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The Ho Chi Minh City (HCMC) People’s Committee has officially approved a proposal to establish the HCMC Venture Capital Fund (HVCF). The fund is designed to provide additional financial resources for innovative startups, foster scientific and technological development, and accelerate digital transformation within the city. It is expected to become a vital financial instrument in driving the city’s innovation ecosystem in the coming period.

The government back VC will operate as a joint-stock company under the name Ho Chi Minh City Venture Capital Joint Stock Company. This model allows for a clear separation between State ownership and private investor interests, placing management in the hands of professional investment experts. This structure ensures that operations remain professional and adhere to market principles.

The fund will operate on the basis of transparency, without State capital guarantees and free from administrative interference in specific investment decisions. The organizational structure will include a General Meeting of Shareholders, a Board of Directors, a Supervisory Board, an Executive Board, and an Independent Investment Council. Furthermore, the fund will hire professional fund management firms or investment consultants to execute investment activities to ensure maximum efficiency.

As planned, the initial charter capital for the fund is expected to be approximately 500 billion VND upon its establishment in 2026. Within this structure, HCMC PC Budget is 200 billion VND (40%); Private Investors contribute 300 billion VND (60%).

In the 2027–2035 period, the fund will flexibly increase its charter capital annually, targeting a minimum scale of 5,000 billion VND by 2035. In this long-term structure, private sector capital is expected to account for 60% of the total (approx. 3,000 billion VND), while the state budget will contribute approximately 2,000 billion VND or less.

The fund is designed with a “seed capital” mechanism, where every 1 VND of State capital is expected to attract at least 2 to 3 VND from the private sector, effectively mobilizing social resources to exceed 60% of the total investment.

For the 2026–2035 phase, the fund aims to investing in 50 to 150 innovative startups, science and technology firms, and high-tech manufacturers; supporting the commercialization of at least 50 products and technologies; incubating a minimum of 5 large-scale technology enterprises capable of listing on the stock market or participating in Mergers and Acquisitions (M&A).

Investment targets include innovative startups, science and technology enterprises, and high-tech firms or incubation projects that possess product prototypes or patents. Priority sectors include (1) Artificial Intelligence (AI), Big Data, and Blockchain; (2) Semiconductors and Microchips; (3) Biotechnology and high-tech healthcare; (4) New materials, renewable energy, robotics, and automation.

While investment activities will primarily focus on HCMC, the fund may consider investing in enterprises in other provinces if the projects commit to technology transfer, building R&D facilities, or contributing directly to the city’s supply chain and socio-economic development.

The proposal introduces a breakthrough investment management mechanism that allows for “controlled risk acceptance” in venture capital activities. Total losses from investments must not exceed 50% of the State capital portion within one investment cycle. Additionally, fund management teams and State capital representatives are granted civil and administrative immunity regarding loss-making investments, provided that the risks arise from objective causes and the investment process was executed in accordance with regulations.

The establishment of this VC Fund is a strategic move to address the capital shortage for startups and promote the commercialization of scientific research. Although HCMC’s startup ecosystem is the most dynamic in Vietnam—hosting nearly 50% of the country’s startups—the market still lacks large-scale, professional domestic venture capital funds.

The long-term goal of the fund is to help raise the contribution of the innovation and high-tech economy to approximately 20–25% of HCMC’s GRDP by 2030. Currently, relevant agencies are finalizing the legal procedures to incorporate the company, aiming to launch the HCMC Venture Capital Fund soon to provide effective support for the city’s innovative startup ecosystem.