Pakistan’s startup ecosystem has once again captured the interest of investors, securing $32 million in funding from various sources during the first four months of the current financial year. This resurgence in investment signals a promising recovery in the country’s startup climate.
According to Invest2Innovate, local startups received $15 million in the first quarter and an additional $17 million in October. The investment landscape began to show signs of recovery with three significant deals in October, totaling over $17 million.
Among the notable recipients, COLABS and Abhi (YC S21) secured $2 million and $15 million, respectively, while Farmdar raised an undisclosed amount. Shorooq Partners led the Pre-Series A rounds for both COLABS and Abhi, while Moment Ventures spearheaded Farmdar’s Pre-Series A round.
Interestingly, Indus Valley Capital was the only local investor to participate in a funding round this quarter, specifically in Farmdar’s Pre-Series A. On a broader scale, venture capital firm Sarmayacar secured a significant $15 million from the UN’s Green Climate Fund, designated for startups addressing climate change.
The month also witnessed notable mergers and acquisitions, with TRAX merging with Secure Logistics Group Limited (SLGL) and Trikl being acquired by Elphinstone. Aly Fahad, a facilitator for the startup ecosystem, attributed the successful attraction of funds to the improving economic conditions in Pakistan, bolstered by the resumption of the IMF program and positive Fitch Ratings.
In a move to further stimulate economic growth and manage inflation, the State Bank of Pakistan (SBP) reduced the policy rate to 15 percent. This monetary policy easing has enhanced access to credit and increased market liquidity. Additionally, the Special Investment Facilitation Council (SIFC) is playing a crucial role in attracting foreign direct investment (FDI), according to the CEO of Paklaunch. Venture capitalists and investors remain optimistic about the improving economic situation and are planning to invest in Pakistani startups.
At the recent Singapore FinTech Festival, overseas Pakistanis, investors, and tech companies highlighted strong indicators of Pakistan’s economic potential and committed to collaborating with high-potential startups and fintech operators.
