An Introduction to Starting a Software Outsourcing Business in Vietnam

Vietnam's IT industry is expected to rise to 300 Billion USD in 2025. Start a Software Outsourcing business in Vietnam today.

The software outsourcing market in Vietnam has recently grown at an exponential rate because of technological and commercial breakthroughs backed by an improvement in education and skillsets. In terms of foreign investment and its impact on the economy, it has also changed the essential elements that drive economic growth, as a substantial amount of foreign firms are setting up operations in Vietnam to take advantage of software outsourcing at lower costs.

Vietnam is a preferred location for businesses to outsource their software development projects due to its status as one of the major outsourcing centers in the world, particularly in Southeast Asia, as well as its affordable rates and highly trained IT workforce. As a result, starting a business in software outsourcing is becoming an increasingly popular choice for foreign investors and entrepreneurs in Vietnam.

Numerous multinational software firms have been increasingly investing in the Vietnam software outsourcing market, including Samsung, Microsoft, Intel, IBM, and most recently, Google & apple. As companies move out of China, due to the

Vietnam’s Foreign Investment Agency reported that the Vietnam software outsourcing market has brought in more than US$14.1 billion in investment capital.

Size of the IT Outsourcing Market

Talent Size

As reported by SunBytes, Vietnam has an enormous workforce of IT developers, the biggest compared to any other nation in Southeast Asia with over 400,000 individuals. Furthermore, it is expected that over 50,000 fresh graduates will join the workforce each year.

Vietnam’s IT outsourcing market is expected to reach 300 Billion USD by 2025 according to a recent report. That is up from the 5 Billion USD reported in 2019, an astounding 5900% increase.

Market Timing: Choosing when to Start Your Software Outsourcing Business in Vietnam

1. Quality Education in Technical and IT Fields

In Vietnam, the standard of instruction and research in the field of technology and information technology is rapidly rising. The reason why top-tier software engineers are being hired from the nation by foreign firms is because of the high standard of education and vocational training. The government made it a priority recently to develop this skill in the general workforce, successfully.

2. Young, Talented, and Affordable Workforce

Unlike many countries that are currently going through population aging and talent shortage issues, Vietnam’s young population has one of the highest percentages in the country.

These young people don’t just provide labor anymore, they are highly skilled IT talents that can help boost the software development and outsourcing scene further.

RELATED: The Developing IT Industry in Vietnam: Update 2021

3. Governmental Reform and Support

The support and reform policies from the government have made foreign investments and doing business in Vietnam less challenging.

In 2019, Vietnam was ranked 69th in ease of doing business, out of 190 countries. Many IT enterprises and corporations have found that obtaining enterprise certificates and investment certificates has become easier.

4. Well-developed Technologies and Infrastructures

Vietnam constantly keeps up the pace of the latest technological advancements around the world. Even Vietnamese tech professionals are continually updated with these newest innovations such as machine learning, blockchain, artificial intelligence, data science, and many others.

How to Start a Software Outsourcing Business in Vietnam

Foreigners can start a software outsourcing business in Vietnam with full foreign ownership. In a 100% foreign-owned company, there must be at least one resident director.

A foreigner can be the owner of the business, but if the foreigner doesn’t reside in Vietnam, they can’t be the director and must appoint someone who is a resident.

Additional requirements to start a Vietnam software outsourcing business:

  • No set minimum capital requirement. However, the planned capital must be realistic and reasonable according to the business plan
  • US$40,000 minimum capital if the founder and their dependents want to get a resident card
  • Responsible for corporate income tax at 20%

About Us

InCorp Vietnam (formerly Cekindo) is a leading provider of global market entry services. We are part of InCorp group, a regional leader in corporate solutions, that encompasses 8 countries in Asia-Pacific, headquartered in Singapore. With over 1,100 legal experts serving over 15,000 Corporate Clients across the region, our expertise speaks for itself. We provide transparent legal consulting, setup, and advice based on local requirements to make your business perfectly fit into the market with healthy growth.

Don’t take our word for it. Read some reviews from some of our clients.

Contact Our Consultant

Verified by:​

Thanh (Tim) Ta

Tim Ta is the Head of the Business Consulting Department of Incorp Vietnam. He is a seasoned professional with more than 6 years of consulting experience in Vietnam for market entry, incorporation, and real estate investment.