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Startups by ‘dropouts' blaze a trail

Update: June, 08/2014 - 17:44
Make your choice: Lozi.vn, launched this year, aims to help customers find cafes and eateries in cities and provinces throughout the country. — Photo courtesy of lozi.vn

A new generation of Vietnamese entrepreneurs show they are willing to take the risk of dropping everything else to focus on the opportunities they have spotted, and to work hard to succeed, reports Vu Lan Dung

Last year, many bus operators reduced their fares and gave free tickets to students who took part in the national university entrance exam.

This was possible partly due to the contribution of the bus ticket booking website vexere.com, which was launched in June 2013.

The idea of launching the website came to Tran Nguyen Le Van, 29, in late 2012 when he was pursuing his MBA at the Thunderbird School of Global Management in Arizona in the US. He read articles about the Vietnamese people queuing up to buy tickets for the Tet (Lunar New Year) holiday. He wondered, "Why does no one in America have to queue up for flight tickets?" With a total number of 24 million passengers, the Vietnamese people were wasting a great deal of time.

Why this rush?: Reports of Vietnamese passengers making long queues to buy tickets for the Tet (Lunar New Year) holiday gave Tran Nguyen Le Van the idea to launch a website - vexere.com, where the tickets can be purchased online. — VNA Photo Hoang Hai

Van started researching airline ticket booking sites in the US such as expedia.com and spent time learning about assessment via traveller ratings on tripadvisor.com.

He then hired a designer to make a prototype and used it to persuade his friends to join the project. He asked around, but only Le Ngoc Long and Dao Viet Thang agreed to quit jobs to lend him a helping hand.

In May 2013, Van decided to suspend his studies and returned to HCM City to turn the idea into reality with an initial investment of VND300 million (US$14,000) to found the Vexere Joint Stock Company. Passengers can book bus tickets online at the website vexere.com, and receive tickets via SMS and online tickets via mobile phones and email. Vexere means "cheap bus tickets", aims to help Vietnamese passengers avoid long queues to buy bus tickets.

"The first period of the project was the hardest due to lack of human resources and limited finance. At that time, it was just an idea and not widely known," Thang said.

With its office located in Thang's house, the team went to bus stations and called the central offices of the operators to get information on bus operators, routes and fares. "It was very difficult to connect with the bus operators at first. When they came to know that we wanted to post information on our website, they thought that we were trying to seek advertisements," Van recalled.

Their efforts paid off when operators Mai Linh and Phuong Trang agreed to partner with them, and the others contacted them later.

At the moment, the website has a daily traffic of 8,000 to 10,000 visitors and tickets have been booked mainly in HCM City, Hai Phong, Nha Trang, Can Tho and Da Nang.

At your service: Tran Duc Minh serves a customer at his restaurant in Dang Van Ngu Street, Ha Noi. — Photo courtesy of Tran Duc Minh

Vexere won the first prize at Echelon Ignite Vietnam 2014, organised by e27 and Egg Accelerator, and the second prize at the Mekong Business Challenge 2014 sponsored by Google, McKinsey and Standard Chartered.

Taking the same first steps, Nguyen Hoang Trung, 22, was inspired to launch a website for sharing food locations when he was studying at the Korean Advanced Institute of Science and Technology (KAIST) in South Korea. In April 2012, when he was preparing to return to Viet Nam, he found it hard to find places to eat in the country.

Trung realised there was a need for a website which would have information about the locations of food joints and stores. With an initial investment of $2,000 earned from doing part-time jobs, he dropped out KAIST, sought out teammates and returned to Viet Nam to carry out the project.

Four students then joined Trung's team. Three of them decided to leave their universities to give their whole time to the project. Lozi.vn was picked as the domain name of the website, with a message for customers that said: "Don't worry". It aims to answer questions on when and what to eat in Viet Nam, and dominate the Vietnamese market.

Hands on: Nguyen Van Sang (right) began a business making garments and traditional handicraft items that now earns more than VND50 million each year. He has also opened a training class for those willing to learn the trades. Sang is seen as an exemplary model in Bac Giang Province's startup movement. — VNA Photo Tran Tong

It took them one and a half years to build the website and gather data on food and food stores. Initially, the team went to food stalls, enjoyed the food there and reviewed it to create data for the website. They consulted two models, a forum and a website to review restaurants, and realised that they did not meet the demands of customers.

Unlike other websites, lozi.vn has been built based on data provided by users. They share photos of their favourite food and restaurants, and review the website. Users can mark them on their home board, follow other members and establish personal connections.

The team won the second prize at the first creative startup competition for youth organised by the Viet Nam Youth Federation last year.

The website was launched in January 2014 and has attracted more than 123,000 likes on its Facebook page.

Choosing a different path, 24-year-old Tran Duc Minh and four other students contributed VND3 million each to open a Vietnamese bread store on Ho Tung Mau Street in Ha Noi in December 2012. The store attracted several customers during the first three months. Then the landlord made them vacate the place and opened a similar store.

The team learned a big lesson, but did not give up. In April 2013, they moved to a new store located in a tenement house in Cau Giay District's Nghia Tan Commune. The store soon became well-known for its delicious bread, and the team hired more rooms.

"At first, all of us knew nothing about cooking. We then learned how to make sauce and mashed potatoes. Each day we serve 300 customers. Sometimes there are so many people that we have to refuse them," Minh said.

Spadework: Young startup farmer Nguyen Thi Tuy has fashioned a new life for herself and her family in Vinh Linh District, Quang Tri Province by setting up a cassava farm. — VNA Photo Hong Hoa

Co-founder Ngo Dieu Linh, 22, worked as a waitress to learn how to make drinks, while Le Trong Huy, 25, worked as a motorbike guard to learn how to handle the vehicle. The work helped them gain more knowledge to run the stores smoothly. The success of the first store led them to open a second store in April 2014 on Dang Van Ngu Street. The team expects to make profits from this store after three months.

According to the Business Registration Department under the Ministry of Planning and Investment, nearly 25,800 new firms were established in the country with a total registered capital of over VND143,000 billion in the first four months of the year. Meanwhile, nearly 21,500 enterprises were dissolved, 9.5 per cent higher year on year.

Nguyen Manh Cuong, executive vice president of the Viet Nam Young Entrepreneurs Association, said that new companies would contribute to the state budget as well as help decrease inflation and unemployment.

He said that young adults launched startups because they saw less opportunities in government agencies, and young people recognised that their self-employment should be connected to their financial ability.

"A startup is a process of working and studying at the same time. Obtaining a degree in universities does not determine the success of a startup business. Startup people are the ones having strong will and are willing to take risks," Cuong said.

Talking about the advantages of launching startups at the moment, he said that young people find it easy to access information with the development of science and technology, and enterprises could target a large market of 90 million people. However, he said that the youth have difficulties in gaining knowledge and capital. Moreover, there are still no institutional frameworks for startups and incubators, he added.

In June, the association will call for participation in the second creative startup competition for the youth, and build a network of startup teams in Viet Nam. It also intends to cooperate with the Trung Nguyen Corporation to introduce a fund to support startups, and partner with the Viet Nam Youth Federation to organise training courses for startup enterprises. — VNS

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