Ho Chi Minh City Proposes $70.8 Million Venture Capital Boost

Ho Chi Minh City wants to commit up to VND1.8 trillion ($70.8 million) in municipal funding to its venture capital fund from 2027 through 2035. The city’s draft resolution would lift the Ho Chi Minh City Venture Capital Fund Joint Stock Company’s charter capital to at least VND5 trillion ($196.8 million).

How large is the commitment?

At an October 28 review meeting, the Economic and Budget Committee of the Ho Chi Minh City People’s Council examined three draft resolutions. They covered local government bond issuance, domestic financial institution loans and charter capital supplementation for the city’s Venture Capital Fund.

Tran Trong Tuyen, deputy director of the Ho Chi Minh City Department of Science and Technology, reported on the fund’s rationale, capital increase roadmap and coordination between public funds and private capital. The fund’s business registration certificate, issued on April 10, recorded VND500 billion ($19.68 million) in charter capital.

Private capital supplied VND300 billion ($11.8 million), or 60%, while the state supplied VND200 billion ($7.87 million), according to the registration dossier. The VND5 trillion target would equal ten times the initial charter capital, while the state’s proposed maximum contribution would equal four times its starting investment.

The registration split put 60% of the starting capital with private investors. The decisive issue is how much additional private capital the city can attract.

How does the matching mechanism work?

The municipal People’s Committee proposes adding up to VND200 billion ($7.87 million) from the state budget each year. With the initial VND200 billion state contribution, total state support would reach a maximum of VND2 trillion ($78.7 million) by 2035, according to the submission.

The city would apply those funds over nine years, from 2027 through 2035, within the VND1.8 trillion ($70.8 million) supplementation cap. The annual ceiling equals 40% of the fund’s initial charter capital, while the full state commitment would reach four times its starting contribution.

State allocations would depend on private fundraising. The submission dossier ties funding to "private capital mobilization outcomes" and specifies a "matching ratio" calculation when private fundraising falls short of targets.

If private capital exceeds expectations, the proposal would still cap annual state additions at VND200 billion ($7.87 million). In a shortfall, the state would cushion the gap on a matching basis; in an overshoot, its annual exposure would remain bounded.

The matching rule caps the city’s commitment while shifting part of any fundraising shortfall to public funds. The annual and cumulative limits give taxpayers a defined boundary.

What did delegates say about investment risk?

Delegates said the capital allocation must account for resources devoted to science, technology and innovation. They also called for governance mechanisms, portfolio evaluation methods and risk-control frameworks for venture capital investments, according to the committee.

The committee’s comments put the fund inside a broader public spending and investment-governance framework. The account of the meeting does not disclose portfolio-exposure limits or the formula for calculating a matching contribution.

The proposal acknowledges investment risk without publishing a portfolio ceiling in the account provided. Oversight design will matter as the state’s exposure rises.

What borrowing accompanies the fund?

The Department of Finance presented a separate draft resolution covering municipal bonds, project bonds, construction bonds, urban bonds, green bonds and loans from domestic financial institutions. The instruments would finance local development projects, according to the department.

Ho Chi Minh City expects to borrow up to VND49.29 trillion ($1.94 billion) domestically from 2026 through 2030 to cover budget deficits. The ceiling includes VND17.55 trillion ($690.9 million) on-lent from government borrowings and VND31.73 trillion ($1.25 billion) raised domestically, mainly through municipal bond issues.

The resolution seeks to diversify financing for urban railways, transport infrastructure, regional connectivity projects, environmental work and digital transformation. Delegates urged the city to match borrowing schedules with project implementation capacity to prevent unnecessary capital costs.

The VND49.29 trillion borrowing ceiling is more than 27 times the proposed VND1.8 trillion fund contribution. That puts the venture capital proposal inside a far larger financing program whose delivery and borrowing costs the city has already flagged.

What remains undisclosed?

The meeting account leaves three details unstated: the matching formula, the private investors and the performance thresholds for capital mobilization. The full dossier may contain them, but the public record provided does not allow an outside test of whether the leverage assumption holds.

The proposal’s arithmetic requires at least VND3 trillion from private sources if the state reaches its VND2 trillion ceiling. The proposal does not say how quickly that money must arrive or what happens if the private target remains unmet.

For investors, the state commitment offers a defined ceiling and a matching mechanism, but the proposal presents no guaranteed return. For taxpayers, the unresolved issue is whether private capital arrives quickly enough to justify a public commitment of up to $70.8 million.