Enhancing the national innovation and startup ecosystem

In line with the development trends of the times

In recent decades, the innovative startup ecosystem has become an important factor in promoting global economic and social development. Not only contributing significantly to GDP through creating added value and tens of millions of jobs each year, startups also promote science and technology through advanced products and services. The dynamism and creativity of this ecosystem is both a driving force and a pressure, forcing traditional businesses to innovate to keep up with trends and avoid being left behind.

Prominent startup sectors include edtech, fintech, and healthtech, along with a strong presence in traditional industries such as tourism and real estate. This reflects the richness of the ecosystem as well as its superior ability to turn input resources into innovative startup achievements.

However, the development of factors in the innovative startup ecosystem in Vietnam is still slow and unsustainable. Part of the reason stems from barriers in startup activities, especially investment and capital mobilization for startup projects. 2024 continues to be a difficult year for the Vietnamese startup ecosystem, as the "capital calling winter" period that has lasted since 2023 shows no signs of ending. Investment attraction activities have not recorded significant progress, forcing many startups to adjust their business models and find ways to adapt to the difficult market context.

In this context, experts recommend that the Vietnamese innovation and startup ecosystem should be oriented towards prominent trends in the world. Currently, startups, both globally and in Vietnam, are focusing strongly on digital transformation and green transformation. Typically, the explosion of startups in fields such as artificial intelligence (AI), renewable energy and biotechnology, shows a strong shift of the startup ecosystem towards advanced and sustainable technological solutions.

This trend is becoming more and more inevitable as the Fourth Industrial Revolution is taking place strongly around the world. Vietnam has missed the opportunity from the three previous industrial revolutions, so the Fourth Revolution brings great prospects for countries without a long-standing industrial foundation like ours. At the present time, if we do not seize the opportunity, Vietnam risks being left behind.

In this context, digital transformation becomes the core factor that helps startups survive and develop. At the same time, it opens up many new opportunities for startups to innovate, helping businesses improve production and management efficiency, cut costs and is an important tool to create new values. Thanks to digital transformation, businesses can easily access the global market and quickly adapt to market fluctuations.

Simply put, innovative startups associated with digital transformation are the application of digital technology to change the way startups operate, thereby creating new opportunities and improving business efficiency. This process includes integrating leading advanced technologies such as AI, Big Data, Internet of Things (IoT) and blockchain into all business operations.

Obviously, digital transformation does not stop at integrating digital technology into socio-economic fields, but is also the process of building a new, advanced and modernized production method. This is also completely consistent with the inevitable trend of the world today, which is green transformation. Along with the goal of developing the digital economy, the green economy is also one of the top priorities in developing economies in the context of rapidly occurring climate change.

Especially for Vietnam, the closer we get to 2030, the more pressure we face to reduce carbon emissions according to international commitments. This is a great opportunity for startups in the field of climate technology, including industries such as renewable energy, energy efficiency, carbon capture and storage, and sustainable transportation. Green transformation is both an essential element in the sustainable development strategy of startups, supporting Vietnamese businesses to participate more deeply in the global supply chain, and opening up prospects for Vietnam to become a pioneering country in the region.

Once again, it is affirmed that the two main trends that are reshaping the global economy are digital transformation and green transformation. Therefore, the dual transformation strategy (combining digital transformation and green transformation) becomes a key solution, helping startups in Vietnam achieve business goals, towards sustainable development. Moreover, when combined with strong regional connectivity, attracting resources, especially investment, financial, expert, and technological resources from other regions in the country and abroad, the national innovation and startup ecosystem will be enhanced.

And need accompanying policies to reach out to the world

Vietnamese technology startup VinCSS has just been honored by Frost & Sullivan as a breakthrough innovation leader in the field of global IoT security in 2024. 2024 marks a year of VinCSS - a cybersecurity startup's efforts to reach out to the world. In just 1 year, VinCSS has continuously joined hands with prestigious enterprises in the region such as Autocrypt from Korea, GoGoByte from China, FPT Software from Vietnam in the field of security for smart vehicles; HiTRUST, Webcomm, Smart Displayer from Taiwan (China) in the field of identity and access management; the world's leading company in IoT devices and industrial computers ASRock Industrial in the field of security for IoT devices. Notably, most recently, VinCSS has had a comprehensive cooperation in all fields with ST Engineering - the largest technology, defense and engineering corporation in Singapore.

Three factors contribute to raising the status of the innovative startup ecosystem. (Photo: ChatGPT)

Going abroad is a strategic step for this startup in the Series B process, focusing on expanding scale, expanding the market, finding new customers, growing revenue and increasing business value. As a startup, VinCSS wants to take advantage of every opportunity to develop.

Established in 2018, starting with traditional IT security services, VinCSS quickly identified new opportunities and expanded its business areas. In Vietnam, it is the only unit providing security solutions for smart vehicles for the past 5 years. VinCSS is also the first company in Vietnam to provide products, services and solutions for passwordless identity and access management. In the field of security for IoT devices, VinCSS has even been recognized as a global pioneer as one of the few companies in the world that is successfully commercializing its IoT security solutions as well as receiving the first international certificates in the world. It can be said that this company has achieved certain successes in the domestic market with large, important customers, creating a solid foundation for moving towards larger international markets. “We want to expand to the international market not only to develop our business, but also to learn from experience, do better and gain new ideas so that we can return to solve domestic “problems” and contribute to Vietnam,” said Mr. Do Ngoc Duy Trac, CEO of VinCSS.

However, entering a large and promising foreign market, this Vietnamese startup also faces many big challenges. In fact, Vietnam is not a country with a high position in the technology field. When Vietnam is often known to the world as a processing country rather than creating new solutions and products. Such a national brand positioning in the international arena also brings difficulties for Vietnamese technology enterprises when they want to reach out to new and competitive markets. At the same time, the new market is a strange land with countless fluctuating parameters. When there are no longer strengths from the home field, Vietnamese enterprises are very likely to make mistakes...

It can be said that Vietnamese innovative startups are reaching out to the world every day with passion and resilient intelligence. Now, in the era of digital transformation and green transformation knocking on the door, the innovative startup ecosystem plays an important role, accompanying and standing side by side with the country to go further on the path of deep integration and sustainable development. However, besides the opportunities to improve the ecosystem, there are still many difficulties and challenges that need to be faced in the coming time to create strong motivation for innovative startups.

One of the major difficulties and challenges for startups is financial issues, legal frameworks and support mechanisms and policies. In particular, the mechanisms and policies to support startups are not issued in a synchronous manner, and there are no preferential policies to encourage businesses to innovate right from the beginning. On the other hand, legal support policies for startups in our country are still overlapping, unclear, and have to go through many paperwork procedures. These are all major obstacles that make startup projects encounter many difficulties in business activities in practice. To solve the challenges in the innovative startup ecosystem, startup experts believe that it is necessary to perfect mechanisms and policies in a synchronous and clear direction towards the group of startups instead of being scattered in many different legal documents as it is now. More importantly, the Government needs to step up support by simplifying legal procedures, creating breakthrough mechanisms to support the budget for the early stages of innovative startups, and at the same time building policies to attract international investment and develop the market more effectively.

Ganoderma