Business content:

Definition: Starting a business is a phrase that has been mentioned a lot in recent times, from
media agencies to policymakers.

Start-up is a topic of great interest in Vietnam, especially in the context of the country's strong
integration with the world economy.

Start-up a business is expected to create economic growth, make a positive contribution to socio-
economic development, and contribute to meeting the increasing demand.

The current situation of startups in Vietnam.

According to statistics of Topica Founder Institute [1], in the period from 2011 to the end of 2017, the
startup ecosystem in Vietnam recorded 296 different investment deals, of which, in 2017 alone. The
number of startups receiving investment capital has reached 92 businesses with a total investment value
of nearly 300 million USD. This number nearly doubled compared to the number of deals in 2016, and
increased more than nine times compared to 2011.

Among them, there are 6 startups with the most capital, accounting for 198 million USD, are Foody (82%
shares of this startup was acquired by Sea Group with 64 million USD); Tiki (C series funding from
JD.com worth 54 million USD); an undisclosed startup received 20 million USD from TNB Ventures and
Vntrip (called for series B funding from Hendale Capital 10 million USD). In addition, Sea also acquired
two undisclosed logistics and fintech startups for $50 million. This strong growth is considered an initial
success of the national entrepreneurial spirit launched in 2016.

Distinction: Many people are now confusing the two terms “startup” and “Entrepreneur”, which
means start-up and start-up.

An “entrepreneur” is an individual or group of people who initiate, own their work, run their own
business because they do not like working for a business.

Meanwhile, to be considered a startup, an individual or business must sell a product that comes with an
idea.

Ways to establish a business: a startup needs to follow 6 fundamental steps including Define strategy ->
Determine business model -> Determine the operating model by the orientation and business model - >
Build organizational structure -> Transform culture -> Implement.

5 skills to operate a small business

-Planning a reasonable strategy
New ideas about products and services are still not enough to help businesses gain a foothold in the
market when competition is increasingly fierce. from domestic and international competitors. When
entering the market, a business must have a reasonable strategy to search for its "blue ocean" - outline
the image and characteristics of the target customer group that the business is aiming for, from That
gives a strategy to penetrate the niche market to reach customers.
-Building your brand and marketing communication strategy
Branding of an enterprise is not only the story of multinational companies or large corporations but all
businesses participating in the market. Identify the personality and unique characteristics of the brand
through a logo, slogan, color, vision, mission, etc. From there, set up a communication campaign to
promote business activities. Many small businesses are still afraid of spending money on advertising, but
this is a necessary activity to help businesses position and maintain a foothold in the minds of
customers.

-Capital management and financial budgeting

Finding capital and managing cash flow is one of the dilemmas of managers. In addition to available
capital and bank loans - financial leasing has become a form that many managers look to supplement
capital for businesses with many advantages such as no need for collateral. can own the property after
renting, the financing rate is high… Thereby, financial leasing has gradually become a reliable
mobilization channel of many businesses. In addition, managers need to pay attention to cash flow
management, reasonable budget allocation for business activities to minimize the risk of cash flow
shortage; through the consideration of financial indicators such as operating costs, selling expenses,
gross profit margin, intermediate financial ratios, etc.

-Build internal processes and controls

To operate the business smoothly from the very beginning, managers need to build internal processes
with reasonable policies for relevant departments. Systematizing the process helps businesses save time
and operating costs, besides, administrators can quickly handle problems arising in the operation
process based on the principles and processes that have been established. show. The loss or
replacement of the person in charge will also be streamlined and will not affect operational results
much.

-Using digital platforms and digital marketing

To operate a business smoothly from the very beginning, managers need to build internal processes
with reasonable policies for relevant departments. Systematizing the process helps businesses save time
and operating costs, besides, administrators can quickly handle problems arising in the operation
process based on the principles and processes that have been established. show. The loss or
replacement of the person in charge will also be streamlined and will not affect operational results
much.

Cause of failure:

-Lack of legal awareness:

The fact that founders are not well aware of legal issues is also one of the reasons why many startups
fail.

When a startup is founded, it often has a mentality of focusing only on products, on how to market,
approach customers, and sell without paying much attention to legal risks. Before money, it is necessary
to mention the provisions of the Enterprise Law. Founders often rarely pay attention to the risks
involved in choosing the type of business, building membership regulations, and company charters. As a
result, the startup stalled, missed good opportunities; At the same time, causing damage to the
relationship between the founders due to conflicts of interest in the capital, property ownership, or
startups having to compensate for contracts signed with partners.

Lack of cooperation terms and business methods is a common shortcoming in young startups. Because
in the early stages, founders are often linked with each other by passion, they simply think: Members
only need to contribute capital and effort to develop the startup.

-fundraising problem:

According to Mr. Don Lam - General Director of VinaCapital, Vietnam is very difficult to start a startup
because the first problem is capital. In addition, Vietnam still lacks a sustainable ecosystem to support
young people to start a business. He emphasized: "Startup is when you start from scratch, how to get a
bank loan, just rely on professional investment funds, or wait for private capital through
acquaintances... But if not, it's not. If there is a methodical ecosystem, it is very difficult to call for
investment capital.”

-Barriers to administrative procedures

However, problems such as administrative procedures, business conditions, sub-licenses, difficulty in

divesting capital after a period of investment in Vietnam always make foreign investors "falter". The
number of domestic start-up projects receiving foreign investment stopped at a "modest" level.