Startup funding jumps twelvefold in first half of 2025

Bangladesh Sees 12-Fold Surge in Startup Funding in H1 2025, Driven by Major M&A Deal

Startup funding in Bangladesh witnessed a dramatic rise in the first half of 2025, largely fuelled by a landmark merger and acquisition (M&A) deal between a local and a global company.

According to data compiled by local think tank LightCastle Partners (LCP), startups raised nearly $119.9 million during the six-month period—an almost 12-fold increase compared to $9.9 million in the same period last year.

This sharp growth was predominantly driven by a $110 million strategic M&A deal between Bangladesh-based B2B commerce platform ShopUp and Saudi-headquartered Sary, which resulted in the formation of SILQ Group. The merger accounted for over 90% of the total capital raised during the period, the report noted.

The ShopUp-Sary deal marked the second-largest transaction in Bangladesh's startup history, following the 2021 bKash-SoftBank investment. The deal alone reshaped the investment landscape, lifting total startup funding to $120 million across just nine deals. Other sectors attracting investment included e-commerce and retail, education technology, and enterprise solutions.

Despite the surge in overall funding, early-stage investment remained significantly subdued. No activity was recorded in debt, pre-Series A, or Series A rounds—contrasting sharply with H1 2024, when pre-Series A rounds accounted for 40% of total funding, totaling $3.9 million.

Venture capital dominated the scene, contributing $117 million—or 98%—of the total funds raised in H1 2025, the LCP report highlighted.

Rahat Ahmed, founder and managing partner of venture investment fund Anchorless Bangladesh, stressed the need for greater synergy within the ecosystem to support local startups beyond isolated big-ticket deals.

“About 93% of startup funding still comes from international investors,” he told The Financial Express. “To make our startups more competitive with their regional peers, we need coordinated efforts to help operationally strong companies scale.”

Ahmed also called for improved access to working capital and stronger incentives to attract local investors, particularly high-net-worth families. He underscored the importance of engaging downstream institutional investors that fund Series A and B rounds. “To attract these investors, we must understand their expectations and build toward them from the outset,” he added.

Musabbir Hosain, founder of gaming startup NapTech Labs, emphasized the need to establish seed-stage and blended capital funds, along with improved mentorship and globally relevant curricula. He also recommended targeted support for game development and esports startups through event sponsorships and hardware grants. Strengthening ties between universities and the tech industry for research and skills development was another key priority, he noted.