July 2020 Newsletter

Photo: We hosted a full-room 500 community event with 500-backed founders in HCMC on June 12
Binh & Eddie

July 09, 2020

Dear all,

Vietnam continues on its economic recovery. Last week, the IMF published an analysis of how Vietnam’s success in containing COVID-19 offers a roadmap for other developing countries. The Financial Times reported that a swift return to normal could provide a “COVID dividend” for Vietnam in the form of greater investment and orders. As foreign investors returned to Vietnam, investor inflows drove the benchmark VN Index up 28% this quarter, making it the second-best performer globally. A landmark deal locked up when the buyout powerhouse KKR led a consortium to invest $650 million in Vinhomes

This month, our team at 500VN focused on community:  

  • Our Saola Accelerator team has been cross-posting a curated set of startup growth blog posts from around the world, in English and Vietnamese, while they prepare for Batch 3. It starts in August, so apply today!
  • We hosted a full-room 500 community event with 500-backed founders in HCMC on June 12, welcoming new faces of the family and celebrating wins of our portfolio companies. 
  • We joined other business leaders in a number of events as we aimed to advise founders and support the ecosystem during the market downturn.
  • We closed our investments in portfolio company #62 (bookkeeping automation startup Bizzi), #63 (digital investment platform RealStake), as well as a follow-on investment into one of our fintech portfolio companies Trusting Social, alongside Sequoia, Beenext, and Tanglin.

Last but not least, 500 Startups was featured in Preqin as the most active VC firm in Southeast Asia in 2019 with 50 deals closed across our 3 regional funds (500 Startups Vietnam, 500 Durians, and 500 TukTuks). Earlier this year, White Star Capital reported that 500 Startups Vietnam was the most active VC in Vietnam in the past decade by number of deals.

See you next month,

Binh & Eddie


500 Startups Vietnam in the News

500 Startups Most Active VC in Southeast Asia500 Startups was the most active venture capital firm in Southeast Asia in 2019, according to Preqin’s “Private Equity and Venture Capital in Southeast Asia’s Digital Evolution”. This reflected investments across 500’s three regional funds, 500 Startups Vietnam, 500 Durians, and 500 TukTuks. Preqin. 6/30

TrustingSocial raised a Series B round. Earlier notes converted, and Sequoia Capital, BEENEXT, and 500 Startups Vietnam “doubled down” on our earlier investments. Since launch, TrustingSocial has served over 80 financial institutions and more than 500 million consumers across India, Indonesia, and Vietnam. DealStreetAsia. 6/24

Digital investment platform RealStake secures seed funding from 500 Startups Vietnam. Angel investing also was Neil MacGregor (CEO of Savills Vietnam), Huan Anh Dinh (Founder & Chairman of Seedcom), Truc Ba Ha (Vietnam Country Director of Qatar National Bank), and others. Fintech News Singapore. 7/6

Binh gave advice to student entrepreneurs and aspiring founders, from how to start a company, which aspects of a business model are most important, to how to raise VC funding and actionable ways to reach out to VCs. Find out the answers on e27.

Saola batch company Axie Infinity is among the 8 international startups selected for Ubisoft’s fifth Entrepreneur Lab. Paris-based Ubisoft is one of the world’s biggest video game publishers. Venture Beat. 6/10

Nghia Vu, founder of Bizzi, shared about market opportunities for automation as companies accelerate digital transformation, and shed light on Bizzi’s growth agenda. Bao Dau Tu. 6/18

From our webinar archives:

⇲ Eddie gave the keynote speech for a UNDP webinar on “Leading With Integrity” — launch event for the UNDP’s Business Integrity Toolkit for Young Entrepreneurs. Eddie shared tangible reasons and tips for doing business with integrity, and spoke about how his father inspired him in this respect. People from 40+ countries registered for the event.

⇲ Binh joined esteemed Indian ministers and business leaders at Horasis India Meeting. Addressing post-pandemic VC capabilities, Binh shared an optimistic outlook in balance with certain cautions. He also discussed why long-term investors need to differentiate temporary trends from the permanent “new normal”.

⇲ Binh live-coached participants of the annual startup competition for Vietnamese entrepreneurs globally — Vietchallenge, as well as founders of SOSV SEA Virtual Roadshow. Meanwhile, Eddie joined the judging panel of TechShake’s Pitch Session where 7 startups pitching to a selected audience.


Vietnam in the News

Vietnam's Economic IndicatorsIMF: Vietnam’s success in containing COVID-19 offers a roadmap for other developing countries, citing tentative signs of a domestic recovery (IMF, 6/29). Vietnam’s purchasing managers index (PMI) read above 50 in June indicating factory output expansion. The index grew for the first time since January before the virus spread in the region (New York Times, 6/30). 

Vietnam’s economic growth in the second quarter fell to +0.4% from a year earlier, a record-low for the country but still likely better than the rest of the region, Bloomberg reported June 29. Vietnam’s rice exports surged to record high in the five-month period to May following the authorities’ export bans drop (Bloomberg, 6/11). Globally, rice futures have spiked to their highest level in nearly nine years after the global pandemic boosted shoppers’ demand for the grain. 

Travel bubbles: As Vietnam has no plans to open up to international tourists yet over fears of a second wave of infections, it has relied on domestic tourism to break out of the COVID tourist trap (Reuters, 6/26). Highly skilled foreign experts, however, have been allowed to enter Vietnam on special flights and quarantine at hotels in a bid to help keep the industry afloat throughout the global pandemic (CNN, 6/26).

A swift return to normal could mean there will be a “COVID dividend” for Vietnam in the form of greater investment and orders, the Financial Times’ John Reed reports. Apple, Nintendo, and Google are among the manufacturers that have moved some of their production to Vietnam. The move seeking to hedge their bets against a backdrop of US-China trade tensions may now prompt others to follow suit. Power tool manufacturer Techtronic Industries will invest an additional $650 million in Vietnam to produce cordless appliances (New York Times, 6/23).

Foreign investors return to Vietnam. Although foreign investors have withdrawn some $140 billion from Asian markets this year, some markets including India, Taiwan, and Vietnam have started seeing net inflows in June. Investor inflows drove the benchmark VN Index up 28% this quarter, making it the second-best performer globally. Among global fund managers betting on Vietnam stocks are Ashmore Group Plc and Coeli Asset Management SA. 

Buyout powerhouse KKR led a consortium to invest $650 million in Vinhomes, the housing development arm of Vietnamese conglomerate Vingroup (Financial Times, 6/16). KKR said the deal underscored Vietnam’s attractiveness as an investment destination, citing it looks to triple Vietnam investments in the next decade. Others agreed. Matthew Vogel of FIM Partners in Dubai wrote in an op-ed on the Financial Times: “Investors should not shrink from frontier emerging markets […] We believe the Philippines, Peru and Vietnam are best positioned to recover.” (Financial Times, 6/17).


Vietnam Tech in the News

The big read: Digital payment taking off

The Vietnamese government is set to approve a pilot project for local telecom players to launch mobile money services. Local telcos VNPT, Viettel, and MobiFone have indicated an interest in launching these services (DealStreetAsia, 6/30). 

In a separate development, Vietnamese budget carrier Vietjet plans to operate an intermediary payment service (Nhip Cau Dau Tu, 6/16). Meanwhile, the State Bank of Vietnam and the Ministry of Industry and Trade have affirmed that they have not licensed Zalo Bank to provide online built-in financial services (Vietnam News, 7/1). As the broader SEA e-wallet market takes off, proxies give Chinese tech giants a seat at the table (DealStreetAsia, 6/9).

VinSmart, a unit of Vingroup, has produced its first 5G smartphones in cooperation with the U.S.’s Qualcomm, Reuters reported July 6. Earlier in June, Qualcomm reportedly set up a new R&D facility in Hanoi (TechRadar, 6/22). The chip maker’s first R&D lab in Southeast Asia will develop new cellular technologies and provide testing services to domestic manufacturing partners. 

Ecosystem roundup: One billion downloads later, Vietnam-based Amanotes is optimistic about the future of non-streaming music platform (e27, 6/22). Venture capital investors are eyeing Vietnam’s HR tech startups with increased interest due to their resilient nature and high-margin potential (DealStreetAsia, 7/1). Indonesia’s most valuable startup, Gojek, will unify its Vietnamese and Thai brands and bring them under one technology platform (Nikkei, 7/3). Meanwhile, Baemin, the food delivery business of South Korean unicorn Woowa Brothers, has expanded to Hanoi a year after its foray into Ho Chi Minh City (Nikkei, 6/23).



Homecoming Series. Join our very own Binh Tran and other overseas Vietnamese as they share about the contributions that they look to bring to the community upon returning to Vietnam. Register here.

Startup Fundraising: Insights from VCs. Our Investment Associate Thao Nguyen along with other VCs and angel investors will share insights into investing in Vietnamese startups in a webinar organized by Vietcetera and Hustle Fund. Register here.

Forbes Vietnam Tech Summit 2020. With a focus on new technologies in data, the summit will gather industry thought leaders to discuss the future of AI, big data, IoT, among other topics. Register here.

Gala Final: FlagUp Startup Competition. Our Investment Analyst Le Nguyen will join the judging panel of the FlagUp Startup Competition organized by International University HCMC. Read more here


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