Monuments of Innovation

(For old acquaintances, on the occasion of the inauguration of the National Innovation Center in Hoa Lac. Thanks to VNEXPRESS for posting a version of this article)

Twenty years ago, I formed a tech company with friends, becoming a director in my early twenties. Back then, the startup fever had not reached Vietnam, or I would have proudly declared myself as a founder.

The company, consisting of seven people, dedicated much time to tasks like assigning fancy titles to everyone, building the company website, designing a logo, choosing a slogan, making business cards, setting up email addresses, opening an office, purchasing furniture, acquiring equipment, and signing papers to define roles and responsibilities.

We had all the necessary elements for a business, except one thing: paying customers. As a result, the company closed its doors without generating any revenue.

For my second entrepreneurial venture, I decided to avoid flashy embellishments and focus 100% on finding and serving customers. It took until the second year for the company to have a website and until the third year for a small office to be established, with no specific titles for anyone unless communication with clients was required.

In essence, we've only done what was necessary to operate the company, emphasizing revenue generation, market expansion, and talent attraction. Today, we have a competent team, decent revenues from satisfied customers.

Between these experiences, I spent nearly 12 years working at Google. Google is known for its beautiful offices, but few are aware that, for much of its history, Google leased spaces and renovated them rather than constructing new buildings.

Google only considered building its headquarters in 2015. Yet at the time, there were concerns that the company had run out of creativity and no longer knew what to do with its money.

The key to business success is to create something that many people want. Silicon Valley companies don't rush to build headquarters because constructing ten buildings won't help them solve the world's pressing problems.

Innovation is a vague, costly, and error-prone process. According to the U.S. Bureau of Labor Statistics, 50% of businesses will close within five years, and 65% will shut down within a decade. The primary reason startups failed is creating things nobody needs, also known as misaligned product-market-fit. The second reason is running out of money. No startup has ever failed due to a lack of office space.

National Innovation Center, Hoa Lac (source)

Annually, the Singapore National Cybersecurity Agency organizes a competition to find solutions for major cybersecurity challenges. The Singapore government commits to funding up to one million SGD, without claiming any rights or equity in the projects. The only requirement, but a wise one, is that winning teams must register a business in Singapore and employ a workforce consisting of at least 50% Singaporeans. I know of at least one team from Vietnam that was selected and is currently operating as a Singaporean entity.

The U.S. government also has various direct sponsorship programs, tax cuts, or rebates for startups and small businesses. The Small Business Innovation Research program, established in 1982, continues to disburse an average of 2.5 billion USD annually to small companies to promote research and development, technology transfer across all fields.

An expert told me that Vietnam cannot emulate other countries because those who receive the state’s money and operate at a loss will be held accountable and may face imprisonment. Perhaps, first and foremost, authorities need to review and innovate the regulations that hinder creative initiatives.

"Build something people want" is the motto of Y Combinator, the private technology incubator that birthed unicorn companies like Dropbox, Stripe, Airbnb, or Doordash. They are considered monuments of innovation, solving many real-world problems, even though behind them are thousands of dead companies.

To stimulate innovation, one must avoid embellishments and embrace failure. Otherwise, I’m worried that Vietnam will only construct monuments that look innovative but do not address any pressing problems.