Unexpected Startup Investment In Congo, Iraq, Uganda, Bangladesh? You bet.

Entrepreneurship and investing in start-ups is a famously risky business. But there is one area where founders and venture capitalists often avoid risk: geography.

Overwhelmingly, funded startups are grouped in countries highly rated for ease of doing business. You rarely see them in nations known as the most dangerous and difficult places to start new businesses.

This basic notion seems obvious, but we thought it would be interesting to see if there are any unexpected places where startup funding is increasing. To do that, we take a World Bank classification1 of the 190 best and worst countries to do business. We then use data from Crunchbase to see how countries at the bottom of the list are seeing returns on initial investment.

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It turns out that there are quite a few nations where this is the case, as the initial and venture investment reaches more parts of the world. For the sake of simplicity, we chose four countries that have never been startup hubs but are experiencing strong growth in funding:

No. 1: Democratic Republic of the Congo

We’ll start with the Congo, the largest country in sub-Saharan Africa and home to a population of around 108 million. It’s a place with a famously horrific colonial history, followed by several troubled decades under a series of strongman leaders. While vast and rich in natural resources, it has never been an easy place to make a living or build a business.

But Congo is too big for startups to completely ignore. Since 2021, around $10.4 million in funding has gone to well-known Congo-based startups listed on Crunchbase.

While Congo’s numbers may not seem great, it is a jump from previous years. For the decade from 2010 to 2020, for example, Congolese companies raised just $1.2 million in pre-seed through venture funds, according to Crunchbase.

Among the largest recipients of recent funding is Altech Group, a provider of solar energy and clean cookstoves. The company raised $1.5 million in equity funding, with social investors SIMA Funds as sponsor, along with $7.1 million in debt financing, according to Crunchbase.

Another $37.5 million went to jamb this year. An African “super Web3 app” with Congo-born founders, the company recently secured a $30 million round in May led by a crypto-focused investment firm. Paradigm. (It is not clear if Jambo also has a presence in the Congo.)

No. 2: Iraq

Iraq isn’t exactly a hub for tech startups. From 2010 to 2020, only about $2 million in total known venture capital and seed capital went to Iraqi startups, according to data from Crunchbase.

More recently, however, things are looking up. Since 2021, Baghdad-based startups have raised at least $13.7 million in equity funding, according to Crunchbase. There is even a dedicated background, Iraqi technology companieswhich it says is focused on “diversifying Iraq’s economy away from oil and into more sustainable sectors like technology.”

In recent quarters, the largest recipient of funds is baly, a Baghdad-based ride-sharing app that raised a $10.5 million round earlier this year. In the meantime, alsaree3a food delivery startup, raised $3.2 million.

No. 3: Uganda

It has been said that Uganda has the youngest population in the world, with a Estimate 45% of its inhabitants are under 15 years of age. Only 2% of people in this sub-Saharan nation are 65 or older (compared to about 17% of Americans).

Apparently, some of that youthful energy is being channeled into startups. Since 2021, at least 20 Ugandan startups have secured seed, venture, or venture debt financing, according to Crunchbase, collectively raising more than $40 million. By comparison, in the entire decade from 2010 to 2020, Ugandan startups made less than half of that.

The biggest name is Tugende, a Kampala-based startup that provides financing and services for small businesses and individual operators who want to own income-generating assets such as motorcycles and cars. According to Crunchbase data, Tugende has raised $22 million in equity funding and $27 million in debt financing to date. the company too Announced an undisclosed-size pre-Series B in June.

telemedicine provider Rocket Health Africa it also landed one of the largest rounds, with a $5 million Series A announced in March. The Kampala-based company offers smartphone consultations, lab sample collection and drug delivery.

No. 4: Bangladesh

With around 170 million people, Bangladesh is the eighth most populous country on Earth. However, by land mass, Bangladesh is ranked No. 94meaning that it is also one of the most densely populated nations in the world.

Despite geographic challenges, Bangladeshis have had a hard-working history, being among the fastest growing economies in the world during the last decade. That led to a sharp rise in financed startups, many of which are tool goods and services for consumers and businesses in the domestic market, as well as export-oriented companies.

Crunchbase lists nearly 100 seeds through venture rounds for Bangladesh-based companies that have gone out of business since last year, collectively raising more than $230 million. Most of that has gone to a single company: based in Dhaka. To buy, a B2B commerce platform for small businesses that has raised more than $200 million in venture funding. Other larger rounds are dominated by e-commerce, logistics and delivery.


Our funding survey included only rounds recorded in the Crunchbase dataset. Due to language barriers, decisions not to publicly announce a fundraiser, and other reasons, other funded rounds may have occurred in surveyed countries that did not make it into the dataset.

Illustration: Li-Anne Dias

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