HANOI – Vietnamese tech startups experienced a significant downturn in funding in 2024, raising just over US$120 million, according to data from market intelligence platform Tracxn. This represents a sharp 38.7% decrease compared to the $196 million raised in 2023, and a dramatic 77% drop from the peak of $518 million in 2022.

Despite the decline, Vietnam ranks 51st globally in tech startup funding, positioning it ahead of Iceland and Luxembourg. The US, UK, and China continue to lead the global funding landscape.

A closer look at the 2024 figures reveals a continuing downward trend throughout the year. Funding in the second half of 2024 totaled $53.6 million, a 19.63% decrease from the $66.7 million raised in the first half, and a substantial 41.68% drop compared to the same period in 2023. However, the fourth quarter of 2024 showed a glimmer of hope, with funding reaching $35.1 million, a significant 89.73% increase from the third quarter’s $18.5 million, and a 68.75% rise compared to the fourth quarter of 2023.

While overall funding declined, late-stage investments offered a positive note. Reaching $14.2 million in 2024, these investments signal a potential recovery after a slowdown that began in 2021. This contrasts sharply with the decline seen in other investment stages. Seed-stage funding dropped by 32.37% to $11.7 million in 2024, compared to $17.3 million the previous year. Early-stage funding also suffered a significant blow, plummeting by 47.26% to just $94.4 million in 2024, a considerable decrease from the $179 million recorded in 2023.

The overall decrease in funding across most stages highlights the challenges facing Vietnamese tech startups. While the fourth-quarter uptick and the resilience of late-stage investments offer some encouragement, the sector faces a long road to recovery to reach previous funding levels.