Business idea: building and hiring for digital company in Vietnam
Hey guys, welcome to this new video Today. We're going to talk about how can you build the tech company in Vietnam? When I talk about tech, it can be, how can you find and how can you hire your talents to join your team? Either maybe you are expanding your business to Asia, and you found that Vietnam could be a great place to expand your activity, or maybe you already have a business overseas, and you are looking to hire talents located in this part of the world. And you are considering Vietnam as a place to hire people in the tech and in the digital field.
So in this video, I will try to go to different very important components. So you can figure it out if Vietnam may be a good place for you. But more than that, how can you start to set up a company, Or how can you start to hire people to grow your business and to expand in Asia. Let's get started.
So, first, why Vietnam could basically be a very good place to set up a tech business First. The country has a very good stability, The country is open for 20 - 30 years ago. And for the last 10 - 15 years, many foreign companies are coming to Vietnam, because you have a manufacturing hub because you have a growing demographics and very growing and booming economy. So basically, it's a frontier market. So many people are targeting this country to invest.
Then this country is also very cost-effective. You know, probably, if you've been to Asia, that in this part of the world, cost of living is very cheap. So here in Vietnam, you can find good talents. And obviously, you can pay them lower than what it could cost you if you want to hire people in your home country, Europe or the US. And then the third point is because you have this very good fundamentals : a very growing demographic with a lot of young workforce. It's also a place that you can consider to scale your activity.
Let's say you start, you hire to three people, and then your business work. You want to scale it. Then it's quite easy to find and to duplicate What you already did and hire people to join your team. So if you want to come to do business in Vietnam, usually there is three main location that we consider.
The first city is Ho Chi Minh City also called Saigon. So this is the megalopolis of around 10 million inhabitants. This city is considered as the booming and economic hub of Vietnam.
Then you can also consider going to the north, and then you will go to Hanoi. That is the capital of Vietnam. And then you have a third city that is more and more under the spotlight of the tech and the digital in Vietnam. This place is called Danang. You have also a lot of Startup located over there.
Then you have a lot of different verticals as well, because you have people working in different fields, right? So if you find, and if you are looking for people for the banking industry, you will find it here to finance is the same. the insurance, the same, all the different subjects you have here as well. Lot of various kind of profile with different backgrounds are available in Vietnam.
And you have also a lot of new trends like the blockchain and AI. The big data is also available here, just because we had recently for the last five, seven years, more and more tech companies that are really disrupting the market. And they are sometimes in the blockchain-related technology.
So you have more and more people that have this skill that you can hire in Vietnam. Now, what about the lack that we observe in the IT workforce in Vietnam? Maybe the first and the main like foreigners may face when they wanna come to Asia and specially Vietnam to do business and to hire team, It will be the language barrier. Obviously, in Vietnam. When we talked about the IT people, maybe you, if you want to deal on a day-to-day basis with someone that is an IT person, is going to be very hard to deal with him. Obviously, if you go to people who are more marketing, who are more sales, those people will tend to use more English and to maybe be more learning English while they are studying.
Maybe some of them will have an experience overseas. But if we focus on the IT people, it may be one of the main challenge. Then the second thing that we observe is about the lack of creativity. So don't don't get me wrong, Like some people are very creative here.
It's just that in general. If you talk to tech people in Vietnam, Sometimes you see a little bit more a lack in the creativity. So it will be your main role as someone who's going to hire them to tell them that they can take initiative. And I can show you how creative there.
Then the third component is the MOA (project owner). So you know, when you tell someone what you expect on the functional aspects, sometimes they won't really catch it. So you have to really start make them understand what is behind it. What does the feature and what is like, the scope of knowledge they have to work for? So this is something also, you have to put more effort that maybe in some Wwestern countries or in the USA. Then finally, the last lack that we have in Vietnam, It would be maybe more on the client mindset. So here is the same most of the offshore and outsourcing companies here in Vietnam.
They have some people who are just directly dealing with the customer. Let's say you have a customer or see, you have someone here and physically here in Vietnam that we will be the middleman and dealing between your customer and then the IT people So expect to have maybe someone here that can be a key person that can represent your company and deal on a day-to-day basis with your developers here in Vietnam. So usually the common ways we get started and we start this entrepreneurial journey in Vietnam and build a Tech team. It's Number 1 : You need to set up your own entity in Vietnam.
So do you have to work with a lawyer? You have to set up your company. I won't go deep in detail In this video. You can find another video that I made on the channel When I explain you really in-depth How does it work to set up this kind of company for foreigners. But basically, when you will come to Vietnam first, you do your market analysis, right? So if you have a project idea, I recommend you to spend three to six months to come here. You know, you get to know the market, you check it to be the competitor.
If there is any players in the market that you are targeting. You can also maybe start to build some relationship to find partners. And then, after, when you ready, find that your business idea may work in Vietnam. Either you are coming to expand your business.
Whether you are coming here to source and find talents to provide Workforce for your business that is already located Overseas, then you have two main step is to get the IRC. And the ERC for your business. So the Investments registration certificate and Enterprise registration certificate.
If you find a trustworthy and legit lawyer, they can go through all the steps for you. And then why you have your company that is set up, then you have to go through the hiring process. So here, it's the same either you work with a headhunter based in Vietnam, either you work with a partne who is going to help you to hire talents that you are targeting to join your team.
And then after up, let's say, two, three, four months, You can be ready to operate in Vietnam. If you plan to come here and to get also investor visa, we usually recommend to invest from 10 to 20 thousand dollar in your company just to have a company that has enough capital and cash to start to operate as a foreign owner of this company. You can obviously have long-term visa. So now, what about the pros and cons of this approach? Basically, if you own and you see to set up your own company, you have 100% control, right? Because you will create, for instance, a 100%-owned foreign company in Jenna.
It's also very easy to scare, right? Because when everything is ready, then you can just have a staff here. Have or build a team here. You can have your payroll here. Basically, you may need to hire a HR (Human resource).
They're going to take care of this part. Basically, you can really grow and scale your company in Vietnam, And for the long term is also more cost effective of you see, because you have everything under control. So you can really check and compare The payroll, find good people with good rate here, build a team and really prepare everything For the long term and for the long run of your company. Now, the cons, I would say, and the downside of using and setting up your company is that you may have some risk, right? You may find not trustworthy person that you will deal with any takes time or social company right? Specially. Nowadays, the border is still closed, So it's maybe a little bit hard to come to Vietnam to do your due diligence and to do your market study. So it's obviously something that is always there.
When you I'm not very familiar with the market, then the other consider that you need to rely on a partner to set up everything for you. But as soon as this is done, then obviously you are 100% in control of your company. And in this setup Also, you have more upfront costs. Of course, you have to set up everything, right? Let's say you want to get your investor visa. You need to put some capital inside the company. So obviously the upfront costs are more expensive, but for the long run, this is the best solution that you can have If you want to start to operate and build a tech team in Vietnam.
Now, the second option that you have, if you want to come to Vietnam, to build a digital team, is to find a hiring partner. So you can find HR companies, Freelancers, recruiters, you know, who will spend time for you. And as soon as they die know which kind of people you want to hire, That would be about to go to meet talent, to benchmark them.
And finally, to provide you talents that you can hire, you have to check if those people are also taking care of the training. And maybe some companies will also provide you the training to be sure that those new talents are fitting with the expectation you have for your company's. Also, those hiring partners may provide you the payroll solution. So let's say you are still oversee. Let's say you still have a company in another country, and you are considering coming to Vietnam. But you don't want to take care of all the payroll aspect.
Then. This is also something you have to consider, because if you hire a staff here that we expect to have, you know, your their salary, but the annual leave, Etc. You have to be aware that if you want to maintain someone for the long run here, Because in Vietnam, the market is very volatile. The young people, the Millennials, they have a lot of choice. So if you wanna keep people committing working with you, the payroll solution is You have to have in mind when you want to come to Vietnam to find talents, Then you also need, obviously, to have someone that helped you on the legal aspect, right to do the paperwork appropriately to be sure that the person have the proper payroll terms, Etc.
And then you can also find people that going to help you to find a workplace. Obviously if you have your team that are all working remotely. It may be able to be frustrating some time for them.
They maybe prefer together and to have a workspace, It can be first, you know, renting an individual seat, a hot-desk or flexible desk in a co-working space, and then find fine after how you can have your old team working from the same place in Vietnam. And finally, you have also other HR Consulting at is also important. We just mentioned before, which kind of contracts.
How do you keep and maintain your staff to be sure that they commit for you? This is also a HR Constructing. The some hiring partners may provide you. So what about this option? If you are working for and with a not hiring partner here? Obviously it's very effective, Right? Because you just need to have someone here that will take care of everything they will have consulting services But you can't really get started and start to operate very fast. This is very easy. You don't need to have a company incorporated in Vietnam.
You can just start to do your market study while doing that. And then after a while, you can really consider setting up your company If this is something that works. But first finding a good and trustworthy hiring partner provide you a very easy to enter the Vietnamese Market in the hiring. And then it will also help you to save initial operating cost. Obviously, I just mentioned you don't need to put thousands of dollars on the table, just like putting capital inside the company. You Just need to pay maybe consulting, or a partnership contract with those people, and they can take care of everything for you Then.
Now the downside is that, of course, if you have those kind of middleman taking care of the hiring aspect, you will have after to take care of the training. So you have to be sure that you will have strong team engagement and get that can be the disadvantage of using those kind of partners, Because again, you're on praise will be very, you know, volatile, and that they have a lot of offers on the market. So they may find a better offer if the inductor and of happy working with you, Then the other thing and the other cons is that you need to build a people-focus solution. Obviously you need to maintain, and you need to retain the staff and it may be very hard and very challenging. Why, working with Gen Z and the Millennials in Vietnam.
So finally, you know, this is very good for short-term operation. But if you have a long-term vision, you may have long-term costs that will always be added to this kind of service, of course, because you're hiring partner will take a cut on the hiring. We take good care to maybe on the payroll aspect.
So if you are looking for a long-term solution, you should consider setting up your company in Vietnam. And now, finally, we have for the last and the third option that people consider while building a team and finding partners in Vietnam to provide them software development. We call here to outsourcing companies. So there is a lot of IT development companies in Vietnam. They can be either locals at the foreign-owned companies, or just joint venture between some local firm and some foreign investor. And they built outsourcing and offshoring companies in Vietnam Here, usually the way they work is that they work on a project basis.
So you're going to come to them. You're going to kind of discuss with them, and they're going to basically provide you a package for the project. So let's say you need to build a website. You need to build an app. They will tell you that it may cost around another 30 day of work from x amount of people, and they will hire the staff for you.
So you don't have Have to deal with this hiring aspect sometime They already have in-house the staff that is already in their ecosystem or they will use, and they will hire just on the flow to be sure that I can provide you the software that you are looking for on time. So this is a very good way or so to get started. If you want to offshore your software development in Vietnam, You have a lot of diversity as well.
So depending on the technology that you are aiming for, All you may find companies that are more software oriented, back-end oriented, or ERP or product that are already on the market, like WordPress, for instance, web as well ... I mean, you have various range of offshoring companies on different scope of IT development. Then for the scaling.
It's also a good and bad. It's like, of course, if you are relying on them, they will take care of everything. But then, of course they will take.
their cut right, because they won't work for free. So every time they go to hire someone every time they know they're going to add a little bit extra hours to be sure that they can provide you the software. sSo it's good for scaling.
But if you think very long-term and let's say, if you really want to enter the Vietnamese Market, obviously always having your own company in Vietnam will be the best. Then you have a lot to have foreign and local players here. You can do your own due diligence, meet and catch up with difference of those companies, and find which one is more appropriate for your product. They will also provide you maintenance. So let's say if you are looking for people here just to monitor some processes overnight, you know, here you have a lot of companies as well.
So this is something you can consider that what you are looking for. And they have finally, a warranty. So they may, and they will kind of commit to deliver you order release, and all the source code, Etc. Always do proven tests on time. So this is something they will take care, and they provide extra work if they are not able to provide you all the release on time. So there is always pros and cons in each different setup.
Here obviously if you choose IT offshoring companies : it's very flexible, right? So you can just pick them mention all the different offers. It's Project based. So they will just provide you a quotation for your project. If the company is legit and reliable, you shouldn't have any problem working with them. So pretty easy to get started, and to outsource your software development in Vietnam.
And it's really project-based, Right? So let's say you have an amount of capital that you want to use for a certain project. You launch your IT project. you have a first beta version that maybe you can help you to pre-sell or to sell, or to see if you have a certain Product Market Fit.
And then later on, He finally this project was, and you can find if you still work with that company, or if you find, and you hire your own team to develop your software, The cons is that maybe is not very relevant for startups. I have a lot of friends here working for the startup, and they mostly all have their own it people, and in all the digital components and digital field, in how so they don't rely a lot on offshoring companies in Vietnam. And it's also a very competitive market. So you should really benchmark the different offers. They are pretty pretty aggressive here on price in Vietnam. So better, I can be to compare the different offers to be sure that you find a company that is legit that will do the work properly.
But that also have competitive price. And so finally, the last cons is that obviously you have more upfront costs, right? Because they will provide you the whole package. Usually I know for foreign customers, They will have some staff that we speak usually your language.
So let's say, even for French people, Some people here are French, and they will have some middleman that will provide you everything In French or for the end customer. Everything is transparent, and they think that they are working with French people. But behind this is usually Vietnamese workers who are working as the IT developers. Hope you guys enjoyed this video.
Hope you give you a clearer illustration about how is it in the tech industry and the hiring process in Vietnam, You may have a new may see different fits and a different option that may be more relevant. And to learn more about this, You can check in the description, I will leave you some resources, and I will also provide you a link that you can click. You can also fill the form, and we can get in touch with each other.
You can tell me what's your situation now? What's your plan into hiring, or expanding your activity in Vietnam? And I will be 100% transparent and tell you, what do I think about your ideas, and is it realistic to do it. And if yes, how you I proceeded to get started, Leave a thumbs up. If you enjoy the video, don't forget to leave a comment below and tell me, what do you think about those different hiring aspect and what you would do, if you want to come to Vietnam, to set up a tech company? I'm willing to listen everyone.
So don't hesitate to drop me a line in the comments below. Hope you guys enjoyed this video, and I'll see you in the next video. Thank you. Bye-bye.