Bangladesh startup: Why we still have only one unicorn

Bangladesh’s startup ecosystem has produced just one unicorn—bKash—in 15 years, a stark contrast to India’s 131 unicorns in the same period. Between 2015 and 2021, the country saw rapid growth in e-commerce, fintech, logistics, and ride-sharing startups like Pathao, ShopUp, Chaldal, and Truck Lagbe, fueled by rising internet and smartphone adoption. The COVID-19 pandemic briefly accelerated growth, with around 3,000 e-commerce firms now operating, but the sector later faced aggressive discount wars, unsustainable cash burn, and widespread scams. Industry insiders blame the collapse on a lack of foreign investment, weak venture capital, and short-term business models. Kazi Saifuddin Munir, CEO of IT Consultants PLC, noted that scams by a small group wiped out over 100 startups, eroding consumer trust and transaction volumes. The government’s Tk500 crore venture capital fund, launched in 2020, was insufficient to support the sector’s needs. Despite talent and innovation, local startups struggle without foreign funding, Munir said. IT Consultants PLC, a 26-year-old fintech firm, remains far from unicorn status with a market capitalization of Tk505 crore ($40 million). The ecosystem’s failure to scale globally stems from regulatory gaps, cash burn, and a lack of sustainable growth strategies. AKM Fahim Mashroor, CEO of Bdjobs.com, echoed concerns about foreign investment barriers, stating that local startups need international capital to leapfrog. The sector’s decline has left a critical trust deficit, with consumers hesitant to engage in online transactions, further stifling growth.