February 2020 Newsletter

People line up to buy masks in Hanoi. Source: Reuters
Binh & Eddie

February 14, 2020

Hello readers,

As elsewhere, in Vietnam in recent weeks the spectre of the COVID-19 coronavirus has been looming. Masks and sanitizers are out of stock. The government has closed schools and banned all foreign visitors who have been to China in the 14 days prior. Office buildings, residences, and retailers are posting and broadcasting announcements about prevention best practices. A number of companies have allowed their employees to work from home.

In our opinion, all in all, it’s been an impressively aggressive response, likely contributing to a fairly manageable number of cases (15 as of February 11) despite Vietnam’s proximity to and interconnectedness with China.

Still, the economic impact on Vietnam is likely to be meaningful through at least Q1 as China battles the epidemic, with impacts particularly on tourism, manufacturing, and trade. A number of international VCs have postponed visits to Vietnam, and major tech events have been rescheduled as well.

As for 500VN, we’re operating as usual. (After all, Warren Buffet did say, “When others are fearful, be greedy”!) The Saola Accelerator kicks off in 2 weeks with a number of international and local experts coming in. We’re looking forward to announcing a number of deals next month. And we have portfolio companies raising from Seed to Series C.

In the meantime, take a look at the action-packed newsletter below!

Until next month,

Team 500 Startups Vietnam

500 Startups Vietnam in the News

Binh Tran shared with Vietnam Investment Review (“Bao Dau Tu”) in a special Lunar New Year issue as he reflected on 500’s operations in Vietnam. “Back then in 2014-2015, the ecosystem wasn’t quite ready for an early stage fund but we wanted to capitalize on being a bit early to build a brand that founders trusted. Today, we’re the most active VC in Vietnam and I hope it means that founders trust us and believe in the value we bring”, said Binh. Bao Dau Tu (in Vietnamese). 1/27

Eddie Thai shared his journey with Business Punk Germany in a January issue covering Saigon’s booming startup ecosystem. From representing a new generation in the Vietnamese startup cosmos – the Viet Kieu, to backing talented Vietnamese founders like Trung Nguyen – founder of Saola batch company Axie Infinity, Eddie reaffirmed his bullish view on Vietnam. Business Punk (in German). 1/15

Debbie Wei Mullin, founder of Copper Cow Coffee, was featured in the MIT Alumni Association’s publication Slice. From a solo venture, Debbie has grown Copper Cow Coffee into its current incarnation, with products sold in 5,000 stores across the US and $3 million in funding. Slice of MIT. 2/5 

Vu Van, co-founder of ELSA Speak, shared about recent developments. The AI-powered English speech assistant is expanding across borders, hiring representatives in some of the biggest markets in Asia, like India, Indonesia, and Japan. The app was recently launched in Indonesia, where Vu is optimistic about ELSA taking off. KrAsia. 1/22 

500-backed TrustingSocial aims to revolutionize credit scoring in emerging markets. Founded in 2013, TrustingSocial is on a mission to fill that gap by providing credit scoring and improving access to financial services for consumers in emerging Asian markets, such as India, Vietnam, Indonesia, and the Philippines. KrAsia. 1/14

Former Microsoft Vietnam executive Jeremy Showalter is now the CEO of 500-backed Pique. “I am excited about the growth impact applied AI can have for vertical ecommerce businesses and retail, and after 13 years at Microsoft, including five years in Vietnam, I wanted to focus again on the incredibly dynamic SE Asia region,” said Jeremy. GeekWire. 1/10

Leflair, which sells high-end products, has ceased its Vietnam business operations as part of a business model shift. Co-founder and CEO Loic Gautier commented on the move, stating the startup will retain its cross-border ecommerce business, fulfillment centre in Singapore and the newly-launched Philippine operations. “The change in business model is expected to help Leflair’s operation to become leaner, with the ability to change faster,” said Loic. DealStreetAsia. 2/5

Vietnam in the News

EU lawmakers ratified a Vietnam trade deal. Under the accord, Vietnam will scrap 99% of its import duties over 10 years and the EU will do the same over seven years, effective around July. The accord also curbs non-tariff barriers and opens up public procurement. This is expected to increase two-way commerce, which was almost 50 billion euros (~US$55B) in 2018.  Bloomberg.  2/12

Vietnam’s two big cities lead the region in dynamic growth. Ho Chi Minh City and Hanoi rank third and seventh among the most dynamic cities in the world, according to the City Momentum Index recently issued by property consultant Jones Lang LaSalle. VietnamPlus. 2/5 

Vietnam confirms 15th coronavirus (nCoV) infection case… Vietnam officially declared the nCoV outbreak an epidemic on February 1. Most patients who tested positive are in Vinh Phuc province in northern Vietnam. Vietnamnews. 2/11

…The coronavirus outbreak hits Vietnam’s economy: Vietnam suspends all flights to and from mainland China as a strengthening measure against the outbreak (The New York Times, 2/5). While stock investors’ concerns have pushed down the benchmark VN Index (Bloomberg, 2/5), a lack of Chinese tourists travelling during the peak holiday season is expected to affect Vietnam as well as Thailand and the Philippines, triggering knock-on currency depreciation (Financial Times, 1/29).

VinGroup bumps airline to focus on auto projects. Vietnamese conglomerate Vingroup JSC is abandoning plans to launch Vinpearl Air so it can focus on other businesses including electric vehicle manufacturing. Company Chairman Pham Nhat Vuong said in December that he’s plowing as much as $2 billion of his own fortune to export VinFast EVs to the US and other markets by 2021. Financial Times. 1/14

January Foreign Direct Investment (FDI) surged 179 percent. Vietnam raked in $5.3 billion in FDI in the first 20 days of 2020, a year-on-year surge of 179.5 percent, according to the Ministry of Planning and Investment. Vietnam News. 1/30

Vietnam Tech in the News

Vietnam’s biggest mobile company Viettel will roll out 5G services, bypassing Huawei and using technology it has developed itself. State-owned Viettel, which is operated by the country’s Ministry of Defence, will begin deploying the next generation mobile network technology from June and complete nationwide deployment a year later. Financial Times. 1/20

Apple partner Pegatron set up production in Vietnam. Taiwan’s Pegatron Corp. plans to set up production facilities in Vietnam, according to people familiar with the matter, becoming the latest Apple Inc. assembly partner to establish a presence in the Southeast Asian nation as they diversify beyond China. Bloomberg. 1/21 

Forbes Vietnam issued the annual 30 Under 30 list, honoring young talented founders of technology startups including Logivan, MindX Education, and Amanotes. Forbes Vietnam. 2/3

Vietnam legalizes car-hailing services. After years of heated debate, Vietnam’s Prime Minister Nguyen Xuan Phuc has signed off on a decree on transportation businesses to legalize car-hailing services. KrAsia. 1/17

Ride-hailing briefing: Grab appoints Nguyen Thai Hai Van as MD in Vietnam (e27, 1/13). South Korea’s Kakao Mobility launches ride-hailing service in Vietnam (Business Korea, 1/20).

Frontier Digital Ventures exits investment in Vietnam-based Propzy. FDV chose to divest its stake due to an upcoming funding round in Propzy that was likely to increase the startup’s losses at the EBITDA level and dilute FDV’s ownership to less than 10%, it added. e27. 2/7

Vietnamese ClassPass clone WeFit replaces CEO, begins restructuring after missing 2019 targets. Founder and CEO Khoi Nguyen was replaced by deputy Dang Nguyen. The company, founded in 2016 and backed by CyberAgent, ESP Capital, and VIISA, had reached 1.2M bookings by 2019. TheLeader. 2/8

Go2Joy raises a $2.5M Series A led by STIC Ventures. Founded in 2017 by Korean Simon Byun, the app helps users book local hotels by the hour. DealStreetAsia. 2/13 

Vietnamese unicorn VNG reduces its stake in Zion, the operator of e-wallet ZaloPay. ZaloPay is one of the most popular e-wallets in the market in terms of the number of customers and transaction volume. DealStreetAsia. 2/5


Startup Contest by Schoolab 2020, HCMC, 2/22. Startup Contest by Schoolab is a one-day hackathon organized by Schoolab Vietnam, in partnership with Saigon Innovation Hub, La French Tech Viet and DIAS-Xchange. Event.

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