As the global funding winter continues, investment in Bangladeshi startups fell 70% (quarter-on-quarter) to about $6.7 million in the January-March period.
Compared to the same period last year, the decline was even greater: 82%. However, the total amount of funding was slightly better than the funding secured by local startups in the July-September period last year, according to a compilation of deals disclosed by Lightcastle.
Additionally, the number of deals continues to decline, with only four Bangladeshi startups securing venture capital funding in the first three months of this year, down from 20 in the same period last year. On the other hand, there were seven transactions in the past. Quarter of 2023.
PriyoShop, a first-generation local e-commerce platform, raised $5 million in foreign funding in the first quarter of this year as it makes bigger bets in the B2B e-commerce space despite modest investments. Ta.
Apon Wellbeing, a multichannel marketplace startup that offers apparel employees affordable retail products with credit benefits and annual health insurance, has secured $1.5 million in funding.
AI startup Hishab received approximately $183,000 in funding from state-run venture capital firm Startup Bangladesh. In contrast, in the first quarter of 2023, Startup Bangladesh had funded at least six startups.
However, agritech startup Agroshift has received an undisclosed amount of early-stage funding from ADB Ventures.
Shaukat Hossain, director of the Bangladesh Venture Capital and Private Equity Association, said, “As inflation and interest rates continue to rise, investors’ appetite for high-risk, high-reward fields such as startups, whether global or local, is decreasing. It’s being suppressed.” . ”
“With funding drying up, startups needed to control costs to survive until the interest rate environment eased and venture capital flows became robust again,” he added.
Global startup investment fell 26% sequentially to $44 billion in the first three months of this year.
Bangladeshi startups were the hardest hit after Pakistani startups, which had no investment in the first quarter after investing $39 million in the previous quarter.
Startup investment in the January-March period fell 65% in Singapore, 69% in China, and 27% in India compared to the previous quarter.
Public investments in startups in Bangladesh decreased from $125 million in 2022 to $72 million in 2023, but in 2021, including SoftBank’s $250 million investment in bKash. The revenue soared to a record high of $432 million.
Direct employment in Bangladeshi startups has fallen by a third to about 35,000 people since the funding winter began in mid-2022, according to industry estimates.
Bangladeshi Startups says there are around 2,500 recognized startups in the country, including Bkash, the only unicorn among leading mobile financial services companies.
