Private Sector Must Come Forward to Invest in Startups

The government has formally launched the Bangladesh Fund of Funds, initially sized at Tk 400 crore, to increase financing for promising startups and innovative entrepreneurs. The initiative aims to attract private and international capital, strengthen local investment and create opportunities for Bangladeshi startups to enter international markets.

ICT Minister Fakir Mahbub Anam highlighted the initiative on August 16, Sunday, at the inauguration ceremony of the Fund of Funds organised by Startup Bangladesh Limited at ICT Tower in Agargaon, Dhaka.

Fakir Mahbub Anam said Bangladesh has no shortage of talented entrepreneurs and innovative ideas. The government wants to create an investment-friendly environment where no promising venture is forced to stop due to a lack of funding.

He said the Fund of Funds would be managed with the highest priority given to skills, good governance and professionalism. Startup Bangladesh has already invested around Tk 111 crore in 36 technology-based startups. However, he stressed that the private sector must also come forward to invest in startups instead of relying solely on government financing.

The minister said initiatives cannot remain limited to paper-based plans; their benefits must be ensured through implementation. Through the Fund of Funds, the government aims to bring more private and international capital into Bangladesh while creating opportunities for local startups to access global markets.

He said, “The Bangladesh Fund of Funds is a game-changing initiative for our startup ecosystem. It is one of the current government’s key steps to support the country’s startup sector. Through this initiative, promising entrepreneurs will have opportunities to access necessary capital, skills and international networks. We believe innovation-driven enterprises will make significant contributions to employment generation, investment attraction and the future economy of Bangladesh.”

Speaking as a special guest, Prime Minister’s Adviser Rehan Asif Asad said the venture capital and startup sectors would play an important role in diversifying Bangladesh’s future economic growth.

He said startups need not only financing but also mentorship, skills, market linkages and technological support. These forms of support should be ensured alongside investment through the proposed Fund of Funds.

He also said the government is committed to protecting the interests of domestic and foreign investors in Bangladesh and ensuring the easy repatriation of legally earned profits and capital. A strong startup ecosystem can be developed through collective efforts, he added.

In his presidential remarks, Md Mamunur Rashid Bhuiyan said the government wants to ensure an environment where venture capital and innovation can develop naturally. If successfully implemented, the Bangladesh Fund of Funds would not only increase startup investment but also create strong investment infrastructure for the country’s future economy.

At the event, Startup Bangladesh Limited Managing Director and Chief Executive Officer Nurul Hai presented details of the fund’s structure, investment strategy, fund manager selection process, co-investment mechanism and potential impact.

He said selected domestic and international venture capital funds with strong governance, professional fund management and credible investment strategies would receive investments under the proposed structure.

The formal process for selecting eligible venture capital fund managers also began at the event through a Request for Expression of Interest (REOI).

Over the past decade, Bangladeshi startups have attracted around US$1.2 billion in investment, but local investors accounted for only about 7 percent of the total. The Bangladesh Fund of Funds will seek to address this imbalance by strengthening local institutional capital, attracting foreign investment, developing the venture capital industry and building a sustainable startup financing structure.

The initiative is expected to support startups at different stages, enhance the capacity of local fund managers, improve investment management standards, facilitate knowledge and technology transfer, and create employment opportunities. It is also expected to strengthen Bangladesh’s position as an attractive destination for venture capital and innovation.

Startup Bangladesh Limited, the government’s flagship venture capital and fund management institution under the ICT Division, has formally launched the government-backed Bangladesh Fund of Funds to increase investment flows from local, international and development partners into the country’s startup ecosystem and encourage private investment. The fund has an initial size of Tk 400 crore.

Representatives including Morikawa Yuko of the Japan International Cooperation Agency, senior government officials, development partners, investors and relevant startup ecosystem stakeholders attended the event.

//DBTech/JUA/SME//