The State Of Startups In Dhaka

The State Of Startups In Dhaka

I started a company recently in Dhaka called HackHouse. We have an amazing office located in Banani. It is more of an experiment for me to see what can be done out of this country of raw talents. There is a buzz in the air. A buzz that will eventually turn into the wave we see in India: billion dollar tech startups, pouring foreign investment, and a spotlight on a country that is often overlooked. It may not fully reveal itself for another five years but I am excited to be a part of it.

work1-1-300x199At HackHouse we are constantly seeking the best talent that Dhaka has to offer. In order to do that, I strongly feel we need to have the best work environment that Dhaka has to offer. Just checkout this office. 

It is an awesome place to work. We have great perks. Highly-competitive salaries. Free lunch. Ping pong table. Plenty of junk food. But the most important thing is to create an amazing culture that people want to be a part of, that’s the hardest part, and I’m still working on that. But as excited as I am about the Dhaka tech scene, there are a few things that concern me:

1. Regulatory rules are slowing business down

It took me 6 months to set up a foreign investment company so I could properly send funds to Dhaka. During this time it was incredibly frustrating to send payments and I had to do several work around paying through Western Union and other means.

Why is it so damn hard to start a business? And why is everything so complicated and messy?

My finance guy is spending every waking hour of his day going bank to bank to fill out reports. That has become his full time job and we’re only an office of 10 people!

Bangladesh – you want people to be focusing on the business, not adhering to inefficient procedures and regulations. Furthermore, there are numerous regulations that stifle competition, and in turn produce inefficient markets. The telecom market is highly regulated, which I found out first hand. There are numerous price floors that are set by the government, which usually ensures competition is limited and big players can always stay ahead. If you want innovation, you need to let people compete on an even playing ground.

You need to focus on one thing and do it brilliantly, better than anyone else. What I’m seeing is startups that say they are making a product/service but then the mission is clouded with the offerings of other secondary services: IT consulting, digital marketing, server hosting, sms marketing, you name it.

2. Lack of focus

So what’s your product again?

So what’s your product again?

Asians have a tendency to start conglomerate types of businesses. It first starts with a plastic factory, then the brother runs the garment factory, and then the cousin starts an IT consulting firm. This is traditionally how many of the largest businesses in Bangladesh have grown. But when it comes to technology, it moves too fast, you can’t’ do too much at once. You need to focus on one thing and do it brilliantly, better than anyone else. What I’m seeing is startups that say they are making a product/service but then the mission is clouded with the offerings of other secondary services: IT consulting, digital marketing, server hosting, sms marketing, you name it.

This not only confuses your end user but does not let the entrepreneur devote a proper amount of time and thinking into what should be a killer product.

Just saying, if you’re a pastry maker, you have no place advising a technology company.

3. Lack of experience/proof

There are very few tech startups in Dhaka that are doing well. Most are losing money and many have no idea what the roadmap for a tech company should be. Many are advised by people that have no real technology experience and no wins under their belts as far as past successes. So in turn, this is putting a lot of bad knowledge out into the scene. Just saying, if you’re a pastry maker, you have no place advising a technology company.

4. Hype

Tons of people want to start companies, not because they want to learn or because it is what truly interests them but because it’s cool. While there is something to be said about creating a movement to make tech cool, in the end you just have a lot of posers who just say they want to be entrepreneurs, without the actual chutzpah (working on my Yiddish) to follow through. It creates noise and makes it harder for investors to find the gems.

5. Hartals

The fruitless efforts of politicians to outdo each other creates no winners, especially for business.

All in all, Dhaka is a great place to be. Even with these potential issues, I see a bright future ahead for this city of 15 million and growing.

While there is something to be said about creating a movement to make tech cool, in the end you just have a lot of posers who just say they want to be entrepreneurs, without the actual chutzpah (working on my Yiddish) to follow through. It creates noise and makes it harder for investors to find the gems.

Note: This piece originally appeared on Fahim’s blog. To find out more about HackHouse, visit www.hackhou.se. More of Fahim Saleh at www.fahims.com. Credit: image by BlasphemedSoldier

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Fahim Saleh is the founder and CEO of HackHouse - a venture factory in Dhaka. He has launched several successful apps and websites garnering millions of downloads in the app store. He is also the CEO of TapFury, a New York based entertainment app shop. Fahim has 11 years of experience building consumer applications.

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