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Pakistani startups raised $375M in 2021

Pakistani startup businesses witnessed impressive growth in outgoing 2021 as they received historic funding worth $375 million from venture capitalists. The figure is five times higher than what the local startups generated in the whole of 2020 when they raised only $66 million. The value is two times higher than the funding raised in last six years combined.

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Pakistani start-ups raised about the US $ 375 million last year while doubling their total investment over the last six years. The flood of foreign capital to Pakistani companies that began during the coronavirus pandemic continues unabated, and the startup scene in the world’s fifth-largest country is entering a breakout year. In 2021, Pakistani startups gained the largest share of logistics finance at 32%, followed by e-commerce at 27%, fintech at 25%, and tech and health tech, according to data from startup investment advisory platform Alpha Beta Core.

It was 4%. “Pakistan start-ups raised more than $ 375 million in 2021, doubling the total for the last six years,” said Khurram Schehzad, CEO of Alpha BetaCore, in a statement. “Investment in Pakistani start-ups is growing exponentially.” Invest2Innovate (I2I), another organization that tracks the flow of money to startups, has invested $ 350 million.

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What does the data reveal?

According to data shared by Invest2Innovate and Arab News, there were 174 transactions worth $ 231 million between 2015 and 2020, compared to 81 investments by Pakistani start-ups in the final year. I made a transaction. Airlift Technologies is Pakistan’s largest single private funding round in history, with a Series B funding round of $ 85 million, ending in August this year. Another startup, B2B Marketplace Bazaar, has raised $ 30 million, Tajir has raised $ 17 million, and FinTech startup TAG has raised $ 17.5 million.

Beauty and fashion startups Bookme and Bagallery, online travel and ticketing platforms, raised $ 7.5 million and $ 4.5 million in a Series A round last month, respectively. Krave Mart, Pakistan’s first introduction to QuickCommerce, also raised $ 6 million in a pre-seed funding round to expand its business in the port city of Karachi and other major cities. According to Schehzad, startups valued more than $ 1.5 billion in 2021 and are five times, or 400% higher, than startups valued at $ 300 million in 2020. Experts predict that funding will continue to surge in 2022. This is because Pakistan’s huge untapped market has 188 million mobile subscribers, 107 million 3G / 4G users and 110 million Internet users.

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What are the hurdles faced by start-up businesses?

Kalsoom Lakhani, founder and partner of Invest2Innovate (I2I), said: The Ventures, an organization that supports and tracks startup funding, told Arab News on Monday. “But as more and more startups mature and have to raise later rounds of funding, capital is needed during the growth phase and talent shortages will continue to be a challenge this year.”

New themes to look for in 2022 are health tech, given a dearth of and access to quality health care, edtech businesses to take online education to millions of Pakistani children, as well as fintech firms to help address Pakistan’s undocumented economy or 75 percent unbanked population.

“Momentum will continue in 2022,” Schehzad said, “with some of the biggest global venture capitals (VCs) now eyeing Pakistan.”