E-commerce offers fresh impetus to Vietnamese digital economy
The strong growth of the local e-commerce sector has become a driving force for the Vietnamese digital economy as several major technology firms recently injected their money into various e-commerce companies, according to industry insiders.
The Vietnamese online gaming and technology firm VNG invested US$22.5 million in Telio, a business-to-business (B2B) e-commerce company, in its pre-Series B funding round, bringing Telio’s total capital mobilisation to US$51 million by September this year.
Most recently, Tiki, the Vietnamese all-in-one commerce platform, also secured US$258 million in series E funding round led by a global insurance group AIA, raising its value to nearly US$1 billion. With the new funding, the company is expected to enjoy growth of between 40% and 50% in revenue over the next few years, according Tran Ngoc Thai Son, Tiki CEO.
Meanwhile, Alibaba and Baring Private Equity Asia also invested US$400 million in Masan retail arm, The CrownX. This merger and acquisition (M&A) deal is anticipated to help Masan accelerate the completion of its online business platform in the country.
The local digital economy is projected to become the second largest in Southeast Asia, reaching US$220 billion in gross merchandise value (GMV) by 2030, according to the “Roaring 20s: The SEA Digital Decade” report produced on November 10 by Google, Temasek and Bain & Company.
Rohit Sipahimalani, chief investment strategist and head of Southeast Asia at Temasek, pointed out that the local digital economy will continue to attract global capital thanks to strong growth fundamentals, along with growing digital ecosystem of incubators and innovation labs.
Mitch Bittermann, executive vice president of Ecommerce Asia at TMX, pointed out that the country currently ranks third in Southeast Asia, just behind Indonesia and Thailand in terms of e-commerce.
He stated that this development trend is anticipated to grow thanks to the country’s National Digital Transformation Project, its young population structure, and a recent boom recorded in online shopping.
Nguyen Ngoc Dung, chairman of the Vietnam E-commerce Association (Vecom), noted that with the COVID-19 pandemic disrupting global supply chains, the trend of developing cross-border e-commerce and boosting exports through online sales channels will become increasing strong in the future.
