An Analysis of Angel investment in Vietnamese market

Abstract

The COVID-19 pandemic has reshaped the sociographic and societal environment of the world, opening many opportunities for new economies to revival and break through. Similarly, the Vietnamese economy is joining the race. The market itself is changing quickly to seize the chance; the evidence of that is the fast-growing startup wave in Vietnam. However, since the startup wave in Vietnam is relatively young and unconventional, many obstacles and inefficiencies restrict the market’s potential. To support the startup wave, diversifying the sources of capital is an effective way. Thus, this study aims to identify market inef-ficiencies limiting Vietnamese startups and angel investment funds – an exuberant source of capital, es-pecially for young entrepreneurs. Inefficiencies are detected by rooting them to the criteria of factors which angel investors consider when invest in the Vietnamese market. This study employed the qualitative method to explore the angel investors’ psyche and answer study questions. Data was collected through semi-structured interviews with eight angel investors having a his-tory of investing in the Vietnamese market. All interviews were conducted with the highest respect for issues of ethicality and data quality. After that, by understanding the operation of investing market and studying the concept of angel investment thoroughly, the author carefully explored and analyzed collect-ed data. Through literature reviews, two primary schools of influential factors were created, which are internal and external factors. The results disclosed typical features and limitations of the Vietnamese market under two primary schools of internal and external factors. Because of the unique situation and history of Vietnam, in terms of either economical or demographical, angel investors prioritize certain aspects over others. In addition, suggestions and some unique experiences of angel investors were also collected, which are good sources for further studies. The COVID-19 pandemic has reshaped the sociographic and societal environment of the world, opening many opportunities for new economies to revival and break through. Similarly, the Vietnamese economy is joining the race. The market itself is changing quickly to seize the chance; the evidence of that is the fast-growing startup wave in Vietnam. However, since the startup wave in Vietnam is relatively young and unconventional, many obstacles and inefficiencies restrict the market’s potential. To support the startup wave, diversifying the sources of capital is an effective way. Thus, this study aims to identify market inef-ficiencies limiting Vietnamese startups and angel investment funds – an exuberant source of capital, es-pecially for young entrepreneurs. Inefficiencies are detected by rooting them to the criteria of factors which angel investors consider when invest in the Vietnamese market. This study employed the qualitative method to explore the angel investors’ psyche and answer study questions. Data was collected through semi-structured interviews with eight angel investors having a his-tory of investing in the Vietnamese market. All interviews were conducted with the highest respect for issues of ethicality and data quality. After that, by understanding the operation of investing market and studying the concept of angel investment thoroughly, the author carefully explored and analyzed collect-ed data. Through literature reviews, two primary schools of influential factors were created, which are internal and external factors. The results disclosed typical features and limitations of the Vietnamese market under two primary schools of internal and external factors. Because of the unique situation and history of Vietnam, in terms of either economical or demographical, angel investors prioritize certain aspects over others. In addition, suggestions and some unique experiences of angel investors were also collected, which are good sources for further studies.