Bangladeshi start-up GoZayaan has recently acquired a Pakistani online travel and tourism portal named FindMyAdventure for $3.5 million, equivalent to Tk30 crore.
“Bangladesh has the potential to create not just local, but also regional or global companies. We are going to try exactly that.
“This unlocks a total addressable market for us which is massive because together, Bangladesh and Pakistan constitute 5% of the world's total population. We said we were going to create the future of travel. Well, the future starts now,” GoZayaan CEO Ridwan Hafiz said in a press release.
The acquisition did not see any money flow out from Bangladesh.
Following a four-month-long pursual, GoZayaan was able to execute the acquisition after five years of its inception in 2017, with the help of an undisclosed amount of seed extension from its already existing investors Nordstar Partners, Saurabh Gupta, Partner at DST Global and Alexander Rittweger, Founder of PAYBACK.
The platform also registered in Singapore in 2019 after two years of its inception.
The Pakistani platform FindMyAdventure started its journey in 2016, with its headquarters based in Karachi, but following the acquisition, its head office will now be in Dhaka operating under the name GoZayaan.
However, a management office has already been set up in Pakistan’s capital Islamabad.
What does the acquisition mean for Bangladesh?
According to the local start-up, the overseas expansion is in line with its aim of becoming a key role player in transforming the South-Asian travel sector through tech-enabled innovative solutions, by unlocking a bigger market constituting 5% of the world’s total population.
The core reason for acquiring a Pakistani travel platform is the similarity in geography, internet penetration and user behaviour in terms of travel booking, the press release further read.
“There are many possible upsides to GoZayaan's acquisition of a foreign startup. Not only will this provide an economic boost to our country (foreign capital injection, job creation, improvement in GDP, etc), but it will also provide a moral boost to Bangladeshi entrepreneurs as they will believe in the possibility of expanding overseas and acquiring larger market shares,” Walee Abedin, a business analyst of Bangladesh Angels Network (BAN) told Dhaka Tribune.
“In addition to that, this will also encourage more foreign and local investors (individual and institutional) to invest into Bangladeshi startups as they will have more confidence in the ability of our entrepreneurs/system as well as react to the FOMO (fear of missing out) that will be created among them,” the start-up analyst pointed out.
According to the management consulting firm McKinsey & Company, tourism made up 10% of global GDP in 2019 and was worth almost $9 trillion, making the sector nearly three times larger than agriculture.
A year later, in 2020, the coronavirus pandemic shook the entire industry, creating unprecedented domino effects across the travel and tourism ecosystem and experts predicted travel spending is unlikely to rebound to pre-pandemic levels until 2024.
The local sector estimated a loss at Tk114 billion until July of last year, having little hope of recovering. Earlier, in a report in April 2021, the Tour Operators Association of Bangladesh (TOAB) had estimated the loss at Tk57 billion until December 2020, where some four million people were struggling to survive.
However, the start-up that started its journey with the mission of digitizing the tourism scene saw an estimated 10 times growth in 2021 induced by rapid technology adoption, amidst the pandemic when the sector was severely disrupted.
The same year, GoZayaan closed its $2.6M seed round led by Wavemaker Partners and joined by VCs such as Ratio Venture, 1982 VC, Iterative, Century Oak Capital along with current and former Airbnb Execs. The start-up raised its pre-seed round from BRAC Osiris Impact Ventures.
How GoZayaan turned the pandemic into an opportunity?
Speaking to Dhaka Tribune, GoZayaan’s Chief Marketing Officer Imamul Islam Suprio explained that the pandemic turned out to be an opportunity, finding out that people in Bangladesh had become more inclined at travelling around the country, which it capitalized on.
“Working from home, we partnered with over 400 hotels across the nation, on-boarded inter-city bus firms and brought about tours in prominent tourist destinations, onboarding all domestic airlines — Novoair, US-Bangla Airlines and Biman Bangladesh Airlines — on our platform,” Imamul said.
“When the restrictions were lifted, we saw a huge influx of users who started travelling causing the boom for us, as well as the small businesses that we started onboarding as part of inclusiveness,” the official further added.