SME growth financing platform Validus Vietnam, early-stage VC firm Do Ventures, and multi-industry conglomerate TTC Group announced today a joint venture to help local SMEs get credit access.
TTC Group has participated in the JV through its group company DHA Corporation, an investor in real estate, health, and sports.
The JV aims to drive financial inclusion and empower the growth of underserved SMEs in Vietnam. It will leverage TTC’s large ecosystem of SMEs across Vietnam’s energy, real estate, cane sugar, and hospitality industries. At the same time, Do Ventures’s expertise in fintech will support Validus’s growth ambitions, and the JV will benefit from potential synergies with portfolio companies under Do Ventures in future.
SMEs play a pivotal role in Vietnam’s economy. However, access to credit remains a pressing issue for SME development in the country. The SME financing gap stands at 12 per cent of its gross domestic product (GDP).
According to a World Bank Survey, during the COVID-19 crisis, the lack of access to finance has been exacerbated as liquidity remains a challenge under a continuous demand reduction. About 50 per cent of firms have under three months of cash flow, and over 60 per cent of firms have reported some difficulties with access to finance.
Vy Le, General Partner of Do Ventures, said, “The pandemic has accelerated the digital transformation of SMEs in Vietnam, and there is a big opportunity for fintech firms to create meaningful and lasting impact through partnerships and technology. We look forward to harnessing synergies to strengthen SME resilience, drive growth for SMEs, and in turn, the economy.”
Since its launch in 2015, Validus has disbursed over US$1 billion in SME loans across Singapore, Vietnam, Indonesia and Thailand. The company is backed by highly reputed VCs, including FMO, Vertex Growth, Vertex Ventures Southeast Asia and India, AddVentures by SCG, K3 Ventures, Openspace Ventures and VinaCapital Ventures.
Do Ventures is a US$50-million early-stage VC fund. It seeks investment opportunities in technology startups that can develop meaningful products and services to improve consumers’ lives in Vietnam and Southeast Asia.
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