DFJ VinaCapital: Venture Funding In Vietnam DDART

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DFJ VinaCapital Venture Funding In VietnamDDART
Diagnosis, Decisions, Analysis, Reality Test

• Stanford Sunspot Team
• Aditya Mittal Meng Kiat Chua Yuxin Chua Ye He

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Diagnosis Problems and Opportunities

• Issues
• Brand building and Brand name recognition
• Funds raised Clarify goals!
• Positioning (Early or multi-stage? Vietnam or SE
  Asia?)
• Actions (Need more funds?)
• Navigating the murky waters of Vietnam
• Opportunity
• Early movers! Great scope!

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Decisions VinaCapital made

1. Focus on early to expansion stage companies
2. Invest into Pre-IPO companies going private
3. Raise more funds from GP and LP to create 50M
   fund
4. Partnering with DFJ allows better branding
5. Special interest in Internet, Mobile and telecom
   penetration

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Our Decisions for DFJ VinaCapital

• Keep all of early to expansion stage companies,
  but stick with proven technology
• Invest into Pre-IPO companies going private,
  increase interaction with government
• Raise more funds from GP and LP to create more
  than 50M fund
• Stick to Vietnam and dont try to expand to SE
  Asia

Focus! Stay Targeted!
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Analysis Vietnam

• High Growth

• But Small Market

• Fast growing economy GDP growth rate third
  after China and India
• Lot of privatization happening
• Rapidly increasing foreign direct investment
• 8.43 as compared to 3.3 in US

• Despite rapid growth, the total size is still
  relatively small compared to other countries
• Increasing competition from outside Increased
  Volatility
• Internal corruption
• 52.8B as compared to 12,455B in US

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Analysis Internet and Telecom in Vietnam

• 300M TAM as compared to 1B in US for IT in 2007
• ButVietnamese govt. planned to inject 3.6B into
  the market to increase internet penetration from
  15.8 to 34 by 2010.
• Demographic Most people under Age 35
• Proven E-commerce and other web technologies
  already proven in other nations

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Analysis Venture Capital in Vietnam/ASEAN
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Analysis - Draper Fisher Jurvetson Offerings

• Top notch brand from Silicon Valley
• Better deal flow
• Network competitive advantage
• Network intelligence
• Network local support, global reach

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Analysis VinaCapital Positioning

1. VinaCapital is the evangelist for Vietnam
2. Started in 2003 in Ho Chi Minh city
3. Needs partnerships for stability and branding
4. Helps DFJ in exploiting the Vietnam technology
   market
5. Has 250M in the Vietnam real estate market
6. Creating 50M fund for the technology market

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Reality Test - implementation risks connected
with your decisions.

• Biggest Risks are
• Bad Legal System and high corruption
• Lack of infrastructure to find right funding
  opportunities
• Hedge risk by adopting only technologies proven
  in the China and US markets
• Hedge risk of increasing volatility in market by
  raising more money to get better market
  penetration and maintain focus in Vietnam and not
  SE Asia

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Reality Test - implementation risks connected
with your decisions.

• Cultural Chasms Do you think I should do the
  dance here in Vietnam? Tim asked his affiliate
  in Hanoi and Ho Chi Minh
• The Riskmaster Don and Tim instantly hit it off
• Economic dont see a downside to helping boost
  the economy
• Ethical dont see any downside to honestly
  helping people build meaningful new companies

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Thank you
Stanford Sunspot Team Aditya Mittal Meng Kiat
Chua Yuxin Chua Ye He
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• STOP
• BACKUP SLIDES BEYOND

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Analysis

• Analysis of company, customers, channels,
  competitors, economics, environmental factors and
  ethical issues

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• Diagnosis Where is this market in its life cycle?
  How attractive is the market opportunity?
• Decisions What is your marketing (or business)
  plan?
• Analysis Why is your plan the best way to go?
• Reality Test What are the risks of your plan,
  and how can we manage those risks?

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• marketing leadership in cross functional teams
• economic analysis to assess the value of
  marketing activities and
• ethical responsibilities to customers, investors,
  and the community,