500 Startups’ latest move in Asia is a $10M micro-fund in Vietnam

500 Startups is continuing its efforts to tap on Asia’s fast-growing startup scene after the U.S.-headquartered VC firm announced a $10 million fund in Vietnam.

The effort is led by Binh Tran and Eddie Thai, two partners 500 Startups hired last year, and it is its first in Vietnam and latest in a series of country-led initiatives. In Asia over the past year, 500 Startups has introduced funds in Japan ($30 million), Korea ($15 million), India ($25 million) and Thailand ($12 million), and doubled the size of its kitty for Southeast Asia to $20 million.

Vietnam is viewed as promising for a number of reasons. The country has a 90 million population, over half of whom are aged under 30, and is a mobile-first market with huge potential for technology and internet businesses. To date, politics and culture are among the factors that have prevented international VCs setting up shop in the country in droves, but Thai hopes to push things forward.

“The timing is right,” he told TechCrunch in an interview. “Ten years ago when VCs first came here there were around four million internet users, now there are around 40 million. There really is potential to grow connectivity, income and spending.”

Entrepreneurship and startups have shown signs of promise in Vietnam for some time, as a New York Times article last year chronicled, but Thai believes this is just the start.

“We really want to bring this to the next level, [and make the country’s startup scene] more efficient, professional and founder friendly — and ultimately build companies that can exit,” he said.

The $10 million fund isn’t ready yet — a first close is likely this month with a final close expected in June — but already Vietnam-based Thai and former Klout CTO Tran, who is located in Silicon Valley for deal flow and cross-border opportunities, have dipped into the money. Thus far, 500 Startups has invested in at least six companies with connections to Vietnam, be that overseas with Vietnamese founders or teams on the ground in the country.

500 Startups is known for its prolific investment volume — it has put money into more than 1,500 companies worldwide — and that approach will continue in Vietnam. The fund is expected to yield 100-150 investments that will vary from $100,000 to $250,000 in check size. As is the case with its other micro-funds, that’ll predominantly cover early-stage rounds which are shared with co-investors.

Beyond spending money, the 500 Startups Vietnam team wants to develop the local ecosystem by educating investors, founders and others players. 500 Startups well known for its global accelerator program and, while there’s no plan to set anything similar up locally, but Thai said they will “support” those building early-stage programs. Beyond helping startups apply for the 500 Startups’ accelerator program in Silicon Valley, he said the Vietnam partners may also launch a version of Distro Dojo, a post-funding growth program that the firm has run worldwide.

But the focus isn’t just on igniting the startup spark at home, Thai wants to connect the dots globally. He said there’s a strong diaspora of tech talent overseas that may want to return/or be involved at home, while others are looking in, too.

“[The fund’s LPs include] overseas diaspora who understand Vietnam, want to do angel and seed investing, and see this as a way to get returns and help build the country. Overseas companies want to expand [because they] find domestic growth harder — in Japan and Korea, for example. They want access [to Vietnam] but don’t know the way,” he explained.