Startup ecosystem is formed by people, startups in their various stages and various types of organizations in a location (physical or virtual), interacting as a system to create and scale new startup companies.
According to different report conducted by the research firm light castle partners, World Bank, hi-tech park authority ensure that startups generate more than almost 3 million jobs per year and have a market worth of US $3 trillion. In the local context, these businesses can contribute to the domestic economic momentum by producing additional jobs through their innovation, thereby influencing the local economy and educational system. This unique approach to the entrepreneurship ecosystem will help Bangladesh build a culture of digital adoption in all aspects of life, which will help the country achieve its goal of being a middle-income country.
Bangladesh's startup environment is maturing thanks to the following factors a healthy economy Startup Essentials where 62 percent of the population is less than 35 years old, with a population of 165 million people (the eighth largest in the world) and a high density (1200 persons per square kilometer).
By 2025, the middle class will have grown by 10 percent every year to 34 million people, with 105 percent mobile phone connections, 70 percent internet penetration and 115 million+ individuals on the internet, including 106 million mobile internet users. The epidemic has also spurred the adoption of information and communication technology (ICT) in areas including as digital commerce, education, healthcare and agriculture.
Demographic Bulge with the Right Skill-sets, the country generates 5,000+ IT graduates each year is creating a strong group of entrepreneurial waves focused on solving critical problems, including those during the pandemic. The country's median age of 28 years means more young people are willing to take risks and explore innovations in the economy. With limited opportunities from STEM graduates (due to the absence of large-scale industrialization except for RMG/Textile, which is still more labor-intensive than automation) - they are looking into forming ICT enabled companies and Startups. NRBs (Non- Resident Bangladeshis) are also returning, bringing in both investment capital and knowledge remittance.
Bangladesh Startup Ecosystem at an Inflection Point: The Bangladesh Entrepreneurship Ecosystem is at an inflection point with an excess of US $ 330 million accumulated over the last decade, in international investments from big-name corporate investors and venture capitals, investing in industries like FinTech, Logistics, and Mobility over the last five years. The emergence of active Angel Investment Networks, Impact Investing, host of local and international operating accelerators/ incubators propelled 1,200+ active Startups, generating 1.5 million+ employment - embracing products and services of Startups as part of the country's everyday life. Additionally, B-SEC (Bangladesh Securities and Exchange Commission) has also approved small-cap stock exchange guidelines, which is a big step towards providing investors with Startup exits.
Government Support: The Government of Bangladesh deployed the National ICT Policy in 2009 to become Digital Bangladesh by 2021. Government policies and projects from the ICT Ministry, such as IDEA Project and Startup Bangladesh Limited with 500 crore BDT ($ 65 Million) funds, are taken to improve the local startup ecosystem.
Additionally, GoB is setting up 28+ Hi-Tech Parks, including infrastructure support like data centers, to support technology companies.
COVID-19 Impact: The COVID-19 disruption has had a significant impact on the country, as well as all of its enterprises and startups, since March 2020. Here 24 percent of businesses have shut down and 56 percent of startups have witnessed at least a 50 percent decline in income generation.
In 2020, 63 percent of startups will have a runway of less than three months, endangering 1.5 million jobs and a loss of more than $ 53 million. However, the disruption is accelerating the uptake of digital services, with Digital Financial Services, Logistics, and Grocery on-demand, EdTech, and HealthTech all witnessing rapid development.
PwC, a global consultancy, also predicts Bangladesh to become the 25th largest economy in the world by 2035. It dominates the global RMG market in 3rd position, right after China and Vietnam, earning U$ 28 billion (83 percent of total export earnings) as of 2020. The ICT sector is booming, exporting $ 800 million worth of service across the globe. The country has a population of 165 million and has reached 37 percent urbanization. Connectivity has reached its peak, with 105 percent mobile phone connection (174 million) and 70 percent internet penetration (115 million) and 64 percent mobile internet penetration (106 million).
Bangladesh Startup Ecosystem A glance of growth in numbers $39 million + Startup Investment Raised in 2020. Where $308 million + International VC Fund Brought in the last decade 1,200+ Active Startups in Bangladesh 200+ New Startups born every year. Among $80 million + Alternative Investment Fund Registered in Bangladesh 200+ Active Angels Boosted by Angel Networks 92 percent Global Investment $ 34 million in 2020 Fintech eCommerce Logistics Popular Growth Sector In 2020. Here 30+ Accelerators & Incubators Active in the Country 1.5 million + Total Employment Created by the Startup Ecosystem Dhaka, Chattogram, Sylhet Major Active Cities in the Startup Ecosystem $65 million Startup Bangladesh Limited VC Fund under ICT Ministry.
From the year 2014, 2015, 2016, 2017, 2018, 2019, 2020 & 2021 Founder's Institute TiE Dhaka, GP Accelerator, Makerlab, Banglalink IT Incubator, YGAP, R- Ventures, YY Goshti, Tiger Cage Bangladesh, Angels Startup Dhaka, Incubator Biniyog Briddhi, Startup Bangladesh VC.
Bangladesh Startup Consortium $1 million: Priyo.com Innovation Extreme $7 million: Surecash Digital World $2 million: Cloudwell $1.3 million: AjkerDeal $1 million: Direct Fresh $0.83 million: Pathao Connecting Startups Robi-Airtel M&A Idea Project Launched $2 million: Pathao Social Media Expo Bangabandhu Satellite launched $56 million: bKash $15 million: Shohoz $10 million: Pathao $5.5 million: Chaldal $5 million: Zero Gravity $3.8 million: Bdjobs $1.7 million: SOLshare $1.6 million: ShopUp $1 million: Sheba JTI - Akij M&A Tier-4 Data Center Launched State owned VC launched-Startup Bangladesh Limited Launched EkSheba, EkPay, EkShop $4.2 million: Sindabad $2 million: Deligram $3.2 million: ShopUp Student to Startup Competition Accelerating Asia Jerra - Summit Partial M&A BDT 500 Cr. Seed Investment Fund by Startup Bangladesh, 28 High-tech Parks launched 2,650 Unions under broadband internet connectivity $ 22.5 million: ShopUp $18 million: Augmedix $1.1 million: SOLshare $0.83 million: Gaze $0.6 million: LoopFreight Call 4 Nation COVID Accelerator EverCare - Apollo M&A Unilever-GSK M&A Janata Jute Mills M&A Startup Bangladesh Limited - "ShotoBorsheShoto Asha" Fund" - investment in 7 startups BIG: Bangabandhu Innovation Grant $2.16 million: Maya $3 million: Truck Lagbe $5.6 million: Praava Health $6 million: Frontier Nutrition $11.8 million: Paperfly Government Initiatives, Private Sector Participation is boosting the startup ecosystem to come of age 12 Multiple events initiate the entrepreneurship spirit Ecosystem enablers, accelerators & incubators initiate Local & global investors bet on the ecosystem Govt initiatives boost the startup ecosystem to come of age Government Initiatives Notable Investments Notable Events Merger & Acquisition Ecosystem Enablers LEGENDS.
With Fintech leading the ecosystem, the overall confidence of ecosystem was positive in 2019-20 A survey source from 100+ startup founders and investors rated Fintech and Ride-sharing and Logistics as the most promising sectors. Online-enabled service marketplace platforms has captured the urban market significantly over the last 5 years. Players like Sheba.xyz, Smanager, Jantrik and Hellotask are formalizing the unstructured SME market and informal workers boosting financial inclusion. eCommerce & fCommerce sector garners high confidence from investors. Startup players like ShopUp, Chaldal, evaly, Daraz and Sindabad.
Home grown Startups have raised US $300 million+ of foreign investment over the last decade 19 Full Funding Undisclosed Source: Databd.co, Crunch base & Light Castle Analysis $ 4.7 million TruckLagbe Logistics from ARIA Group, Betatron & Mount Parker Ventures $ 3.5 million, Maya HealthTech from Osiris, Anchorless Bangladesh $ 4.9 million SOLsharecleantech from IIX Growth Fund $ 12.8 million Paperfly Logistics from Ecom Express $ 9 million + Zero Gravity (Sindabad & Kiksha) ecommerce from Aavishkar VC & Frontier Fund $ 6 million Sheba.xyz service marketplace from Epyllion Group, BFP-B DFID and Local Angel Investors $ 26 million + Sure Cash fintech from Osiris Group $ 8.8 million + BDjobs job marketplace from SEEK $ 36 million + Pathao logistics from GO-JEK, Osiris Group Openspace Ventures, and Battery Road Digital Holdings $ 19.6 million + Shohoz logistics from Linear Venture, Golden Gate Venture $ 28 million + Shop Up Fintech and B2B Commerce from Sequoia Capital India, Omidyar Network, Flourish Ventures $ 19.5 million + Chaldal ecommerce from IFC, IDLC, Mir Group, Y Combinator $ 81 million + Bkash fintech from Money in Motion, BRAC Bank, Gates Foundation & Ant Financial $ 10.6 million, Praava Health HealthTech from SBK Tech Ventures and Angels $ 7 million + Bongo entertainment from Razor Capital Not an Exhaustive List*
Startup Policy: With the Digital Bangladesh agenda in Government's core, it is eminent to form a startup policy to offer multiple benefits for the startup and ecosystem players such as ease of access to debt finance, reducing the cost of doing business, ease of doing business, fiscal policy support - VAT/tax exemptions and rebates. An enabling policy will promote the growth of startups and the ecosystem attracting foreign investment in the ecosystem, benefiting the country's growth and employment rate.
