|One of the challenges of edtech is good marketing to convince parents to try out new education services, photo Le Toan|
Those were the words of Tony Ngo, chairman and co-CEO of Everest Education, at last week’s Vietnam Venture Summit 2020 organised in Hanoi.
Ngo said that even though a quarter of Vietnam’s near-100 million population are classed as students, most of them are not located in urban areas and so their opportunities to approach brand new technologies are largely limited.
“Instead of only focusing on students living in big cities, it is necessary to find ways to effectively give access to the remaining subjects which account for a large part of the total,” Ngo added.
Dao Lan Huong, chairman and founder of Teky Academy, told VIR that popularising edtech in urban areas is easier than in suburbs or rural areas. “In big cities, in addition to parents being willing to pay for education, it is easier for new kinds of education to become more common because such cities always attract more novel ideas.”
Currently, Teky Academy is accelerating promotional activities for edtech products in other cities and provinces. “Marketing plays the most important role in popularising new kinds of education,” said Huong. “Once edtech becomes more well-known to parents, putting it into operation will be more favourable.”
In addition to Hanoi and Ho Chi Minh City, this company is targeting the northern port city of Haiphong, Danang in the central region, and more.
Attending the Vietnam Venture Summit 2020, Nguyen Phuong Hanh, a teacher at Just Kids kindergarten, told VIR that during the health crisis this year, many parents became interested in edtech, while the school is also developing an edtech platform by itself.
“I came here to find opportunities to partner up with businesses specialised in the sector. However, from what the speakers said at the event, I have yet to be satisfied,” said Hanh. “I am looking for actual solutions for the shift from offline to online, while they just focused on experiences in operating in the segment.”
Meanwhile, Tran Viet Hung, chairman and founder of domestic edtech startup Got It, said that the key factor deciding the make-or-break of any edtech platform is training quality. “Edtech companies have to focus on offering quality lectures on platforms – specifically, how to provide them products satisfying the actual demand of learners and teachers,” he explained. “That is a big challenge for any local startup working in the sector because most online learning platforms in Vietnam are only in the first phase of development.”
Moreover, Hung emphasised that to operate edtech platforms well, businesses do not have to prioritise gathering plenty of teachers or learners, but instead should focus on creating a useful platform that must become the first choice for them.
According to information published at the Vietnam Venture Summit 2020, the country is home to more than 100 startups specialised in edtech, focusing on content, online classes, online-to-offline, and business-to-business. Besides that, the local edtech market this year is valued at about $103 million, on a scale that is set to increase.
Spending on education makes up about 40 per cent of local people’s income, and the expenditure is expected to grow in forthcoming years. The Ministry of Education and Training recently issued a decision outlining integrating technology with education from kindergarten to Grade 12.
With nearly 50 million smartphone users and Southeast Asia’s leading internet use, Vietnam is an appealing destination for educational investors across the world. According to a survey of about 50 international funds this year, edtech will be the leading target of investors in the next 12 months.
Trinh Minh Giang, CEO of Global Elite Education and Training Corporation, said that some of the difficulties in the sector are that local people still rely on traditional education platforms and get too familiar with using the free-of-charge learning resources. Nevertheless, the challenges also pave immense opportunities for startups. “If they enter the sector as soon as possible, their chances to succeed will also improve,” Giang said.
Olivier Raussin – Co-founder and managing partner, FEBE Ventures
Before COVID-19, Vietnam was already attractive with its strong GDP growth, strong digital market, and plenty of engineers generated annually.
The country is growing in both quality and quantity. Moreover, Vietnam is one of the nations witnessing a strong gender balance which sees a large number of female entrepreneurs and many women holding strong positions in the companies.
With these factors, Vietnam has been an ideal destination for many investors even before the pandemic. As the country has been doing well in controlling the outbreak, the attractiveness has been improved.
I believe that next year, Vietnam will be back to normal with a GDP growth rate of 6-7 per cent.
That means the digital economy will potentially soar by 25 per cent in 2021 overall. And we hope to see a new wave of new startups from some C-level companies or overseas Vietnamese students who finished studies and have come back to Vietnam to start their entrepreneurial journey. My main expectation is that most of the new generation of talents will start their tech companies in Vietnam because the early stage always demands a lot of talent.
We invest in technology at an early stage. We, at the moment, particularly like categories like online education and invested in one startup in Hanoi called Clavei, tutoring after school for Vietnamese kids. We like a lot in fintech too. We invested in one startup in Hanoi named NANO which provides an early wage access platform to employees in Vietnam.
We are also interested in logistics, and are trying to find potential companies to work with.
And we are particularly into healthtech – we already have one healthtech dental company in Vietnam called Zenyum that does invisible braces.
We also hope to be able to support them to become number one in Vietnam in their respective fields.
Justin Nguyen – Partner, Monk’s Hill Ventures
COVID-19 has had a mixed impact on startups. We have seen some companies do really well and adapt, especially in e-commerce, logistics, and payments, while there are some companies that might not do so well such as in food and beverages. But overall, we have seen companies emerge stronger during the pandemic, by focusing on business models that make sense and not always depend on more funding. The startup ecosystem has also gotten better.
Our investment strategy remains the same and we invest in different tech Series A projects. We primarily focus on three elements when looking at potential investments. The first is great founders. It can take more than 10 years to build a company. Founders need to be mission-driven and resilient in the face of challenges. Secondly, they have to be solving a big problem. This means having a scalable business model that has the potential of addressing sizable market opportunities, such as a billion-dollar industry. Thirdly, we look out for companies with sound unit economics. There needs to be a clear path to profitability, and their unit economics need to make sense.
For Series A, we add product-market fit as another important aspect and want to see companies that have traction and some semblance of repeatable customer acquisition. The bottom line is that we believe in backing great founders.
Ninh Nguyen – CEO, Wecare.vn
The pandemic has both positive and negative impacts on startups in a way we have never seen before. We see a sudden reduction in revenue especially in businesses that depend on offline activities such as tourism and transportation. Without positive cash flow and funding, startups can hardly survive through months of lockdown and are forced to reduce business size or slow down to survive.
Soya closed a number shops during the pandemic, the CEO of ride-hailing app Be left, Wefit shut down, and a lot of other startups are almost dying.
Besides this, changes in consumer behaviour also force startups to change their business models to adapt to the new normal. Many startups get positive impacts such as digital content or software-as-a-service tools to support remote working, and many businesses have been turning to e-commerce as the main selling channel. On the other hand, many others are struggling to survive.
It is not easy to raise funds now. Many venture capitalists take more time for due diligence to find startups that have abilities and advantages in the new normal. The practice of growing at all costs may not work anymore and healthy sustainable business models are preferred.
So we can see that startups that can survive through the pandemic are the ones that adapt to the crisis and turn it into an opportunity. After the pandemic ends, some business trends may emerge such as edtech, fintech, and healthtech.
Nguồn: Vietnam Investment Review