Venture funds frantically hunt for startup projects
17-07-2015 14:01:20+07:00
Venture funds frantically hunt for startup projects
Many venture funds have come to Vietnam in recent years to look for startup projects.
CyberAgent has announced a decision to inject money into VeXeRe JSC, a startup in the technology field which runs a website, booking coach tickets via the internet.
This is the second time CyberAgent has poured money into VeXeRe, and besides CyberAgent, the firm also has money from Singapore Pix Vine Capital.
CyberAgent has committed to provide resources, including business knowledge and operation knowledge.
According to Nguyen Manh Dung, chief representative and investment director of CyberAgent Ventures in Vietnam and Thailand, Vietnam is a market with great potential, but it is still relatively small compared with other Asian countries.
Therefore, though venture funds look for feasible projects to inject money in, the number of successful projects remains modest.
The fund last year set a target of injecting money into 10 companies, while the same target has been set for this year.
Analysts noted that the majority of the investment deals are on a small scale, just $300,000-500,000 each. The disbursement has been made mostly for projects in the fields of e-commerce, services and education.
Many firms receiving capital from investment funds provide services that help connect manufacturers and consumers, thus increasing the market share and sales.
Most of the investment deals also relate to e-commerce, where there is a growing tendency of investment funds in the sector, which has development potential.
The analysts noted that Vietnamese startups also want to approach investment funds because they can get additional value as well.
“Once you receive capital from Japan's CyberAgent, you will find it easier to access capital from other Japanese investors for your next development stages,” he explained.
“If you have the opportunity to work with a well-known investment fund, you will have more opportunities to approach other well-known funds,” he added.
An investment expert noted that IDG and CyberAgent were the only two funds which have invested in many projects in Vietnam, while the other funds remain ‘quiet’.
In Asia, the funds tend to eye Indonesia first, a larger market with bigger opportunities than Vietnam.
At first, the funds make investments in Indonesia, from which it will reach out to smaller markets of Thailand and Vietnam.
Dung of CyberAgent said the fund considers hundreds of ideas for startups every year. However, the majority of the ideas fail because of many reasons.
