The Vietnam-Finland Innovation Partnership Programme (IPP) is calling for Expressions of Interest from Finnish companies and Finnish-led consortia to join the Vietnam Market Access and Partnership program (VMAP) which will run from October 2017 to January 2018. VMAP is targeting innovative Finnish companies that are interested in exploring Vietnam as the next step in their international expansion strategy. In VMAP, top-class local experts coached by international business creation professionals are teamed up and high-trust networks leveraged upon to support each invited company intensively over the course of the program. For the companies invited to participate in VMAP, IPP covers the expenses of their assigned local expert team and the international professionals that train and support their team. The companies joining VMAP cover their share of project costs by making two trips to Vietnam during the program.
The key objective of VMAP is to initiate long-term Finnish-Vietnamese partnerships and projects that bring to market either (a) Ecosystem Solutions or (b) Business Solutions. The former refers here to comprehensive, ecosystem level solutions and strategies that respond to Vietnamese needs and the latter to potentially high impact innovative solutions for Southeast Asian and further international markets using Vietnam as the entry point.
The deadline for companies interested in VMAP to send Expressions of Interest is August 31st, 2017. Up to 20 Finnish businesses and/or Finnish-led consortia will be supported.
1. Background of the Call
With a population of 95M (2017, UN), Vietnam is one of the fastest growing economies in the world and part of the emerging ASEAN single market of 625M people. Vietnam’s middle class is set to double in the next five years. A dynamic internet market, the country has a large tech-savvy youth population, over 30M smartphones in use and a target to increase internet access rate from today’s 53% to 90%. Vietnam is also rapidly integrating into global networks. Application of the EU-Vietnam Free Trade Agreement (EVFTA) is expected to begin in 2018. With the US having abandoned the Trans-Pacific Partnership (TPP), EVFTA will have particularly high visibility and impact. Foreign direct investments have grown significantly over the past decade, dominated by Japan and Korea. Doing business in Vietnam requires time, commitment and local partners, but the opportunities are notable in various sectors where European enterprises have a global competitive advantage. The time is ideal for Finnish companies with tested and proven solutions related to, e.g., cyber security, digitalisation, education, e-government, fintech, food safety, health, manufacturing, maritime and smart cities, to tailor their offerings for Vietnam.
The Vietnam-Finland Innovation Partnership Programme Phase 2 (IPP) has operated on the ground in 7 major Vietnamese cities since 2014. The focus has been the development of entrepreneurial capabilities, networks, and ecosystems across Vietnam. Backed by 11M euros of funding, IPP has been a key driver in recent significant mindset change and shift in Vietnam’s overall economic policy to favour entrepreneurship, innovation, co-creation and global networks. Having funded 70 Vietnamese organisations and created a high-trust network of 200 local experts, IPP has good coverage of the major local entrepreneurial ecosystems and emerging economic hotspots of Vietnam, in which Finland by now is a well-known, highly valued partner. The cities of Ho Chi Minh and Danang were particularly keen to see more Finnish solutions in the market. The need for comprehensive solutions that contribute to overall ecosystem development within a certain sector is of interest. Winding its operations down by October 2018, IPP is in the process of passing the torch to strong Vietnamese partners but is now also reaching out to find strong partners from Finland — to build upon the IPP footprint.
2. Purpose of the Call
The Vietnam Market Access and Partnership program, VMAP in short, is an initiative of IPP to enable the tailoring of tested and proven Finnish solutions for Vietnam and to initiate and accelerate long-term partnerships between Finnish and Vietnamese organisations for positive developmental impact. VMAP brings IPP’s on-the-ground experience and networks together to deliver hands-on support to Finnish companies. IPP has grant-funded portfolios of 18 ambitious globally oriented startups, 14 incubator/accelerator development projects and 8 University Entrepreneurship & Innovation programs; alumni of 63 IPP-certified E&I trainers and 12 IPP-certified innovation coaches, and well over 100 associated local experts: Entrepreneurs, executives, business developers, educators, innovators and policy makers.
To operate successfully in Vietnam, foreign companies need a trusted and networked partners on the ground. VMAP will focus on forming company-specific high-trust networks, help companies screen the market and build a presence for the longer term. IPP works with a pool of international and Vietnamese financiers, and VMAP will help explore access to continued project funding. Finnish innovation and export financing organisations, which IPP also works closely with, are increasingly active in Vietnam, not to mention larger international financiers, private investors and other support programs.
The key objectives of the call are to:
- Respond to real challenges and demonstrable market demand in Vietnam with tested and proven Finnish solutions and scalable strategies tailored for Vietnam
- Help Finnish companies review the Vietnamese market and design Vietnam-related projects and market entry strategies and explore funding options
- Facilitate the formation of high-trust networks, strategic partnerships between Finnish and Vietnamese companies and other organisations
- Spark market entry, concrete projects and business creation out of the Finnish-led innovation and business partnerships in Vietnam and beyond
- Accelerate growth in Vietnam for the ambitious Finnish companies interested in accessing the market as entry point to the wider ASEAN market space
IPP is one of the last Official Development Assistance (ODA) programs Finland is funding in Vietnam. The relationship between the countries is shifting from aid to trade based partnerships. The new partnerships will be showcased and launched during the Saigon Innovation Week, 23-28 October 2017, which is also the kick-off week of VMAP. The week will draw a nationwide and international audience to the Southern metropolis Ho Chi Minh City. Finland is program lead for two days during the Saigon Innovation Week: One day dedicated to the Slush Global Impact Accelerator that will gather together impact investors, startups and gurus from the Mekong area and beyond, and one day to city-led collaboration and showcasing Finnish enterprise solutions.
3. Details of VMAP
VMAP is a market access and partnership creation program for Finnish companies that want to enter the Vietnamese market, find the right partners and form a long-term project and growth plan in Vietnam or in the broader Southeast Asian market. VMAP runs from October 2017 to January 2018.
The following graph summarises VMAP benefits.
VMAP is targeted to Finnish companies interested in bringing to the Vietnamese market either (a) Ecosystem Solutions or (b) Business Solutions. Ecosystem Solutions comprise comprehensive ecosystem level solutions and strategies that respond to Vietnamese needs. Business Solutions refer here to high impact potential innovative solutions for Southeast Asian and further international markets using Vietnam as an entry point. There is no pre-defined priority between the two categories. Ideally, both categories will be strongly represented in VMAP.
Companies invited to VMAP will be matched with a local resource team and networks that best serve the specific focus of the three-month VMAP project as well as the long-term targets of the company in relation to Vietnam. Local resourcing will be discussed and decided on together with the company. IPP will coach and prepare the local resource teams for a month before VMAP kicks off. Geographically experienced mentors will be accessible for the duration of the program.
To cover for their part of company-specific total project costs, at minimum one representative per company project will take part in the VMAP launch to form a detailed action plan with the local team and showcase their solutions to the international audience of what aims to be Vietnam’s biggest and brightest annual innovation event, the Saigon Innovation Week. And another such field trip is performed at a timing that will be separately agreed with each company.
A project agreement is entered between IPP and the invited Finnish company or Finnish-led consortium, in which IPP agrees to cover dedicated costs related to the work of the local project team in Vietnam and the Finnish partner to cover costs related to two field trips to Vietnam. At the minimum, there will be one field trip during the Saigon Innovation Week, as explained above, and one around the end of the 3-month VMAP project. A jointly agreed upon project budget will be drafted and made part of the project agreement. An average VMAP project budget will be defined as 10.000€ of which IPP will agree to cover 70% and the Finnish partner 30%, all as per the outline discussed above.
4. Eligibility and Evaluation Criteria
To be eligible, a company must be registered in Finland. Consortia of two or more partners with a leading Finnish company partner are welcomed to apply. Applicants must not have unpaid taxes or disturbances in payments, and they should demonstrate financial credibility to carry out larger and longer-term projects in Vietnam. There are no limitations to company age, size or sector, but the (lead) company must be demonstrably established in international business.
Assigned business development experts will evaluate the Expressions of Interest. Evaluation interviews will be conducted to discuss the company’s Vietnam interest in more detail and assess the IPP’s potential to match the company-specific needs. The following evaluation criteria will be applied:
- Market: Relevance of the recognised problem, nature of demand and customers
- Solution: Technical and commercial potential of the solution in Vietnam & ASEAN
- Track record: Prior relevant success of the company in Finland and beyond
- Impact: Outlook for expansion and long-term impact in Vietnam and beyond
- Commitment: Readiness to form strategic partnerships in Vietnam
- Profitability: Targeted benefits for Vietnamese and Finnish partners
- Credibility: of the VMAP project plan to reach desired short and long-term goals
- Team and resources: Key people and company/consortium resources
- IPP’s capacity: The fit of IPP’s experts and networks with the case at hand
5. Application and Selection Procedure
- The applicants fill in the Expression of Interest and send it to firstname.lastname@example.org by 31 August 2017. Consortia applicants fill in one joint form.
- An assigned lead evaluator will be in contact with all applicants during the evaluation phase
- Evaluation decisions are announced by 30 September 2017 at the very latest
6. Monetary support, eligible costs, and reimbursement
IPP will directly cover the project costs that relate to resourcing the local support team and the international professionals that train and support the team, amounting on average to 7.000€ or 70% of total project budget (local costs). IPP monitors the project and pays the local team’s work directly based on approval of work by the Finnish partner. Only direct human resource costs and related travel costs in Vietnam of the dedicated local team and the international professionals that support the team can be covered by IPP. The local team and network will be gathered for the company from the IPP’s trusted network of mentors, coaches, domain experts and business developers in consultation with the company.
The Finnish partner covers the costs of 2 field trips to Vietnam; equal in the VMAP project budget to a total of 3.000€ or 30% of the total project budget. In other words, completion of 2 field trips to Vietnam fully covers the Finnish company’s share of total project costs. In the case of no field trips, the Finnish partner will cover 30% of the local resource team costs (equal to 2.100€).
A project agreement is entered between IPP and the invited Finnish company or Finnish-led consortium, as explained above. IPP will take care of subcontracting with the dedicated local resource team according to its established processes in collaboration with the companies to be supported.
Companies send an end of project report to IPP. Reporting procedures related to the VMAP project are detailed during contracting.
9. Intellectual property
In the project agreement, the participants shall agree upon the ownership, access rights and exploitation of the intellectual property generated during the cooperation. The principle rule is that all IPR born in the project will belong to the Finnish partner.
10. Further information and contacts
You may contact the following individuals to discuss your idea in detail while drafting the EoI document:
- IPP representative in Vietnam (until 31 July 2017): Mr. Marko Seppä email@example.com, tel. +84 123 237 1447
- IPP representative in Finland (until 31 August 2017): Ms. Silja Leinonen firstname.lastname@example.org, tel. +358 40 538 4831; +84 919 055 235
- Finpro representative: Ms. Eija Tynkkynen email@example.com, tel. +84 90 603 9977 tel. +358 40 522 8507 (on vacation 26.6.- 31.7.)
Further Reading & Reference:
Local English-language media:
Dealstreetasia Vietnam coverage (investment related)
Tech in Asia (startup and tech themes)