Govt launches Tk 400cr fund to boost startup investment

The government today launched a fund with an initial size of Tk 400 crore to boost investment in the country’s startup ecosystem, attract local and international capital, and strengthen the venture capital industry.

Startup Bangladesh Limited (SBL), the government’s venture capital and fund management institution under the ICT Division, announced the launch of the initiative, titled “Fund of Funds,” at an event at ICT Tower in Dhaka.

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

The fund will invest in selected local and international venture capital funds with strong governance, professional fund management and credible investment strategies, according to Nurul Hai, managing director and CEO of Startup Bangladesh.

The formal process for eligible venture capital fund managers also began through a Request for Expression of Interest (REOI), he also said while giving a presentation on the fund’s structure, investment strategy, fund manager selection process, co-investment mechanism and potential impact.

Speaking as the special guest at the event, Rehan Asad, the prime minister’s adviser for ICT and Telecom, said venture capital and the startup sector would play an important role in diversifying Bangladesh’s economic growth.