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Difficulties facing start-ups in Việt Nam

Update: June, 03/2017 - 09:00
Trịnh Minh Giang. – Photo dantri.com.vn
Viet Nam News

Trịnh Minh Giang, chairman of Creative Start-up Group of Việt Nam Private Sector Forum, tells Hải Quan (Customs) newspaper that the lack of human resources and market connections are major obstacles for start-ups in Việt Nam.

What are the favourable factors for start-ups, especially innovative start-ups in Việt Nam?

First, technology-related infrastructure, such as data linkage, archives and data management, are developing beyond the limit that one could have imagined before. Currently, one can use this infrastructure with only a small budget. In addition, big enterprises are providing artificial intelligence services at a low fee.

Another favourable factor is the start-up environment. When I started my business some 10 – 11 years ago, there were not many mentors who I could ask for help. Particularly, I faced difficulties in securing capital to start the business. The social awareness about start-ups was low, with many people thinking it was something for the young only. Now, there have been changes in the awareness of both enterprises and the Government. A network to support start-ups is beginning to take shape, with start-up mentors and scouts, a familiar force in other countries, starting to play a prominent role. At the same time, a network of investors for start-ups is also coming into being.

What are the obstacles for start-ups?

Like in other countries, the first difficulty is how to form a working group. In Việt Nam, talented workers are attracted to work for big technology firms, so it is hard to find tech talent to found a start-up group, which often needs 6-10 people taking charge of technology work. This is not an easy task. Especially, group leaders must work well enough to maintain the group, because in the beginning, there is hardly any income.

The second difficulty is to find people in other fields to join the group, because a company or a product needs more than technology to succeed. A working group also needs people who do PR, marketing, etc who really understand the market. Moreover, although the start-up community is receiving increasing support, many start-up mentors are not sufficiently qualified. The network of investors is also weak. Most start-up groups that have good products are waiting for funds from foreign investors, while those from domestic investors are below expectation. As innovative start-up mentors, we hope there will be a mechanism to make investors feel secure so as to attract more professional and big investors.

Another difficulty relates to the problem I just mentioned earlier: many start-ups lack capable staff to do sales or marketing, and thus limit the chance for their products to access the market. A solution is to connect start-ups with potential customers. Many enterprises are lacking technology solutions for business management issues--like human resources, accounting or inventory--while many young people are trying to come up with solutions for these issues. The number of enterprises in Việt Nam is high, and the market for technology products to support business management is large. Therefore, we are aiming to connect innovative start-ups with enterprises.

What changes should be done to ‘empower’ start-ups?

Start-ups need more training, and support organisations need to play a more active role. In Singapore, the government has simplified administrative work for start-ups by establishing co-working spaces where start–ups work next to each other and also besides representative offices of State agencies to minimise the amount of time needed for business registration or tax filing. Detailed instructions will make it easier for start-ups to do their business. In fact, it that sort of a specific support that start-ups need, not macro-level support policies.

The Vietnamese Government has launched Project 844 on Supporting the National Innovation Start-up Ecosystem by 2025 to support start-ups through support organisations. However, the methods have not been so effective and failed to trigger a start-up support ‘wave’. Anyway, the most important thing for start-ups and their founders is to focus on their groups and their products. They should first understand markets and their capabilities well, rather than just waiting for support policies. VNS

 

 

 

 

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