You need capital? Knock, investment funds’ doors will open

VietNamNet Bridge – Investors now all wish to pour money into the high technology sector, which means more and bigger opportunities for high technology start-ups.

Vietnam, investment funds, venture fund, FII

Vietnam witnessed 37 merger and acquisition (M&A) deals made in the information technology (IT) in 2012 and the first half of 2013. According to TOPICA, in the first nine months of the year, 18 start ups successfully received investments. This shows that the doors to investment funds for capital have been opened widely to technology firms.

Truong Ly Hoang Phi, Deputy Director of BSSC, said the figures are not surprising at all because of the high potentials of IT firms and the high demand of investors to make investment for profit at this moment.

Analysts also think that no need to worry about the lack of capital for the business ideas. There are enough investors who have enough money to support feasible business plans.

The affair that kicked off the new trend of investment funds injecting money in IT firms was the purchase of Vietnam Online Network (VON) by CarrerBuilder, one of the US two biggest job groups.

It might take VON a lot of exertion in the last 10 years to catch the attention of the US investor.

“It is necessary for businesses to set up specific development strategies right from the very beginning and strictly follow the strategies. The ways businesses organize their operation need to be transparent and methodical, so that investors can see clearly the businesses’ development stages and their potentials,” said Nguyen Hung, CEO of CareerBuilder Vietnam.

Hung admitted that this was one of the reasons that made him obtain a price much higher than the VON’s initial value.

Prior to that, Vietnam witnessed the sale of 50 percent of stakes in Huy Bao Trade and Services Company in 2012, also a M&A deal made by Hung, who is called the “start-up expert.”

Established in 1995, Huy Bao provides industrial hygiene services. According to Hung, despite the unfavorable conditions of the national economy, it took him half a year only to call for the investment into Huy Bao.

“The young owners of start-ups just need to spend their time on developing high quality products, while no need to worry that they may not find investors,” Hung said.

“Investors will come once they see the possibilities of making profit from the start- ups,” he maintained.

There are two factors that all investors would consider before making decisions whether to pour money into businesses: the operation process and the businesses’ board of management.

According to Doan Thien Phuc from Setech Viet, the core value of technology firm is the ideas and products. And it would be easier to persuade investors to make investment if businesses can show perfect business plans.

However, both Phuc and Hung, while emphasizing the importance of products, business ideas and enthusiasm, affirmed that the things are less important than the qualification and vision of the enterprises’ leaders.

According to Hoang Phi, the young owners of start-ups may feel giddy amid the opportunities offered by investors. However, she noted that in the current conditions, businesses can be fastidious and they should only accept the offers if they find the offers reasonable.


Vietnam, investment funds, venture fund, FII