Bangladesh startup: Why we still have only one unicorn

Highlights:

• Bangladesh has just one unicorn startup – bKash – in 15 years; India created 131 in same period
• Startups like Pathao, ShopUp, Chaldal and Truck Lagbe once drew major investor attention
• Covid-19 pandemic briefly boosted sector; Bangladesh now has around 3,000 e-commerce firms
• Ecosystem fell into discount wars, cash burn, scams and consumer trust crises instead of scaling up

In the past 15 years, Bangladesh has produced just one unicorn startup: bKash. During roughly the same period, India created 131. 

A unicorn is a startup valued at $1 billion or more, typically a company that has disrupted an existing market and scaled rapidly. 

Bangladesh once looked promising in this field. A generation of e-commerce, logistics, fintech and tech startups emerged with ambitious founders, rising internet penetration, a surge in smartphone use, and millions of young consumers and homemakers coming online for the first time.

Between 2015 and 2021, Bangladesh experienced a startup surge driven by ride-sharing, logistics, e-commerce, fintech, food delivery, youth entrepreneurship and foreign investor interest. Companies such as Pathao, ShopUp, Chaldal and Truck Lagbe drew significant attention.

Then came the Covid-19 pandemic boom for startup companies, as lockdowns pushed consumers heavily toward online services. According to the e-Commerce Association of Bangladesh (e-CAB), established in 2015, the country now has around 3,000 e-commerce firms alone. The government also formed a venture capital firm, Startup Bangladesh Limited, in March 2020 with an allocation of Tk500 crore to support promising startups, though the amount was insignificant compared to the sector's needs.

We have talents, we've ideas, but foreign investments aren't coming into the country. Local startups need foreign funds for a leapfrog.

Kazi Saifuddin Munir, MD and CEO of IT Consultants PLC

But what happened afterward, and why did Bangladesh's startup firms fail to scale up?

The failure goes beyond a handful of collapsed startups. Industry insiders say Bangladesh lost an opportunity to build globally scalable technology companies at a time when digital adoption, smartphone usage and consumer demand were all accelerating.

Instead of creating a pipeline of high-growth firms, the ecosystem became trapped in aggressive discount culture, unsustainable cash burn, scams and eventual collapse. Industry insiders also blame limited venture capital, short-term business models, weak regulation and repeated crises of consumer trust.

"Bangladesh had a golden opportunity in e-commerce and other startups, but it failed miserably," said Kazi Saifuddin Munir, managing director and CEO of IT Consultants PLC, a publicly listed tech company. "Just eight to ten people who committed scams wiped more than a hundred startups out of the market."

The fallout went far beyond the fraudsters themselves. Customer trust in e-commerce collapsed, and transaction volumes have fallen sharply since, a wound the sector has yet to recover from.

Funding is the other missing piece. Bangladesh has no meaningful venture capital ecosystem, Munir said, leaving promising startups with nowhere to turn when they need growth capital.

ITCL itself is a case in point. Established 26 years ago, the company develops and operates digital financial and payment solutions, including banking software and fintech platforms. 

Publicly listed and technically accomplished, it is still far from unicorn status. Its market capitalisation stood at just Tk505 crore as of 14 May 2026, equivalent to roughly $40 million.

"We have talents, we've ideas, but foreign investments are not coming into the country. Local startups need foreign funds for a leapfrog," said Munir.

AKM Fahim Mashroor, CEO and co-founder of Bdjobs.com, established in 2000, also said Indian startup firms receive continuous funding from both domestic and foreign investors. Bangladesh does not.

Mashroor, also the founder of AjkerDeal, one of the country's leading B2C online marketplaces, said Bangladeshi startups often fail to secure even $40 million to $50 million in annual capital, while India attracted $10 billion in venture capital last year alone.

"The Indian consumer market is very big and whenever a company launches a new product, the demand gets very high. India has huge Internet access and a middle-class population. Bangladesh is Dhaka-based and the cost of living is very high here," he told TBS.

Fahim Ahmed, CEO of Pathao, the country's largest digital services platform and market leader in ride-sharing, food delivery and e-commerce logistics, said scaling up a technology or startup company requires three conditions: abundance of demand, abundance of capital and abundance of talent.

"India, China and the US satisfied these three conditions, but we don't," Fahim told TBS. "But you don't need to have all these three conditions all the time."

For example, Fahim said Estonia, with a population of just 1.3 million compared to around 30 million people in Dhaka alone, lacks large domestic demand but has abundant capital and talent. "That's why the country has become a regional and global market," he added.

Pathao has so far raised around $50 million (more than Tk600 crore) from foreign venture capitalists, but less than 1% of its total funding came from local sources.

"Now, we are doing very well. We are witnessing a very rapid growth led by our courier service. We've expanded to fintech and payment services and our daily disbursement has crossed over $1 million," Fahim said.

Ataur Rahim Chowdhury, CEO of ShopUp, another promising startup firm, said Bangladesh's broader business environment has struggled in recent years - from the Covid-19 pandemic to global war and domestic political instability - making foreign fund inflows increasingly difficult.

"A tech startup firm needs heavy investments and it takes 10-12 years to make a strong foundation. Some companies can survive this struggle, but most can't. Getting investments is the key to survival," said Chowdhury.

Mamun Rashid, president of ShopUp, pointed to another challenge affecting startups.

"Our main challenge is the minimum turnover tax since net margin is very low. The turnover tax has been increased to 1% from 0.30% during the interim government, which is eroding the capital of the small profit or no profit companies," said Mamun.

There are, however, signs of fresh momentum.

An independent venture capital platform backed by 39 private banks has formed a Tk425 crore fund to provide capital to high-growth startups and attract global venture capital alongside it.

The platform, named Bangladesh Startup Investment Company, plans to invest from its inaugural $35 million fund in at least three firms over the next four months, according to officials involved in the process.