Vietnam has long been known as a hub for low-skill manufacturing—think T-shirts, shoes and so on—but as the country seeks to move up the manufacturing value chain, success stories like Modmo are helping to demonstrate the nation’s potential for becoming a base for launching bespoke high-tech goods.
Modmo was created by 24-year-old Irishman Jack O’Sullivan with the not unambitious goal of creating the world’s best electric bicycle, one that he says can replace your car. The company has just delivered their first production run on 100 bikes, with the two models aptly named the Saigon+ after the city where they are headquartered, and a more stripped-down model called the Saigon S.
The bikes themselves are the result of some inventive design and engineering, but the story of how they came to be made in Vietnam is perhaps representative of an often-overlooked capability that exists here to manufacture this kind of product from the ground up.
O’Sullivan was on a sourcing trip to China in 2018 looking for a potential partner factory to make the electric bike he envisioned. Not finding anything he felt was the right fit, when someone suggested he make a detour to check out possible sources in Vietnam he booked a two-day trip. That stopover ended up turning into a permanent move.
“It was just mind-blowing,” he says of the motorcycle factory he toured on the outskirts of Ho Chi Minh City compared to the rudimentary facilities he found that were available to him in China. “Everything was really organized, and precise, and all the welding was done by robots.”
Not all of the process for building the Saigon+ can be automated, and that is where O’Sullivan agrees that Vietnam occupies a sort of manufacturing “sweet spot” with the combination of advanced facilities but also low-labour costs for more hands-on, time-intensive work. A good example of this is that while the frames of the Modmo bikes may be welded by robots it requires around 17 hours of hand sanding to make a seamless, aerodynamic final product.
The human talent available on the ground in Vietnam was another factor in O’Sullivan deciding to set up shop here. One of his first hires was a local engineer who had never designed an electric bicycle before. However, he credited a local trait of open-mindedness and enthusiasm for hard work as a key factor in the company being in the position it is today.
“People [in Vietnam] don’t tend to see the language barrier as that much of a barrier at all,” he says. “There is a kind of a hidden talent here because I’m sure some of these guys could be working for Apple, but they cannot really communicate the ideas they have.” The secret, O’Sullivan says, is finding ways to connect that can lead to greater collaboration and design breakthroughs.
Many of those innovations are evident in the Saigon+ and the 47 components that go into making each one (not all are yet made in Vietnam, but the goal is to do so in the near future). At the heart of the Saigon+ is a removable battery housed within the oval frame that gives the bike a 200km range. It powers a 250kW motor that has five power levels. Speed, battery life and distance cycled are visible in a display in the handlebars, and you can stay connected via GPS, Bluetooth and 4G. There are also modular add-ons such as child seats, baskets and panniers available.
For a company that O’Sullivan ran out of a one-bedroom apartment just two years ago, things are looking up. Seated in the office of the river-front villa the company now calls home, he was reviewing paperwork for a round of seed funding with undisclosed investors that Modmo had just completed. “The traction we got from that was really impressive so people are obviously excited about the bike space, so we are looking to sell five times as many bikes as we did last year.”
By Brett David @ Forbes.
David has been covering Vietnam since 2010 as a reporter and managing editor of AsiaLIFE magazine and a contributor to Forbes.com