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Vietnam big blip on IDG’s radar

IDG conducted its first Asia Pacific Managers meeting in Hanoi last week to raise awareness about Vietnam’s IT industry as it’s top priority. Van Anh talks with Patrick J. McGovern, IDG chairman of the board, about the company’s plans for Vietnam.

What is the purpose of the Asia Pacific Managers meeting in Hanoi?

“The IT market is one of the fastest growing in the world and they will tell more of their national companies to come and invest in Vietnam.” – Patrick J. McGovern
For this trip I want to introduce leaders of IDG companies throughout Asia and headquarters personnel to the reasons why I think Vietnamese companies are the most attractive for IDG to expand in the next 10 years. So we organised the annual AP Managers meeting to be here in Hanoi.

In our 13 years history in Vietnam, we have experienced a rapidly growing market opportunity. All headquarter executives and company leaders should be aware of it and we want to emphasise our rapid development here. They will be back and talk to their headquarters offices in Japan, China, Singapore and India, about the areas that we raised – the Vietnam market as top priority – because people are very enthusiastic about IT, the government supporting additional investment and GNP growing rapidly. The IT market is one of the fastest growing in the world and they will tell more of their national companies to come and invest in Vietnam.

Forty-five delegates from 11 countries came and they were extremely impressed by government officials and policies involved to make direct foreign investment more effective. Our full support of e-government development in IT throughout government activities, especially the service sector, will be great. [Vietnam’s] commitment to IT education for the 20,000-25,000 who will be trained in these areas this year and preparation works for us in IT are being accelerated, and commitment to use cyber upgrades to connect internet access through schools and libraries throughout the country so young people in all parts of the country will have great access to broadband and internet.

What is the plan for the IDG venture funds?

We have just completed the first two investments into iSphere, which is offering customised IT solutions for major corporations, and PeaceSoft, which has an online market place where people buy and sell products which is growing rapidly.

We expect to announce two more investments [into Vinagame and Vietnamworks] and to make one new investment every two months. So by the end of the first five years, we will invest in 30-35 companies then after we will establish the new investment for the first five years and use the remaining money in the fund to realise the second or third round of investment for the company portfolio and then we start new finding out for the next five years to expand larger investment in the new companies.

In 2010, we will establish a new fund with total investment capital of $150 million compared to the first $100 million fund, in 2015 with $200 million, and in 2020 with $300 million, and in 2025 with $450 million. So in over 20 years, we will raise capital in Vietnam to $1.2 billion and have actually invested $600 million at that time in 150-180 companies. The rest of money we will use to make further investments into 140 companies who have invested in Vietnam. We think of Vietnam as a top priority, not only in terms of venture capital activities, but also expansion of our information services to training, market research and many new publications.

How will IDG focus on market research?

We have IDC as the largest IT market research company in the world , and we have a team to [analyse local plans] to buy PCs and IT products and provide that information to the market here and internationally so we can share more forums and more databases to people in order to make their investment decisions in Vietnam. IDC covers all parts of hardware, software and services, so they do research on the basic computer system market, enterprises as well as PC market research, market storage, market security for IT and for database management.

What will IDG’s presence be in Indochina?

Vietnam has started to expand responsibility for the head of IDG Vietnam, who is also in charge of Cambodia and Laos. At the same time, we arranged two major [Asia Pacific Managers] conferences and at the CIO conference awards gave awards to 10 outstanding CIOs in Vietnam, Cambodia and Laos.