Ignite Eased Pathways for Local and Global Venture Capitalists Through Pakistan Startup Fund

The Pakistan government’s Ignite has further eased pathways for domestic and global venture capitalists (VCs) to deploy capital into high-potential local startups. This latest initiative forms part of the Pakistan Startup Fund’s (PSF) expanding overarching vision to cultivate world-beating, innovative companies locally through public-private sector collaboration.

Interested investors can now seamlessly register on the dedicated Pakistan Startup Fund portal to gain access to an approved whitelist of venture capital firms. Once registered, VCs undergo rigorous due diligence by PSF’s investment committee to verify credibility and domain expertise.

The streamlined mechanism allows whitelisted VCs to apply for matching grants worth 10-30% of their direct investments into post-revenue Pakistani startups. Unlike typical arrangements, PSF only serves as an investment catalyst and does not seek equity, governance rights or royalties in funded startups. This allows optimal freedom to investors and entrepreneurs without outside interference.

Moreover, grants get awarded to startups as the ‘last cheque’ in ongoing funding rounds only after securing commitments from commercial VCs upfront. This ensures purely complementary support once business viability gets validated externally.

Over 180 domestic and global VCs have already registered on the platform to access co-investment grants supporting Pakistan’s next generation of innovative companies.

By eliminating red tape, creating aligned incentives and facilitating access to growth capital, Pakistan Startup Fund proves instrumental for its vision of making Pakistan a global hub for technology entrepreneurship. Already, funded startups are showing potential to drive innovations and expand globally across verticals like fintech, edtech, healthtech and more.

Attracting international VC attention also results in localized knowledge and connections transferring to domestic ecosystem stakeholders. This paves the way for more homegrown fund managers to emerge.

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Navigating Innovation: Pakistan’s Flourishing IT Industry and Startup Ecosystem

Pakistan’s Information Technology (IT) industry stands as a beacon of innovation and growth in the South Asian region, propelled by a dynamic mix of talent, entrepreneurship, and government support. As the country embraces digital transformation, its IT sector, along with a vibrant startup ecosystem, is playing a pivotal role in driving economic progress and technological advancement.

The Current Landscape

Pakistan’s IT industry has witnessed remarkable growth in recent years, with a diverse array of companies and startups making significant strides in software development, IT consulting, outsourcing, digital marketing, and other specialized services. The industry’s value is estimated to exceed $3.5 billion, and this figure is poised for further expansion as the sector continues to evolve.

Fueling this growth are Pakistani startups, which have emerged as key players in driving innovation and disruption across various sectors. From telecom, e-commerce and fintech to healthtech and edtech, Pakistani startups are leveraging technology to address societal challenges, enhance efficiency, and create new opportunities for economic growth.

Key Growth Drivers

Several factors have contributed to the success of Pakistan’s IT industry and startup ecosystem. Foremost among these is the government’s commitment to promoting innovation and entrepreneurship through initiatives such as the Digital Pakistan Vision and the National IT Policy. These efforts have created a conducive environment for startups to flourish, offering incentives, funding opportunities, and regulatory support.

Additionally, Pakistan’s young and tech-savvy population has played a crucial role in driving innovation and entrepreneurship. With a large pool of skilled professionals graduating from universities and technical institutes, Pakistan boasts a talent pool capable of competing on the global stage. This abundance of human capital has attracted both domestic and international investors to the country’s burgeoning startup ecosystem.

Furthermore, the increasing adoption of digital technologies across various sectors has created a fertile ground for startups to thrive. From mobile apps and online platforms to IoT devices and AI-driven solutions, Pakistani startups are harnessing the power of technology to solve complex problems and meet the evolving needs of consumers and businesses.

Challenges and Opportunities

Despite the rapid growth of Pakistan’s IT industry and startup ecosystem, several challenges remain. These include limited access to funding, regulatory hurdles, infrastructure constraints, and a lack of ecosystem support. However, these challenges also present opportunities for innovation and collaboration, as stakeholders work together to address common concerns and build a more robust ecosystem.

One of the key areas of focus for Pakistani startups is digital inclusion, with efforts underway to bridge the digital divide and ensure that all segments of society have access to technology and its benefits. This includes initiatives to promote digital literacy, expand internet connectivity, and develop localized solutions that cater to the needs of underserved communities.

In addition to domestic challenges, Pakistani startups also face competition from global players and regional rivals. However, this competition also serves as a catalyst for innovation and excellence, pushing startups to strive for greater heights and differentiate themselves in the market.

Recent Updates and Future Outlook

Recent updates by the IT Ministry have further bolstered Pakistan’s IT industry and startup ecosystem. These include initiatives to promote innovation, provide financial support to startups, and create a conducive regulatory environment. Additionally, collaborations with international partners and participation in global tech events have helped raise the profile of Pakistani startups on the global stage.

Looking ahead, the future of Pakistan’s IT industry appears bright, with ample opportunities for growth, innovation, and collaboration. By leveraging its talent pool, embracing emerging technologies, and fostering a culture of entrepreneurship, Pakistan is well-positioned to become a hub for innovation and creativity in the digital age. With continued support from the government, private sector, and international community, Pakistan’s IT industry is poised to chart a path towards sustainable growth and prosperity.

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Boost global payments in Pakistan: Alipay+ partners Pakistani fintech NayaPay

Alipay+, the cross-border digital payment and marketing platform operated by Ant Group’s Ant International, is partnering with Pakistani fintech platform NayaPay to “boost global payments in Pakistan”.

The two companies will deploy QR codes compatible with Raast (Pakistan’s instant payment system) and Alipay+ payment partners, including e-wallets and banking apps. This will facilitate foreign exchange inflows and at the same time connect cashless payment systems in global markets to Pakistan.

The collaboration will also aim to address common issues, such as limited interoperability and high transaction costs. Through this partnership, NayaPay will connect Pakistani businesses, especially SMEs, with more than 25 global Alipay+ payment partners.

Alipay+’s move follows its steady expansion across Southeast Asia over the past few quarters. In September last year, the company announced integrations with digital payment platforms in the Philippines. It has also created integrations for its mobile wallet system in Thailand, among other countries.

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PM inaugurates Sohni Dharti Remittance Program – an initiative to promote remittances

HBL and Visa announce Winners of First Edition of She’s Next program in Pakistan

Five winners were announced for She’s Next, Visa’s global platform dedicated to women entrepreneurs at an awards ceremony in Karachi
Hira Javaid, CEO of Foster Learning wins People’s Favorite Award
Winners receive US$10,000 grant each, a tailored training program by Katalyst Labs, and access to the She’s Next Club.
An independent committee selected winners from almost 2,500 applicants across a variety of sectors, from training to education, advertising to professional services, beauty and online retail.

Visa, a world leader in digital payments, together with HBL, Pakistan’s leading Bank today, announced five winners of Pakistan’s inaugural edition of the She’s Next program, Visa’s global platform dedicated to supporting women in their efforts to fund, run and grow their small businesses.

Winners included Ziana Sakhia, CEO & Cofounder of Bechlo, Sadaf Rehman, Cofounder of CodeSchool, Rida Zainab, Cofounder of Porter Pakistan, and Ayesha Awan, Cofounder of SocialBlu. The program also included a People’s Favorite award, where members of the public voted online for their favorite finalist, Hira Javaid, CEO of Foster Learning.

Winners were chosen from a pool of almost 2,500 applicants from a range of sectors including textiles, education, food and beverage, professional services, beauty and wellness within Pakistan. The five winning woman-owned small businesses received a US$10,000 grant each, along with a tailored training program by Katalyst Labs, and access to the She’s Next Club where they will have access to multiple resources including a workshop library and a community of entrepreneurs for mentorship.

A jury evaluated entries based on the progression of the applicant’s entrepreneurial journey, the robustness of their business metrics, their digital presence; and demonstrated ability to confidently solve problems. The members of the jury included: Carl Manlan, Visa’s Vice President for Social Impact in Central Europe, Middle East and Africa (CEMEA), Maya Inayat Ismail, Chief of Staff to the Chairman and ⁠Chairperson, Sustainability Forum – HBL, Aatif Awan, Founder and Managing Partner of Indus Valley Capital and Sheema Sultan, CEO of Core Gym.

Leila Serhan, Senior Vice President and Group Country Manager for North Africa, Levant and Pakistan (NALP), Visa, said: “We are thrilled to announce the winners of our inaugural edition of She’s Next in Pakistan and recognize the ambition and confidence of these women entrepreneurs. We had a tough job selecting our finalists from almost 2,500 exemplary Pakistani women, and our judges had an even harder job picking our winners tonight. This is just the tip of the iceberg, and our hope is that we continue working with our partners to empower this inspiring community of women entrepreneurs.”

Aamir Kureshi, Head Consumer, Agriculture & SME Banking – HBL, said: “HBL is proud to be the exclusive partner of Visa for the She’s Next global program in Pakistan. The program aims to support and empower women entrepreneurs on their path to financial success. This initiative further supports HBL’s commitment to uplift women entrepreneurs in the country. While we have five winners from the 10 shortlisted, the Bank acknowledges and celebrates the exceptional spirit of all 2,500 applicants, each a winner in their own right. HBL is committed to shaping the financial industry of the country. In this regard, SME’s and in particular women businesses will remain a key focus area for us.”

Since 2020, Visa has invested around US$ 3.8 million in over 380 grants and coaching for women SMB owners through the She’s Next grant program globally including in US, Canada, India, Ireland, Ukraine, Saudi Arabia, UAE, Egypt and Morocco.

Pakistani freelancers will start receiving PayPal payments in February: Federal IT Minister

Dr. Umar Saif, Acting Federal Minister for ICT, shared some interesting developments at the Tech Destination Pakistan event. A pilot project will be launched starting February that will benefit 10,000 freelancers in Pakistan by allowing them to receive payments through PayPal.

Dr Saif explained that although PayPal will not have a direct presence in Pakistan, an agreement has been entered into to facilitate payment through PayPal through a third party agreement. In this innovative program, freelancers will not need to go through the traditional process of opening a PayPal account. Instead, people outside Pakistan will make payments from their existing PayPal accounts, and these funds will quickly be deposited into freelancers’ accounts.

To simplify the process for self-employed workers, the government has simplified the process of opening bank accounts. Freelancers only need to provide proof of accounts on popular platforms such as Fiverr, Upwork, Elance, Toptal or Crossover.

Dr. Saif emphasized that there is a revolutionary policy for freelancers in the IT industry: the 50% dollar retention policy. This means freelancers can keep half their earnings in dollars, while providing them with a debit card to spend that money locally or internationally.

The government has allocated funds for setting up E-Rozgaar centers across Pakistan. These centers are designed to provide world-class facilities, improve productivity and contribute to enhancing the overall digital landscape in Pakistan.

As part of this comprehensive programme, more than 250 E-Rozgaar Pakistan centers are scheduled to be established through collaboration between government and private entities. This initiative seeks to encourage self-employment and entrepreneurship in Pakistan, and promote integration into the digital, financial and economic sectors.

Dr. Saif also highlighted important decisions aimed at improving IT education. A standardized quality test for 75,000 IT graduates is scheduled to take place on January 15, and successful candidates will be offered job opportunities through the industrial recruitment programme. The government allocates funding to support industry-specific university courses, ensuring students are well prepared for current industry trends.

The government plans to train 16,000 people for international certifications, ensuring a skilled workforce in areas such as Salesforce, Cisco, Microsoft and Oracle Financials. Federal Secretary for Information Technology, Hassan Nasser Jami, stressed the ministry’s keenness to develop the information technology ecosystem and encourage entrepreneurs, students and developers to take advantage of the opportunities available in this evolving landscape.

Government launches Start-up Fund in Pakistan in a big boost for entrepreneurs

Pakistani startups raised more than $70 million in 2023, which represents a significant decline of more than 70 percent compared to the previous two years.

Acting IT Minister says the government hopes to create value of at least Rs 50 billion annually in Pakistan’s startup ecosystem.

The government on Tuesday launched the Pakistan Startup Fund (PSF), which aims to invest Rs2 billion annually in startups, Acting IT Minister Dr Omar Saif said, after a dismal year for business activities in the country.

According to Saif, the venture fund is designed as equity-free capital that will help close a venture capital (VC) round for a startup and help it raise its first outside investment.

This development comes after a lackluster year for Pakistani startups. In 2023, they raised more than $70 million, according to independent tracking firms, which represents a significant decline of more than 70 percent compared to the large influx of funding in 2021 and 2022.

“Today we launched the Pakistan Startup Fund (PSF), which will invest up to Rs 2 billion annually in Pakistani startups,” Saif wrote on social media platform X, previously Twitter.

“If you are a startup in Pakistan and a foreign VC is evaluating your startup for a $1 million investment, the VC only needs to invest $700,000; the Pakistan Startup Fund will provide you with a $300,000 grant to help close the round.”

Saif assured the startups that the government will not obtain shares or seats on the board of directors in exchange for funding. He said that the Enterprise Support Fund aims to reduce the risks of international investors investing in Pakistani startups. Once the government gives money to startups, “we won’t bother them at all,” he added.

“With PSF, we hope to create value of at least Rs 50 billion annually in Pakistan’s startup ecosystem,” he wrote.

Pakistan’s financial regulators last week expressed optimism about 2024, predicting a more promising year for local startups after the country’s general elections.

They noted that Pakistan’s ongoing economic recovery and the announcement of elections have restored investor confidence, which is expected to boost the startup ecosystem in the country.

Qistbazaar achieves Rs. 1.0 billion sales milestone in just 17 months

Qistbazaar, a leading e-commerce start-up, has achieved the milestone of Rs. 1.0 billion in sales, in just 17 months since its establishment in November 2021. As a rapidly growing BNPL (Buy Now Pay Later) platform, and working as a licensed NBFC (Non-Banking Finance Company), Qistbazaar is committed to uplifting the living standard of all citizens by making over 400 products easily accessible at affordable monthly installments.

Over 15,000 customers have availed Qistbazaar’s plans in this period, to clock up the Rs. one billion in sales, with mobile phones, refurbished laptops, refrigerators, LED TVs, motorcycles and ceiling fans being the most popular purchase items. Customers earning less than Rs. 45,000 per month constitute 57% of total customers, with 70% of customers being below 35 years of age. Micro-business owners like ‘thela walas’ and others comprise over 40% of customers.

“We have crossed a milestone not only for sales but for making a positive impact on the lives of others,” stated Arif Lakhani, co-founder of Qistbazaar, adding, “Our focus is to especially support the population who are unbanked and with zero credit score. From a bunkababwala to an unemployed man buying a motorcycle to become a delivery rider, to a rickshaw driver getting a phone to connect with passengers, or to a gig worker buying a laptop to earn extra income from home, we are enabling people to earn livelihoods and grow for themselves.”

The platform provides personalized support to ensure that customers get the help they need and when they need, through a well-trained digital team, 8 facilitation centers and a women’s branch purely catering to women customers, acting as madadgars.

The growing popularity of the platform can also be attributed to that fact that everyone is eligible to buy at Qistbazaar and not just those who have credit cards or bank accounts. Payments can be made by cheques, online bank transfers, Jazzcash, EasyPaisa and cash on delivery, with early repayments also allowed.

K-Electric announces Winners of the first 7/11+ Innovation Challenge

K-Electric (KE) announced the winners for the first 7/11+ Innovation Challenge in partnership with INNOVentures Global at a day-long event held at Habib University in Karachi.

KE’s 7/11+ Innovation Challenge is the first of its kind event in Pakistan’s utility market, designed for entrepreneurs, startups, researchers, and university students to promote and accelerate strategic innovation. Participants spent the first half of the day making final pitches to the esteemed Jury followed by a panel discussion and award announcement in the second half. Chairman NEPRA, Tauseef H. Farooqi was also in attendance as the Chief Guest.

The challenge is aligned with the United Nations Sustainable Development Goals (UNSDGs), particularly Goal 7 – access to affordable, reliable, sustainable and modern energy for all and Goal 11 – sustainable, inclusive, safe and resilient cities and communities. K-Electric aims to highlight the importance of innovative problem solving and critical thinking within the public and provide a platform to convene organizations and individuals across Pakistan working at the critical intersection of sustainability and innovation.

Participants from various scholastic backgrounds took part in this Innovation Challenge in teams, beginning in February of 2022 going through stages of pitches, capacity building sessions and focused mentoring. The journey began with over 300 applications hailing from several startups, universities and relevant fields of study out of which 10 teams made it to the finals.

Speaking to the audience, Tauseef H Farooqi, the Chairman of National Electric Power Regulatory Authority (NEPRA) shared that “As a regulator, we have a tremendous responsibility towards society that extends beyond the creation of affordable, accessible and reliable energy supply. We must also support the community, through constant innovation and development. Under our Power with Prosperity, Power with Safety, Power with Equality, Power with Security and Power with Unity plans we have uplifted and transformed the socio-economic landscape of Pakistan aligned with the UNSDG’s to impact over 32 million lives, creating over 46,000 jobs including 8,400 jobs of women alone with over 32 Billion Rupees of financing. All this was aimed to promoting work-place safety, diversity and inclusion and security. Innovation is imperative for positive change and we must continue to strive for a better and brighter future.” Mr Farooqi also endorsed how K-Electric, the only vertically integrated power distribution company in Pakistan, was stimulating grass-root level impact through their best practices and serving as a role model within the power sector.

“K-Electric is one of Pakistan’s most innovative utility companies making substantial improvements since privatization through investments and automation of its infrastructure. Deeply embedded in the very fabric of this great city, KE continues to positively contribute towards Karachi’s sustainable and innovative growth.” Stated KE, Chief Executive Officer, Syed Moonis Abdullah Alvi. “Through KE’s 7/11+ Innovation Challenge we aim to create operational excellence, enhance customer experience, and optimize our supply chain and logistics to energise the city’s future in a sustainable and customer-centric way.”

The Innovation Challenge Jury was made up of dynamic profiles in the current Pakistani innovation ecology including Farhan Anwar, Assistant Professor of Practice Social Development and Policy at Habb University, Seher Abbas, Co-Chair, Karachi Hub Women in Energy & IFC, Sheikh Imranul Haq, Energy Expert, Shehryar Hydri, MP, Deosai Ventures, Shaista Ayesha, CEO of SEED Ventures, Naeem Zamindar, Founder of Neem Financials and Naz Khan, CSO at KE. Together they selected the top 10 finalists which included Ezbike with their electric bike and battery swapping service, Ezgeyser with the sustainable energy plan, Lorawan with meter reading retrofit, Novel Insulator with an insulator design, OptimaLoad with a solution to balance load on a transformer Orko with an application to manage EV charging stations, Power Distribution Improvement with an efficient short and long term demand forecasting technique, Smart Transformer Health with a device to monitor health of a transformer, Thingsty with IoT applications for domestic and commercial users and Vtol Dynamics with drones for geospatial survey and monitoring. Total cash prize pool was 3 million PKRs – 1.5 million to the winner, 750,000 PKRs each for the first and 2nd runner up.

After a rigorous and competitive journey, the Energy Informatics Company of LUMS emerged as the winner for their Data Analytics based Prediction and Forecasting model, while ezBike’s Electric bike and charging infrastructure was awarded first runner up and NUST PNEC’s was the second runner up for their LoRaWan based meter retrofit technology capable of incorporating smart technology on conventional electricity meters.

Naz Khan, K-Electric’s Chief Strategy Officer said “KE’s 7/11+ Innovation Challenge is a move to embrace innovation not just as a corporate social responsibility but as a strategic priority. At KE, we believe the emerging utilities landscape, post CTBCM, will require organizations like ours to go beyond the organizational boundaries and knowledge-bases to pilot and deploy the best ideas for the benefit of the society at large. The Innovation Challenge has enabled us to do just that by synergizing with some very talented individuals from start-ups, universities, and academia to create advanced solutions that will no doubt positively contribute to both KE and Karachi’s progressive development.”

Dr. Athar Osama, Managing Partner INNOVentures Global, appreciated this novel innovation effort, “I am glad that KE has managed to establish this platform,” acknowledging how this was “the best way forward for corporate sector towards a transition to a developed economy.”

PITB Incubation Wing and Swyft Logistics Sign MoU to Support Local Start-up Ecosystem

Lahore – Nov 24, 2022

An MoU was signed between Punjab Information Technology Board (PITB) Incubation Wing and Swyft Logistics to mutually support the development of the local startup eco system in Pakistan. The MoU was signed by PITB Joint Director Incubation Wing Hammad Khailque and CEO Swyft Logistics Muhammad Uns in a ceremony held at Arfa Software Technology Park.

Other officials from both organizations including PITB’s Incubation Wing Head of Partnerships Noman Zubair and Swyft Logistics Head of Sales Zahir Kamran, Head of Growth Ali Chaudhry and team members Ajwad Wasim and Mehak Najam were also present.

While appreciating the initiative, PITB Chairman Syed Bilal Haider said, “PITB is fully committed to supporting ambitious aspiring entrepreneurs and startups by creating an enabling environment to foster their skills and talents. It is also helping the startups in expanding their businesses nationwide by facilitating them through collaborations with relevant organizations.”

According to the MoU, Swyft Logistics would accommodate PITB startups by offering them special discounted rates for their Cash on Delivery (COD) & Online Paid deliveries. This would help the startups to compete with the existing players by offering discounted shipping rates. Furthermore, this would speed up the payment processing time for the startups for their COD shipments.

PITB’s Incubation Wing is a portfolio of projects targeted towards providing opportunity for aspiring entrepreneurs. These include Plan9, Regional Plan9, PlanX and National Expansion Plan of NICs. With 22 incubation centers nationwide, this is currently the largest network of technology incubators in Pakistan.

Senegal’s solution to smart attitudes for Africa

Congestion and pollution have hit African cities in a way that is detrimental to the economy and climate. An integrated and efficient transportation system is required if the continent is to progress. In Nairobi, a survey showed that The average time spent searching for a parking space was 32 minutes.

The streets of Dakar, Senegal are no exception. Not only is parking difficult to find, but Cosmopolitan residents resort to parking on perilous sidewalks. After moving to Senegal from the US, CEO Gabriella Marin had a luminous moment after her son nearly crashed into a parked car on the curb. flight engineer I decided to get into the business of creating additional car parks to lighten the sidewalks with licensed empty yards in Dakar.

“Running a parking lot was more difficult than we expected,” Gabe says. “We also quickly realized that no car park operator program is geared towards emerging markets like Senegal.”

The team started by creating a trigger/tracking tool and with that they were able to nearly double their profits because they were able to understand how much traffic they were facing in one parking lot. Today, Parcsmart is building software that not only helps drivers find and reserve a parking space using their smartphone before they reach their destination, but also allows parking operators to manage a lot better.

Parcsmart software users are multifaceted and not just profitable operators who use the product. Private parking operators use the software to manage lots in their hotels and communities. Street parkers use it in informal markets to inform users of available parking spaces on sidewalks, and drivers use the app to reserve parking before they arrive or as soon as they reach their location.

Parcsmart has faced some challenges in spreading its product and knowing the context in which it operates. One of the main realizations was that their users would not be comfortable using the internet and navigating to a website, and sometimes the user might not even be able to read.

“We got the UI right after some trial and error and created a feature where we can take pictures of the car’s tag and the algorithm will decode the tag through computer vision and automatically record it,” says CTO Lamine Ba. “We’ve also reduced the number of buttons you have to click to register a vehicle.”

The vision is to democratize parking and get people to use Parcsmart globally in the cities that need it most. Understanding the market and including many players in their value chain serves Parcsmart well and it is clear that their impact will be enormous.

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