The government has committed USD 100 million through a venture capital fund to support entrepreneurship and startups across the country, aiming to stimulate economic growth and innovation. Discussions are currently underway between the government and the venture capital firm.
Dorji Choden
The government has committed USD 100 million through a venture capital fund to support entrepreneurship and startups across the country, aiming to stimulate economic growth and innovation. Discussions are currently underway between the government and the venture capital firm.
Announced on His Majesty the King’s birthday this year, the initiative aims to foster a vibrant startup ecosystem and strengthen the role of the private sector in Bhutan’s national development.
At the recent Meet-the-Press session, Industry, Commerce and Employment, Minister Namgyal Dorji said that the fund will be strategically allocated to high-growth sectors such as technology, manufacturing, and green energy.
“While the specific allocations are still being finalised, the focus will remain on sectors with significant potential to drive innovation and sustainable development,” Lyonpo added.
To ensure effective management, the government will partner with an experienced venture capital firm to oversee the fund’s operations.
Lyonpo said that the 50 percent of the funding will be provided by the government while the remaining will be sourced from an international venture capital fund. It is expected that the partnership will ensure transparency, regulatory compliance, and strategic investment decisions.
The fund is designed not only to provide financial backing but also to deliver structured capacity-building programmes. These include mentorship, accelerator programmes, and business development services to increase the success rate of startups.
Startups and small to medium enterprises with scalable, innovative business models, particularly those aligning with the country’s long-term economic vision, will be prioritised.
Lyonpo said that the eligibility criteria are currently under development, but local entrepreneurs, including those operating internationally, are expected to benefit.
He added that the evaluation process will consider business viability, market potential, innovation, scalability, and financial sustainability. “The initiative is primarily equity-based, although other financial instruments may be explored depending on the business stage and investment requirements,” he added.
According to Lyonpo, the fund’s governance structure will also incorporate strong accountability mechanisms.
Regular audits, independent evaluations, and performance monitoring will be carried out to ensure responsible fund utilisation. Risk management strategies and due diligence protocols will also be embedded within the framework, with clear reporting requirements and recovery mechanisms where necessary.
Beyond financial assistance, the government is also considering additional support, such as tax incentives and policy measures, to foster a more conducive environment for entrepreneurship.
These components are under review in consultation with relevant stakeholders.
With access to finance being a hurdle for Bhutanese entrepreneurs, Lyonpo said that the initiative recognises other potential challenges, such as infrastructure readiness, regulatory adjustments, and investor confidence.
