Startups must issue 10% shares to get listed: BSEC chairman

Startup companies wishing to enter the capital market must issue at least 10 percent of their shares, the chairman of the capital market regulator has said.

Prof Shibli Rubaiyat Ul Islam, chairman of Bangladesh Securities and Exchange Commission (BSEC) disclosed the information at a conference on Thursday.

The conference, titled “Capital Market of Bangladesh: Prospects and Opportunities for Tech Startups and Growth Stage Companies”, was held at the Dhaka Stock Exchange (DSE) Building in Nikunja, Dhaka.

State Minister for Information and Communication Technology Junaid Ahmed Palak was present as the chief guest at the conference.

The BSEC chairman said that startup companies take time to make profits. “However, there is an opportunity to come to the stock market with a discount or opportunity (waiver) even if it is in a loss.”

“Such companies must issue at least 10 percent shares if they want to be listed in the stock market. Otherwise, they will not be allowed to withdraw capital,” he added.

He mentioned that all loss-making startup companies cannot be brought to the stock market by changing the law. “This will enable some opportunistic startups to take advantage of the system.”

Startup companies are mostly formed by the new generation who do not always have the resources, the chairman said, adding that the commission will support such companies.

The BSEC chairman also informed that the commission is mulling the formation of a new board for startup companies.

Furthermore, Rubaiyat Ul Islam said that some startup companies cannot adapt to mainstream or SME markets.

But after improvement, those startups will be given to enter the SME market and after further development, they can enter the main market, he added.

Earlier, DSE Managing Director Tarique Amin Bhuiyan and Startup Bangladesh Limited’s Managing Director Sadi Ahmed signed an agreement to be listed in the capital market.