Startup Synergy: Local VCs Seek Tax Holiday Parity and Policy Ease
Local venture capitalists have urged the government to extend tax holiday benefits to startup investments, similar to those available in the capital market. New entrepreneurs have also called for simplified taxation and permission to register offices in residential areas. Meanwhile, the Bangladesh Hi-Tech Park Authority (BHTPA) aims to break the “wall of mistrust” between startups and venture capitalists.
These perspectives were shared at a stakeholder consultation meeting held on Monday evening, November 3, at the conference room of the ICT Division. The meeting was presided over by ICT Secretary Shish Haider Chowdhury and attended by Sophie Dong, Financial Sector Specialist at the World Bank (USA); A.K.M. Amirul Islam, Managing Director of BHTPA; Hosna Ferdous Sumi, Senior Private Sector Specialist at the World Bank (Bangladesh); Private Sector Specialist Marjana Nandita; and Manzur Mohammad Shahriar, Project Director of the Digital Entrepreneurship and Innovation Ecosystem Development (DEIED) Project under the ICT Division and BHTPA.
Moderated by Arifur Rahman, National Coordinator of the “Accelerating Bangladesh Scale-up” and “Startup Bangladesh” programs, the session brought together representatives from established domestic corporations such as Square Group, City Group, Pran Group, and Brain Station 23 PLC; venture capital firms including Startup Bangladesh, IDLC, and DIVC; as well as several emerging startups and corporate houses.
After listening to the participants, the Managing Director of BHTPA announced that initiatives would be taken between November and December to identify and select eligible startups. Representatives of the World Bank expressed strong optimism about the ongoing Startup and Scale-Up programs and stated their intent to continue supporting the projects for another two years. They also reaffirmed their commitment to working more closely with venture capital firms and private companies to strengthen Bangladesh’s startup ecosystem.
Instajob founder Ummul Kusum Putul requested that startups be allowed to obtain and renew business licenses in residential areas. PharmaZilla’s Khairul Islam emphasized the need for tax exemptions and simplification of procedural complexities.
Square Group’s Head of Human Resources, Fakhrul Hasan Pradhan, remarked, “Square itself evolved from a startup into a billion-taka company. Except for e-commerce, we are active in almost every sector. Now, we want to invest in entrepreneurs. Those who can add genuine value to the startup value chain by solving known and unknown problems will attract investment from Square.”
Pran-RFL Group representative Farhad Hasan Mamun said, “We are looking for local initiatives capable of delivering efficient ERP solutions. If the youth of our country can develop innovative solutions in this AI-driven era, they will emerge as the skilled manpower the nation needs.”
DIVC’s Head of Portfolio, Omar Faruk, pledged to invest in startups with 5–7 years of experience, particularly in the agriculture and apparel sectors.
Startup Bangladesh representative Md. Anwar Zahid highlighted the existing gaps between the funding and founding stages of startups.
Calling on the government to design clear exit plans for investors, IDLC’s Additional Managing Director Syed Javed said, “Without tax incentives for taking risks, investors will gradually move away from startup funding. Despite immense potential, a comprehensive venture capital ecosystem has not yet been established.” He added, “Like the corporate funding systems of global giants such as Google and Microsoft, Bangladesh should also introduce tax holidays and reinvestment opportunities. We demand similar privileges to the capital market for at least seven years. We have invested Tk 35 crore in six startups, including Tk 5 crore sourced from abroad.”
Another venture capitalist, Faisal Ahmed, called for official certification for startups, while Brain Station 23’s Naeem Ahmed emphasized focusing on “value creation over volume.” He further suggested that top technology universities like BUET establish business schools to nurture technically proficient yet management-oriented professionals.
Finally, Nabila Nawrin, founder of Moar—a co-working space provider for startups—announced her plan to launch a venture capital firm soon to help startups maintain compliance and operational sustainability.
