The National Innovation Centre (NIC) under the Ministry of Planning and Investment and the venture capital fund Do Ventures have just released the Viet Nam Innovation and Tech Investment Report 2021, which reflects a broad picture of Viet Nam’s venture capital in 2021 and provides a snapshot of the country's innovation and startup ecosystem.

Accordingly, Viet Nam is currently leading Southeast Asia in growth rate of venture capital deals.

Venture capital going into Vietnamese startups reached a record high in 2021 amidst market uncertainties and upheaval caused by COVID-19.

The total funding amount reached a new high of US$1.4 billion in 2021, 1.5 times higher than the prior record of $874million set in 2019- the time before COVID-19.

Also in 2021, Viet Nam saw the emergence of two new technology unicorns: Momo and Sky Mavis. Their success doubles down on the country's growing status as a rising tech hub in the region.

As compared to 2020, the number of venture capital transactions in Viet Nam in 2021 increased by 57%.

The growth rate of investment deals in Vietnamese startups was higher than that of Singapore (53%), Philippines (42%), Indonesia (27%), Thailand (9%) and Malaysia (1%).

Also last year, the total number of funds investing in Vietnamese startups climbed by 60% evenly distributed among countries worldwide.

At the same time, the total number of deals of over $10 million exceeded $1 billion, up 255% over the previous year, spreading over 17 deals.

Gaming, entertainment, payments, retail and education were the most funded sector.

Prominent investment trends in the near term will include fintech and web 3.0 with the growing popularity of cryptocurrencies as well as blockchain technology.

According to the aforementioned report, Viet Nam's investment proportion in fintech is currently ranked 3rd in Southeast Asia, after the Philippines and Thailand.

In the eyes of investors, the popularity of smartphones in Viet Nam is creating opportunities for startups active in digital payments and online transactions.

NIC hopes that 2022 will be the pivotal year for Vietnam's ecosystem to have breakthrough developments, with numerous prospects for the digital economy's next stage of growth.

Sharing her comments on the report, Vy Le, General Partner of Do Ventures, said: "Our innovation ecosystem has achieved meaningful strides in 2021 thanks to the resilience of startups as well as the timely support from the Government. We believe that Vietnamese entrepreneurs will continue to thrive, transforming Viet Nam into a regional technology hub.”

Reporting by K.NINH – Translating by A.THU