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Please be aware that the content herein has not been peer reviewed. It consists of personal reflections, insights, and learnings of the contributor(s). It may not be exhaustive, nor does it aim to be authoritative knowledge.
Title
Please provide a name for your action learning plan.
Localize a Market-fit Offer for Vietnam AccLab Innovation Service
Challenge statement
Challenge type: If you are working on multiple challenges, please indicate if this is your "big bet" or "exploratory" challenge.
Please note: we ask you to only submit a maximum of 3 challenges - 1x Big Bet, 2x Exploratory. Each challenge must be submitted individually.
BIG BET
Challenge statement: What is your challenge? (Please answer in specific terms: "Our challenge is that...”.)
Our challenge is that the UNDP Viet Nam AccLab and CO need to fundraise and establish a cost-recovery mechanism for our activities to ensure Lab sustainability and continued viability
Background: What is the history of your challenge? What is causing or driving it? Who is involved? How does the current situation look like? What undesired effects does it produce?
Over the past decades, Viet Nam has experienced rapid economic growth, transitioning from a low-income to a low-middle-income country. While this progress is a positive milestone, it has led to a significant decline in Official Development Assistance (ODA), as international donors shift their focus to lower-income nations. As a result, UNDP Viet Nam and the Accelerator Lab must explore alternative funding models to sustain our work in driving innovation for sustainable development.
This challenge is further compounded by a global decline in international development funding, as donor priorities shift towards domestic concerns and emerging global crises. Development organizations worldwide are facing increased pressure to demonstrate financial sustainability and justify their value proposition beyond traditional models.
At the same time, Viet Nam is undergoing a major political restructuring under its new leadership. While this has created a temporary bureaucratic freeze, there are emerging policy opportunities, particularly with Resolutions 57 and 03, which signal a strong governmental push for science, technology, and innovation (STI). This shift presents a window for the Lab to position itself as a key partner in Viet Nam’s innovation landscape.
However, a fundamental challenge remains: Viet Nam’s government has historically not paid for UN services. Unlike the private sector or donor-funded initiatives, government institutions are accustomed to receiving ODA rather than using their own budgets to procure services from international organizations. This lack of precedent presents both a mindset and structural barrier to positioning UNDP and the Accelerator Lab as a viable service provider in innovation consulting.
As a result, the current situation produces several undesired effects:
- Uncertain financial sustainability of the Lab beyond 2025, risking a loss of innovation capacity within UNDP Viet Nam.
- Limited agility in responding to local needs, as reliance on donor funding dictates priorities rather than market-driven demand.
- Missed opportunities for client partnership with the Vietnamese government, as existing UNDP support is often viewed through the lens of donor-funded technical assistance rather than as a strategic service offering.
- To overcome these challenges, the Lab must navigate a fundamental shift in how it operates—transforming from a donor-dependent initiative into a financially sustainable, market-responsive innovation service provider.
Quantitative evidence: What (official) data sources do you have on this challenge that better exemplifies the importance and urgency of this frontier challenge? You can add text, a link, or a picture.
Declining ODA and Shifting Donor Priorities:
Between 2000 and 2020, Vietnam was a major recipient of Official Development Assistance (ODA), receiving between $1 – $4 billion annually. According to the DevelopmentAid Country Report on Vietnam (2018), Vietnam’s net Official Development Assistance as a percentage of GDP has steadily declined as the country’s robust economic growth has gradually reduced its aid dependency due to Vietnam's improved human development indicators and its entry into middle-income country status. .
Financing Challenges and IDA Graduation:
The Oxfam Library report on Financing Development in Vietnam offers an in-depth analysis of Vietnam’s shift away from concessional financing as it nears IDA graduation. This report details how key donors—including Japan, USAID, and the EU—are adjusting their portfolios, leading to significant reductions in concessional aid. Such recalibration underscores the urgency for Vietnam to explore alternative funding mechanisms to sustain its development agenda.
Innovation Policy and R&D Investment:
Recent policy moves, such as Vietnam’s Resolution 57-NQ/TW (2023) and Resolution 03/NQ-CP (2024), aim to boost the nation’s innovation ecosystem by enhancing digital transformation and public–private partnerships. Meanwhile, World Bank data indicate that current R&D investment is around 0.5% of GDP, with a target of 2% by 2030—an ambitious goal to drive sustainable economic transformation.
Qualitative evidence: What weak signals have you recently spotted that characterizes its urgency? Please provide qualitative information that better exemplifies the importance and urgency of this frontier challenge. You can add text, a link, or a picture.
Our existing relationship with government partner such as the Ministry of Science and Technology (MOST), the National Innovation Center (NIC), and provincial such as Danang and Hue hint at a growing interest in leveraging UNDP expertise for innovation consulting. This is something we have done for free in previous years, but it can be potential entry point for UNDP’s services.
New leadership in Vietnam and a strong push in innovation and technology such as with Resolution 57 and 03 in 2024-2025 to push investment in R&D indicate a room of opportunity
Value proposition: What added value or unique value proposition is your Accelerator Lab bringing to solving this challenge? Why is it your Lab that needs to work on this challenge and not other actors within UNDP, other stakeholders in the country respectively? Why is it worth investing resources to this challenge?
The UNDP Accelerator Lab Viet Nam brings a unique, systems-focused approach to innovation that sets it apart from traditional development actors, private sector consultancies, and government agencies. Our five years of on-the-ground experimentation, deep contextual knowledge, and global network of 90+ Labs uniquely position us to tackle this challenge.
1. A Proven Track Record in Innovation & Experimentation
The Lab has pioneered lean experimentation, solutions mapping, and systems thinking to address complex challenges in circular economy waste management, digital transformation, and public sector innovation.
Unlike traditional UNDP country programs, which focus on policy advocacy and large-scale interventions, the Lab is agile, adaptive, and iterative—able to prototype, test, and refine innovation models before scaling.
2. Bridging the Gap Between Government, Development, and Market-driven Innovation
The Vietnamese government recognizes the need for innovation but lacks the internal capacity to design and execute human-centered, experimental approaches.
Private sector consultancies provide innovation services but are often detached from local development needs and lack a sustainability lens.
The Accelerator Lab operates at the intersection of these two spaces—leveraging UNDP’s policy credibility while offering the agility and problem-solving mindset of a start-up.
3. Global Knowledge + Local Application
Through the UNDP Accelerator Labs network, we have access to cutting-edge methodologies, global case studies, and peer-to-peer learning opportunities, ensuring that Viet Nam benefits from global best practices.
Our deep contextual expertise in Viet Nam’s unique governance, economic, and cultural landscape allows us to localize and tailor innovation services in ways that international consulting firms cannot.
4. A Unique and Sustainable Business Model
Unlike traditional UNDP programs, which rely on ODA and donor grants, the Lab’s new fee-for-service model will create financial sustainability, reducing reliance on external funding.
This approach aligns with the Vietnamese government’s push for public-private partnerships in innovation, creating an opportunity to mainstream innovation services as a strategic investment rather than a donor-funded activity.
Short “tweet” summary: We would like to tweet what you are working on, can you summarize your challenge in a maximum of 280 characters?
💡 As Viet Nam transitions to a middle-income country, The UNDP Accelerator Lab is pioneering a market-fit innovation service to sustain impact beyond 2025—monetizing our expertise to support gov, businesses & development partners. #Innovation4SDGs
Partners
Who are your top 5 partners for this challenge? Please submit from MOST to LEAST important and state Name, Sector and a brief description of the (intended) collaboration.
Please state the name of the partner:
Ministry of Science and Technology (MOST) – Public Sector (Government Innovation & STI Policy)
MOST is the leading government agency responsible for science, technology, and innovation (STI) in Viet Nam. Given the push from Resolution 57 & 03, MOST is actively seeking mechanisms to advance innovation and R&D commercialization.
National Innovation Center (NIC) – Public-Private Innovation Hub
NIC is Viet Nam’s premier government-backed innovation ecosystem, focusing on R&D, digital transformation, and startup acceleration.
Large Private Sector Firms (e.g., FPT, VNG, VinGroup Ventures) – Private Sector (Technology & R&D Investment)
Vietnamese tech conglomerates and corporate venture funds are investing heavily in R&D, digital transformation, and sustainability but lack structured innovation processes.
National Economics University (NEU) Fulbright University Viet Nam (FUV) – Academia (Public Policy & Anticipatory Governance)
What sector does our partner belong to?
Government (&related)
Please provide a brief description of the collaboration.
With Gov: Position the Accelerator Lab as an innovation service provider for MOST’s initiatives, offering systems mapping, foresight, and experimentation services to test and scale national STI policies.
Partner with NIC to co-develop and pilot fee-based innovation services, embedding UNDP’s expertise in policy experimentation, circular economy, and digital innovation within NIC’s existing programs.
With Corporate: Offer systems innovation, prototyping, and behavioral insight services to help businesses test and de-risk innovation initiatives, embedding UNDP’s expertise into corporate R&D strategies.
With Universities: Partner with university on innovation capacity-building programs, conduct joint research on public sector innovation, and leverage private sector networks to expand innovation service offerings.
Is this a new and unusual partner for UNDP?
No
Learning questions
Learning question: What is your learning question for this challenge? What do you need to know or understand to work on your challenge statement?
How can the UNDP Accelerator Lab Viet Nam design, test, and operationalize a market-fit innovation service that is both financially viable and aligned with Viet Nam’s development priorities, while navigating government procurement barriers and a historically donor-dependent system?
To what stage(s) in the learning cycle does your learning question relate?
Grow
Usage of methods: Relating to your choice above, how will you use your methods & tools for this learning question? What value do these add in answering your learning question?
Business Model Innovation & Cost Recovery Strategies
🔹 Why? To develop a sustainable revenue model for UNDP’s innovation services in Viet Nam.
🔹 How?
Explore different pricing strategies (e.g., fee-for-service, subscription, PPPs).
Learn from UNDP country offices & global innovation hubs that have tested cost-recovery models.
🔹 Tool: Business Model Canvas + UNDP Cost Recovery Framework.
Existing data gaps: Relating to your choice above, what existing gaps in data or information do these new sources of data addressing? What value do these add in answering your learning question?
Existing Data Gaps & How Our Innovation Methods Address Them
To design a market-fit innovation service, we need to fill critical information gaps about demand, feasibility, pricing, and operational models for monetizing UNDP innovation services in Viet Nam. Below are key data gaps and how our selected innovation methods will address them:
Market Demand & Willingness to Pay for Innovation Services
Data Gap:
What specific innovation services are in demand by government agencies, businesses, and donors in Viet Nam?
Are these stakeholders willing to pay, and if so, how much?
How We Address It:
Human-Centered Design & Behavioral Insights → Conduct deep listening & user research to understand government and business needs.
Lean Experimentation → Pilot small-scale paid services to test demand and validate pricing.
Business Model Innovation → Use competitive benchmarking to identify how similar innovation services are monetized elsewhere.
Value Added:
Provides real-world insights into which services have market potential and at what price points, ensuring we don’t create services that no one will buy.
Closing
Early leads to grow: Think about the possible grow phase for this challenge - who might benefit from your work on this challenge or who might be the champions in your country that you should inform or collaborate with early on to help you grow this challenge?
1. Government Partners (Policy & Public Sector Innovation)
Ministry of Science and Technology (MOST) – Leads Viet Nam’s science, technology, and innovation (STI) policies and is actively seeking innovation partnerships under Resolution 57 & 03.
National Innovation Center (NIC) – Viet Nam’s flagship hub for tech and innovation; potential co-developer or client for innovation services.
Ministry of Planning and Investment (MPI) – Oversees economic development policies; key for integrating innovation into national development planning.
Local Governments (e.g., Da Nang, HCMC, Hanoi People’s Committees) – Cities with strong interest in urban innovation, circular economy, and digital transformation.
2. Private Sector & Innovation Ecosystem
Tech Corporations & Impact Investors (e.g., FPT, VNG, VinGroup Ventures) – Large Vietnamese firms investing in R&D and could co-develop or procure UNDP innovation services.
Startup Ecosystem (e.g., BK Holdings, Zone Startups, Sun Startups)* – Potential partners for co-creating and piloting innovation models.
Chambers of Commerce (e.g., EuroCham, AmCham, Vietnam Business Forum) – Bridge to foreign enterprises interested in sustainable innovation solutions.
3. Development & Multilateral Organizations
Bilateral Donors (e.g., USAID, GIZ, ADB, World Bank) – Some donors are shifting from ODA grants to innovation funding models, presenting an opportunity for cost-sharing.
UNDP Global & Regional Innovation Teams – Can provide guidance on fee-for-service models and lessons learned from other country offices.
4. Academia & Research Institutions
Vietnam National University (VNU), Fulbright University Viet Nam (FUV) – Potential partners for co-developing innovation methodologies and training programs.
Think Tanks & Policy Labs (e.g., NEU’s Anticipatory Governance Initiative) – Provide policy insights and open doors to government collaboration.
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9Industry, innovation and infrastructure
16Peace, justice and strong institutions
17Partnerships for the goals
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