Pakistan Tech Summit 2020 at Draper University in San Francisco Bay Area

Hundreds of Pakistanis and Pakistani-Americans attended Pakistan Tech Summit 2020 at Draper University in San Mateo, California on February 15, 2020. It was organized by Arzish Azam of Ejad Labs with sponsorships from JS Bank, Netsol, VisionX, Pakistan IT ministry, Pakistan National IT Board and Pakistan Software Exports Board. This event came after a recent report in Germany's Deutsche Welle (DW) by Miriam Partington who wrote in a story titled "Pakistan: The next big Asian market for tech startups?" that "Pakistan's young and tech-savvy population, market of over 220 million people and increasing levels of local capital are creating opportunities for tech entrepreneurs".

Pakistan Tech Summit:

At this conference, I was really encouraged by the presence of many young Pakistan entrepreneurs eager to realize the vision of Digital Pakistan. Enthusiasm is necessary but not sufficient. What is missing is serious attention to attract more risk capital to support these young enthusiastic entrepreneurs.  Unfortunately, I did not see any known Silicon Valley venture capitalists (VC) at the event. Recent McKinsey report on Pakistani startup ecosystem noted that per capita venture capital is just 6 cents, lower than 7 cents in Bangladesh and only a third of 18 cents in Nigeria. What Pakistan needs is a venture capital initiative along with digitization initiative.

Founders or cofounders of several Pakistani startups pitched their companies hoping to attract venture investors. Among the attendees were many young enthusiastic techies.

Najeeb Ghauri, Chairman of Netsol Technologies, made a pitch that focused on the opportunities presented to investors by Pakistan's growing young enthusiastic talent pool and large aspirational middle class population. JS Bank's Noman Azhar talked about his bank's fund that invests in Pakistani startups taking advantage of the government's Digital Pakistan Initiative. An example of their investment is e-challan systems in Islamabad and Peshawar.

Morning keynote speaker was Farrukh Mahboob of VisionX which offers custom-built digital products and mobile applications for businesses. Their digital solutions are tailored to clients’ needs and are powered by emerging technologies including artificial intelligence (AI), augmented and virtual reality (AR, VR).  VisionX clients includes Fortune 500 companies.

A number of startup pitches followed. Founders or co-founders of DontPort, Integry, Kumlaudi, SafePay, JoyCo and Social Pie pitched their ideas.

Examples of VC Funded Startups:

McKinsey report "Starting up: Unlocking entrepreneurship in Pakistan" has cited Daraz, Zameen, PakWheels, Tez Financial, Patari, AugmentCare and Sastaticket.  Monis Rahman, CEO of, says this is an incomplete list. He personally knows about funds raised by the following companies that are missing from the McKinsey list: -- $9 Million across 3 rounds

Finja -- $4.5 Million seed + bridge (working on $15 Million round)

Airlift -- $12 Million Series A (working on $20 Million round)

Examples of VC Funded Pakistani Startups. Source: McKinsey

Lack of Venture Capital:

It was great to see many young Pakistan entrepreneurs eager to realize the vision of Digital Pakistan. Enthusiasm is necessary but not sufficient. What is missing is an enabling environment for startups to attract more risk capital to support these young enthusiastic entrepreneurs.  Unfortunately, I did not see any known Silicon Valley venture capitalists (VC) at the event. Recent McKinsey report on Pakistani startup ecosystem noted that per capita venture capital is just 6 cents, lower than 7 cents in Bangladesh and only a third of 18 cents in Nigeria. India's level of per capita is at $3.72 and UAE's $40 per capita VC investment is more than 10X India's.

Venture Capital Per Capita. Source: McKinsey

Need For Venture Investment Initiative:

Pakistan needs to have a venture capital initiative to ensure that Pakistani startups fully participate in  Digital Pakistan Initiative. Part of the venture capital initiative should create legal and policy framework to protect investors and facilitate their exit strategies. Pakistan government should invite  venture capitalists and offer to participate as a significant investor in professionally VC funds that invest in Pakistani startups. Experienced Pakistani VCs and entrepreneurs like Asad Jamal and Monis Rahman can be used as a resource to establish this venture investment initiative.

Enabling Startup Ecosystem. Source: McKinsey


Recent "Pakistan Tech Summit 2020" at Draper University in San Francisco Bay Area attracted dozens of enthusiastic tech savvy young men and women ready with their startup pitches. It confirmed what Deutsche Welle's Miriam Partington recently reported in a story titled "Pakistan: The next big Asian market for tech startups?" in which she wrote: "Pakistan's young and tech-savvy population, market of over 220 million people and increasing levels of local capital are creating opportunities for tech entrepreneurs". Unfortunately, I did not see any known Silicon Valley venture capitalists (VC) at the event. Recent McKinsey report on Pakistani startup ecosystem noted that per capita venture capital is just 6 cents, lower than 7 cents in Bangladesh and only a third of 18 cents in Nigeria. India's level of per capita is at $3.72 and UAE's $40 per capita VC investment is more than 10X India's. Pakistan needs to have a venture capital initiative to ensure that Pakistani startups fully participate in  Digital Pakistan Initiative. Part of the venture capital initiative should create legal and policy framework to protect investors and facilitate their exit strategies. Pakistan government should invite  venture capitalists and offer to participate as a significant investor in professionally managed VC funds that invest in Pakistani startups. Experienced Pakistani VCs and entrepreneurs like Asad Jamal and Monis Rahman can be used as a resource to establish this venture investment initiative.

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Riaz Haq said…
A high-profile panel discussion on Pakistan’s digital future attended by prominent players in the local digital industry was hosted by Serena hotels as part of its public diplomacy initiative called ‘Raabta’.

The event titled ‘Re imagine our Digital Future – Preparing to Thrive or Survive?’ was hosted by raabta curator and prominent journalist Sidra Iqbal.

A lively and thought-provoking discussion was held about the challenges facing the local digital economy in face of its rapid expansion, and the challenges and opportunities this brings in terms of innovation, governance, job market, cyber risks, regulation and ease of doing business.

“The focus of the event is to discuss the potential benefits and costs arising from global digital technology changes and, importantly, anticipate public policy solutions to emerging problems that will shape the future of society and the economy for generations to come,” said Sidra Iqbal. “Change can come within a generation if managed properly, rather than waiting for millennia. We are asking if the policymakers going to be reactive to the digital revolution or take the bull by the horn and prepare an environment for the digital economy to thrive?”

The keynote speaker at the event was ‘Digital Pakistan’ initiative chief Tania Aidrus, who spoke about the five pillars that form the cornerstone of the government’s digital policy, which include access and connectivity, digital infrastructure, e Government and digital skilling. Tania said the response to the PM’s digital initiative was overwhelmingly good and it felt like a movement already. She said a lot is happening in the digital arena but it’s important to keep an end view in sight and take a strategic approach. She said the efforts at provincial and federal levels have to be synchronized to achieve the objectives on a broader scale. She said the internet is a democratizing force and digital allows equitable access to knowledge provided the affordability of digital infrastructure was enabled and commodities like the internet are not taxed as a luxury item.

The panel included prominent figures of the local digital landscape including GM of Careem Zeeshan Hasib Baig, MD Ehsan Saya, CEO Foodpanda Nauman Sikandar Mirza, Chief Corporate and Enterprise Officer Jazz Ali Naseer, MD KPITB Dr Shahbaz Khan and Chief Business Support Officer U Microfinance Bank Sharmeen Niaz.

Zeeshan Hasib Baig said that Careem has enabled 500,000 jobs which shows that going digital will not take away jobs as some fear, however it will change the way we work and make it more efficient so the focus can be on better quality leading to productivity gains. He said digital companies like Careem are improving livelihoods, moreover they are allowing females much better mobility for work and leisure.

Ali Naseer from Jazz said “we need to change the lens of how we look at things and there needs to be a paradigm shift in our traditional processes to allow for digital to be effective lest we become redundant.” “Whilst we have 3G/4G broadband license since 2014 but less than 40% of the population is connected on broadband currently which is a travesty.”

Nauman Sikander Mirza of food delivery service Foodpanda Pakistan said that Pakistan’s digital economy was in very early stages with no e-commerce companies operating in the country and very few government entities using automation.

MD of online selling platform Ehsan Saya spoke about digitization boosting the trade industry like never before despite the fact that the majority of the population is not accustomed to buying online. He said the e-commerce will pick up eventually when the government improves regulation.
Riaz Haq said…
Bayut (#Dubai) & Zameen (#Pakistan) parent EMPG #emergingmarket #realestate business group raises $150 million at a valuation of over $1 billion, announces merger with OLX in a few markets, including Pakistan

Dubai-based Emerging Markets Property Group (EMPG) that runs property portals in different emerging markets across the world including Bayut in Dubai, Zameen in Pakistan, and Mubawab in North Africa, has become a unicorn after raising a $150 million round led by OLX Group and its existing shareholders, the company announced in a statement to MENAbytes today.

EMPG did not disclose the exact valuation but said the deal values the company at over $1 billion post-transaction.

The deal includes merger of OLX Group’s classifieds business with Emerging Markets Property Group (EMPG) in Pakistan, Egypt, Lebanon, and the United Arab Emirates.

OLX Group with the deal has become the single largest shareholder of EMPG, owning 39 percent of the company. The $150 million investment is fresh cash injection and will be used by the company to develop a range of new services, creating a more seamless user experience, enhancing data transparency, and deepening market intelligence for both consumers and business users.

According to the statement, EMPG will operate existing OLX platforms in Egypt & Lebanon, and roll out new services for the real estate community. EMPG before the deal did not have any presence in Egypt & Lebanon.

In Pakistan & United Arab Emirates, the platform of both the groups which apparently include EMPG’s Zameen & Bayut and OLX Groups’ OLX and Dubizzle, will be operated EMPG.

EMPG will also operate OLX’s platforms in Saudi Arabia, Bahrain, Kuwait, Qatar, and Oman after this deal.

The statement notes that the aggregated value of properties sold in these markets is estimated at $90 billion, providing a commission pool for real estate agencies of over US $2 billion per annum, “This presents a great opportunity for EMPG to enhance their real estate services in these markets.”

Imran Ali Khan, the co-founder, and CEO of EMPG, said, “EMPG has grown at a tremendous pace since its inception. Our unique ability to scale using our proprietary tech has aided and enabled this expansion. This deal puts us one step further in our journey towards providing solutions in multiple markets to over a billion consumers around the world, expanding our classifieds offering significantly.”

Martin Scheepbouwer, CEO of OLX Group, says “I’m proud of what we have built in these four markets. Our brands are household names, and currently help tens of millions of people to exchange goods and services every month. The next phase is an exciting one, with EMPG’s real estate industry expertise helping deepen the customer experience. As EMPG’s largest shareholder, we’ll have a front seat to explore how we can scale their services model further – taking our ambition to shape the future of classifieds into its next stage.”

Haider Ali Khan, Head of EMPG – MENA on this collaboration: “We, at Bayut and EMPG, are very excited about the future of the UAE real estate industry and the prospects of real estate in the MENA region. This merger of EMPG and OLX will allow us to better serve our customers, given that both operate brands with a strong following and will allow us to leverage existing tech and data to paint a more accurate picture of the state of affairs in the real estate industry across the region.”

“At the same time, we will be making significant technology investments to provide more value to all users of property, automotive and other segments of the Dubizzle and OLX platforms. I look forward to a bright and prosperous future for the group,” he added.

EMPG is currently present in the GCC region with Bayut, Pakistan with Zameen, Bangladesh with Bproperty, Morocco and Tunisia with Mubawab, and Thailand with Kaidee.
Riaz Haq said…
Telenor Accelerator launches #EdTech Innovation program in #Pakistan. It provides curriculum and skill-based #education for school, college and university students, as well as additional courses incl personal development modules, #digital skills & #STEM

Telenor Velocity, the digital startup accelerator by Telenor Pakistan, has introduced its EdTech Innovation programme, to forge alliances with EdTech startups/scaleups. This initiative is launched in response to the closure of educational institutions and offices due to the coronavirus outbreak, Telenor said.
The programme provides curriculum and skill-based education for school, college and university students, as well as additional courses including personal development modules, digital skills, and STEAM (Science, technology, engineering, arts and mathematics) with a special focus on Robotics.

The Telenor Velocity EdTech Cohort has stepped forward to help students shift to online access and added a number of partners for this purpose including K-5 SABAQ Muse, a learning service based on videos, games and ebooks in multiple languages for early grades. The Edaksa service supports STEAM education and helps Pakistani high school students prepare and pass their standardized government exams; while the EDTechWorx content creation and collaborative delivery platform connects learner, educators and the overall industry. The Skills First online academy aims to allow users to develop their skills; while LearnObots aims to develop makers and creators of tomorrow, with a practical learning approach in the domain of Educational Robotics.
Riaz Haq said…
Y-Combinator backed #Lahore-based #Pakistan #startup Tajir raises $1.8M to help mom-and-pop stores source inventory. It is led by Pioneer Fund, Golden Gate Ventures, Fatima Gobi Ventures, Karavan, and VentureSouq. | TechCrunch

But slowly, global investors who arrived in India and other Asian markets in the last decade are beginning to look at Pakistan and bet on startups that are solving similar challenges.

Tajir, a Lahore-headquartered startup, today serves more than 15,000 neighborhood stores, locally known in the region as kirana, across Pakistan.

The two-year-old startup, the first startup from the nation to be backed by Y Combinator, said on Friday that it has closed a new financing round.

Pioneer Fund, Golden Gate Ventures, Fatima Gobi Ventures, Karavan, and VentureSouq led the round, with participation from a clutch of angel investors, Tajir co-founders Babar Khan and Ismail Khan told TechCrunch in an interview.

Tajir offers full transparency on the prices of various products, addressing a challenge that store owners confront offline each day, and sells and delivers inventories to the stores, said the Khan brothers, whose father ran an FMCG retail distribution business for three decades.

“We help store owners save money on inventory and help them boost their sales,” said Ismail.

Like in India, offline retail drives the vast majority of sales in Pakistan. “The retail is even more unorganized here compared to neighboring nations,” they said. There’s no Amazon or any major giant running an e-commerce business for consumers in Pakistan today.

For Babar and Ismail, that’s a big opportunity as they scale. According to official government data, there are about 2 million neighborhood stores in Pakistan.

Tajir is gaining ground in the country today mostly through word-of-mouth endorsement from existing partners, though the startup also maintains a sales team to educate more store owners about their platform.

It plans to use the capital to expand its offering and develop more services that stores need to grow their business, the brothers said. These offerings could include a wider catalog of inventory, and access to financial services, they said.

“We want to offer an essential service to every single mom-and-pop store in Pakistan,” said Babar.

Tajir today does not have any major competitor, which is good news as a lot is riding on its founders’ shoulders who are among the early batch of entrepreneurs in the country. In many ways, their success will determine the perception of the Pakistani market to investors worldwide.
Riaz Haq said…
Prosus Ventures leads $13 million series B #investment in #Pakistan's ride-hailing #startup Bykea. Current investors Middle East Venture Partners & Sarmayacar also invested in the round, bringing total to-date raised to $22 million. #tech via @techcrunch

The startup has been able to out compete firms like Careem and Uber in Pakistan by offering localized solutions. It remains one of the few internet businesses in the country that supports Urdu language in its app, for instance.

“Our brand is now widely used as a verb for bike taxi and 30 minute deliveries, and the fresh capital allows us to expand our network to solidify our leading position,” he said.


Bykea, which leads the ride-hailing market in Pakistan, has raised $13 million in a new financing round as the five-year-old startup looks to deepen its penetration in the South Asian country and become a “super app.”

The startup’s new financing round, a Series B, was led by storied investment firm Prosus Ventures . It’s the first time Prosus Ventures has invested in a Pakistani startup. Bykea’s existing investors Middle East Venture Partners and Sarmayacar also invested in the round, which brings its total to-date raise to $22 million.

Bykea leads the two-wheeler ride-hailing market in Pakistan and also operates logistics delivery business and financial services business. The startup has partnered with banks to allow customers to pay phone bills and get cash delivered to them, Muneeb Maayr, founder and chief executive of Bykea, told TechCrunch in an interview.

Fahd Beg, Chief Investment Officer at Prosus Ventures, said firms like Bykea are helping transform big societal needs like transportation, logistics and payments through a technology-enabled platform in Pakistan. “Bykea has already seen impressive traction in the country and with our investment will be able to execute further on their vision to become Pakistan’s ‘super-app,” he said in a statement.

Bykea works with over 30,000 drivers who operate in Karachi, Rawalpindi and Lahore. (Two-wheelers are more popular in Pakistan. There are about 17 million two-wheeler vehicles on the road in the country today, compared to fewer than 4 million cars.)

The new investment comes at a time when Bykea restores the losses incurred by the coronavirus outbreak. Like several nations, Pakistan enforced a months-long lockdown to curtail the spread of the virus in March.

As with most other startups in travel business globally, this meant bad news for Bykea. Maayr said the startup did not eliminate jobs and instead cut several other expenses to navigate through the tough time.

One of those cuts was curtailing the startup’s reliance on Google Maps. Maayr said during the lockdown time Bykea built its own mapping navigation system with the help of its drivers. The startup, which was paying Google about $60,000 a month for using Maps, now pays less than a tenth of it, he said.

Starting August, the startup’s operations have largely recovered and it is looking to further expand its financial services business, said Maayr, who previously worked for Rocket Internet, helping the giant run fashion e-commerce platform Daraz in the country.

Monis R. said…
Great development for the startup ecosystem. Bravo State Bank of Pakistan. Old laws must be quickly revamped to feed the growing traction within our startup ecosystem. was the first Pakistani startup to raise international venture capital. It was hard. Had to invent a structure that worked for foreign professional VC funds. Many startups have followed the corporate holding pattern we pioneered. Now there are dozens of venture funded Pakistani startups soon to be hundreds. Not having to fight an outdated system means entrepreneurs can spend more time building game changing businesses.
Riaz Haq said…
SBP, after approval of the Federal Government, has introduced three new categories of investment abroad under its revised policy governing equity investment abroad and banks have been authorized to allow remittances under newly introduced categories.

1. Establishment of Holding Company abroad by residents for raising capital from abroad: Pakistan’s investment regime is quite liberal that allows full freedom to repatriate profit, dividend, and capital. However, some international investors prefer to invest indirectly through a holding company established abroad specially in the Fintech and Startup firms. SBP’s revised policy will enable the Pakistani Fintech and startup companies to channelize foreign direct investment in the country by establishing a holding company abroad against remittance of up to USD 10,000 and subsequent swapping of shares to mirror the shareholding of a local company in the holding company.

2. Establishment of subsidiary/branch office abroad by export-oriented companies/firms for promoting exports: The policy will enable the export-oriented companies to establish subsidiary/branch office abroad against remittance of 10 percent of their average annual export earnings of last three calendar years, or USD 100,000 whichever is higher. This will facilitate exploring new and non-traditional markets and capturing more export orders, as international buyers prefer dealing with subsidiaries/representative offices of foreign companies present in their country. Accordingly, the proposed policy would help in the growth of export-oriented companies and boost the exports of the country.

3. Investment abroad by Resident Individuals: The policy will allow the Resident Individuals of Pakistan to acquire an equity stake in international firms through share option plans or investment in listed securities subject to observance of the annual ceiling of foreign exchange defined in the policy. In the case of sweat equity, a person can acquire up to twenty percent shareholding in a foreign company. These policy provisions will provide opportunities to individuals to earn foreign exchange for the country in the form of repatriation of dividend/ capital gains to Pakistan.

Riaz Haq said…
Pakistan launches growth funds for startups,with%20amounts%20that%20were%20undisclosed.

The (IT) minister (Aminul Haq) said the overall environment in the country is improving. Bykea, one of the startups accelerated at NIC Karachi, has raised $21 million of Series B Funding.

Altogether, 122 deals worth $178 million were made from 2015-2020 in Pakistani startups including another 19 deals with amounts that were undisclosed. This brings the total deals count up 141.


Asim Shahryar Husain, CEO of Ignite said 272 startups have graduated from Ignite’s National Incubation Centers with a total investment commitment of Rs8 billion and cumulative revenue of Rs3 billion. These nascent companies have created more than 100,000 new jobs and these numbers quantify the achievements of our five incubators in a short span of time. Ignite is planning vertical incubators and accelerators in future to boost the startup ecosystem of Pakistan.

Husain said the platform will be the first of its kind in and will aim to bridge the gap between entrepreneurs and national and international investors of all types including commercial and impact investors, donors and philanthropists.

The ministry and Ignite will invite various investors, donors and other investment/financial institutions to participate in the platform to consider business opportunities for financing, investments, supply chain commitments and networking. “It will be open to qualifying startups from all NICs and AP incubated and accelerated businesses across Pakistan. Under PakImpactInvest, first grand national pitching session of top 25-30 startups selected from all NICs and AP accelerated companies will be held in the last week of March 2021.”
Riaz Haq said…
In 2012, Pakistan’s start-up ecosystem had only two major
business incubators and accelerators – it has quickly evolved
since then.
By 2019, the country had 24 incubators and
accelerators and around 20 key investors
with many funds
catering to early stage start-ups.
Riaz Haq said…
The era of VCs and boom of start-ups
Fatima S AttarwalaPublished March 8, 2021

“I have never seen as much genuine interest in writing cheques as I have in the last year,” says Kalsoom Lakhani, co-founder of the $15 million venture capital fund i2i Ventures. “There are so many international funds in Silicon Valley, East Asia, Middle East and other places that are realising that Pakistan is one of the most exciting places to come.”

Despite the pandemic, venture capitalist (VC) activities increased by 37 per cent to $65.6m in 2020 in Pakistan, explains Misbah Naqvi, co-founder of i2i Ventures. The fund is a sister concern of Invest2Innovate that was formed to support frontier markets in 2011 and acts as a pipeline of start-ups for i2i Ventures.

The lockdown speeded up sectors such as e-grocery, e-food delivery, fintech and edtech. International funds that have invested in similar companies in other markets have a much higher appetite to come into Pakistan as they already know what that model looks like, they explain.

In the last five years, over $200m has been raised by startups of which only about 3pc was towards female-founded or co-founded companies

They give the example TelloTalk, Pakistan’s first messaging platform in English, Urdu and regional languages. With close to 1.5m downloads and continuing to grow, the company has grown four times in terms of active user growth since i2i Ventures’ investment in 2019.

Understanding the VC model
In a traditional business model, the bottom line indicates the returns investors receive. In a VC model, investors make money when they sell their stake and exit the business. The exit can be in the form of an initial public offering, an acquisition, or it could be that the company is growing so fast, such as in the case of Careem and Uber, that more and more investors come in at later stages and buy the stake of initial investors.

“The whole idea of VC is to look at making 10x returns on your investments. The way VC works is that there will be a couple of unicorns that go on to become hundred-million-dollar companies, a few that will do pretty well and offer 3x to 5x returns, some that will just recoup the investment and then there will be those that will go bust,” outlines Ms Naqvi.

“It is a very high-risk asset class, especially in Pakistan where it is unproven,” says Ms Lakhani. “Since the space is really new, and exits require a five- to ten-year timeframe at least, it is too early to assess exits.”

A more mature market
There are several rounds of investments for startups. The first is when capital is raised by friends and family, followed by a pre-seed round that has angels and institutions involved. The seed level is when one starts seeing traction, after which the founders can raise either pre-seeds, Series A, up to Series A1. The Series A round of funding is when the company has figured out its product market and wants to, for example, grow to a few more cities. Series B and beyond is like putting fuel into the engine, explains Ms Naqvi.

“Considering the continuum, you can appreciate that a few years ago we were mostly seeing seed-stage deals. However, in the last year, we have had more series A deals in tandem with higher valuations of these companies.”

Criteria for funding
“We typically finance $100,000-200,000 in each investment,” they explain. Their process can take anywhere between four weeks to a few months, depending on how investment-ready the founders are.

The most important factor for the investing duo is the strength of the founding team. Secondly, they analyse the market opportunity — for example, a business in the organic food niche may be great but the opportunity would not be as large as say e-groceries. The third factor is traction — the partners don’t invest in a company that is just an idea.

Riaz Haq said…
#Pakistan's #tech ecosystem is finally taking off. In 2021, Pakistani #startups are on track to raise more money than the previous 5 years combined. This capital is coming from investors from #Asia, #MiddleEast & top #SiliconValley VCs. via @techcrunch

Pakistan, the world’s fifth most populous country, has been slow to adapt to the internet economy. Unlike other emerging economies such as China, India and Indonesia, which have embraced digitization and technology, Pakistan has trailed the region in the adoption of technology and startup formation.

Despite this, investors have dreamed for years of the huge opportunities in unlocking Pakistan’s potential as a digital economy. As a country of 220 million people, almost two-thirds of whom are under the age of 30, Pakistan draws natural comparisons to Indonesia — which has rapidly emerged as one of the most vibrant technology ecosystems outside the U.S. and China.

After years of lagging behind, over the course of the past 18 months, Pakistan’s technology ecosystem has come to life in unprecedented fashion. In 2021, Pakistani startups are on track to raise more money than the previous five years combined. Even more excitingly, a large portion of this capital is coming from international investors from across Asia, the Middle East and even famed investors from Silicon Valley.

The rapid emergence of Pakistan’s technology ecosystem on the international stage has been no accident — it’s the result of a confluence of changing facts on the ground and shifting dynamics in the startup and investing world as a result of the pandemic.

The sudden emergence of Pakistan’s tech ecosystem on the international stage has been driven by three major factors: an improving security situation, quickly growing mobile connectivity, and critical legal changes and deregulation.

As a frontline state and coalition partner in the United States’ invasion of Afghanistan, Pakistan saw fatalities from terrorist violence soar from 295 in 2001 to a peak of over 11,000 in 2009. This climate of instability and violence scared away international business and investors from Pakistan for much of the first two decades of the 21st century.
Riaz Haq said…

Pakistan’s startups fund raising is going through the roof. Record $101 million in the first half of this year compared with $65.6 million in the whole of 2020

Pakistan’s Keenu Eyes IFC backing as startups raises record funds – Bloomberg

(Bloomberg) -- Wemsol Pvt., known as Keenu, is looking to raise as much as $5 million from the International Finance Corporation that would extend a record fundraising spree by Pakistan’s startups. The Karachi-based company, which makes point-of-sale debit and credit card machines, will use the money to expand its network, Chief...
Riaz Haq said…
#Karachi-based #startup Bazaar completes series A round. #Pakistan's B2B marketplace and digital ledger platform Bazaar has raised $30 million led by #SiliconValley-based early stage VC Defy Partners & #Singapore-based Wavemaker Partners. via @techcrunch

A one-year-old startup that is building a business-to-business marketplace for merchants in Pakistan and also helping them digitize their bookkeeping is the latest to secure a mega round in the South Asian market.

Bazaar said on Tuesday it has raised $30 million in a Series A round. The new financing round — the largest Series A in Pakistan — was led by Silicon Valley-based early stage VC Defy Partners and Singapore-based Wavemaker Partners.

Scores of other investors including current and former leaders of Antler, Careem, Endeavor, Gumroad, LinkedIn and Notion as well as new investors Acrew Capital, Japan’s Saison Capital, UAE’s Zayn Capital and B&Y Venture Partners and existing investors Indus Valley Capital, Global Founders Capital, Next Billion Ventures, and Alter Global also participated in the new round.

One way to think about Bazaar is — especially if you have been following the Indian startup ecosystem — that it’s sort of a blend between Udaan and KhataBook. “That’s a good way to describe us,” said Hamza Jawaid, co-founder of Bazaar in an interview. “We had this benefit of hindsight to not just look at India but other emerging markets,” he said.

“We saw lots of synergies between these two. If you look at commerce, you have to acquire every single merchant in every single category differently. Whereas with Khata, merchants in any city and category can download it. So effectively, it’s a great customer acquisition tool for you,” he said on a WhatsApp call, adding that this also provides greater insight into businesses.

Bazaar’s business-to-business marketplace, which provides merchants with the ability to procure inventories at a standard price and choose from a much larger catalog, is currently available in Karachi and Lahore, the nation’s largest cities, while Easy Khata is live across the country.

At stake is a booming $170 billion retail market in the world’s fifth-most populous nation that is yet to see much deployment of technology, said Saad Jangda, Bazaar’s other co-founder. Both of them have known each other since childhood and reconnected in Dubai a few years ago. At the time, Jawaid was at McKinsey & Company while Jangda was working with Careem as a product manager for ride-hailing and food delivery products.

There are about 5 million micro, small, and medium-sized businesses in Pakistan. Like India, even as a significant portion of the population has come online, most merchants remain unconnected, said the founders, who surveyed shops going door-to-door.

“We’ve been investing in FMCG B2B marketplaces across the region since 2017. After working with Hamza and Saad over the past year, we’ve been impressed by their customer-centric approach to product development and the speed of their learning and execution,” said Paul Santos, Managing Partner at Wavemaker Partners, in a statement.

“It’s no surprise that they’ve received glowing reviews from their customers and partners. We’re excited to support Bazaar as they solidify their market leadership and digitize Pakistan’s retail ecosystem,” he added.

The startup said it has amassed over 750,000 merchants since launch last year. And it appears to have solved a problem that many of its South Asian peers are still grappling with: Retention. Bazaar said it has a 90% retention rate.

I asked Jangda if he plans to expand to the ‘dukaan’ category. Several startups in Asia are currently building tools to help merchants set up online presence and accept digital orders. He said the market is currently not ready for a dukaan product just yet. “The B2C market is still developing, so there is not so much demand from the consumer side yet,” he added.

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