Bangladesh needs a branding revamp

By Nirjhor Rahman

The Realistic Optimist is a newsletter covering the globalized startup scene.

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Biography

Nirjhor Rahman is the CEO of Bangladesh Angels, the country’s first angel investment network. 

Prior to that, Nirjhor was the Bangladesh country director for ygap, an international organization that supports early-stage social impact ventures.

From 2014 to 2017, Nirjhor led the Bangladesh leg of a Gates Foundation-backed project to introduce, pilot and commercialize new sanitation technologies in urban areas of Bangladesh, under Water and Sanitation for the Urban Poor (WSUP), a UK-based NGO.

There is a mismatch between the Bangladeshi ecosystem’s potential and its reputation. Which criticisms are fair? 

The country’s economy is troubled. Bangladeshis have been dealing with inflation, the local currency (the Taka) has devalued and the government is seeking help from the IMF. Causes for this maelstrom are threefold: governmental mismanagement, an undiversified economy and political turmoil. 

The run up to the country’s contested election, concluded on January 7th, fostered an underlying tension. Societal unease mixed with economic uncertainty sent companies and consumers in retreat. From afar, investors’ apprehension is understandable. 

This made the “Bangladesh pitch” harder for founders. Bangladeshi startups reporting revenue in USD struggled to craft a coherent growth narrative, given the Taka’s depreciation. These difficulties are tangible: Bangladesh’s startup ecosystem suffered a 42% funding drop from 2022 to 2023.

Other systemic issues plague the country’s attractiveness. Bangladeshi public equities’ lackluster performance doesn’t scream “come invest”. This has been caused and compounded by bad policy decisions, such as floor prices on stocks. Tax disputes between the government and Grameephone, the country’s largest telco operator, haven't whetted investors’ appetite nor given confidence that they can easily repatriate profits they make. On the startup side, lack of exits is an obstacle to attracting foreign VCs.

Bangladesh isn’t the only country suffering from these issues. Other ecosystems, such as Pakistan, have created decent ecosystem branding relative to the country’s international reputation. Indonesians have done well too. 

On the contrary, what do you think foreign investors aren’t seeing?