BioWraps founder Trịnh Công Qui introduced the company's products to customers at a recent event for start-ups in Hong Kong (China). — VNA/VNS Photo

HCM CITY — The Ministry of Science and Technology is finalising plans for a national venture capital fund aimed at supporting innovative start-ups and attracting private investment, with authorities seeking to launch the fund as soon as possible, senior officials said.

According to Minister of Science and Technology Vũ Hải Quân, Việt Nam's start-up ecosystem currently comprises about 4,500 innovative enterprises, but continues to face shortages in early-stage financing and an incomplete legal framework for venture capital investment.

Quân said his ministry is working urgently on a proposal to establish a national venture capital fund, and plans to submit it to the Prime Minister for consideration. 

The State would act as a facilitator, partner and guide, Quân said. He added that using State budget funds for venture capital investment would be a pioneering step that poses challenges under Việt Nam's current legal framework.

Deputy Minister of Science and Technology Hoàng Minh said the proposed fund would focus on innovative technology start-ups rather than distributing capital broadly across sectors. The fund's performance would be assessed over the long term rather than on individual investments.

According to Minh, the planned mechanism would allow for a degree of investment risk consistent with venture capital practices, with results evaluated over an investment cycle of around 10 years.

Quân called on experts, policymakers and investment fund representatives to provide recommendations on three key issues: the most appropriate legal structure for the fund, international best practices that could be adapted to Việt Nam, and governance mechanisms capable of attracting private sector capital.

During a conference this week in HCM City, he said feedback from industry participants would help the ministry finalise the proposal and accelerate the launch of the fund.

Nguyễn Minh Phương from venture capital firm Quest Ventures said international experience suggested State-backed venture capital programmes should initially allocate funds to a limited number of proven private fund managers before expanding more broadly.

Drawing on examples from Singapore and Kazakhstan, Phương said successful models required a combination of supportive legal frameworks, tax incentives and strong fund management capabilities.

Phạm Hồng Quất, director of the Ministry of Science and Technology's National Academy for Advanced Technology and Innovation, said the legal basis for the fund was provided by Resolution 57 and Decree 264/2025.

He said the objective is not to maximise returns, but to stimulate the venture capital market and attract additional private sector investment.

Việt Nam has begun expanding start-up financing at the local level, with HCM City approving plans for a venture capital fund aimed at supporting innovative start-ups and technology enterprises.

The fund is scheduled to begin operations later this year with initial charter capital of VNĐ500 billion (US$19 million), including VNĐ200 billion from the State budget and VNĐ300 billion from private investors, according to the city's plan.

Authorities aim to increase the fund's capital to at least VNĐ5 trillion by 2035.

The fund will operate under a public-private partnership model, with State funding serving as seed capital to attract private investment. City officials expect every đồng of public funding to mobilise between two and three đồng from private sector investors.

A number of major Vietnamese corporations and investment funds have committed to participate as founding investors, including Sovico Group, Vingroup, VinaCapital, Becamex IDC, VNG Corporation, CT Group, Hoa Sen Group, Lotte Ventures Vietnam and FPT Corporation.

Between 2026 and 2035, the fund plans to invest in up to 150 innovative start-ups and science and technology enterprises. It also aims to support the commercialisation of at least 50 new products or technologies, and help develop at least five large tech companies capable of listing on stock exchanges or pursuing international mergers and acquisitions.

Investment priorities include digital technologies such as artificial intelligence, big data and blockchain, as well as semiconductor manufacturing, biotechnology, advanced materials, renewable energy, automation and robotics. — VNS