Overseas Vietnamese should be investing in tech startups, not just sending remittances.
In 2013, overseas Vietnamese (or Viet Kieus) remitted an estimated USD11 billion into Vietnam. In 2013, Vietnam’s GDP was USD170 billion. That’s right; Viet Kieus send back so much money that it’s equal to about six percent of Vietnam’s overall GDP. And although Vietnam’s GDP is still growing by roughly five percent per year, USD11 billion is still huge. Some of this money should be intelligently going to Vietnam’s entrepreneurs. And it is. Right now, there are over 3600 businesses in this country that are owned by Viet Kieus, with a total capital of over USD8.6 billion. For perspective, the total annual income of Viet Kieus is estimated to be USD50 billion. Only a small percentage of that USD8.6 billion is going into technology. Viet Kieus are now a seminal part of Silicon Valley. It’s clear that the Vietnamese community overseas has done well and the biggest connector is their deep ties to Silicon Valley – 13 percent of Silicon Valley’s Asian engineers are Vietnamese. Asian engineers, in total, account for 11 percent of The Valley’s total engineer population. Although that’s small compared to the Chinese and Indian populations (Chinese account for 51 percent and 23 percent are Indian), the phenomenon has had subtle effects on the startup ecosystem back in Vietnam.
Trung Dung, the cofounder of OnDisplay, sold his company for just under USD2 billion. Trung went to the US from Vietnam at the age of 17 with only two dollars in hand and after a successful career as an entrepreneur in the States, he has returned to Vietnam to start Mobivi. It’s a startup that tackles the mobile payment industry. Trung is not the only Viet Kieu that has had success in The Valley. Recently, Klout was acquired for over USD200 million, its cofounder is Binh Tran – a Viet Kieu. There’s also Misfit Wearables, lead by founder Sonny Vu, who does most of the design and engineering for its wearable devices in Vietnam. Sonny shows that you can manage a team in two countries successfully, taking advantage of the labor and skills in Vietnam while leveraging Silicon Valley connections over in the US. The list goes on.
What’s the motivation for Viet Kieus to get involved in Vietnam? It’s because the engineering talent is leveling up and the local market is also waking up. Vietnam’s software industry was worth over USD2 billion in 2012. That number is largely influenced by major outsourcing companies. In addition, Hanoi and Ho Chi Minh City are developing a strong middle class population. By 2020, Vietnam’s middle class will double to 33 million people. On top of this, it is arguable that Vietnam is one of the ideal jumping off points to attack markets across Southeast Asia. Both Thailand and Singapore are a bit too advanced for the rest of the market, while Indonesia and the Philippines have infrastructural issues – but Vietnam sits in between these worlds. The key is that Viet Kieus will have an easier time adapting and connecting to the Vietnamese people in their motherland. Yes, there are legal barriers, but they can be overcome. Of course, there is red tape and lots of headaches connected to investing in Vietnam. But the fact is if you really want something, you can make it happen. People like Trung Dung and companies like OneCapitalWay, which is funded mainly by Viet Kieus living in The Valley, are examples. There are even things like the Silicon Valley project, lead by the Ministry of Science and Technology, that want to make this easier too. The resources are now in place. The people are ready. Are you?
Anh Minh-Do is the editor at TechInAsia.com for Vietnam focusing on technology startups, trends and companies. Minh also organizes events at Evecoo.vn.
2 thoughts on “Silicon Valley Vietnam”
Excellent posting with useful info. Is there a tabulated listing of contacts so Viet Kieus can sign up? And does Vietnam have a bulletin board allowing projects monitoring?
Author here. What kind of contacts do you want? A listing of companies? If so, Starthub.vn is a potential avenue for that.
In terms of project monitoring, the best source would be news sites like Twenty.vn and Techinasia.vn which write about startups and tech news daily. Any other questions, I’m happy to answer of meet up for coffee.