For Andy Ho, managing director at VinaCapital, the ecosystem is the key. “We call it investing in the ecosystem. Who are the players we can invest in to support that ecosystem?” he says. “We invest in sectors that contribute to and benefit from the growth of the domestic economy.”

As one of Vietnam’s leading investment management firms, with $1.3bn in assets under management, VinaCapital plays a central role in taking local businesses public and bringing FDI into the country.


Many sectors are set to benefit, thanks to Vietnam’s striking FDI growth in recent years. The south-east Asian country of 95 million people recorded $24.4bn in FDI in 2016, up 7% on the previous year, benefiting tremendously from inflows from Asian powerhouses South Korea, Japan, and Singapore in sectors such as manufacturing, retail and real estate.

A range of advantages

Proximity to China, a growing domestic market, cheap labour and government incentives such as tax breaks and ready-made infrastructure have all propelled Vietnam’s FDI to its current position, to the point where it makes up nearly 20% of the country’s GDP. “As people get wealthier they are going to move to the city, buy homes, improve their amenities. So we invest in property development, hospitals, pharmaceuticals, education, banks, financial services – all that basic stuff,” says Mr Ho.

Raised in the US, Mr Ho graduated from Massachusetts Institute of Technology’s business school and worked as director of investment at Prudential Bank Vietnam following management positions at Dell Ventures in Texas and Ernst & Young. His experience equipped him with specific skills central to managing VinaCapital, which now has three offices across Vietnam and a fourth in Singapore.

“Managing money for life insurance at Prudential gave me some discipline in terms of looking at what has investment potential, and in understanding the risk and return profiles in places like south-east Asia,” he says. “Prior to Prudential I invested money for Dell computers. In the tech start-up or venture world, you have to take a lot more risk than normal, but you obviously want more return. That’s somewhat similar to what we do in Vietnam: we take a big risk and ask for quite a bit of return.”

Local knowledge

Another key to Mr Ho’s success is his familiarity with the local market. “Our strategy is to look for opportunities that are not available to other investors,” he says. This includes exchange-traded funds and large multinational investment funds. “We look at opportunities to invest in companies before they list publicly, or we look at state-owned enterprises [SOEs] being privatised,” he adds.

“We look for good businesses with brand names, distribution channels and manufacturing scalability, and invest between $10m and $40m. We help strengthen the management team and corporate governance, give them depth and capital. We sit on the boards and offer minority protection, and we prepare them to sell to the multinationals who want to access Vietnam in the form of FDI.”

VinaCapital also has a technology fund. “We look for new tech ideas to invest in, which in themselves will attract FDI,” says Mr Ho. When Intel entered Vietnam to build its largest chip factory, for instance, it had to invest in the tertiary system around the factory. “So a lot of the start-ups we invest in help support the ecosystem that Intel needs,” he adds. “And at the same time, we make a lot of money.”

That is the company’s unique feature, according to Mr Ho. “And we’re able to do that simply because I am Vietnamese and our CEO is Vietnamese, yet we also bring to Vietnam international experience,” he says.

Too much of a good thing

One concern Mr Ho highlights is that while FDI is a good thing, too much at once risks hollowing out the local economy, because domestic businesses have less access to cheap capital and incentives, and will struggle to compete with multinationals. He therefore emphasises continued privatisation of SOEs, extending government incentives to Vietnamese enterprises, and investing in local brand building. 

VinaCapital communicates with the government on these issues, and Mr Ho says it is listening. “FDI is great because it’s creating wealth, bringing in know-how and capital, but we have to create an environment that allows domestic businesses to grow with strength,” he says. True to its roots, VinaCapital appears dedicated to that goal.