Babuland: Children’s entertainment in a concrete jungle

By Rahma Mirza

Investment Analyst

EDGE Research & Consulting

Posted on: 25 Oct, 2022

One of the more interesting investment cases that we came across was Babuland. We were introduced to the company right after the peak of COVID had passed, with some normalcy returning to Dhaka. Babuland is a children's entertainment and indoor playground services company focused on Urban-Bangladesh. The company started in late 2018 and expanded into 4 indoor playground branches within the next 3 years. Ticket sales suffered due to COVID-19 restrictions, however, when we met the company, it was showing promising signs of recovery. 

The market for goods and services catering to young children remains fragmented and underserved. Bangladesh’s children population is expected to grow at a rate of ~18 children per 1000 people per year. Due to extreme density and expensive real-estate, urban parents and children are finding themselves in cramped cities with little access to open spaces. 
For adults, entertainment mostly boils down to socializing at eateries, while children basically have little to no option beyond their school. Unfortunately for the kids, many of the schools centered within the city do not have adequate playgrounds either. This essentially means children are mostly limited to digital forms of entertainment, which has its own set of issues. 

On the flip side, more families are now dual-income earners, and broadly families have more disposable income which they are happy to spend on entertainment/leisure. This mix of growing entertainment needs and increasing affordability made Babuland’s target market extremely lucrative.
For cities like Dhaka, huge open space-based entertainment parks similar to the likes of Disneyland are unfeasible simply due to a shortage of real estate. Building something of that nature might be possible 3-4 hours away from the main city, and with that sort of commute, parents might consider bringing their children to the place once a year, not every weekend.

As such, weekend entertainment facilities for children have to be within ~30 minutes of commute time, for a city like Dhaka this essentially means they have to be within a 3-4 km radius. Contrary to the scarcity of open spaces, indoor spaces with about 8000-10,000 sq/ft are actually quite abundant. There are tons of shopping malls which remain underutilized thanks to e-commerce and oversupply in general, and shopping mall operators are more than happy to offer a vendor like Babuland a great deal on the lease as it brings footfall. 

The other key point which looked interesting to us was the early mover advantage. Babuland chose to begin with non-prime locations in Dhaka, where Babuland was the only game in the neighborhood for a long time. Once kids start visiting an outlet, either they make friends in the outlet or they begin inviting friends from school/elsewhere, and the entire Babuland visit evolves into some sort of a group sport. This gives each outlet a network effect of sorts, as kids will only go to the outlets where their friends are going.

Babuland chose to price its tickets at a moderately lower end (with benefits for regulars) which encouraged foot traffic. While it is easy to replicate the business, achieving Babuland’s reach is a challenge. The company doubled down on its community-building efforts by launching its own characters and content, all of which helped differentiate it further in children’s minds.


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  • Babuland, children entertainment