Vietnam Tech Startups See Significant Drop in Funding in H1 2024

In the first half of 2024, total funding for Vietnam's tech startups plummeted by 52.7% to $46.5 million, compared to $98.5 million during the same period in 2023. According to the “Geo Semi-Annual Report: Vietnam Tech H1 2024” by a global SaaS-based market intelligence platform, this decline reflects broader global economic trends and presents a challenging landscape for Vietnam's tech startup ecosystem.

Despite the overall reduction in funding, some sectors continued to show strong performance. Vietnam ranked as the 45th highest-funded country globally in the first half of 2024. This was a drop from the $77.4 million raised in the second half of 2023, underscoring the shifting investment climate. In contrast, the United States, the United Kingdom, and China secured the top three spots for global funding.

Breakdown of Funding Stages

• Seed-Stage Funding: Vietnam’s tech startups raised $5.2 million in seed-stage funding in the first half of 2024. This marked a 29% decrease from $7.4 million in the second half of 2023 and a 23.5% drop from $6.8 million in the first half of 2023.

• Early-Stage Investments: Early-stage investments totaled $41.3 million, down 41% from $70 million in the second half of 2023 and a 53.4% decline from $88.6 million in the first half of 2023.

• Late-Stage Funding: No funding was secured for late-stage startups in the first half of 2024, consistent with the trend from the second half of 2023. In contrast, $3 million was raised in the first six months of 2023.

Regional and Sectoral Performance

Ho Chi Minh City led the funding arena, followed by Hanoi and Binh Thanh. Tech startups in Ho Chi Minh City raised $36.3 million, while those in Hanoi and Binh Thanh garnered $7.7 million and $2.5 million, respectively.

Top-Performing Sectors:

• Transportation and Logistics Tech: Funding surged by 940%, from $3 million in H1 2023 to $31.2 million in H1 2024.

• EdTech: Saw a 280% increase in funding, from $2.5 million in H1 2023 to $9.52 million in H1 2024.

• Retail Tech: Also emerged as a strategic growth area despite the overall decline in funding.

Market Observations

No new unicorns were created in the first half of 2024, continuing the trend from the previous period. The merger and acquisition (M&A) landscape contracted with only two acquisitions in the first half of 2024 compared to three in the same period in 2023. Notably, RHB Vietnam Securities was acquired by Public Bank for $15.2 million, marking the highest-valued acquisition in H1 2024, following the acquisition of Home Credit Vietnam by SCBX.

Key Investors

Investment activity in Vietnam’s tech ecosystem was driven by key players such as CyberAgent Capital, Insignia Ventures Partners, and Genesia Ventures, who remained the top investors. Northstar Ventures, Ansible Ventures, and Monk’s Hill Ventures also significantly contributed to the investment landscape in the first half of 2024.

Despite the challenges, the report highlights the resilience and potential of Vietnam's tech startup ecosystem, particularly in sectors showing strong growth and strategic importance.