Business
VinaCapital pours money into start-ups in Vietnam
Technology, and start-ups in particular, hold the greatest promise for Vietnam, according to VinaCapital`s CEO.
Vietnam-based fund manager VinaCapital in August launched VinaCapital Ventures, a USD100 million technology holding company and announced its first investments in Logivan and FastGo, two technology enabled startups providing solutions for the transportation and logistics markets in Vietnam.
Focus on technology
"While manufacturing and property get most of the attention and investment in Vietnam, tech - and start-ups in particular - hold the greatest promise for the country," said Don Lam, VinaCapital co-founder and CEO.
"Technology is playing a transformative role in all manufacturing and service sectors and will drive Vietnam's economy forward," he added.
In case of Logivan, VinaCapital Ventures decided to invested US$1.75 million, while the amount injected in FastGo was not disclosed.
The company normally invests USD2-10 million per company with an unlimited holding time. The amount will be decreased if VinaCapital Ventures become strategic investor of both companies or others decide to jointly invest in those companies.
According to VinaCapital, the focus of VinaCapital Ventures is on technology sector, targeting entrepreneurs with big ideas and helps them build companies that make a significant impact on the lives of people in Vietnam and beyond.
Once selected, VinaCapital Ventures will assist those start-ups in capitalizing on new opportunities in Vietnam's fast-rising technology sector and building a regional presence.
Two investments by VinaCapital Ventures satisfied these criteria. FastGo is a ride-hailing mobile application developed in three years by Vietnamese engineers that offers advantages for both drivers and customers. Before its launch in June 2018, FastGo had been approached by major taxi companies in Indonesia and Taxi Open99 Group from Vietnam.
Notably, with the exception of a fee to join the app, drivers will not have to pay commission to the operators of FastGo. Instead, driver partners just have to pay a maximum service fee of VND30,000 per day in case they earn more than VND100,000 per day.
FastGo currently has the second largest market share of ride hailing applications in Vietnam, of which the start-up has nearly 15,000 car and bike drivers registered in Ho Chi Minh City and Hanoi, and has connected over 15,000 rides in August.
Meanwhile, Logivan is a Vietnamese-owned startup that provides B2B truck hailing and logistics network solutions to address the industry's inefficiencies.
Dubbed as "Uber for trucks", it leverages the power of technology to help forwarders, shippers and truckers across the country to utilize assets for collaborative consumption and more cost-effective operations, aiming to lower the cost of logistics in Vietnam, improve income for trucks owners and drivers, and reduce CO2 emissions in transportation.
Logivan has over 6,000 trucks and 1,000 shippers registering its service.
For the upcoming plans, FastGo set sight to expand its service network to eight major cities in Vietnam in 2019 and have 5 - 10 million users in the next three years, while Logivan expected to grasp the opportunity from Vietnam's road transport business worth US$9 billion with annual growth rate of 9.5%.
In supporting the entrepreneurs, VinaCapital Ventures offers capital, network and mentorship. Its team combines a diverse set of skills and experience, ranging from entrepreneurship, product marketing, operational management, and technology strategy, to developing client bases, deal making and capital raising.
Stepping up investment activities
In addition to VinaCapital Ventures, Vietnam Opportunity Fund (VOF), VinaCapital's flagship fund, has been increasing investment activities.
In February, VOF invested approximately US$45 million into two subsidiaries of PetroVietnam (PV Power and Binh Son Refining and Petrochemical). Recently, VOF has announced that it will invest $25 million in private hospital operator Tam Tri Medical Joint Stock Company, which operates four hospitals in south and central Vietnam.
In the first half of 2018, VinaCapital mainly targeted public and private companies, which are reaping benefits from high growth rate of the middle income class and young population.
Under VOF's 10 largest investment portfolio released in July, in addition to its holdings in large public companies such as Hoa Phat Group, Vietnam Dairy Products (Vinamilk), and Vietjet, among others, VOF also owns shares in Ho Chi Minh Development Bank (HDBank) and Vietnam Export Import Commercial Bank (Eximbank).
Notably, following its recent divestment in a series of companies, such as the selling of 332,600 Tasco shares, 7.82 million shares of entertainment group Yeah1, and 420,000 FPT Retail shares, VinaCapital has become a major shareholder of Vietnam's leading developer Cotec Construction (Coteccons) after purchasing 100,000 shares of the company.
Illustrative photo.
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"While manufacturing and property get most of the attention and investment in Vietnam, tech - and start-ups in particular - hold the greatest promise for the country," said Don Lam, VinaCapital co-founder and CEO.
"Technology is playing a transformative role in all manufacturing and service sectors and will drive Vietnam's economy forward," he added.
In case of Logivan, VinaCapital Ventures decided to invested US$1.75 million, while the amount injected in FastGo was not disclosed.
The company normally invests USD2-10 million per company with an unlimited holding time. The amount will be decreased if VinaCapital Ventures become strategic investor of both companies or others decide to jointly invest in those companies.
According to VinaCapital, the focus of VinaCapital Ventures is on technology sector, targeting entrepreneurs with big ideas and helps them build companies that make a significant impact on the lives of people in Vietnam and beyond.
Once selected, VinaCapital Ventures will assist those start-ups in capitalizing on new opportunities in Vietnam's fast-rising technology sector and building a regional presence.
Two investments by VinaCapital Ventures satisfied these criteria. FastGo is a ride-hailing mobile application developed in three years by Vietnamese engineers that offers advantages for both drivers and customers. Before its launch in June 2018, FastGo had been approached by major taxi companies in Indonesia and Taxi Open99 Group from Vietnam.
Notably, with the exception of a fee to join the app, drivers will not have to pay commission to the operators of FastGo. Instead, driver partners just have to pay a maximum service fee of VND30,000 per day in case they earn more than VND100,000 per day.
FastGo currently has the second largest market share of ride hailing applications in Vietnam, of which the start-up has nearly 15,000 car and bike drivers registered in Ho Chi Minh City and Hanoi, and has connected over 15,000 rides in August.
Meanwhile, Logivan is a Vietnamese-owned startup that provides B2B truck hailing and logistics network solutions to address the industry's inefficiencies.
Dubbed as "Uber for trucks", it leverages the power of technology to help forwarders, shippers and truckers across the country to utilize assets for collaborative consumption and more cost-effective operations, aiming to lower the cost of logistics in Vietnam, improve income for trucks owners and drivers, and reduce CO2 emissions in transportation.
Logivan has over 6,000 trucks and 1,000 shippers registering its service.
For the upcoming plans, FastGo set sight to expand its service network to eight major cities in Vietnam in 2019 and have 5 - 10 million users in the next three years, while Logivan expected to grasp the opportunity from Vietnam's road transport business worth US$9 billion with annual growth rate of 9.5%.
In supporting the entrepreneurs, VinaCapital Ventures offers capital, network and mentorship. Its team combines a diverse set of skills and experience, ranging from entrepreneurship, product marketing, operational management, and technology strategy, to developing client bases, deal making and capital raising.
Stepping up investment activities
In addition to VinaCapital Ventures, Vietnam Opportunity Fund (VOF), VinaCapital's flagship fund, has been increasing investment activities.
In February, VOF invested approximately US$45 million into two subsidiaries of PetroVietnam (PV Power and Binh Son Refining and Petrochemical). Recently, VOF has announced that it will invest $25 million in private hospital operator Tam Tri Medical Joint Stock Company, which operates four hospitals in south and central Vietnam.
In the first half of 2018, VinaCapital mainly targeted public and private companies, which are reaping benefits from high growth rate of the middle income class and young population.
Under VOF's 10 largest investment portfolio released in July, in addition to its holdings in large public companies such as Hoa Phat Group, Vietnam Dairy Products (Vinamilk), and Vietjet, among others, VOF also owns shares in Ho Chi Minh Development Bank (HDBank) and Vietnam Export Import Commercial Bank (Eximbank).
Notably, following its recent divestment in a series of companies, such as the selling of 332,600 Tasco shares, 7.82 million shares of entertainment group Yeah1, and 420,000 FPT Retail shares, VinaCapital has become a major shareholder of Vietnam's leading developer Cotec Construction (Coteccons) after purchasing 100,000 shares of the company.
