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THE ASCENT vol. 4: Next level of social commerce in Vietnam

Above: Manisha Shah, CFO of e-payment unicorn MoMo, sharing fundraising best practices with SHINE women founders

Hello everyone,

We hope you had a good start to the new quarter. Q1 really flew by, and here in Vietnam, we saw some positive economic rebound signals. In the first 3 months of 2022, Vietnam’s GDP grew 5% y-o-y. Investment activities have been strong with the stock market outperforming Asian frontier peers and Q1 FDI disbursement hitting over $4.4B, the highest over the past five years. In addition, new enterprises were forming at a record level, while 25,000+ existing businesses resumed operations.

With borders fully reopened and overall positive business sentiment, Vietnam is forecasted to lead recovery in Southeast Asia. However, experts are also watchful for potential adverse impacts from labor shortage, new COVID variants, and the Russia-Ukraine conflict.

Within the tech ecosystem specifically, there have been some notable developments in the second half of Q1. In this volume’s Vietnam Tech in the News section, we will touch on the increasingly dynamic roles of Vietnam as a market and a breeding ground for regional startups. We will also discuss Sky Mavis’ Ronin Bridge hack, dubbed one of the biggest crypto hacks to date. Finally, we will highlight recent investment interest in digital commerce before diving into social commerce in the Spotlight section.

Zooming in on AVV, one of the highlights is the SHINE fundraising bootcamp for women founders in March. We will share a quick recap of SHINE plus heads-up on select team activities in April & May under AVV in Action. If you have any interesting projects this quarter and think we can partner up, do get in touch.Check it out. 

Until next time,

The Ascent

Vietnam Tech in the News

1. When locals go regional and regionals go local. While more startups from Vietnam have been branching out to the region and beyond and investors are taking notice, we are also seeing regional tech companies deepening their presence here. Indonesian ride-hailer Gojek’s recent handshake with local e-wallet MoMo will offer more payment options to their Vietnamese users and MSME financing startup. Funding Societies made Vietnam its fifth market in SEA after its recent Series C+ funding. Innovation is moving in both directions, solidifying Vietnam’s role as a critical part of the SEA startup ecosystem and creating a flywheel effect for the ecosystem’s growth.

2. Sky Mavis’ Ronin Bridge hack and a lesson on startup resilience. The hack that resulted in the theft of over 173,000 ETH and US$25M USDC from Sky Mavis’ Ronin Bridge is considered one of the biggest crypto heists to date. While investigation and full resolution is still ongoing, the team has taken full ownership, acted swiftly and proactively, and maintained constant communications with stakeholders including their player communities. On top of the recent $150M raise as part of their commitment to reimburse all affected users, Sky Mavis has also been working hard on implementing rigorous security measures, (including rolling out a bug bounty program,) resuming all activities, and launching a new title, Axie Infinity: Origin. Their responses have been well received by their users (example: 350% jump in Axie NFT sales within 24 hours after refund decision.) In a social media post in late March, we expressed confidence in the Sky Mavis team’s ability to emerge stronger than before, and we remain long-term believers and excited about what their future will bring.

3.March, a good month for digital commerce startups. Last month, D2C menswear brand Coolmate raised a $1.1M+ pre-Series A round, SoBanHang, a Shopify-like solution for MSMEs raised $2.5M, and cross-border e-commerce platform OpenCommerce raised a $7M Series A round. Vietnam is one of the fastest-growing e-commerce markets in the region (according to Google, Temasek & Bain’s e-Conomy SEA 2021 report.) Read Spotlight to learn where some of the opportunities lie.

Spotlight: Vietnam is Poised for the Next Level of Social Commerce

Photo by Ekaterina Bolovtsova, Pexels 

Social commerce is not new. In Vietnam, long before traditional e-commerce established a foothold with tech-savvy consumers, commerce activities largely took place on major social media platforms such as Facebook, Instagram, and Zalo. Serving both big-city shoppers and the majority of the population who live outside of core urban centers, social commerce made up about 65% of Vietnam’s $22B e-commerce in 2020, representing the highest rate in Southeast Asia according to Bain & Co.

While traditional e-commerce has grown significantly and received notable investment over the last few years, only within the last 2 years has a generation of startups begun harnessing the untapped potential of Vietnam’s social commerce playing field. 

  • What makes Vietnam an ideal launchpad for social commerce startups? 
  • Who are the rising stars of social commerce innovations? 
  • What are the winning strategies in such an expanding sector and changing competitive dynamics? 

AVV in Action

1. Helping women founders map their capital paths. Our SHINE fundraising bootcamp for women founders in March was a success. We were happy to receive positive feedback from our participants – in addition to new fundraising knowledge, our founders appreciated having a safe space for open discussions and the opportunity to connect with other female entrepreneurs. Special thanks to our partner Investing in Women, our in-house instructors (AVV Partner Hau Ly, AVV Senior Investment Manager Thao Nguyen, and 500VN Portfolio Manager Adrian Latortue), and other mentors & guests (Ruby Nguyen from Curieous, Ryan Galloway from Funding Societies, Manisha Shah from MoMo, and Linh Pham from Logivan) for your generous support for SHINE. If you are interested in learning more about our upcoming women founder initiatives, reach out to shine@ascendvietnam.com.

Group photo after our wrap-up session

2. Joining CCIFV to empower and realize potential startups. On May 5, our associate Minh Ta will represent AVV as an investor at an accelerator program pitching session by The France-Vietnam Chamber of Commerce & Industry (CCIFV). While the CCIFV’s core missions are to represent and assist the French business community in Vietnam and promote bilateral trade between the two countries, their accelerator program opens to all kinds of projects and sectors regardless of nationality. The pitching event will feature eight projects at different stages in sectors such as insurtech, fashion & lifestyle, and language learning. Find more information about the program here.

3. Immersing in Hanoi’s thriving startups community. Last week, Sohun Bae and Minh Ta from the investment team visited Hanoi. They met with over 50 people from the startup ecosystem, including founders, friendly VCs, media, and ‘super-connectors’ in the city. A highlight of the trip was the inaugural “AVV & Friends” event that hosted over 25 guests to meet and network. Coming back to Ho Chi Minh City, Sohun and Minh are convinced that Hanoi boasts a thriving startup scene, albeit with unique differences based on geography, local industries, and engineering talent. Want to join us in meeting and working with amazing and talented founders? AVV is hiring! Check out open positions here

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