Crowdfunding in Vietnam – An Overviewby Fintechnews Singapore August 5, 2016
Crowdfunding in Vietnam:
Crowdfunding is a term that has just reached Vietnam within the last years and is therefore still a relatively new concept for the country. Crowdfunding is not only a source for raising funds from a larger community but also a possibility for Start-Ups to see if their project is well perceived. Even though crowdfunding in Vietnam is not that common yet in comparison to many Western countries, it is showing growth and is emerging as a new trend.
The four types of crowdfunding
In general four main types of crowdfunding can be observed, which are divided by the kind of return to the crowd investor. With equity-based crowdfunding the investor will receive a stake in the company, however there is also the possibility for investors to receive tangible items or services in return for their funds, which is known as reward-based crowdfunding. The third type is known as lending-based crowdfunding with which investors are repaid for their investment over a period of time. If contributions go towards a charitable cause, that kind of crowdfunding is known as donation-based crowdfunding.
Challenges for crowdfunding in Vietnam
Due to cultural differences between East and West, Vietnam has to face challenges regarding crowdfunding, which do not exist in Western countries. In Vietnam the perception of failure and the fear of receiving criticism rather than support by the society, affects the willingness for people to share their ideas and to ask for investment. Personal business relationships play an important role in the Vietnamese culture, which makes it difficult for people to invest into a ‘stranger’ over the Internet. Another obstacle in addition is the Vietnamese legal system, which has not defined specific laws about crowdfunding yet. However this does not mean that crowdfunding in Vietnam is not growing, on the contrary many crowdfunding platforms are emerging.
Some crowdfunding platforms in Vietnam
FirstStep, founded in 2014, is a reward-based crowdfunding platform in Vietnam, which gives start-up companies the possibility to raise funds. FirstStep sees itself as a bridge that connects Vietnamese people who have innovative ideas with people who love creativity. By turning these ideas into reality, FirstStep indirectly improves the lives of Vietnamese people with useful and highly innovative products and services.
Similar to FirstStep, Betado is also a rapidly growing crowdfunding platform, which was founded in 2015, with the goal of creating opportunities for bringing innovative products to the Vietnamese market.
Comicola is a crowdfunding platform for the Vietnamese comic industry with the aim of helping the young comic artist community in Vietnam to share their products. Comicola wants to publish and bring comics to a wider public and help the artists to receive maximum profit.
Founded in 2015, FundStart.vn follows their mission to help people with great ideas by turning their dreams into reality with funds, which are coming from the community. Fundstart.vn sees itself as a creative house, which incubates small to big projects from different fields such as music, art, design, games or technology.