Xây dựng và phát triển quỹ đầu tư mạo hiểm ở việt nam tt tiếng anh

STATE BANK OF VIETNAM

MINISTRY OF EDUCATION
AND TRANING

BANKING ACADEMY OF VIETNAM
---------------------------

PHAM TIEN MANH

BUILDING AND DEVELOPING VENTURE CAPITAL FUNDS
IN VIETNAM
Major : Finance – Banking
Code number : 9.34.02.01

SUMMARY OF PHD THESIS

HANOI, 2019


STATE BANK OF VIETNAM

MINISTRY OF EDUCATION
AND TRANING

BANKING ACADEMY OF VIETNAM
---------------------------

PHAM TIEN MANH

BUILDING AND DEVELOPING VENTURE CAPITAL FUNDS

IN VIETNAM
Major : Finance – Banking
Code number : 9.34.02.01

SUMMARY OF PHD THESIS

Supervisors: 1. Assoc. Prof. Dr. NGUYEN THANH PHUONG
2. Dr. DAO LE MINH
The thesis was defended in front of the thesis committee at ……… on ………….2019
at the Banking Academy of Vietnam
The thesis can be found at:
-Library of the Banking Academy of Vietnam
-National Library of Vietnam

HANOI, 2019


1
INTRODUCTION
1. THE NECESSITY OF THE THESIS
Since the renovation in 1986, the Vietnam economy has gained remarkable
achievements; Vietnam is always in the top of countries with the highest economic
growth rate in the world, the rate of poor households decreases, the life quality of
people is constantly increasing. However, the renovation of the economy, building and
development of the country is a continuous process, requiring combinations of a
number of factors to create a sustainable and highly competitive growth rate.
Experiences from developed countries with high science and technology
development level such as the US, Europe, Korea, China, Israel, etc. show that,
venture capital investment plays a key role in the process of technological innovation,
modernization of the country, improving the development of domestic enterprises,

towards global competitiveness; in which, venture capital funds play an intermediary
role in transferring capital from individuals and organizations with capital, willing to
accept investment in promising venture projects, with the aim of achieving high
profitability in the future.
In addition, experiences in countries such as China and South Korea show that,
their governments soon realized the important role of venture capital in general and
venture capital funds in particular, invest in and promote this sector to create a driving
force for sustainable economic development. Specifically, in the early stages of
establishment and development of venture capital funds, these nations had focused on
the process of reforming mechanisms and policies, as well as focusing on developing
the primary stock market and secondary market, creating favorable conditions to
promote venture capital funds to develop and expand investment scale. In addition,
other factors such as creating resources for venture capital funds to raise capital,
orienting investment areas of venture capital funds, creating networks to connect the
domestic and foreign venture capital community have been promoting a good role in
the development of venture capital funds in these countries.
In Vietnam, venture capital is still considered a relatively new investment
sector, which has been interested by the government in terms of policies to encourage
development since 2015, through circulars, decisions, decrees or laws have been


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enacted to promote the process of supporting businesses, encourage the creation of
venture capital funds for innovative startups, or promote economic sectors to engage
in venture capital, etc, to take advantage of the country’s internal resources in the
economy development. In fact, most of venture capital funds in Vietnam are foreign
venture capital funds, starting investments in venture capital market in Vietnam since
1991; until 2015, new venture capital funds which were established by Vietnamese
beginning in the investment operation. So far, the number of venture capital funds
operating in Vietnam are still small, the amount of investment capital and investment

sector is limited; therefore, it has not played prominent role in promoting the start-up
projects, creation and improvement Vietnam economy.
Therefore, the establisment and development of venture capital funds in
Vietnam in the future still have many problems and angles to discuss; in order to
create favorable conditions for the field of venture capital in general, and venture
capital funds in particular, to be developed sustainably, to create conditions for
promoting the scientific and technological level of Vietnam as well the development
of Vietnam economy
Therefore, the author has chosen the topic "Building and developing venture
capital funds in Vietnam" for his doctoral thesis.
2. RESEARCH PURPOSES AND RESEARCH QUESTIONS
Objectives of the study
The thesis has the main research purposes, which are:
Systemize the theoretical basis for the building and developing of venture capital
fund, in which it delves into the environment necessary for the operation of the
venture capital fund; criteria to assess the development of a venture capital fund in the
process of its operation.
Analyze the current situation the development of venture capital funds in Vietnam,
including foreign and Vietnamese venture capital funds. After that, the thesis is going
to assess the development of all venture capital funds operating in Vietnam, analyzing
the advantages, shortcomings, limitations and causes.
In addition, the thesis is going to develop an econometric model to assess the
factors affecting the building and developing venture capital funds in Vietnam in the


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current period, thereby serving as a basis for developing incentive solutions.
encourage the establishment and support of the development of Vietnam's venture
capital funds in the future.
Last but not least, the thesis will propose solutions to promote the establishment

and development of venture capital funds in Vietnam, including legal framework,
building the necessary specific mechanisms, proposing a organizational and
operational model, state management issues, and propose necessary roadmaps to
support the building and developing venture capital funds in Vietnam.
Research question
Firstly, what is the current status of building and developing of venture capital
funds in Vietnam?
Secondly: What factors are needed for building and developing venture capital
fund in Vietnam currently?
Thirdly: What policies are needed to accelerate the process of building and
developing venture capital funds in Vietnam in the future?
3. RESEARCH OBJECT AND SCOPE OF STUDY
3.1. Research object
The main object of the thesis is to build and develop venture capital funds.
3.2. Scope of study
Scope of space: Foreign and Vietnamese venture capital which are in operating in
Vietnam.
Scope of time: Venture capital funds are in operating in Vietnam, from 1990 to 2018.
Limitations of research: Because it is difficult to collect data from venture capital
funds operating in Vietnam because of small and newly established venture capital
funds do not publish data on the investment process. As a result, This thesis focuses
on the four largest venture capital funds operating in Vietnam, including VinaCapital,
Mekong Capital, IDG Venture and Dragon Capital. In addition, the thesis also uses
available data published in the social media of Vietnamese venture capital funds (from
2015 until recently).
4. METHODOLOGY AND RESEARCH METHODS


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In order to achieve the research objectives, the thesis has used the methodology of

dialectical materialism and historical materialism, and at the same time combined with
scientific abstraction, qualitative and qualitative research methods to achieve
comprehensive, systematic research objectives.
In addition, the main technical methods which used in the thesis include statistical
methods, comparisons, assessments, systematic analysis methods and some other
methods. Specifically:
For primary data, the thesis uses in-depth interview method and survey method
through questions related to the thesis. For in-depth interviews, the thesis selects
experts who are working at the State Securities Commission (mainly official working
at the Fund Management Department), experts working at investment funds which
having representative office/main office in Hanoi. From in-depth interviews of these
experts, combined with previous studies of domestic and foreign authors on venture
capital funds, the thesis has drawn a number of key factors that affect the building and
developing venture capital funds. Since then, the questionnaire has been formed to
serve the survey.
For the survey, it is designed in two forms: (1) online form through the use of Google
Docs; (2) Paper questionnaire printed on A4 size paper; This questionnaire is then sent
to those who have experience in the field of investment in general, and venture capital
in particular, in the form of email, it was sent directly or by post; for online
questionnaires, the results are automatically updated on the online results; For the
questionnaire sent directly or by post, the respondent will take a picture of the results,
send it via social media applications (Messenger, Zalo, Viber, email), or send directly
to the person asked. The content of survey questionnaire includes 4 main parts: (1)
Personal information; (2) Assess the knowledge levels and views of venture capital in
Vietnam; (3) Factors affecting the building and developing venture capital funds in
Vietnam; (4) Suggestions for building and developing venture capital funds in
Vietnam in the future.
For secondary data, the thesis uses investment data from venture capital funds
that have been invested activities in Vietnam for a long time, with data which are
collected from the websites of those investment funds. After that, thesis use statistical

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and comparative methods to find out the development trend of venture capital funds
operating in Vietnam. With macroeconomics data, the thesis uses data from the
official websites of the State Securities Commission, General Statistics Office,
Ministry of Education and Training, Ministry of Justice, General Office and Family
Planning, Ministry of Finance, etc.
For the solutions to build and develop venture capital funds in Vietnam, the thesis
uses scientific abstraction method, in order to combine the orientation of developing
venture capital funds in Vietnam by The Government, with the current situation in
Vietnam, aiming to offer some suggestions for building and developing venture
capital funds in Vietnam.
5. NEW CONTRIBUTIONS OF THE THESIS
On theoretical side
- The thesis has built a set of targets and systematized the factors affecting the
establishment and development of venture capital funds in Vietnam.
On the practical side
- The thesis has comprehensively assessed the necessary factors for the
establishment and development of venture capital funds in Vietnam in recent years.
- The thesis has used econometric model to test the environmental factors that have
the most impact on the building and developing venture capital funds in Vietnam.
- The thesis has combined research results from theory and practice, then proposed
a systematic, synchronous and high-value solution system to encourage establishmeng
and promote the development of venture capital funds in Vietnam under current
conditions, such as the development of special mechanisms for the venture capital
fund to operate; propose the organization and operation model of the venture capital
fund in Vietnam; or based on the mechanisms, policies and directions of the
government on venture capital, combined with the current situation of the
development of venture capital funds in Vietnam today, proposing a roadmap for

building and developing venture capital funds in Vietnam.
6. THEORETICAL AND PRACTICAL MEANINGS OF THE THESIS


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In the theoretical perspective, the thesis has systematized the theoretical basis
of venture capital fund, the conditions for building and developing venture capital
funds.
In the practical perspective, the thesis has conducted in the context of Vietnam
government, the investment community have been focused on venture capital
investment, start-up issues to create breakthroughs, develop science and technology,
building entrepreneurship for generations of entrepreneurs in Vietnam. Although the
venture capital funds started investing in Vietnam from 1991, but until 2015, Vietnam
government began to release documents and policies on to promote the venture capital
in general, and venture capital funds in particular. The thesis is a source of reference
for policy making to accelerate the process of building and developing venture capital
funds in Vietnam.
7. THE THESIS STRUCTURE
In addition to the introduction, conclusion and list of references; The thesis content
consists of 05 chapters:
Chapter 1. Research overview
Chapter 2. Theorical framework of building and developing venture capital funds
Chapter 3. The current status of building and developing venture capital funds in
the world
Chapter 4. The current status of building and developing venture capital funds in
Vietnam
Chapter 5. Solutions on building and developing venture capital funds in Vietnam

CHAPTER 1. RESEARCH OVERVIEW
1. OVERVIEW OF FOREIGN RESEARCH

1.1.

Capital supply for building and developing venture capital

Previous studies on capital supply for venture capital funds show that:
Firstly, the government plays an important role in the early stage of building and
developing of venture capital funds. The Government is the object of capital
contribution to establish venture capital funds and market orientation in venture


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capital sector. At the same time, it provides funding for promising venture capital
projects which are facing difficulties in the next capital mobilization rounds.
Second, the participants in capital contributions to venture capital funds include
angel investors and institutional investors. For angel investors, they are wealthy
individuals and families with business and investment knowledge; they are willing to
accept a high level of risk in their investments in search of high-risk venture capital
investments. Institutional investors are insurance companies, pension funds,
investment funds, investment banks, etc, with the advantage of investment experience
and investment capital. Institutional investors are the main source of investment
capital for operating venture funds.
Third, in the early stages of venture capital projects, angel investors often play a
major role in raising capital for such projects; while institutional investors often prefer
to invest in later stages of the business life cycle.
Fourth, macroeconomics factors also affect capital mobilization of venture capital
funds, such as short-term interest rates, long-term interest rates, GDP, etc.
Fifth, the performance of venture funds in the past has had an impact on
subsequent venture capital mobilizations. However, there is no linear relationship
between past investment performance and money raised; newly established
investment funds, or investment funds with low investment results, can still raise

investment capital at subsequent capital mobilization campaigns.

1.2.

Policy factors affect the building and developing venture capital funds

Policy factors affecting the building and developing of venture capital funds,
including government policy elements, as well as from within the social investment
community, which is accepted and supported by the government, or local
governments to accelerate the establishment and development of venture capital
funds. Policy factors include:
Firstly, entrepreneurship supportive network
Second, educational policies to train investors
Third, tax policy in venture capital


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1.3.

Internal factors influence building and developing venture capital
funds

Internal factors affecting the development of venture capital funds include:
Firstly, the type of venture capital fund
Second, the investment period
Third, the terms and conditions in investment contracts

2. OVERVIEW OF DOMESTIC RESEARCH
Previous studies in Vietnam on the field of venture capital are still limited such as
the previous research had been done a long time ago, therefore the data and economic

context have changed a lot; the previous research focuses only on a number of areas of
individual venture capital funds, there is no full research on venture capital funds in
general; or previous studies on venture capital only study on a certain locality, not
covering the whole market in Vietnam.
3. THE RESEARCH GAPS
In sum up, previous studies have made great contributions in both theoretical
and practical assessments of factors affecting the building and developing of venture
capital funds; emphasizing the role of developing venture capital investment in the
development of regional economies. However, these studies still have certain research
gaps, which are:
Firstly, in the previous countries' studies on the establishment and development
of venture capital funds, the lessons which are learned from other countries are still
general, not in-depth and specific. Therefore, the connection with Vietnam is limited.
Secondly, there are a number of studies on factors affecting venture capital
funds, but there have not been any studies on the setting up of general criteria to
assess the factors needed to build and promote the development of venture capital
funds, not in depth analysis and follow this set of criteria when researching in each
specific market.
Thirdly, studies on venture capital funds in Vietnam have not mentioned the
investment trend of venture capital funds operating in Vietnam. In addition, previous
studies have been conducted for a long time, therefore, the figures are outdated,


9
unable to update the operational situation of venture capital funds operating in
Vietnam today.
Therefore, the research on building and developing of venture capital funds in
Vietnam, in order to understand the current investment trend of venture capital funds
operating in Vietnam, learning the lessons from previous countries, identifying and
evaluating influencing factors, and solutions to accelerate the process of building and

developing venture capital funds in Vietnam are essential.


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CHAPTER 2. THEORICAL FRAMEWORK OF BUIDLING AND
DEVELOPING VENTURE CAPITAL FUNDS
2.1. Concept of venture capital and venture capital
2.1.1. Venture capital theory
Venture capital is the capital which was provided by wealthy individuals, or
financial institutions for startup projects, small businesses with high potential for
future growth; or other businesses that need capital to continue production and
business. Because of this capital investing in highly risk projects and businesses, so
investors must be willing to accept the losing possibility of capital in their investment
projects.

2.1.2. Venture capital funds
Venture capital fund is a type of investment fund that receives from venture
capital investors to make investments in newly established companies, in companies
with high potential for future growth, but with many potential risks. Venture capital
funds can invest in many sectors of the economy, but are primarily aimed at startup
firms, high-tech companies.
2.2. Theory of building and developing venture capital funds
According to Avnimelech et al (2016), the process of building and developing
of a venture capital fund consists of 5 stages below:
(1) Period of the necessary conditions for building a venture capital fund
(2) Period of pre-appear venture capital fund
(3 Development stage of venture capital funds
(4) Crisis phase of venture capital funds
(5) Recovery period of venture capital funds

2.2.1. Building venture capital funds
When building a venture capital fund, the following factors need to be
considered: (1) Venture capital investors; (2) Organizational model; (3) Limited


11
provisions in the fund's investment; (4) Standard for disbursement of investment
projects; (5) Exit strategies
2.2.2. Developing venture capital
To evaluate the criteria for building and developing venture capital funds, the
thesis uses 4 criteria, namely (1) the number of venture capital funds established over
the years; (2) The total venture capital which was mobilized; (3) investment sector of
venture capital funds; and (4) performance of venture capital funds.
2.2.4. Factors affecting the building and developing venture capitals
2.2.4.1. Factors affecting the process of building and developing venture capitals

In order to build and develop a venture capital fund, it is necessary to consider
five essential factors below: (1) Government policies; (2) Cultural and social values;
(3) Training and research capacity; (4) Location factors; (5) Venture capital resources.
2.2.4.2. Method of assessing the influential factors on the process of building and
developing venture capital funds
In order to evaluate the establishment and development of a venture capital
fund in Vietnam, in addition to the questions of understanding the venture capital
fund, the thesis uses research variables related to the building and developing venture
capital funds in Vietnam, which are:
(1) CSCP: Government policies factors
(2) VHXH: Social and cultural factors
(3) ĐTNC: Training and research capacity factors
(4) ĐĐ: Investment location factors
(5) NL: Resource factors

The thesis uses the Exploratory Factor Analysis (EFA) to evaluate the
influencing factors to building and developing venture capital funds in Vietnam.
Research methodology includes the following steps:
Step 1. Use the Cronbach’s Alpha test to check the quality of the scale
Step 2. Analyze Principle-Component Factor


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Step 3. Find the rotation matrix
Step 4. Bartlett test and KMO test


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CHAPTER 3. THE CURRENT STATUS OF BUILDING AND DEVELOPING
VENTURE CAPITAL FUNDS IN THE WORLD
3.1. The process of building and developing venture capital worldwide in the
reality
3.1.1. The history of building and development venture capital
3.1.2. The development trend of venture capital fund over the world
3.2. The experiences of building and developing venture capital in China and
Korea
After studying the trend of developing venture capital funds in the world, and
experiences in building and developing venture capital funds in China and Korea, the
thesis draws some lessons from the following:
(1) Government plays an essential role in the process of building and developing
venture capital funds
(2) Focus investment capital on sectors which requiring high scientific and
technological qualifications
(3) Take advantage of attracting venture capital from all sectors of society
(4) It is necessary to build a connection network in venture capital

(5) It is necessary to select the appropriate form of venture capital fund in each
different development periods
(6) Focus on developing the stock market


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CHAPTER 4. THE CURRENT STATUS OF BUILDING AND DEVELOPING
VENTURE CAPITAL IN VIETNAM

4.1. Introduction about the environmental factors affecting venture capital
activities in Vietnam
4.1.1. The government policies
The government plays an essential role in creating an effective operating
environment for venture capital. Through guiding policies, the government can
influence all aspects needed to develop an effective capital market in general and the
activities of venture capital funds in particular. Government policies are necessary for
the operating environment of venture capital funds which can be mentioned as
follows: policies in the field of education - training related to business and investment;
government policies related to scientific and technological development; and
government policies related to financial markets, in which the stock market plays a
leading role.
4.1.2. Social and cultural values for business
In investments, social and cultural values are expressed in two main points:
business culture of the country and the region; Perspectives on risks and failures
(Lerner et al., 2015)
4.1.3. Scientific and technological research factors

Scientific and technological research elements include: scientific research
capacity (such as the number of research institutions, universities and colleges);
regulations on scientific research of scientific staff; regulations, enforcement of

intellectual property rights, etc.
4.1.4. Investment location factors
Investment locations factors includes (1) Local infrastructure and (2) Business
associations.
4.1.5. Venture capital resources
The element of resources for venture capital includes two main issues: (1) the
demand for venture capital: small and medium enterprises, human resources; (2) the


15
supply of venture capital: the number of companies, economic groups, and national
resources; (3) the internal development of venture capital funds.
4.2. The status of building and developing venture capital funds in Vietnam
4.2.1. The status of building venture capital funds in Vietnam
4.2.1.1. For foreign venture capital funds
At the time of joining Vietnam market, all of these venture capital funds were
established and raised capital abroad, in which the shares of these venture capital
funds were listed in foreign stock market. The investors participating in these venture
capital funds is institutional investors, without the participation of individual
investors. At that time, venture capital funds had a wide range of activities, from
manufacturing, trading, services, finance, and so on, without the necessary objective
of investing in companies in the field of high technology, startups, etc ...
For the venture capital fund structure, foreign venture capital funds established
in Vietnam in the early stages often choose the open-end fund structure, with the
characteristics of capital mobilized once from the beginning. The Fund is not
responsible for payment to investors during the operation of the Fund, but investors
must sell to other investors in the stock market, etc. this will create stability in capital
raised by venture capital funds, in order to focus on the implementation of selected
venture capital projects.
4.2.1.2. Vietnamese venture capital funds

In Vietnam, venture capital funds have been officially established since 2015,
with the main goal of investing in innovative startups. These investment funds mainly
mobilize capital from the state budget, related ministries and branches, or from
companies, groups, etc., while the investment capital from angel investors is limited.
Venture capital funds have been operated under the supervision, management
of the company, parental corporation, or run by the governing bodies of the
government, orienting development directions; with the main objective of responding
to the Government Decision 884/QĐ-TTg on approving the Government's Project
"Supporting national innovation start-up ecosystem to 2025"; therefore, the
organizational model is mainly headed by government, holding companies, the


16
parental corporation, or the legal representative of these venture capital funds; in
which experts participate mainly in the role of advising and supervising the projects
that the fund invests in, without putting a preference role in raising capital of these
venture capital funds.
When it was established, Vietnam's venture capital funds aimed to invest in
startups, science and technology firms, natural sciences, etc. with the goals which
were learnt from start-up countries such as the US, China, South Korea, Israel,
Singapore, etc. to promote the country's science and technology, create momentum for
sustainable development of the economy, and to enhance competitiveness capacity
globally of Vietnamese enterprises and technology products.
4.2.2. The current status of Vietnamese venture capital development
To evaluate the criteria for developing venture capital funds, the thesis uses 4
criteria, which are (1) the number of established venture capital funds over the years;
(2) total mobilized venture capital through the years; (3) investment sectors of venture
capital funds; and (4) performance of venture capital funds.
4.3. Survey results of factors affecting the building and developing venture
capital funds in Vietnam

Based on the analysis results of convergent and discriminant values, there are
5 factors were extracted, corresponding to 23 observed variables; all load coefficients
of observed variables are > 0.5; all the observed variables measured for the factors
CSCP, VHXH, ĐTNC, ĐĐ, NL have high load coefficients on the same factor, this
means all the variables have good convergence values; and there is no significant
difference in the load coefficient of an observed variable on other concepts, this means
the observed variables have a good discriminant value.
KMO test results show that, KMO coefficient = 0.735 (> 0.7) should the research
model achieve completeness. At the same time, Bartlett test results show that Sig. =
0.000 (<0.005), meaning in this research model, the variables are correlated with each
other in the total variables. Finally, with an explanatory variance of 0.8002, these 5
factors explain 80.02% of the building and developing venture capital funds in
Vietnam. In which, at each research factor, there are observations that play the most


17
important role such as: in the CSCP factor, the variable CSCP2, that is clearly and
completely legal regulations to protect the rights of venture capitalists and venture
capital funds have the strongest impact; in the element of social culture, variable
VHXH3, that is, entrepreneurs who have the ability to assess and adapt to business
risks have the strongest impact; The research factor has a ĐTNC3, which is enhances
people's understanding and enforcement of intellectual property rights with the
strongest impact; in the factor ĐĐ, ĐĐ11, the network of different types of transport
places that play an important role when deciding to invest in a locality; in the factor
NL, there is variable NL8, which means investment efficiency of venture capital funds
over the years has the strongest impact.

4.4. Summarizing the status of building and developing venture capital funds in
Vietnam
4.4.1. Positive results

Firstly, the number of venture capital funds in Vietnam has increased over the
years.
Secondly, the value of venture capital into Vietnam has grown sharply over the
years, consistent with the growth / accumulation periods of the economy.
Thirdly, the investment sector of venture capital funds is mainly focus on
finance - banking, real estate, and high technology, information and entertainment
sector.
Fourthly, the investment results of foreign venture capital funds operating in
Vietnam in this study have achieved remarkable results.
4.4.2. Negative sides and causes
Some of the negative sides:
Firstly, the number of venture capital funds in Vietnam is limited.
Secondly, the number of venture capital projects and venture capital invested in
our country is still modest.
Thirdly, the investment sector of foreign long-term venture capital funds in
Vietnam mainly focuses on investing in listed firms in the stock market, which are
real estate and food, drinks or media, entertainment sector. Meanwhile, only a few


18
venture capital funds established by Vietnamese currently focus on high-tech,
security, information technology companies.
Fourthly, in terms of investment results, despite the growth of investment
results over the years, but venture capital funds operating in Vietnam have
unsustainable investment results, they are still affected much due to the volatility of
the stock market, leading to periods of strong volatile investment results

The existence of the limitations above has several main reasons as below:
First, the legal framework for venture capital funds in Vietnam is currently
unavailable.

Second, there is no specific mechanism for venture capital funds to mobilize
and divest from invested companies.
Third, limited resources for venture capital.
Fourth, venture capital funds in Vietnam have not focused on investing in high
technology.
Fifth, there is no effective network connection for venture capital funds in
Vietnam yet.
Sixth, there is no specific organizational and operational model for venture
capital funds.
Seventh, there is no state agency specifically managing the venture capital
funds.
Eighth, there is no clear and specific roadmap for building and developing
venture capital funds.


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CHAPTER 5. POLICY RECOMMENDATIONS FOR BUILDING AND
DEVELOPING VENTURE CAPITAL FUNDS IN VIETNAM
5.1. Orientation for building and developing venture capital funds in Vietnam
Currently, the Vietnamese government has focused on implementing policies to
support, establish and manage venture capital funds related to the start-up stage, for
small and medium-sized businesses. But in fact, the investment stages of venture
capital include not only the start-up stage but also the later stages. It seems that the
government is separating between start-up funds and securities investment funds, with
the implication that the government will create favorable conditions on the legal
corridor, even investing bait capital to help establishing new businesses, new projects;
then let the market decide whether or not to invest in these businesses again, through
the effectiveness of the product research and development phase.
In general, at present, the legal environment for venture capital funds in
Vietnam is almost nothing specific, they are still in encouraging and unsystematic

decisions and projects, synchronous law. There are only some the Regulations and
Decrees are related to venture capital, but most of them are of short-term nature,
usually valid until 2020 or 2025, in order to test Government programs in venture
capital sector. In addition, as mentioned in the previous section, there are currently
very few legitimate venture capital funds established in Vietnam, mainly foreign
venture capital funds. The problem of allowing venture capital funds operating in
Vietnam, while there is no specific legal corridor for this field, has created a gap in the
operation of those funds. At the same time, foreign venture capital funds wishing to
invest in Vietnam have also not felt comfortable, trusted and limited the capital
flowing into the field of venture investment in our country.
5.2. Some policy recommendations for building and developing venture capital
funds in Vietnam
5.2.1. Developing comprehensive legal framework
At that time, in Vietnam, there is no specific law for venture capital funds, but
only a draft for venture capital funds in the field of innovation. For general investment
funds, there is only a law for securities investment funds. As such, this is a huge legal
gap for this potential investment area.


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5.2.2. Building specific mechanism for venture capital funds
In the financial market, the most effective divestment is through the stock
market, but so far, there has not been any specific mechanism for divesting or issuing
stocks to the public.
5.2.3. Attracting resources for venture capital funds
As described in chapter 2, resources for venture capital funds include:
Attracting investment capital in society, especially for organizational investors;
improving the level of human resources; and the intrinsic nature of venture capital
funds.
5.2.4. Encouraging venture capital funds focusing on high technology sector

5.2.5. Establish network for venture capital funds
The establishment of venture capital funds connection network will improve
the operational efficiency of venture capital funds. Through this network, venture
capital funds will save the costs of finding venture capital projects, sharing investment
experiences, giving warnings about phenomenal projects which showing signs of
fraud, capital profiteering of venture capital funds and so on.
5.2.6. Suggestions to improve the organizational and operational model and of
venture capital funds in Vietnam
5.2.6.1. Simple provisions on conditions for setting up a venture capital fund
5.2.6.2. Types of investors of venture capital funds
5.2.6.3. Suggestions for venture capital fund ownership model
5.2.6.4. Operational model for venture capital funds
5.2.6.5. State management of venture capital funds
5.2.6.6. Roadmap to support the building and developing venture capital funds in
Vietnam


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CONCLUSION
Venture capital funds play an important role in attracting venture capital
resources of the economy, creating a motivation for the development of science and
high technology area, encouraging start-up entrepreneurs to introduce investment
ideas in reality. Venture capital funds are the objects that are interested by many
countries, especially developed countries, which are considered as the main object
promoting the development and creating sustainable competitiveness of that country.
For developing countries, they are also aware of the importance of venture capital
funds, and there are some researches to find out suitable conditions to promote the
building and developing of venture capital funds in Vietnam, but there have been no
general studies on the formation and development of venture capital funds operating
in Vietnam. Moreover, previous studies have been out of date both in theory and

research data, so it was no longer suitable for the current conditions, when the
Vietnamese government was aware and emphasized the importance of venture capital
funds in economy. Therefore, previous studies still have research gaps to analysis.
The thesis has synthesized the theoretical basis for the establishment and
development of venture capital funds, in which a set of criteria for factors affecting
the building and development of them. The thesis then analyzed the current situation
of building and developing venture capital funds in Vietnam, from 1990 to 2018,
including existing legal bases on venture capital funds, and the orientation of the
government in developing venture capital fund under present conditions, etc. The
thesis has also evaluated the environmental factors affecting the building and
developing venture capital fund.
In addition, the thesis uses econometric model to identify factors affecting the
building and developing of venture capital funds in Vietnam, considering which
factors have the strongest impact. The research results show that factors of clear and
complete laws to protect the interests of venture capitalists and venture capital funds;
factor entrepreneurs are able to assess and adapt to business risks; factor to improve
people's understanding and enforcement of intellectual property rights; network
elements of various types of transportation connecting locations; investment


22
efficiency factors of venture capital funds over the years have the strongest impact on
the building and developing venture capital funds.
By assessing the status of building and developing venture capital funds in
Vietnam, combined with experiences in building and developing venture capital funds
in countries around the world in chapter 3, the thesis has suggested some solutions to
promote the process of building and developing venture capital funds in Vietnam.
In summary, the thesis has solved the research questions and research
objectives. Researchers hope this thesis will contribute a part to the theoretical basis
and solutions to accelerate the process of building and developing venture capital

funds in Vietnam in the current period. Because of the limitations of data accessibility,
as well as the ability to research, the thesis still has limitations and shortcomings.
Therefore, PhD students want to receive the comments from experts and scientists so
that the knowledge and content in the thesis become more completely.


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LIST OF PUBLISHED SCIENTIFIC WORKS RELATED TO THE THESIS
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Tên bài
Vai trò hỗ trợ của chính phủ Hàn
Quốc đối với quỹ đầu tư mạo
hiểm – Bài học cho Việt Nam
Ưu đãi thuế nhằm thúc đẩy phát
triển quỹ đầu tư mạo hiểm tại Việt
Nam
Venture Capital Trend Worldwide
and Policy Impilication for
Vietnam

Kinh nghiệm phát triển quỹ đầu tư
mạo hiểm tại Trung Quốc và bài
học cho Việt Nam
Quỹ đầu tư mạo hiểm và vai trò
đối với nền kinh tế

Tạp chí
Tạp chí Nghiên cứu Đông Bắc Á, ISSN
2354-077X; Số 6 (220)

Năm
6/2019

Kinh tế Châu Á – Thái Bình Dương,
ISSN 0868-3808; Số Cuối tháng

4/2019

International Journal of Advanced
Engineering and Management
Research; ISSN: 2456-3676; Vol.04;
No.02/2019
Tạp chí Khoa học và Đào tạo Ngân
hàng; ISSN 1859-011X; Số 194

2/2019

Tạp chí chứng khoán;
ISSN 0866-739X; Số 223

3/2018

7/2018