Nguyen Ky Phung, deputy director of the HCMC Science & Technology Department, said that one of the most important factors which measures the success of startups is whether they can call for investment capital. In HCMC, while the startup movement has been developing strongly, capital from angel investors remains small.

“The role of angle investors is always very important in the preparation period of startups. However, the investors still are not enthusiastic about injecting money into startup ideas because there are no support policies to ensure that they will benefit,” Phung said at a workshop on calling for investments for science & technology projects several days ago.

Vietnamese startups complain that they still find it difficult to get capital from angel and venture investors even though many investment funds have been established.

Vo Viet Anh, the founder of Dropdeck, a platform that connects startups and investors, the reason lies in the quality. Startup projects in Vietnam in general still cannot attract ‘sharks’, or investors who hunt for potential projects.

“In other countries, there are many high-quality startups which make it difficult for investors to choose projects to pour money into. In Vietnam, the problem is the low quality,” he said. “Frankly speaking, the majority of projects have low capability.”

Vu Kim Hanh, chair of the Club of Vietnam High Quality Product Enterprises, believes that instead of relying too much on angel investors, Vietnam should apply a model under which domestic large corporations give support to startups.

Facebook, Google and Microsoft are building research teams and turning them into satellite companies. They invest in the businesses and then buy back the businesses once they grow. 

The startup ecosystem in HCMC has been developing rapidly in the last two years. According to the city’s science & technology department, it has assisted in connecting 640 start-up projects to help develop business ideas, while it has assessed start-up products for 1,523 individuals and groups, connecting 3,200 people with investors, experts and consultants.

MOG’s CEO Tran Anh Dung said that since Vietnam still doesn’t have a reasonable legal framework, investors are now pouring capital into startups in an ‘underground form’.

He said that since it was very risky to invest in startups, startups need tax incentives.

Meanwhile, Bui Quang Ngoc, CEO of FPT, said FPT Ventures has $2 million for startups, but to date, only ‘several thousand dollars’ have been disbursed.

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