Investing in "Frontier" Markets

Ramzi Farah, Co-Founder and Managing Partner at Razor Capital, has charted a unique path—from witnessing the 2008 financial crisis at Lehman Brothers to pioneering venture capital in markets others avoided, namely in the Middle East and Southeast Asia. One of those markets is Bangladesh, which Ramzi believes holds immense promise despite its challenges. In this conversation, Ramzi discusses his decision to invest in “frontier markets.”

A Journey To Venture Capital

Ramzi started his career at the height of the 2008 financial crisis, interning at Lehman Brothers just weeks before its collapse. From there, he spent five years at Mubadala GE Capital, gaining experience in corporate lending, before working in investment banking at Corporate Finance House in Beirut. But even after years in finance, something was missing. He enrolled in a master’s program but soon found himself uncertain about the path that would follow.

After ruling out fields like medicine (not a chance, obviously) and investment banking (been there, done that), Ramzi began honing in on what truly excited him. His first angel investment in Yoco back in 2013 had sparked in him an interest in early-stage investing—where risk meets innovation and long-term impact. That’s when it clicked. By the time he completed his master’s, he knew exactly where he was headed: venture capital.

The Birth of Razor Capital

In the summer of 2015, as Ramzi was preparing to move to the U.S. for his master’s, his longtime friend Oussama Glilah walked into his Beirut office, convinced he had found a goldmine. Oussama had just returned from Bangladesh, where two of his university friends had urged him to visit. “You have to see what’s happening here,” they told him. “It’s exploding.”

Skeptical but intrigued, Ramzi started digging. The data couldn’t be ignored: 170 million people, the fastest-growing economy in Asia, 7–8% GDP growth, a median age of 24–25, and rapid digitization. The macroeconomic fundamentals were undeniable, and the opportunity aligned perfectly with Ramzi’s interest in venture capital.

Ramzi, Oussama, and their two Bangladeshi partners, Ahad and Zoheb, set up a WhatsApp group—RAZO, an acronym of their names—to start sharing deals. It quickly became more than that. RAZO evolved into Razor Capital— one of Bangladesh’s only venture capital firms, built to back the founders shaping the country’s future.

Betting Big on Bongo

Bongo was an audacious gamble and Razor Capital’s first investment. Founded by Ramzi’s partner, Ahad and his friend Navidul Haq, the startup had spent years acquiring digital rights to Bangladesh’s media content. From floppy disks to VHS tapes, they painstakingly digitized the nation’s cultural archive, creating the largest digital library of Bangladeshi content.

Bongo was aiming to become the "Netflix of Bangladesh". “The Bangla-speaking population is the seventh-largest in the world. They had the potential to own that digital space,” says Ramzi.

Ramzi flew to Bangladesh for the first time in January 2016. “I was shocked by the energy on the ground,” he says. “Everyone, from top executives to street vendors, was hustling. It was contagious.” By the end of his weeklong visit, Razor Capital had signed a $1.5 million term sheet with Bongo—despite not yet securing the necessary capital or formally establishing their fund.

The next year became a relentless pursuit of investors. "We spent the first year, between January 2016 and December 2016, fundraising for Bongo," Ramzi says. Convincing investors to put money into Bangladesh wasn’t easy. “We were one of the first international VCs entirely focused on Bangladesh,” Ramzi notes. “There was a lack of follow-on investors, with a very young ecosystem. It was being built from scratch as we started investing.”

As all entrepreneurs starting their journeys, Razor Capital had to turn and depend on the trust of family, friends, and those who believed in the success story Bangladesh was creating. Fast forward to today, Bongo is the largest media conglomerate in the country.

Razor Capital, Today

After the Bongo deal, Razor Capital doubled down in Bangladesh and continued to create impact in the country. By 2022, the firm had grown more confident, and deployed over $10 million under their first fund Monsoon Tech and now have a leading portfolio in the country.

Today, after a few successful exits from Bangladesh, Razor Capital has expanded its footprint into three distinct verticals.

• Monsoon II: Razor’s second Asia fund focuses on high-potential markets across Southeast Asia, including Bangladesh, Indonesia, Vietnam, and the Philippines.

• Lighthouse: In 2020, amid Lebanon’s political and economic turmoil, Ramzi launched a growth studio to support Lebanese entrepreneurs from seed to Series A, investing in five companies, including Podeo, the largest podcasting platform in MENA.

• RC Selekt: Razor also launched this arm for targeted exposure to top-tier U.S. and UK companies, making minority investments in firms like SpaceX and Voyager Space.

Challenge of Fundraising in Emerging Markets

Unlike in the U.S., where investors are spoiled with opportunities and capital moves quickly, securing funding for startups in regions like the Middle East as well as Southeast Asia is significantly harder.

The reality is that investors prioritize security, liquidity, and familiarity. A U.S. family office managing $100 million, for example, will allocate the majority of its portfolio to low-risk instruments like bonds, real estate, and blue-chip stocks. Venture capital is only a small sliver of that allocation, and even then, most of it flows into the U.S. ecosystem, where returns are more predictable and exits are well-defined.

For emerging markets, the challenge is twofold: first, convincing investors to take a chance on high-risk geographies, and second, competing against the sheer abundance of lucrative opportunities in established markets.

While the skepticism from global investors is a challenge, Ramzi notes a shift. More local wealth in Asia is staying within the region, with family offices in countries like China, Vietnam, and Indonesia reinvesting in local ecosystems. This change is fueling the growth of startups in emerging markets.

Investing Where The Problems Are

Ramzi’s decision to invest in emerging markets comes down to one core belief: you have to invest where the problems lie. He sees emerging markets not as risky outliers but as fertile ground for meaningful innovation and positive impact—because the biggest challenges create the biggest opportunities.

But seizing those opportunities requires a different playbook. The traditional VC model, with sky-high valuations and rapid follow-on rounds, simply doesn’t fit. “You almost have to take a private equity approach instead of a venture capital approach,” Ramzi explains. With limited capital available, startups must be built for sustainability from day one. 

“The path we’ve taken hasn’t been easy,” Ramzi reflects. “But the journey has been deeply rewarding. We’ve proven that it’s possible to create value in places where others see only risk.”

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