Vietnam has long become a strong growth market for many industries as the size of the market and the improving infrastructure is driving innovation in the market. Fintech in the country is booming, as more investors and financial institutes look to break into the market.
The country has produced many strong fintech startups that are driving innovation in the financial industry and bringing digital finance to consumers. Once such startup is Anfin, a Vietnam-based fintech firm that offers a stock trading platform. They recently announced a USD4.8 million funding round led by Clement Benoit and Y Combinator.
To find out more about Vietnam’s growing and evolving fintech industry, we speak to Michael Do, who is a Co-Founder and the Chief Product Officer of Anfin. Prior to starting Anfin, Michael was an Investment Banker at Lazard, Product Manager at Machine Zone, and Venture Capital Investor at BEENEXT.
Why Vietnam might be the next martech hub for Southeast Asia
The new funds will be used to strengthen product development, especially its social investment product which lets users host and join live audio rooms. This is to create a social component for investors on their platform to interact and share insights and more.
Here’s what Michael had to share with us.
Congrats on the investment. Could you break down how the money will be used?
The money will be used for product development and growth initiatives. Specifically, we are building a social investment product that allows users to share trades and ideas in a fixed format with a global community of Anfin users. By employing newsfeed ranking algorithms and the usage of a “bull and bear” like system (staying relevant to the culture of trading), we can identify and feature top traders on the app. Building this feature directly in the app reinforces trust as the investment profile features metrics that highlight an investor’s track record, risk level. This is Phase 1 and Phase 2 will include influencer-driven incentives to help others invest.
Vietnam is an interesting market, could you give us insight into the local fintech landscape there?
According to Vietnam Securities Depository Center, the Vietnam Government aims to increase the rate of the population which invests in the stock market from 3% in 2021 to 5% and 10% in 2025 and 2030. The stock market’s participation rate has reached 5.2% of the population, thus proving there is increased interest in stock education as a potential investment channel.
Recently, there has been a surge of new Fintechs focused on investments, such as Finhay, Infina and Tittitada. The space will be competitive offering users the best trading experiences, lowests costs, and access to new financial products faster. There is also increasing competition for the acquisition of brokerage licenses – which have greatly driven up the price.
What are the challenges you foresee in the next 12 to 24 months, when it comes to expansion in the market?
Bear markets typically cause investors to buy less and hold more. The greatest challenge is how to engage users with products while they have less money to invest. In addition, Vietnam’s investors are becoming increasingly picky and sensitive to fees and promotions because of the increase in venture funding in the investment space which cause companies to become more generous in acquisition.
Do you see the growth post-COVID and into a bear market continuing?
We follow a strategy of product-led growth. We do not try to grow aimlessly every month. Instead we let our stable feature releases guide how we spend our marketing dollars. At the moment, Anfin holds a relatively small market share and there are big opportunities to win over users when they’re investing less and open to trying new products. We do not foresee the bear market being a factor for us besides users trading less. This is because we have other metrics to target.
Could you elaborate on what the metrics are and how you plan to sustain growth given an expected decrease in user activity?
The plan is to build social features that drive MAU growth despite an expectation that users may trade less i.e. less MTU (monthly transacting users).
What’s next for Anfin?
We will continue to grow our metrics and observe the fundraising climate. We expect to raise our Series A early-mid next year.