Starting a business with Vietnamese investor and a foreigner's "idea"

1. Cons for the Vietnamese business owner hiring the foreigner would be:

-The Vnmese has to sponsor/vouch for the foreigner with long term visa when hiring the foreigner. The Vnmese owner of course will be involved when the foreigner does anything illegal in Vietnam. If the foreigner committed a crime, it's pretty much tangled.

-If the business went badly, the Vnmese owner has to take ALL the responsibilities: pay the debts, crime investigation, fraud, prison, etc. Without legit evidence, the foreigner can get away with his crime by simply book a flight back to their country.

2. Cons for the foreigner and his "ideas":

-His idea can be "stolen" and the Vnmese can proceed everything on his own without the foreigner.

-In better scenario, the business goes well, the Vnmese then can "kick out" the foreigner and claim the whole successful business for himself.

So in short, be very careful. Have good lawyers back things up. Have eyes and ears wide open.

Excellent response. Thanks a million.

Ngan Khanh wrote:

2. Cons for the foreigner and his "ideas":

-His idea can be "stolen" and the Vnmese can proceed everything on his own without the foreigner.

-In better scenario, the business goes well, the Vnmese then can "kick out" the foreigner and claim the whole successful business for himself.

So in short, be very careful. Have good lawyers back things up. Have eyes and ears wide open.

Ms. Nhan Khanh nailed it, particularly her points on the foreigner's ideas getting "stolen" or duplicated by the VNese partner or anyone else ...

It's relatively easy and quick nowadays to set up a company in HCMC VN, 100% completely & solely-owned by the foreigner (I have personally done it, guided by an excellent Legal Associate at a very reasonable cost). It has many benefits, but again, the down-side is that the foreigner will usually have a much smaller network of contacts than the VNese partner or competitor. But you also have independence away from the local VNese, if you choose that route too.

You have to weigh which is the better option - a partnership with a VNese, or on your own with subsequent 'partnership' agreements, or the like.

VNese are very proud, independent, and entrepreneurial people. So whatever you do set up, thinking that you may have a one-of-a-kind idea, it will be duplicated within 2-3 months if it proves anyway successful. Perhaps not at the same level of expertise, but it will be duplicated at 'some' level of quality and delivery (and perhaps even better eventually!), and you will have competition almost from the 'get-go'. So, be prepared for that ...

Generally, VNese business folks operate their ideas excellently within VN but relatively poorly or timidly outside of VN. Again, that's just a generalization, but there is plenty of evidence to demonstrate & support that (call it) resistance to expand far internationally, say into the Middle East, European, Russia, Africa, and North American markets. The issue is simply because of the 'stage of evolution' that many VN's businesses enjoy at this point in time. There are exceptions of course, but very few ... It will improve greatly over the next few years as more & more travel and awareness takes place, and also more & more foreign specialists (like me) who strongly encourage them to expand their businesses both domestically and internationally.

Another interesting reply. Thanks. I suppose I will have to help my Vietnamese friend find out more about what's involved for joining such a venture. Actually, it's the Vietnamese person that's dear to me, but they know very little of business and very little about this kind of business. The idea is that they risk no money. But I do worry about the other risks mentioned above. Perhaps they will need a lawyer's advice. I wish I could tell whether this idea was a winner or not. It's good to be skeptical. Well...if anyone here knows about building and design, you're welcome to PM me. Either way, the info here is useful to me and will be useful to others I dare say.

VanRoss wrote:

Well...if anyone here knows about building and design, you're welcome to PM me.

What do you mean by "building and design"?

Construction industry? Architecture?

Yes. Exactly.

MeoMun wrote:

VanRoss wrote:

Well...if anyone here knows about building and design, you're welcome to PM me.

What do you mean by "building and design"?

Construction industry? Architecture?

Yes. Construction - specifically interior finishing.