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Against the backdrop of a global funding slowdown, the Bangladeshi startup ecosystem underwent significant transformations in 2023. The country faced unprecedented macroeconomic instability fueled by geopolitical tensions leading to consequences felt on a local level. Despite government interventions, the year witnessed rising inflation, sluggish export growth, remittance challenges, currency depreciation, depleted foreign exchange reserves, and harsh import restrictions.
While Q’1 recorded the highest funding at USD 37 Mn, the investment landscape experienced fluctuations before staging a comeback in Q’4, witnessing a 2.5x quarter-on-quarter growth, totaling USD 22 Mn. However, the annual figures reveal a 42% decrease in startup funding, amounting to USD 72 Mn across 45 deals. Despite a decline in funding, the local ecosystem showcased adaptability, with a focus on diverse sectors and a maturing investment environment
Key deals of the year included ShopUp, 10 Minutes School, Arogga, and Jatri, collectively securing USD 43 Mn. Global investors took center stage in Q’4, backing 99% of startup investments, marking a sharp contrast from the local-centric trend observed in the previous quarter. Local investors, however, actively participated in the highest number of deals this year, showcasing a substantial 1.1x increase from 2022.
Explore the latest trends in Bangladesh’s startup investment landscape for 2023 in our comprehensive report, ‘Bangladesh Startup Investment Report 2023: Year In Review’. Brought to you by LightCastle Partners, in collaboration with Startup Bangladesh Limited, Anchorless Bangladesh, ExitStack, and BD Startup Founders, this report is part of our ongoing series of quarterly publications on Bangladesh’s startup ecosystem.
Some of our key findings from this report include:
Startup Bangladesh Limited is the flagship venture capital fund of ICT Division and the first and only venture capital fund sponsored by the government of the People’s Republic of Bangladesh.
Anchorless Bangladesh is a New York-based early-stage venture capital fund dedicated to investing in critical businesses that empower Bangladesh’s socio-economic growth.
ExitStack is an online platform featuring stories, deal news, and analysis about Bangladeshi and diaspora startups. It aims to share insights on companies and founders to everyone, including potential investors and partners, around the world.
BD Startup Founders Group is the leading startup community of Bangladesh that connects the prominent active startup founders and ecosystem builders in the country.
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