Pakistani Tech Startups Raised a Record $36 million in 2019

Pakistani Tech Startups Raised a Record $36 million in 2019

In 2019, investors poured $36 million into 14 Pakistani tech startups across 15 deals.

Highlights

💰 $36,140,000 — Total amount raised by 14 startups.
#️⃣ 15 — Number of deals during the year.
📊 534% — Year over year growth in funding.
📈 $2,409,333 — Average funding.
🚌 Transportation — Most funded category.

*VC or Angel funded active startup founded or co-founded by a Pakistani and headquartered in Pakistan.

Source:Crunchbase | Data:Google Sheets

Best Year Ever

After a disappointing 2018, where 7 startups raised meager $5.7 million, the Pakistani startup ecosystem managed to bounce back and had a record-breaking 2019.

There were three big rounds that tipped the scale and helped achieve the record total.

First, Airlift raised $2.2 million in Seed, a record. Second, in a later round Airlift raised $12 million in Series A, also a record. Third, Cheetay raised $7.8 million in Series A.

In other words, approximately half of all funding went to 2 startups across 3 deals.

Seed Funding

Seed is the first round of funding a startup receives and it indicates that the startup has garnered traction, built a solid team and achieved product/market fit.

List of Pakistani tech startups that raised Seed funding in 2019:

  • Airlift: $2.2 million from Fatima Ventures, Gobi Partners, & Indus Valley Capital.
  • Tello Talk: $1.6 million from i2i Ventures and SparkLabs Ventures.
  • Eat Mubarak: $700K from Karavan and other undisclosed investors.
  • PriceOye: $450K from Fatima Ventures & Artistic Ventures.
  • Bookme.pk: $425K from Lakson Investments Venture Capital.
  • SmartChoice: $100K from Wadi Accelerator.
  • AYECo: $75K from Aamir Ibrahim & Naeem Zamindar.
  • Amplifyd: $70K from an undisclosed investor.
  • Fotisto: $15K from an undisclosed investor.
  • Marham: $5K from Shazil Sultan.

Series A Funding

Series A, on the other hand, is the next round of financing after Seed that indicates the startup is making some revenue, customers are growing and unit economics look promising.

List of Pakistani tech startups that raised Series A funding in 2019:

  • Airlift: $12 million from First Round Capital, Fatima Ventures, Gobi Partners, and Indus Valley Capital.
  • Cheetay.pk: $7.8 million from undisclosed investors.
  • Bykea: $5.7 million from Sarmayacar & Middle East Venture Partners.
  • Knowledge Platform: $2 million from Lakson Investments Venture Capital.

Convertible Note Funding

A convertible note is technically a loan that converts to equity (stock) at a given time in the future or at an agreed-upon milestone.

Finja raised $3 million in a convertible note financing round from Quona Capital and BEENEXT.

2020 Outlook

I really missed the mark with my 2019 outlook. I predicted anemic growth in funding.

I was way off.

I realized that when it comes to Pakistan, it can be a hit or miss.

Pakistan competes with Pakistan itself.

2019 was just a phenomenal year both in terms of the country’s image as well as investor confidence.

That said, my predictions for 2020:

  • Funding will witness modest growth, if not outright decrease compared to 2019.
  • Investors will double down on startups that are competing in the transportation and education space.
  • The Government will keep throwing money and resources on dead-on-arrival initiatives.
  • A cottage industry will emerge to support YouTubers and other online influencers.

Good times ahead.

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