Why I am bullish on the Bangladesh Startup scene?

Despite all the stories and headlines you hear about Bangladesh in the international media, Bangladesh is still the place to be for the next decade. The population demography of the country is going to give the country a dividend – 71% of the population is still under 40 years old and 51% of the population is still under 25 years old. Most importantly, it is a growing consumer market that is skipping desktop and going straight to mobile. Mobile phone users are more than 125 million subscribers with Internet penetration hitting between 32 to 40 million. Smartphone penetration is growing and friends in telecom say android OS dominates 50% of all mobile phones. This country is mobile only.

Bikroy & Social Media in Numbers

Recently, I heard a pitch from Bikroy.com, the leading online market place in Bangladesh. The 2-year-old startup’s stats were absolutely stunning to turn every tech investors head to confirm a simple fact; there is money to be made in Bangladesh. Let’s take a look at the numbers:

4M Unique visitors Per month

70 Million Page views per month

700k Interested Buyers per month

8+ min average time on the site

150k Mobile phone ads (live)

100k Electronics, laptop and camera ads (Live)

Oh by the way they also have raised $40M!

(Source: E27 Qualifier Pitch)

Why is this so interesting? Just take a look at the Facebook landscape in Bangladesh that makes the Bangladeshi startup scene more enticing.

Facebook Landscape
Facebook has been a dominant social media platform in Bangladesh that is growing as Internet usage increase. In some areas of Bangladesh, Internet is recognized as Facebook. The stats are above from Facebook audience insights. Infograph credit: Magnito Digital

 

Investor’s Biting Early

The fast growing data use among the locals makes the Bangladesh startup scene more attractive to get in early for foreign and local investors. I, along with my partners Mustafiz Khan & Samad Miraly, have invested in about 3 Bangladeshi startups and actively investing in another 3 exciting ventures.

samad fayaz mustafiz

Our portfolio spans from Digital Marketing, Market Tech, Lead Gen & Analytics Platform, Media, E-Commerce, and Transport. As strategic investors, we are utilizing not only our capital, but most importantly our experience in running blue chip companies in Bangladesh. We also help by leveraging our business network to help the startups succeed.

Last year, we saw  500 Startups invest in  Chaldal and Fenox Venture Capital getting in with Priyo early. There has been an unconfirmed report that a local food delivery company has been offered a buy out deal. This shows that there is genuine interest in this market.

Events Changing Landscape

We are now starting to see improvement in entrepreneurs’ mindsets, tech products and their ability to focus on one idea versus multiple projects. Since 2013, more events are taking place, and more entrepreneurs are finding the courage to build their businesses.

GIST Meetup
Startup Dhaka partnered with U.S State Department and CRDF Global to organize regular meetups at the Wave, the coolest co-working space in Dhaka,Bangladesh where many of the exciting startups work.

This year, SD Asia launched a 12 Week Bootcamp where 11 participants have started executing their startup ideas into real businesses such as GoBD, Umbrii, Golatech, Salex etc. Bangladeshi Canadian Startup founders Shahtaj & Ahmer from Umbrii have taken the plunge by coming from Canada and launching their business from Dhaka by building their social media lead generation platform for small to medium businesses. GoBD Founder’s Qasim Rana and Farhan Rahman only had attended Innovation Xtreme which was sponsored by Grameenphone just a couple of months back in Nov 22, 2014.

Since the event, they have worked  real hard to launch their traffic app to solve Bangladesh’s local traffic problem. They are providing users with timely/accurate traffic data to help users plan their day better or re-route to less congested roads. Join us on demo day on May 24 2o15. These graduates of the program will definitely leave a lasting impression on the Bangladesh startup scene.

We also found out that from our Innovation Xtreme (IX) event, one of the 10 startups who pitched, also received funding from a VC in Singapore. Innovation Xtreme was a game changer for the Bangladesh tech scene with several foreign investors who visited Bangladesh for the first time getting to really understand what the opportunity is all about.

We also saw some great startups from the Bangladesh Echelon Qualifier that was facilitated by SD Asia in partnership with e27. At this Bangladesh startup event, we saw companies such as Track My Vehicle, a vehicle tracking system and Live TV (live streaming at low bandwidth) really turn some of the investors’ heads.

impact in bangladesh startup scene
Startup Dhaka has organized or partnered with all the events. Some of the Co-Founders were the main organizers of Startupbash the first entrepreneurial week celebration. Bangladesh startup ecosystem is growing.

 

Other industries popping up

The Bangladesh E-commerce landscape is constantly growing as well. There are multiple F-Commerce and E-Commerce stores. Currently the estimated online sales is about $30 million which is growing every year. Rafi Mustafa, ex-Groupon member, recently started ZuumZuum.com in high-fashion and thinks the market will grow every year. BASIS along with other institutional bodies have also formed an E-Commerce alliance to support the growth of the e-commerce industry.

Fintech is also heating up with Bkash, leading the way to becoming the largest mobile money transfer company. Recently, SureCash also received $7 million dollars from Osiris Group to become a mobile money aggregator platform by connecting with different banks. Telenor also is getting ready to increase more resources in MobiCash.

Challenges

There are of course challenges and it’s always not a rosy picture. At the policy level, we need changes so that venture funds can be locally established here. In order for venture funds to exist, they need structural and tax policy support. BASIS, ICT Ministry & Bangladesh Bank have been at the heart of pushing for some of these changes. The government has also been receptive of the recommendations which align with their 2021 Vision. Bangladesh bank has already reformed the repatriation policy for foreign investors as well which has been a concern for me.  The government has significantly reduced bandwidth price, and BASIS again has led the way to get Tax breaks for the tech industry.

Startup Dhaka paving the way

We started the Startup Dhaka website on May 24, 2014, which was re-branded as SD Asia, for a reason. We knew what we were getting into by taking a long term view of building the ecosystem. Our goal was to enable people and attract everyone from home and abroad to focus on the startup scene in Bangladesh. We wanted to create a different story and write about different opportunities to excite the audience of what Bangladesh can be in the near future with the power of technology. We knew that this will be a stepping-stone to attract the talent, investor network and attention that was needed to create fundamental social and economic change in Bangladesh. We know that this will happen one step at a time. So join us at the early stage because the tech revolution is only beginning.

Fayaz Taher

Fayaz is a serial entrepreneur, investor, mentor and a startup community advocate from Bangladesh and the current CEO of Fortuna, one of the leading footwear companies in Bangladesh. He is also a startup specialist with key strengths in digital marketing, operations, sales and finance. He is a Co-Founder at SDAsia.co He is also a director at Magnito Digital & Lightcastle Partners. He can be reached at fayaz.startupdhaka [@] gmail.com

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