Vietnam’s venture capital (VC) landscape is demonstrating underlying strength as deal-making remains steady despite a market correction, according to the Vietnam Innovation & Private Capital Report 2025.
The report, a collaborative publication by the Vietnam Private Capital Agency (VPCA) and the Vietnam National Innovation Center (NIC), with insights from Boston Consulting Group (BCG), highlights the enduring appeal of Vietnamese startups for both domestic and international investors.
In 2024, Vietnam’s innovation and private capital market recorded US$2.3 billion invested across 141 deals, with the VC segment accounting for a significant portion. While the overall capital deployed experienced a 35 per cent contraction in 2024, the number of deals in the VC sector remained relatively stable, indicating continued investor engagement with the long-term potential of Vietnamese tech ventures. This resilience underscores the foundational strength of Vietnam’s burgeoning startup ecosystem.
Early-stage VC activity showed promising signs of recovery, with deals valued at US$500,000 or smaller rebounding. This resurgence suggests a sustained appetite for backing Vietnam’s next generation of startups at their initial stages of development.
The sectoral focus of VC investment in 2024 reveals key areas of dynamism. Business automation emerged as the leader in VC deal value growth, experiencing a remarkable 562 per cent surge. This growth reflects Vietnam’s increasing emphasis on technologies that enhance productivity.
Furthermore, AI, agritech, and greentech gained strong investor momentum, fuelled by digitalisation trends, sustainability imperatives, and supportive government policies.
Notably, AI funding witnessed an eight-fold increase, while agritech funding grew nine-fold year-on-year. By the end of 2024, funding raised by AI startups reached US$80 million, a substantial leap from the US$10 million recorded in 2023.
The agriculture sector, in general, saw a remarkable nine-fold increase in funding, with total investment surging to US$74 million in 2024 from US$8 million in the previous year. The greentech sector also experienced increased investor interest, with the number of deals rising from four to ten in 2024.
Investor participation in Vietnam’s VC market remained robust, with nearly 150 active investors in 2024, marking the highest number since 2021. This strong interest came from both domestic and regional players, with Singaporean investors being the most active, followed by a notable return of Japanese investors to the Vietnamese VC scene.
Analysing the decade-long evolution of Vietnam’s private capital market reveals distinct phases that have shaped the current VC landscape. Following a formative period, the market experienced rapid acceleration, peaking in 2019. While the COVID-19 pandemic caused some disruption, VC activity remained resilient.
More recently, the market has entered a correction phase characterised by increased investor selectivity. In 2024, total capital invested in VC dropped to US$398 million, a 24.7 per cent decline from 2023, and the number of deals also fell to 118, continuing a downward trend. This suggests a more cautious investment environment, potentially influenced by global economic uncertainties, with investors focusing on more selective deals.
Despite this correction, certain trends persist. For instance, in 2024, business automation dominated deal value, reaching US$84 million, a significant increase from the previous year. Agriculture also emerged as a prominent sector, growing by 857 per cent.
Singaporean investors were the most active in Vietnam’s VC landscape in 2024, followed by strong participation from local investors, indicating a growing maturity and local capital within the ecosystem. The renewed engagement of Japanese investors after a period of quieter activity further underscores Vietnam’s attractiveness as a regional innovation hub.
The report notes that nearly 150 investors actively engaged with Vietnam’s market in the past year, the highest number since the peak in 2021, signifying renewed investor confidence.
Looking ahead, Vietnam’s strategic focus on digital transformation, underpinned by initiatives like Resolution No. 57-NQ/TW, and the continued strengthening of its innovation ecosystem through the NIC, positions the country as a compelling destination for venture capital investment seeking high-growth opportunities in Southeast Asia. The resilience shown by deal volume in the face of a capital deployment slowdown suggests a market with strong underlying fundamentals and a promising future for its tech startups.
Source: e27 / Digpu NewsTex
