Opening a new era in start-up investment

Published: October 10, 2018 22:27:06 | Updated: October 12, 2018 14:12:23


From left to right: Samad Miraly, Sanchayan Chakraborty, Minhaz Anwar, Jayesh Parekh, Naima Chowdhury, Tina Jabeen, Akkie Okma, Harry Verweij, Kazi M. Aminul Islam, Sajid Rahman, Maliha Quadir, Tanveer Ali and Nazmul Karim

Bangladesh Angels, a pioneering angel investment network in the country, was inaugurated at Radisson Blu Dhaka Water Garden on October 04, 2018. Angel investors, venture capitalists, financiers, entrepreneurs and other stakeholders from both Bangladesh and abroad attended the event. Kazi M Aminul Islam, executive director, Bangladesh Investment Development Authority and Harry Verweij, the Ambassador-Designate of Kingdom of the Netherlands, delivered speeches as chief guest and special guest respectively, says a press release.

The world of entrepreneurial startups is where the most exciting and creative action is happening in today's business world. Business angel investors are high net worth individuals who usually provide smaller amounts of finance at an earlier stage than many venture capital funds are able to invest. Similarly, Bangladesh Angels is targeting to play a critical role in the startup funding ecosystem by connecting angel investors who desire to make investments in early stage businesses with promising early stage entrepreneurs. The network will identify such enterprises, support them in seeking funding, provide transactional support to angels and enable mentorship and monitoring, besides evangelising startup, organising knowledge forums and enabling exchange programmes with international angel networks.

The Bangladesh startup ecosystem has gained significant traction recently with a number of incubators, accelerators as well as venture capital and private equity firms. "These are critical developments in the path towards becoming a middle-income country, complementing the long-standing tradition of enterprise and entrepreneurialism of the private sector in Bangladesh," according to Harry Verweij, who delivered the opening remarks. "Unfortunately many of these entrepreneurs struggle to make themselves bankable because of a lack of business know-how and ability to get finance.  Organised platforms like Bangladesh Angels are critical in enabling wider participation of both investors and entrepreneurs to jumpstart entrepreneurial activity," he said. He continued that the Netherlands Embassy is proud to support this initiative, which is being backed by Dutch Good Growth Fund (DGGF). DGGF is a programme of the Dutch Ministry of Foreign Affairs which facilitates development-oriented trade and investment, that is backing Bangladesh Angels through its technical assistance programme managed by Aavishkaar Venture Management.

Bangladesh Angels will be an independent Bangladeshi network with a separate legal entity, local team and governance structure, guided by eminent startup investors and mentors with extensive experience building the start-up ecosystem in the country.  The governing board includes eminent stakeholders such as Minhaz Anwar (CEO, Betterstories), Samad Miraly (cofounder, Startup Dhaka), Tina Jabeen (investment advisor, Startup Bangladesh, ICT Division), Sajid Rahman (CEO, Telenor Health) and Sanchayan Chakraborty (partner, Aavishkaar). Guided by the governing board, the network will provide end-to-end investment readiness support to entrepreneurs, while working with angel investors to identify, negotiate, close and monitor investments, often through syndication.

"Investments rates into Bangladesh are increasing, and more and more international capital is finding its way to the country. But for young entrepreneurs, there still remains a critical gap in funding that traditional finance cannot meet. Angel investing, therefore, can be an important bridge that not only provides flexible capital but mentorship to young entrepreneurs as they establish themselves," said Kazi M Aminul Islam in his closing remarks.

At the beginning of each quarter, Bangladesh Angels team will conduct an initial screen of prospects to assess the investment thesis based on some set criteria such as scale potential, team strength, business and revenue model, funding need etc. Subsequently, the team will conduct commercial due diligence on the shortlisted candidates and further narrow down the list. A number of startups will receive support from the team to present their case to the investment committee.

Startups who are able to attract angel funding of suitable terms and quantum for the round, often led by an anchor investor, will undergo tax, legal and financial due diligence in coordination with the Bangladesh Angels team. Startups who are able to secure funding through the network are also offered with post investment support from the network. The entire process can take two to three months.

Bangladesh Angels is looking for promising start-ups that are working to solve a clearly articulated problem for a well-defined target market, with a strong and balanced team that has a track record of success in past endeavours, that has or is working to develop a product and business model with a sufficient moat that makes it difficult to replicate.

Prospective angel investors and entrepreneurs can go online to sign up for the network or apply for funding via www.bdangels.co.  The network will have its first closed-door session between vetted start-ups and investors in January 2019.  

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