Pakistani-American VC At Top Silicon Valley Firm Leads First Investment in Pakistan

 Kleiner Perkins, a top Silicon Valley venture capital investment firm, is leading series A round of $17 million investment into Pakistani start-up Tajir. The startup operates an online marketplace for small store merchants in Pakistan. The announcement came via a tweet by Mamoon Hamid, a Pakistani-American Managing Partner at Kleiner Perkins who led the investment. Last year, Tajir raised a $1.8 million seed round.  The company's revenue has increased by 10x since its seed round. 

Here's what Hamid tweeted: "Made my first investment in Pakistan, my country of birth, and a place I called home from the ages of 10 to 13. Feels special. This also marks @kleinerperkins first investment in Pakistan. We are thrilled to announce our investment in @tajir_app_pk" 

Tajir has been cofounded by two brothers, Babar and Ismail Khan. The company lets stores place orders for inventory through its app and allows customers to compare the prices of goods, purchase inventory and have access to 24/7 ordering with a next day delivery. 

Mamoon Hamid, partner at Kleiner Perkins (who is himself originally from Pakistan), who led the round told Forbes magazine that given Pakistan’s prevalent bodega (small retail outlet called kirana store in South Asia) model, what Tajir was doing was very compelling. “Their software and mission to improve that supply chain and availability of products and pricing and digitizing that process made a ton of sense,” Hamid says. “I thought that would be the first foray for a company to make an attempt at doing a lot more to be a consumer company, not just a wholesale company.”    

Other investors joining Kleiner Perkins include YC Continuity, AAVCF, Fatima Gobi Ventures, Flexport, Golden Gate Ventures, Liberty City Ventures, VentureSouq, and angel investors including Under 30 honoree and CEO of Figma Dylan Field, and Flexport CEO Ryan Petersen.

Mamoon Hamid has a bachelor's degree in Electrical and Computer Engineering from Purdue University, an MS degree from Stanford University and an MBA from Harvard Business School. Here is how Mamoon has described Tajir on Kleiner Perkins website:

"Tajir is Pakistan’s largest tech-enabled retail network — a one stop shop for sellers to compare the prices of goods, purchase inventory, and enjoy the convenience of 24/7 ordering with next-day delivery. They’re already servicing thousands of neighborhood stores in Lahore and have been growing in large part from word of mouth from the goodwill they’ve built with the seller community". 

Comments

Riaz Haq said…
Why did Retailo raise a phenomenal seed round?
With $6.7mn in seed round and $9mn in total funding, the B2B marketplace is gunning to digitise mom-and-pop stores in Pakistan, and Saudi Arabia

https://profit.pakistantoday.com.pk/2021/05/09/why-did-retailo-raise-a-phenomenal-seed-round/

B2B e-commerce marketplace Retailo Thursday announced raising $6.7 million in what the company claimed was the largest seed round for a Saudi Arabia-based startup.

Largest or not, the round is undoubtedly indicative of how rapidly the B2B e-commerce is heating up. At least four not-so-old B2B marketplaces are contending to digitise neighborhood convenience stores in Pakistan. Bazaar and Jugnu are trying their luck from their offices in Karachi, whereas Dastgyr and Tajir are sporting in Lahore.

Then we have Retailo, digitising mom-and-pop stores in Pakistan from their office in Karachi, and Saudi Arabia from their head office in Riyadh.
Riaz Haq said…
New players in the market, such as Tajir and Bazaar Tech, all seem to be primarily focused on aggregating demand for those in the retail segment and this is a great entry strategy. It's likely to be a profitable business in terms of unit economics and they are solving a real need. However before we go deeper into their strategy lets learn about the current best practices within the industry.

https://www.dyl-ventures.com/p/digitising-pakistans-retail-market

How do retailers stock their shelves today?

Currently retailers have to deal with multiple distributors and wholesalers, with some even going to places such as Carrefour/Metro to get bulk deals on products. Each store carries anywhere from 50-500 products and to gather inventory they have to deal with upwards of 20-30 distributors and wholesalers. The ordering process is ultimately broken as they have to wait for order-bookers to come and initiate the process. Having an order-booker is convenient if you are a big store and are serving a large area, however, if you are a small store in an underserved area it does not help much because the order-bookers are less likely to approach you on a regular basis. Once the order is taken, delivery usually takes place the next day.

Each of the startups (Tajir, Bazaar etc) currently entering this arena is likely to be focusing on the following key components: assortment; price; fast delivery and ease of use. While factors such as these are the most critical for ensuring long term success, We believe there are a few other areas that startups should also focus on to ensure long-term retailer loyalty, diversification of revenue streams and the creation of a strong ‘’moat’’ in general as a defense against competition.

Ease of Use & Guaranteed Delivery

The startups intend to provide retailers with an easy and simple mechanism to place orders for supplies. This itself will add value as the retailers will now be able to compare prices of inventory very easily and therefore earn a higher return on their investment. They also intend to offer speedy delivery along with the option to do live tracking of the ability to choose delivery slots.

Branded Items & Private Label

The startups intend to offer all sorts of branded items from all the FMCG’s that are available. One of the largest segments of sales however are commodities such as sugar, flour and salt which are ripe for upstream integration and can be sold under private labels. In a market which will be inundated with new startups and incumbent players the best way to make yourself stand out is to have the lowest prices. We believe that the shrewdest of players will go the extra mile and aim for a higher strategic position in the supply chain to earn additional value.

Building Infrastructure & Enabling Technology Focused Growth
After these startups establish their core business models, they can then begin to focus on expanding their business lines. By using their relationships with retailers, they could decide to build core infrastructure which currently does not exist and/or are unusable by retailers for reasons such as complexity, comprehension and price. Some examples could include infrastructure for Inventory Management Systems (IMS), a Point-Of-Sale (POS) System, Credit Ratings for retailers etc. Getting into these adjacent markets will create a larger impact in the future. This is because it will provide other Pakistani startups & retailers with the infrastructure and data they need to expand into additional services such as Loyalty Programs and the B2C market..

Riaz Haq said…
Dukan.pk vs Chikoo: How do these e-commerce solutions stack up against each other?

https://www.techjuice.pk/dukan-pk-vs-chikoo-how-do-these-e-commerce-solutions-stack-up-against-each-other/


While both Dukan.pk and Chikoo empower their customers to conveniently create an online outlet for their business, there is some nuance that separates both of their offerings.

Built using state of the art technological tools like Accelerated Mobile Pages (AMP) and Progressive Web Applications (PWA) alongside infrastructure like Google Cloud Platform and Amazon Web Services, Chikoo “provides a single-window solution for web, conversational commerce and aggregator-platform e-commerce orders”. It comprises an easy-to-use system featuring merchant-first ordering, out-of-the-box payments, and logistic integrations.

On the other hand, Dukan.pk provides a platform that not only takes care of payments, but also handles delivery of goods/supplies and basic accounting. Plus, upon analysis of the business’s track record, it even hands out “instant affordable loans” to the business to help it grow.

Therefore, upon a cursory glance, it appears that Dukan.pk has more to offer and is willing to work more closely with businesses to keep them afloat.

Ease of use

Both Dukan.pk and Chikoo feature an incredibly user-friendly interface, and all you need to do to get things going is to enter your phone number. For people with minimal technical knowledge, you can’t come up with a simpler way of kick-starting an e-commerce journey.

However, Dukan.pk ultimately takes the cake in terms of time taken to launch a web store. While Chikoo will “setup your online store in 3 minutes”, Dukan.pk allows you to “create your web store in 29 seconds”. That is an incredible lead, and one that will definitely sway consumer decisions.

Company size

With 201-500 employees as per LinkedIn data, Chikoo is definitely the larger of the two startups. In contrast, Dukan.pk has no more than 10 employees.

Testimonials

I personally find this one to be the most interesting metric for comparison, because if there is one thing that would compel business owners from a diverse set of background to trust your solution, it’s testimonials from other business owners like them. Naturally, both Dukan.pk and Chikoo have used made sure to use that fact to their advantage.

Both startups have taken a different approach here, however. Chikoo’s testimonials come about in the form of pictures of apparently satisfied business owners on its home page. Dukan.pk, meanwhile, has a whole YouTube channel featuring short clips of business owners explaining how the ecommerce solution has helped them.

Riaz Haq said…
Bloomberg's Faseeh Mangi's tweet:


Pakistan’s startup funding and foreign interest is going through the roof. Why? Covid has helped us because travel has closed. Now investors are open to speaking with founders over Zoom. It was not easy for them visiting Pakistan, says
@afkhwaja

https://www.bloomberg.com/news/articles/2021-06-07/two-fintech-deals-add-to-startup-funding-rush-in-pakistan

https://twitter.com/FaseehMangi/status/1401967579812466696?s=20
Riaz Haq said…
#Pakistani online #pharmacy Dawaai nets $8.5M in latest funding round to scale #supplychain. Round led by #US-based "500 Startups" with local #VC firms Sarmayacar, Kingsway Capital, Crimson Seed Capital & Mentors Fund participating. https://shar.es/aWmoyi via @MobiHealthNews

Pakistani online pharmacy Dawaai has announced that it raised $8.5 million in a recent investing round led by US-based 500 Startups and participated by local venture capital firm Sarmayacar. Kingsway Capital, Crimson Seed Capital and Mentors Fund also participated in the round.

WHY IT MATTERS

Launched in 2014, Dawaai is touted to be Pakistan's largest pharmaceutical marketplace that offers authentic and affordable medicines. On the enterprise end, it runs an online one-stop shop for the inventory needs of small pharmacies. With over 250 staff, the company is serving 11 million people across the country with deliveries made in 98 cities.

The healthcare merchant also provides other web and mobile app-based services, including teleconsultations, nursing, physiotherapy and at-home lab testing.

The latest funding round brings a total investment of $10.5 million for the company to date. In a press statement, Dawaai said it will deploy the proceeds to build a pharmaceutical supply chain infrastructure in Pakistan, as well as invest in technology for business optimisation.

THE LARGER TREND

Digital pharmacies drew investments from various sources in 2020 as lockdowns forced customers to purchase medications online.

In July last year, NowRx bagged $20 million in Series B funding for its expansion. In the same month, Medly also closed a financing round where it raised $100 million.

Online pharmacy platform GoodRx debuted in the Nasdaq in September where it drew $1.1 billion from cornerstone investors.

ON THE RECORD

"We are laser-focused on our mission to make healthcare accessible and affordable for the people of Pakistan and wider South Asia. The first step in achieving that is building the missing pharmaceutical supply chain infrastructure in the markets we operate and honing the next generation of talent to take our economies forward. This financing is enabling us to carry forward on our journey to make the lives of people better across the length and breadth of Pakistan, with a low-cost healthcare model for all Pakistanis," Dawaai Founder Furquan Kidwai said.
Riaz Haq said…
#Pakistan’s online #grocery delivery #startup, GrocerApp, has successfully raised $5.2 million in a Series-A round from local and global institutional and angel investors. #technology #Investment https://profit.pakistantoday.com.pk/2021/06/14/pakistans-grocerapp-scores-5-2mn-in-series-a-funding/

The round was led by Hayaat Global, with participation from Millville Opportunities Fund, New York, MENA-based Wamda Capital, Jabbar Internet Group and Nama Ventures, China-based Haitou Global, and Pakistan-based LeanBricks and Walled City Co. Further participation from angels included former Souq/Amazon MENA CFO Asif Keshodia, Khalid Alami, Ziyad Alami of Huda Group in Dubai, and Jon Puckhaber of Alvento Capital who participated in his personal capacity.

Founded in 2016 by Ahmad Saeed, Hassaan Sadiq, and Rai Bilal, GrocerApp is digitising grocery shopping in Pakistan with a focus on customer experience. Grocery shopping is the largest segment of consumer spending comprising over $48 billion in 2019 according to Household Integrated Economic Survey (HIES) data from the Pakistan Bureau of Statistics. It was until recently also largely an untapped market as far as tech-enabled solutions are concerned.

Prior to GrocerApp, the founders were key team members of PakWheels, scaling the company to one of the earliest Pakistani tech ecosystem powerhouses.
Riaz Haq said…
#KP province of #Pakistan takes lead in #IT sector with first-ever #5G trial. Experimental test in #Peshawar comprises remote surgery concept & cloud gaming. The trial in Peshawar will increase pace of #internet penetration in Pakistan. #Telecom #Tech
https://tribune.com.pk/story/2305786/k-p-takes-lead-in-it-sector-with-first-ever-5g-trial

The country took one step further towards expanding its internet horizon on Thursday with Khyber Pakhtunkhwa (K-P) conducting the successful test of 5G technology for consumers at the Durshal Incubation Center in Peshawar.

The PTCL Group and Khyber Pakhtunkhwa Information Technology Board (KPITB), under the umbrella of Department of Science and Information Technology, conducted the 5G trial in a limited environment on a non-commercial basis.

The demonstration included successful remote surgery concept, cloud gaming and an overview of anticipated 5G technology applications in Pakistan. Once the infrastructure and systems are operational, surgeons will be able to perform surgeries remotely in the far-flung areas.

Once operational, Pakistan would join a select group of nations benefiting from the latest internet tech. The first country to adopt 5G was South Korea way back in 2019. Other leading nations like Switzerland, Kuwait, Finland, Qatar, US, UK, China, Italy, Spain, Australia etc followed later.

There are a host of others, including India, who have started making remarkable progress with 5G or have already achieved 5G technology. Noman Ahmed Said, Chief Executive Office (CEO) Si Global said that there were several advantages in introducing 5G in Pakistan.

The advantages, he added, included increased bandwidth along with faster speed with the potential to integrate seamlessly with technology that supported it. “The 5G, the 5th generation mobile network, enables a new kind of network that is designed to connect virtually everyone and everything together, including machines, objects, and devices,” he told The Express Tribune.

K-P Senior Minister and Minister for IT, Science and Technology Atif Khan termed the 5G trial in Peshawar a “significant milestone in the history” of K-P. Speaking at the trial, he congratulated all the stakeholders on “making significant contribution to this latest technology demonstration”.

“This technology, once deployed, will enable provision of best medical and healthcare facilities to remote areas, provide international-level education opportunities to the underserved areas, and have a significant overall impact on the socio economic landscape of the country,” he added.

The main challenges facing the developing counties like Pakistan in implementing 5G is that “we have very recently implemented 4G for which the overall roll-out phase is still incomplete”, Said said. “There are also major technical challenges that we are likely to face while deploying 5G.”

According to Said, there were various security aspects of the 5G networks, which were an ongoing issue and added: “We are currently not technologically competent to handle the many security glitches of 5G networks.”

He said: “Additionally, there are infrastructural hurdles that will need to be completely reworked and will also involve heavy costs in doing so. Spectrum costs, costs of increased network density and dynamic spectrum sharing are also issues that are to be considered.”

Said said that introducing 5G would be a massive step in the formation of a Digital Pakistan in accordance with the vision of Prime Minister Imran Khan, adding that 5G would facilitate the move towards digital currency and cryptocurrency, putting the country at par with the rest of the world.

According to Si Global CEO, implementation of 5G could ultimately change the technological landscape of Pakistanm but stressed that several arrangements had to be made prior to its implementation.

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