular, and the growth of the overall economy in general In addition, the Investment Law and the Enterprise Law (2016), have been more transparent and open to international investors in terms of market entry, investment procedures, forms of investment and investment incentives and dispute resolution In 2018, the government issued Decree 38/2018/ND-CP – Innovative Startup Investments, which provided guidelines for the investment and management of venture capital funds in Vietnam The government also launched the National Innovation Center (NIC) in 2019 to support research and development and attract foreign investment, connect startups with investors and industry partners to facilitate collaboration and growth In 2022, NIC’s contribution included proposing new policies to support innovation activities (Resolution 38/2018/ND-CP on venture capital funds) In addition, the continuous technology advances and the emergence of new economic sectors are also remarkable contributors
Figure 5: Vietnam Innovation & Tech Investment Report 2020 of DO Ventures
On the other hand, there are still notable challenges that venture capital funds in Vietnam are facing, including limited expertise and human resources, the lack of angel investors and crowdfunding activities, the difficulties in finding and evaluating potential startups, as well as the fierce competition from other opponents However, while the industry is still relatively young and currently records a rapid growth, there is still room for improvement, growth and maturity
2.1.2 Some outstanding venture capital funds
Since the inception in 2001, Mekong Capital has been one of the largest private equity firms that specializes in consumer-driven businesses across various sectors, including retail, consumer goods, healthcare, financial services and other fields They are also the pioneers in implementing the Ontological approach to private equity (a self-based and situation-based methodology where the business operates in the realm of being and the knowledge roles as “a map, not the territory”) The Vision Driven Investing model Mekong Capital developed from
2009 also originated from this Ontological philosophy Throughout their development process, their investment portfolio records numerous notable cases, involving Mobile World, one of the market leaders in Vietnamese mobile phone
15 sector; Pharmacity, one of the first cutting-edge retail pharmacy chains in Vietnam and other outstanding names
In 2007, Mekong Capital first invested 3.5 million dollars in Mobile World In
2018, Mekong Capital reported that after 10 years and a half, MEF II's investment achieved a return on investment (ROI) of 57 times and an internal rate of return (IRR) of 61.1% on a cumulative basis, becoming one of the most successful investments in the history of private equity investing in Asia Mekong Capital helped Mobile World to improve its supply chain, logistics, inventory management and expand its store network, develop new products and services such as its grocery store chain and online marketplace During the time of IPO, Mobile World had added over 200 retail outlets, a remarkable growth from a modest 5 in 2006
Established in 2004, IDG Ventures Vietnam (IDGVV) is the first technology venture capital firm in Vietnam as well as a founding member of the Vietnam Private Equity and Venture Capital Association (VPEA) IDGVV aims to provide not only funding but also strategic guidance and operational support to its portfolio companies to help them achieve their full potential They have invested in more than 40 companies across various sectors, including digital media, technology, software and telecom Some of the notable companies in IDGVV's portfolio include VNG Corporation, Tiki.vn, and Yeah1 Network
One of the outstanding investment cases of IDG Ventures Vietnam is its investment in VNG Corporation, one of the leading digital content and online gaming companies in Vietnam IDG Ventures Vietnam first invested in VNG in
2007 and continued to support the company through multiple rounds of funding VNG Corporation has since grown to become a major player in the Vietnamese technology market, with a range of popular digital content and online gaming products, including Zing (a social media and entertainment platform that used to attract millions of active users in Vietnam), CrossFire (one of the most successful first-person shooter games in Asia) IDG Ventures Vietnam's investment in VNG has been highly successful with the company achieving strong development and
16 profitability In 2014, VNG Corporation became the first Vietnamese tech company to list on the NASDAQ stock exchange, with a valuation of over $1 billion
500 Startups Vietnam (500 Global) is a venture capital firm and startup accelerator that prioritizes seed-stage investments in Vietnam's emerging startup ecosystem, especially the promising Vietnam-connected startups with an emphasis on technology companies Their investment philosophy targets companies characterised by a strong team with complementary skills, a clear and differentiated business model, and a large addressable market Since its launch in
2010, 500 Startups Vietnam has invested in more than 40 Vietnamese startups particularly in the areas of e-commerce, fintech, healthcare and edtech with some notable names, including Tiki, one of the leading e-commerce platforms in Vietnam, and Appota, a mobile content platform
One of the outstanding investment cases of 500 Startups Vietnam is Tiki, one of Vietnam's largest e-commerce platforms offering a wide range of products and services, including books, electronics, fashion, beauty products, and others The company raised $54 million in its Series C funding round in 2017, which was led by JD.com and participated by VNG Corporation and CyberAgent Ventures With the help of this funding, Tiki expanded its operations and improved its services, logistics and delivery capabilities, continued to grow and expand its market share in Vietnam's highly competitive e-commerce space
Opportunities and challenges to develop in Vietnam
It is undeniable that the form of investment through venture capital is becoming more and more popular in Vietnam these days In fact, the main sources of funding for startups in Vietnam mostly come from securities investment funds,
18 individual investors, non-governmental organizations, as well as venture capital funds According to Topica Founder Institute, from 2016 to 2018, the amount of venture capital and foreign capital invested in innovative start-up companies in Vietnam increased by more than three times, from $205 million to nearly $900 million The number of business affairs in this time period nearly doubled, from
50 deals in 2016 to 92 deals in 2018 Another source from the Journal of Echelon
- Singapore, Vietnam now has approximately 3,000 innovative startups, nearly double the estimated figure of 1,800 businesses at the end of 2015 This also means a positive impact on the venture capital market in Vietnam
Considering the global context, the development of science, technology, and innovation as well as the Fourth Industrial Revolution act as a motivator for the increasing number of startups in Vietnam Witnessing a rise in the number of startups, the government sees this trend as an opportunity to boost the country’s economy and starts to bring out policies, regulations, incentives, etc to support and encourage startups This course of action has been reflected in the Global Innovation Index (GII), from the 32nd rank out of 141 countries in 2015, Vietnam has made it to the 44th rank out of 132 countries in 2021, holding the 1st rank in the group of 29 countries with the same income level
For foreign venture investors, Vietnam is a promising market as it is among the most populous countries in the world with a market of 100 million people considered as golden population The rate of purchasing power, the ability to absorb and welcome new products, especially technology, is higher than in other countries The Vietnam market, with the potential of the young market and the level of information receptivity, will meet the investors’ demand Moreover, globalization and international economic integration can also be counted as positive factors in the development of capital funding in Vietnam These trends help Vietnam approach global standards and make partnerships with other countries According to Vietnam Innovation & Tech Investment Report 2021 by
DO Ventures, the number of foreign investors continued flocking to Vietnam for many years, with Singapore being the most active investor
As a result, there is no doubt that venture capital funding is growing day by day as startups need to raise capital for their business activities
The development of venture capital funding in Vietnam also faces some challenges in its growth These include the lack of legal corridors, the lack of angel investors, etc Legal corridors or policies in favor of venture capital funds need improving in the future The current procedures to establish member funds were rapid but the law still lacked specific regulations on definition, policy orientation, or preferential conditions for venture fund operation
Another challenge, according to experts, is that the majority of domestic corporations have never invested in a venture capital fund model before For them, this type of investment model is quite risky compared to investing in stocks, bonds, or real estate Understandably, 97-98 startups out of 100 fail to continue their business activities To explain the number, domestic companies often face difficulties in accessing such venture capital due to the lack of innovative business ideas, and weak business and financial management skills
Figure 6: Investors Continued Flocking To Vietnam
20 which fail to attract venture capital It is undoubtedly that most investors are still skeptical and won’t pour their capital into it Not only domestic venture capitalists but the number of foreign venture investors is also decreasing Due to language barriers, there are many startups that are actually doing well in their business but their founders do not know how to persuade the foreign venture capitalists, leading these investors to question their potential and refuse to risk their money
Consequently, there is a huge gap between the demand and supply for venture capital in Vietnam as the number of new enterprises continues to increase while the amount of capital raised is very limited The smaller the size of the Vietnam capital market is, the less attractive it appears to big investors, including domestic and foreign individuals Evidently, the number of foreign investors pulling out of Vietnam is decreasing; therefore, the amount of capital raised is also dropping
Additionally, there has been a shift in the global capital flow According to Crunchbase News, in the first half of 2021, global venture capital funding broke its previous record as more than $288 billion was invested worldwide, which means approximately $50 billion was invested monthly But in a recent analysis also by Crunchbase News, total global venture capital in November 2022 was
$22 billion, down by $70 billion compared to November 2021 This is the lowest funding month-on-month record since February 2020, which saw $18.3 billion invested
Figure 7: Global Funding Monthly Averages By Half Year
RECOMMENDATIONS
Governmental supports
First, the overall regulatory framework for venture capital should be promulgated Due to the lack of a legal framework, the investors cannot have many incentives in investing in this new kind of market Thus, the Government needs to make a set of legal reforms not only in the venture capital market but also in a number of areas, such as Finance and Banking, Tax, Infrastructure, Intellectual Property and Dispute Resolution Furthermore, the Law had better distinguished the concept “venture capital” and “private equity” Based on that, the promotion policies for those markets can work effectively Most importantly, the definition of “Innovative SMEs” should be explained in detail, which is the critical point to make other incentives more effective
Second, government should promote more Vietnamese Venture Capital funds instead of overseas venture capital investment in domestic companies To promote this establishment, local Venture Capital tax rates need to be competitive However, until now, there is no explicit guidance on specific tax incentives and separate accounting systems of a Venture Capital Fund Thus, on the investor tax incentive side, first, it needs to offer a discounted tax rate to Venture Capital funds domiciled in Vietnam of zero (tax exempt for 5 years) to 10% (make Venture Capital a strategic industry) In addition, a tax deduction for Venture Capitalists is also recommended The overall risk of their investment in the early-stage would be lowered through their tax payment savings The tax deduction for Venture Capital investors could be piloted for five years Depending upon its ability to increase the amount of capital available to domestic Venture Capital funds it could then be discontinued or extended for another set period of time.
Venture capital funds
In addition to government support, venture capital funds also need several measures to attract capital, build strong ecosystems and have appropriate investment policies
First, venture capital funds need to have measures to attract investment capital
Venture capital funds in Vietnam are often established in the form of joint stock companies or limited liability companies with a few shareholders, in order to unify goals and make decisions more easily The capital of these funds can come from many sources, such as the state budget, individuals, large corporations, brands, public investment funds or other financial institutions, etc
Besides the state budget, in order to encourage stakeholders to increase their investment and funding for venture capital funds, funds need to enable and promote different mechanisms from which stakeholders can learn, exchange and share information with each other One of the most important measures is that funds need to actively open up information channels and be financially transparent Businesses are not open to funds in general and venture capital funds in particular if they do not have broad access to information about these funds
Up to now, most businesses are still operating in the absence of information in all areas They have to rely on commercial intermediaries to get market information and pay very high fees for information services To improve this situation and to respond to the requirements of the global information age, it is necessary to expand information channels so that businesses can get the necessary information This also means opening of information channels to all audiences equally, not just for one object at all
Second, venture capital funds need to build a strong ecosystem
With the current speed of scientific and technical development, there is no shortage of innovative, high-tech and potential products The important thing is how it is introduced and connected with investors Therefore, venture capital funds should create networks and opportunities for startups to connect with investors through organizing networking seminars, establishing groups to share information, organizing innovation and start-up competitions, etc Not only will this help funds to find potential projects, but also inspire and exchange experiences with young people who want to start a business, thereby promoting the growing startup community In addition, funds can also search for potential businesses or projects through cooperation with channels such as high-tech parks, business incubators, universities, research institutes, business associations, etc
Besides the financial support, funds can also provide non-financial support such as helping businesses to improve their management systems and business models, providing mentorships and consultants, building brand reputation, researching the market, giving professional training for startups and other investors, etc Since then, funds can both enhance their influence and bring more value to the society
Third, venture capital funds need to evaluate and select projects carefully based on specific financial indicators and criteria
The performance of venture capital funds depends on the success of their investment projects A good project will bring high returns to businesses, venture capitalists and fund managers Therefore, choosing a good project or a potential business plays a very important role Once a number of potential projects or businesses have been discovered, venture capital fund managers need to base on certain criteria to decide on the selection of suitable and effective investment projects Therefore, it is necessary to carefully consider the financial indicators of businesses and develop appropriate evaluation criteria such as: being reputable in the market, having a clear idea about the product, having a clear business plan and transparent financial statements, having an effective business management team, etc
Fourth, venture capital funds should fund in stages and directly participate in the development of the business
After the project evaluation process is completed and an investment decision is reached, venture capital funds should not sponsor a project or business once as the whole, but instead, divide it into several rounds In the first stage, funds should finance a part, then if the investment is found to bring the results as intended or committed, the funds will continue to invest in the next stage
In order to limit risks, venture capital funds need to control the business receiving the funding by directly participating in the management of the business in the whole process and assisting in making business development decisions
Simultaneously, through the shares they own, venture capital funds can monitor the investments and cash flow of the business.
International cooperations and partnerships
With Vietnam’s current economy, the development of the venture capital market in general and the venture capital fund models in particular is necessary to realizing the cause of industrialization and modernization of the land Country in the context that the Vietnamese economy, especially the private sector, requires huge capital However, capital supply in Vietnam is still limited, the size of the capital market is small compared to the region There is a large gap between the supply and demand for venture capital in Vietnam, necessitating the formation and development of the venture capital market, as well as mechanisms and policies that contribute to the development of venture capital firms Therefore, attracting overseas venture capital funds to invest in Vietnam is critical
According to Bain & Company’s recent survey, nearly 90 percent of investors said the hottest Southeast Asian market outside of Singapore in 2018-2019 is Vietnam and Indonesia With this advantageous situation, Vietnam needs more strategic policies to develop venture capital funds significantly In which, international cooperation and partnerships can play a crucial role in attracting foreign venture capital investment to the country Here are some potential initiatives that could be undertaken to promote such partnerships:
First, strengthening relationships with foreign venture capital firms: Private sector players and government organizations in a country seeking foreign venture capital investment should pay attention to developing and strengthening the relationships with foreign venture capital firms This could involve attending industry conferences and meetups, and partnering with local organizations that work with venture capital firms, organizing meetings and events to connect with these firms and highlight the country's startup ecosystem
Second, promoting the establishment of international venture capital funds:
International venture capital funds could be established to invest in startups in the country seeking foreign venture capital investment Such funds, which could
25 be led by a mix of local and international players, could provide valuable funding and assistance to startups as they grow
Third, creating startup exchange programs: Startup exchange programs could be established to encourage cross-border collaboration between startups and investors These programs could provide startups with opportunities to learn from international investors and gain exposure to new markets, while also enabling investors to gain access to promising startups in the country seeking foreign venture capital investment
Fourth, increasing access to information to promote the country's image:
Vietnam can provide more information about the startup ecosystem to foreign venture capital firms This can include information about the types of startups that are most successful in Vietnam, the regulatory landscape, and any cultural nuances that could impact doing business in the country Vietnam can also highlight its vibrant startup ecosystem, showcasing its talented entrepreneurs and the innovative ideas they're working on This can include hosting startup events and hackathons, and creating a network of incubators and accelerators Private sector players and government organizations in the country seeking foreign venture capital investment could collaborate to promote the country's strengths and opportunities to potential investors This could include emphasizing the country's favorable economic conditions, supportive regulatory environment, and skilled workforce
Lastly, facilitating partnerships between startups and multinational corporations:
Multinational corporations could be encouraged to partner with startups in Vietnam, which are seeking foreign venture capital investment Particularly, one of the major challenges facing the startup community in Vietnam is the lack of funding; therefore, partnerships could provide startups with access to valuable resources and expertise, while also enabling multinational corporations to gain access to new technologies and business models
Through the report, it has clarified the characteristics and operation mechanism of the venture capital fund model, as well as the influence of the venture capital fund model in Vietnam The report synthesizes the experience of developing venture capital funds while also proposing some measures to encourage the creation of a venture capital development environment in Vietnam
Overview of countries around the world, it is clear that the venture capital industry in general, and venture capital in particular, has affirmed its role and position in the development of the economy Investment recovery manifests itself differently in each country, depending on the characteristics of the political, economic, and legal environments, among other things Although the formation and development of venture capital funds in Vietnam is no exception to that general rule, we also cannot apply foreign experiences mechanically, but we must have considerations and choices to suit the specific and general situation of Vietnam In order for this type of investment to bring into full play the priority given to the financial market, to the process of scientific and technological innovation and above all to the national economy, our enterprises and the State need to have truthfully determined great effort First of all, is the formation of the initial legal framework for this type, then research and promulgate policies to encourage venture investment to develop Vietnamese businesses also need a change in management structure, company size to be suitable and especially to nurture business ideas to create attraction for venture capitalists Venture capitalists also oppose the requirement of taking a long time and making great efforts of the Government and businesses to match the development of the economy
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[14] Phạm, Q A (n.d.) Hình thành quỹ đầu tư mạo hiểm nhằm huy động nguồn vốn ngoài ngân sách đầu tư cho khoa học và công nghệ trên địa bàn thành phố Hà Nội
[15] Phan, T B N (n.d.) Thu hút vốn đầu tư mạo hiểm cho đổi mới công nghệ tại
Việt Nam Thế Giới Luật https://thegioiluat.vn/bai-viet-hoc-thuat/thu-hut-von- dau-tu-mao-hiem-cho-doi-moi-cong-nghe-tai-viet-nam-7073/
[16] Phát triển doanh nghiệp khởi nghiệp sáng tạo (n.d.) Cổng Thông Tin Điện Tử
Bộ Tài Chính Retrieved March 8, 2023, from https://mof.gov.vn/webcenter/portal/vclvcstc/pages_r/l/chi-tiet- tin?dDocName=MOFUCM187734
[17] Phát triển thị trường vốn đầu tư mạo hiểm ở Việt Nam (n.d.) Cổng Thông Tin Điện Tử Bộ Tài Chính Retrieved March 8, 2023, from https://www.mof.gov.vn/webcenter/portal/btcvn/pages_r/l/tin-bo-tai- chinh?dDocName=MOFUCM227620&dID"8636
[18] Teare, G., & Teare, G (2021, July 13) Global Venture Funding Hits All-Time
High In First Half Of 2021, With $288B Invested Crunchbase News https://news.crunchbase.com/venture/global-vc-funding-h1-2021-monthly- recap/
[19] Teare, G., & Teare, G (2022, December 12) Global Venture Funding Dips
Further In November 2022 Crunchbase News https://news.crunchbase.com/venture/global-vc-funding-monthly-recap- november-2022/
[20] Thái Nghiêm Minh, N (2014, July 28) Vốn mạo hiểm và vai trò cung ứng vốn cho mục tiêu phát triển của Việt Nam
[21] V (n.d.) Vietnam’s Leading Investment and Wealth Management Group -
VinaCapital Vinacap https://vinacapital.com/
[22] Vietnam Innovation and Tech Investment Report 2021 (2021) DO Ventures
[23] VinaCapital Ventures (n.d.) https://ventures.vinacapital.com/