Startup Bangladesh Limited is the company which was incorporated in March 2020 as the first venture capital company sponsored by the Government of Bangladesh with a committed fund of taka 500 crores. The company would make equity investments in seed and growth-stage startups through direct investments, co-invest, fund-of-fund, and strategic partnerships. TINA JABEEN, CEO & Managing Director, Startup Bangladesh Limited,ICT Division
THE RESILIENCE OF THE STARTUP SECTOR
Startups have been affected drastically by the COVID-19 disruption with 24% companies shutting down, 56% of startups reported 50% drops threatening million employment, and an annual loss of over US$ 53 million. However, we have an extremely resilient startup community. Even in the midst of this pandemic, we have seen a few funding opportunities which are quite promising. We have seen that startups have modified their operation, business models, and in many cases pivoted to a new business line leveraging their existing operations and network.
We have also seen companies operating better remotely, and they may continue to do that even after the crisis. TINA JABEEN, CEO & Managing Director, Startup Bangladesh Limited,ICT Division
SHAPING THE NEW NORMAL
Adoption of digital services has accelerated with the onset of the pandemic, with Digital Financial Services, Logistics, and Grocery on-demand, EdTech, Health Tech seeing steep growth.
The disruption will be pretty significant and in many cases, it will be part of the “new normal”. For example, the mode of the workplace has changed significantly – Zoom and video meetings probably will be the norm. Think about the food and hospitality industry – the young MAC segment – will they eat out as often as they used to? One thing I wonder about is the sports and movie industry – probably there will be a boon in online video streaming startups and so on. How about sports? Are we going to flock to the cricket matches? So the “new norm” maybe death for many traditional contact intensive industries and “birth” of many new “contact less” services. Startup Ecosystem: Beyond COVID
NATIONAL ICT PLANS
With the visionary guidance of the Honorable Prime Minister and the able leadership of our National ICT Advisor, we are forging ahead with the National ICT Policy, National AI Strategy, National IoT Strategy, e-Government master plan among others. The honorable state minister Zunaid Ahmed Palak MP, ICT Division, is fully engaged with the startup community and guiding them towards the fruition of Digital Bangladesh.
This is a huge opportunity for the startups – under these plans, the government is undertaking and implementing various projects which engage startups in crosscutting industries in multiple layers. This can create a significant domino effect – for example, strategic interventions by the government in digital finance/fintech will also significantly uplift, expand and create market opportunities in digital commerce, edutech and agritech, as we enable last mile consumers with interoperable payment capabilities.
In each of these areas, startups will become a major player catering to millions of customers. These successful startups will set precedence – and banks will be convinced that although risky, venture capital investment can truly bring disproportionate size of returns which will contribute to their profit margin (as did many successful startups in the Silicon Valley).
These successful startups will set precedence – and banks will be convinced that although risky, venture capital investment can truly bring disproportionate size of returns which will contribute to their profit margin
DEPLOYING NEW SKILLS AND CREATING EMPLOYMENT
The ICT initiative foresees taking direct employment to 1 million and indirect employment to 5 million by 2025 through the creation of a startup and Venture Capital friendly ecosystem in the country. The country generates 5,000+ IT graduates each year which is creating a strong group of entrepreneurial waves focused on solving critical problems, including those during the pandemic. TINA JABEEN, CEO & Managing Director, Startup Bangladesh Limited,ICT Division
The national-level plans mentioned earlier also focuses on human resource development – Special Training Scheme Targeting 4IR and automation, which entails enabling our youth, which is more than half of our population, male and female alike, with technological know-how. With that, it is expected that we should be able to not only cater to local demand for a tech-enabled workforce but also export white-collar tech-enabled freelancers and managers.
POLICY SUPPORT FOR THE STARTUP ECOSYSTEM
Like any emerging sector, the ICT sector too stands to benefit from well-defined policy support. We can look into a National Startup Policy and other horizontal policy frameworks that will foster and develop the startups’ ecosystem in Bangladesh, which is still coming of age. For example – provide special exemptions to startups from tax, vat, business incorporation; tax reformation for digital purchase and digital advertisement; policy support to ensure local employment and self-sustainability. Incentives to promote the “Made in Bangladesh” agenda to ensure local IT companies are prioritized, especially for essential services. We can also encourage academic institutions through funding/tax exemptions to establish Center of Excellence’s to promote R&D, skill development, and the capacity development of IT-ITES Companies in emerging technologies. A significant impact can be made if we can prioritize funding to emerging technology startups; promote and fund emerging technology solutions, from PoC development to scale up, for the public sector, including health, agriculture, education, smart city, etc. TINA JABEEN, CEO & Managing Director, Startup Bangladesh Limited,ICT Division
CEO & Managing Director
Startup Bangladesh Limited