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| A cash switch carried out by way of the cell app of know-how unicorn Momo. The Ministry of Science and Technology proposed assessing start-up eligibility for IPOs utilizing indicators higher suited to innovation-driven companies. — VNA/VNS Photo Văn Phúc |
HÀ NỘI — The Ministry of Science and Technology has proposed easing preliminary public providing (IPO) necessities for revolutionary start-ups by eradicating the requirement that firms have to be worthwhile earlier than itemizing.
The proposal was submitted as a part of feedback on a draft modification to the Law on Securities within the context that Việt Nam is accelerating the event of the innovation-driven start-up ecosystem.
Under present rules, firms in search of an IPO should fulfill 9 situations, together with recording earnings for two consecutive years earlier than the providing, having no accrued losses and sustaining a minimum of VNĐ30 billion (US$1.1 million) in constitution capital.
The Ministry of Science and Technology stated that present rules have been stopping high-growth know-how corporations from accessing home capital markets.
These necessities don’t replicate the enterprise mannequin of know-how start-ups, which generally spend their first three to 5 years investing closely in analysis and improvement (R&D), product improvement, know-how testing, enterprise mannequin refinement and buyer acquisition, in keeping with the ministry.
Such firms typically settle for sustained losses throughout their early levels to construct long-term progress, making it troublesome to satisfy profitability necessities for IPOs regardless of sturdy progress potential.
The ministry warned that sustaining the present rules might discourage fast-growing start-ups from itemizing in Việt Nam and immediate them to hunt abroad capital markets as an alternative, probably diverting funding away from the nation.
Instead of relying totally on profitability, the ministry proposed assessing start-up eligibility utilizing indicators higher suited to innovation-driven companies, reminiscent of income progress, R&D expenditure as a share of income, firm valuation and backing from enterprise capital funds.
However, in keeping with the Ministry of Finance, which is getting ready amendments to the Law on Securities, the prevailing IPO necessities are meant to make sure firms have achieved a fundamental degree of economic stability earlier than elevating funds from the general public, and to defend buyers and preserve the standard of the inventory market.
The proposed various indicators should not standardised accounting or monetary measures and should not adequately exhibit an organization’s capability to generate sustainable money circulate, and utilizing such standards might trigger subjective assessments and problem for regulatory oversight.
The finance ministry is as an alternative finding out a separate capital market mechanism tailor-made to revolutionary start-ups, alongside the event of a specialised buying and selling platform.
Việt Nam’s start-up ecosystem has expanded considerably lately, with round 4,000 revolutionary start-ups by the top of 2025, together with two know-how unicorns valued at greater than $1 billion every, particularly MoMo and Sky Mavis.
The ecosystem additionally consists of 208 funding funds, 84 incubators, 40 enterprise accelerators and greater than 20 start-up assist centres nationwide.
Earlier this 12 months, the Government authorised the nationwide technique on revolutionary start-ups, which goals to extend the variety of revolutionary start-ups to a minimum of 10,000 by 2030 as a part of a broader goal of 5 million enterprise entities nationwide.
By 2045, the technique envisions one in each ten residents participating in entrepreneurial exercise, one enterprise for each 35 residents and roughly one revolutionary start-up for each 5,000 folks. At least 100 start-ups are anticipated to achieve valuations exceeding $100 million, with the enterprise capital market increasing to $10 billion.
Unlocking capital circulate by the inventory market is taken into account essential to turning these long-term nationwide ambitions into actuality, particularly as enterprise capital funding has slowed from its 2021 peak.
According to VinVentures, Việt Nam recorded about 41 enterprise capital offers price roughly $215 million in 2025, down 30 per cent from the earlier 12 months. — VNS