There are many examples around us where the dream of becoming an entrepreneur is shattered due to a lack of capital despite all the wonderful ideas. While the first-world countries have all the opportunities and support to launch a startup, Bangladesh doesn't have a favorable condition to begin a startup. However, still, some enthusiastic minds took their step and became successful. To accelerate their initiative, government-owned Venture Capital Company Startup Bangladesh Limited started their journey.
The Journey of Startup Bangladesh LTD
The cabinet has approved a state-owned venture capital company called Startup Bangladesh Limited in August 2019. According to the government's Information and Communication Technology Divisions (ICT), the Prime Minister gave policy approval to the company at a regular meeting. Once the company is established, it will be able to invest a maximum of Tk. 1 crore in the seed stage and a maximum of Tk. 5 crores in the growth-guided startup round in terms of startup valuation.
According to a written statement from the Department of Information and Communication Technology, Startup Bangladesh Limited will play a key role in creating a sustainable startup ecosystem in Bangladesh as the first state-owned venture capital company and will take the government's vision-2021 one step further.
The aim of the company is to encourage foreign direct investment in the country by transforming the innovative ideas of startups in Bangladesh into business, as well as to eliminate unemployment, create employment and economic development for the country as a whole. ICT Minister Zunaid Ahmed Polok mentioned in the cabinet meeting that the company needs to be formed to provide funding, mentoring, co-working space, legal aid, etc., to startups. In 2019-2020 budget, the government had allocated Tk. 100 crore for the startup sector.
The journey started with the capital of Tk. 500 crore. This year, startup Bangladesh Limited will provide Tk 100 crore to 50 entrepreneurs. The funds will be spent on creating young entrepreneurs, innovating technologies, advances, new workplaces, and socioeconomic change.
The announcement came at the signing ceremony of an agreement to celebrate the 50th anniversary of independence as well as the first series of startups to invest in Bangladesh. With this, the new campaign titled 'ShotoBorshe Shoto Asha' of Startup Bangladesh Limited officially started its journey on March 31, 2021. The campaign was officially announced by ICT minister Zunaid Ahmed Palak. Deputy Minister for Education Mohibul Hasan Chowdhury was the special guest.
The company gave Tk. 15 crores to 7 Bangladeshi startups this year. The seven companies are Pathao Limited, Sheba XYZ, Chaldal.com, Intelligence Machine, Dhaka Cast, Eduhive, and Moner Bondhu. This fund will enable them to improve the quality of their products or services, increase productivity, market and improve supply-chain management.
This time Startup Bangladesh Limited is investing only in established and successful ventures. But the company will also invest in the new entrants too, especially the students. Students need to be introduced to such startups; then they will be able to do something on their own without running after the job.
Seven Bangladeshi Startups to Get Investments from Startup Bangladesh LTD
Following are the details of the 7 Bangladeshi who are getting Tk.15 crore.
Bangladeshi ride-sharing company Pathao is going to get more investment and this time from the government-owned venture capital company. However, the exact amount is not published yet, but they will get a significant amount for sure. This is not the first time that Pathao received an investment. Previously the company raised investment from the secondary market in 2018 from Clearstone.
Earlier, Gojek, an Indonesian ride-sharing company, made a big investment in Pathao. Gojek invested $2 million in 2017.
In 2015, Pathao started its journey as a courier service and later brought ride-sharing services through the mobile app. At first, bikes were added, and then car or car services were added. After receiving the investment, the company adds food delivery and payment services to their services. But Pathao Pay as a payment service was stopped later as it did not get approval from Bangladesh Bank.
Pathao has expanded its ride-sharing service to Dhaka, Chittagong, and Sylhet in the country. It has also launched a ride-sharing service in Nepal.
Seva XYZ is an online service-based marketplace in Bangladesh. There are many services in the service app, including air conditioning service, electric and home appliance, plumbing and sanitary, furniture making and repair, wall painting, house cleaning. The organization has worked on a personal and small scale for so many days. Recently, they have started providing services to the corporate sector by increasing the scope of their activities.
Sheba XYZ got funding from Startup Bangladesh Limited. Nevertheless, the company also raised an overall $1 million previously. The company needed at least two million more dollars to run the operations at home and abroad. Hence, the investment from the government-owned venture capital company will surely boost Sheba XYZ to expand its business.