In an exclusive interview with The Business Standard, the CEO of government-owned Startup Bangladesh Limited talks about Bangladesh’s start- up ecosystem and its potential, the do’s’ and ‘don’ts’ for start- ups trying to raise investment and what Startup Bangladesh Limited is looking for in start- ups
Tina Jabeen is the founding Managing Director and CEO of Startup Bangladesh Limited - a public limited company focused in VC investment and wholly owned by the government under the ICT Division.
Over the last few years, Tina has assisted the ICT Ministry in policy and investment initiatives with other governments and private industries across Asia, North America, and Europe.
Tina graduated from Haas School of Business, University of California, Berkeley, worked for KPMG and later joined PricewaterhouseCoopers, US.
In her early career, Tina focused on the financial services industry. Eventually, she found her passion in "partnership" and "flow through entities" in the private equity industry.
Tina got involved with the venture capital (VC) industry in 1999 with the then newly minted GGV Capital, one of the early investors in the Alibaba Group. In her last firm Horsley Bridge Partner, Tina held the position of Director of Finance and Tax.
In 2016, Tina wanted to come back to Bangladesh with the mission to contribute to her motherland, especially in the development of women and youth.
"As luck would have it, when I was visiting Dhaka in December 2016, Startup Bangladesh - iDEA project had just been approved by the Prime Minister's office. Under the dynamic leadership of State Minister Zunaid Ahmed Palak MP, with a small team of three, I started the initial work. It was indeed a thrilling experience to be part of the first accelerator - a pioneering project by Bangladesh government."
In an exclusive interview with The Business Standard, Tina talks about the prospects of Bangladesh's start-up ecosystem.
What are the potential sectors for start-ups to invest in Bangladesh?
Covid-19 has brought misery to millions, but it has also opened up new frontiers - creating new markets or expanded exiting ones.
The government has various national plans based on technology which creates opportunities for start-ups. Under these national plans, the government is implementing various projects which can potentially engage start-ups in multiple layers in crosscutting industries.
This can create a significant domino effect - for example, strategic interventions by the government in digital finance/fintech will also significantly uplift, expand, and create market opportunities in digital commerce, edutech, and agritech, as we enable last mile consumers with interoperable payment capabilities.
In each of these areas, start-ups will become major players, catering to millions of customers. Successful start-ups will set precedence – banks will be convinced that venture capital investment can truly bring disproportionate size of returns which can contribute significantly to their profit margin (as many successful start-ups did in the Silicon Valley).
How can start-ups serve the bigger purpose when Bangladesh's majority population is yet to adapt to technology?
We still have a long way to go in regards to technology adaptation and affordability. We still need to effectively handle the digital divide.
I believe that fintech start-ups can have a huge impact across the board. Its beneficiaries are millions of individuals working in garments, transportation, domestic services, ports, hospitality, and agriculture/livestock sectors.
Fintech will also vastly impact digital commerce, edutech, agritech, health-tech, which will transform lives of the last mile population and accomplish multiple sustainable development goals such as financial inclusion, zero poverty, gender parity, etc.
With increase in digital penetration, we also need to ensure device accessibility so that the last mile population has the tool to reap the benefits of such transforming technologies. We are yet to make a significant stride in this area.
How can start-ups shape the future of our country?
Start-ups are already shaping the future of Bangladesh.
Look at Pathao! They completely transformed how we commute! Young working professionals in major cities are loyal Pathao riders. Pathao made commuting faster, cheaper, and convenient.
Flagship start-ups within Bangladesh's start-up ecosystem and others, together, generated 1.5 million of employment, supported 150 thousand plus SMEs and brought in $243 million of foreign direct investment.
We have an ecosystem which is barely in its teens and has already showed impressive results. Just imagine how far we can go with better policy support, public and private investments, stronger infrastructure, and digital affordability?
I say - very far. I say we can and we should reach for the stars!
According to a research conducted by LightCastle Partners, start-ups in Bangladesh have been able to raise $222 million in the form of international venture capital. How can we bring more investment to Bangladesh?
Representing Bangladesh's start-up culture on the international level will allow foreign investors to grasp a clearer scenario of our start-up ecosystem.
We hope to bring in more investment to Bangladesh with the help of media. Non-resident Bangladeshis also have a huge role to play in this area as we have a large affluent and tech savvy NRB community.
Can you tell us a bit about Startup Bangladesh Limited?
Startup Bangladesh Ltd was incorporated in March 2020 as the first VC company sponsored by Bangladesh government with a committed fund of Tk500 crore.
The company will focus on seed and growth stage equity funding with a ticket size of Tk50 lakh to Tk5 crore. We also have the option to co-invest, be a funds of funds, as well as raise funds locally and abroad.
This is a huge opportunity for Bangladesh to promote itself as a nation, which is committed to develop the local start-up ecosystem towards achieving SDGs.
How can start-ups attract investment from Start-up Bangladesh Limited?
We would curate start-ups from various accelerator programs that are actively working with start-ups (at various stage of their lifecycle). We have certain investment objectives, investment risk mitigation criteria, performance metrics, and a strict due diligence process. We also have multilayer review process and finally the investment Board will approve the investment.
Currently, we have a robust pipeline of candidates and are not planning to call for any submissions soon.
What are the 'do's' and 'don'ts' start-ups trying to raise investments should be following?
Networking is really important – VCs invest in founders they can trust, who are open to criticism and have good judgement and through networking, the relationship is built and nurtured, which eventually ends up in an investment.
Do not be shy, do your homework before you go to any event so that you can ask good questions. Learn the corporate culture and professional etiquette. It always helps!
I see many start-ups attend mentoring sessions which is great – remember though, until you apply the knowledge in your business it is just a sunk time.
Let us not go to any meetings unprepared. You will probably get only one chance to pitch to the senior investment team – so do your homework and wow them!
Know your audience - if you are an idea stage start-up, get connected to accelerator folks; a seed stage company may want to be more connected to VC folks who are investing in relevant industry and stage.
Please keep your feet firmly grounded when it comes to valuation. Valuations of a company in hundreds of millions does not makes sense if you are still tinkering with the market, have a proto type, and zero traction.
How can the ICT Division's Action Plan aid in the growth of start-ups in the long run?
Under the leadership of State Minister Zunaid Ahmed Palak MP, the ICT division is also implementing the initiatives of the National ICT Policy, National AI Strategy, National IOT Strategy, e-Government master plans among others. Startup Bangladesh Ltd, is working closely with the start-ups in the area of innovation and inclusive Bangladesh toward making Digital Bangladesh vision a reality.
Under the National ICT Roadmap, we are focusing on digitalisation and its streamlining in all aspects of life.
We are focusing on agriculture and food security, health and well-being, education, employment and skills, supply chain, social protection, financial inclusion and public and private sector transformation and Innovation.
Each of this vertical will create many opportunities for the start-ups to provide services in respective verticals. Success of the government will depend on how effectively and efficiently we leverage technology and the agility of the platforms used – in both cases start-ups are our best bets.
Start-ups need to understand the government's vision and align their business model accordingly. The government's action plan is hinged on the needs of its citizens and the start-ups who will provide solutions to the needs of the citizens at large will be more successful.
Local investment for start-ups is very low, how can we promote venture capital among traditional businessmen?
Half a century ago, who would have thought of consulting a doctor over the phone? Two decades ago, would fish farmers have ever thought of monitoring the feed through a phone? But it all happened!
It takes time to accept and internalise any new concept. VC investment, start-ups, and angel investments - these are still alien words in traditional financing world.
As the ecosystem matures, with more few success stories and policy incentives, I firmly believe that traditional investors will come forward with their coffers to invest in our start-ups and in the future of Bangladesh.
Can you tell us a bit about Bangladesh Start-up Consortium?
Bangladesh Start-up Consortium is an informal platform that consists of a major stakeholders - of accelerators, angel investor network, successful entrepreneurs, research, and legal firms and Startup Bangladesh Limited in the Bangladesh start-up ecosystem.
We came together during the Covid-19 pandemic to provide support to the start-up ecosystem. Working with ICT Division under the guidance of State Minister Zunaid Ahmed Palak MP, we prepared a start-up rescue proposal which sought rescue funding for start-ups who are servicing the essential and critical market.
We also conducted a five-week Covid-19 accelerator program for start-ups in collaboration with the Bangladesh HiTech Park Authority. We are grateful to ANM Safiqul Islam, Joint Secretary and Project Director, BHTPA for his sincere support.
Currently, we are working with the Education Ministry to provide digital contents – videos for Sangshad TV for higher secondary and technical and madrasah education curriculum. We are indebted to our Education Minister Dr Dipu Moni MP and Deputy Minister Mohibul Hasan Chowdhury Nowfel MP for their confidence on our edutech start-ups, who are relentlessly working to produce dynamic and engaging video classes for students near and far. These classes are now being broadcasted in Shangshad TV through Amar Ghore Amar School program.
Any last words…
Among all frontier markets, Bangladesh holds the most promising opportunity for venture capital and private equity investments. The country's English speaking, tech-savvy young population is ready for deployment.
With its focus on financial inclusion, social equity and tolerance, and increasing access to technology, Bangladesh can become a stellar performer in achieving sustainable development goals.
For me, as the managing director and chief executive officer of Startup Bangladesh Limited, it is a monumental opportunity and a tremendous honour to be able to serve the nation in this capacity.
Long live Bangladesh.