Pakistan Startup Report

A 15-min guide by World Startup Report
Updated: July 7, 2014
#pakstartupreport

#pakstartupreport © 2014 All Rights Reserved
Bowei Gai
•  Silicon Valley serial entrepreneur
•  Founder, World Startup Report
•  Founder, CardMunch (acquired
by LinkedIn)
•  Bowei@worldstartupreport.com
•  @Bowei
Adam Dawood
•  Pakistani Entrepreneur
•  Founder, DYL Ventures
•  Co-Founder, PetPeople.pk
•  adam@dyl-ventures.com
•  @adamdawood
Authors

Contributors
@shakirhusain
Creative Chaos
@kalsoom82
I2I
@kayzafar
LUMS
@monispk
Rozee.pk
Muneeb Maayr
Daraz.pk
Ahmed Khan
Kaymu
@jehan_ara
P@SHA
Imran Ali Khan
Zameen.com
The authors would also like to thank the countless number of people within the local startup community who helped
compile the database. We would also like to thank Sara Sultan and everyone else who reviewed the presentation and
wiki prior to it being released. This report would not have been possible without the tireless work of many in the community
Obaidullah Khawaja
Flikkable
@nabeelaq
Plan9

Our Mission
Document
To document Pakistan’s startup ecosystem as a chapter of the World Startup
Report through detailed analyses and reports based on the local culture,
trends, key players and challenges. We wish to share this report pro bono to
encourage investors to take advantage of current opportunities.
Connect
Identify and empower local startup activists to become ambassador’s for
Pakistan’s ecosystem. We aim to assist local entrepreneurs connect with each
other and with the global startup community.

Agenda
1. Why Pakistan
2. Names to Know
3. Culture
4. In Depth Look
5. Opportunities
6. Acknowledgements

“Pakistan with its nearly 200 million population is simply too large
and too attractive a market to ignore” Ehsan Malik, CEO of
Unilever Pakistan
Why Pakistan?

6th most populous nation in the
world with 180+ million people
60% aged between 15-45
Pakistan at a Glance
Investors are allowed to hold 100% equity and
full repatriation of capital.
110 million 3/4G users expected by 2019
25-45 million broadband users expected by 2020
4th largest middle class population in
absolute numbers in Developing Asia.

Pakistan at a Glance
All $ amounts in USD
Pakistan India USA
Population 184m 1.2B 320m
GDP 254B
(‘14)
$1.8T $16T
Population < $2/day 60.2%
('08)
68.7% 0%
Population < 30 years
old
68% 63% 40%
Population (2020) 210m 1.3B 337m
% of pop that’s speaks
English
55%
(‘10)
10% 94%

Web & Mobile Markets
Pakistan India USA
Population 184m 1.2B 320m
Internet Users 30m 240m 260m
Internet Penetration 16% 12.6% 81%
Online ad market ~ $10m ~ 577m ~ $100B
Mobile Subscriptions 136.5m 893m 327m
Mobile Penetration 74% 72.1% 102%
Smartphone Users 6.8m 35m 152m
Smartphone
penetration
3.7% 3% 47.5%
Mobile Operator ARPU/
month
$2.5 $2 $46.50
Facebook Users
(Jun'14)
14.4m 104m 180m
E-commerce Market
Size
$15m $16B $272B
All $ amounts in USD

Mobile Subscribers in 2019
-
20
40
60
80
100
120
140
160
180
200
2014 2019
Forecasts for Mobile Subscribers.
(in millions)
GSMW-CDMALTE
Ovum (2014)
110 Million 3G/4G Subscribers
anticipated by 2019

Lahore
Incubators
Lahore is the cultural capital of the country and also the main techhub. The
Arfa Software Technology Park is the heart of the cities software industry and
also home to the Punjab IT Board.
Population: 10 million
Universities: 30
Co-Working Spaces

Karachi
Incubators
Co-Working Spaces
Karachi is the largest city in Pakistan and the financial and economic centre
of the country. It is home to the largest companies within Pakistan and an
increasing number of startups.
Universities: 32

Islamabad Peshawar
Incubators
Co-Working Spaces
The Capital of the country hosts
some of the nations best
engineering universities.
Universities: 18
Local Entrepreneurs have started a
movement to create a hub of
technology enthusiasts.
Universities: 11

Names
to know
“Foreign Firms are rushing into Pakistan to compete in some of the
most easily monitizeable parts of the web.”
Steven Millward, Editor TechinAsia

IT Solutions (1995)
$40M valuation
Careers Portal (2007)
Valued at $10-$20m. Acquired
Minhati.com in 2013 for $2-$5m
Collaboration Tool (2011)
Raised $5m from
Morgenthaler Ventures
Recent Successes
Key Players
Rising Stars
E-commerce (2008)
1,500 products sold/day
E-Commerce (2006) Automotive Portal (2003)
E-Commerce (2012)
Funded by Kima Ventures
Real Estate Portal (2006)
Funded by Frontier Digital
Ventures & Catcha Group
Video Sharing (2006)
30 million video views/month
E-Commerce (2006)
Biometrics (1977) Vision Technology (2012) Food Delivery (2013) SMS Messaging (2010) Internet Marketing (2004)
Game Studio (2006)
Food Delivery (2012)
Acquired by E-Takeaway
Cricket Network (2012)
This list comprises of only a small selection of Pakistani startups, for a more complete list visit StartupJuice.pk

International Investments
Fashion (2012)
1,000+ products/day
Marketplace (2012)
1,000+ orders/day
Food Delivery (2012)
250+ orders/day
Private Limo (2013)
Real Estate (2013) Automobiles (2013)
Hotel Booking (2014)
Classifieds (2014)
Schbisted recently
launched Asani to
compete with OLX
Classifieds (2011)
The largest classifieds
In Pakistan
Bus Ticketing (2014)

Angels, Incubators, Investors
Incubators/
Accelerators
Angels Investors
Plan9 Yusuf Jan Kima Ventures
The Foundation by LUMS
Center for Entrepreneurship
Zafar Khan Frontier Digital Ventures
Invest2Innovate Afaque Ahmed Draper Fisher Jurvetson
PlanX Humayun Mazhar ePlanet Ventures
Microsoft Innovation Centre Jamal Khan Rocket Internet
IBA CED Nadeem Elahi P@SHA Fund
MITEF Atif Khan Seed Ventures
Seed Incubation Centre Shabana Khan Arpatech
Cloud9 Startups
Jumpstart Pakistan

Media, Conf, Events
Tech Media Conferences Meetups Events
ProPakistani
P@sha ICT Awards Startup Grind StartupWeekend
TechJuice TIE Conference Civic Hackathons Lean Startup
PakWired CIO Summit Google Developer
Group
T2F Workshops
Scoop Circle TEDx Code for Pakistan Startup Cup
Pakineur Google DayX Google Business
Group
P@SHA Launchpad
Blogogist Digital Youth Summit KPK Shepherds Pie
LUMS
Entrepreneurship
Challenge

Culture

Web Culture
Sensitive Media Gets Shut
Down
•  Due to the sensitive
nature of certain
religious and cultural
issues social media
channels such as
Facebook and Twitter
have been banned at
various points in the
last 5 years. Currently
YouTube is still offline,
and recently Twitter
has been blocking
certain tweets.
Online Engagement
Prevalent Among
Political Youth
Last year's online
support for Imran’s Khan
PTI election campaign
shows that the youth of
the nation is using social
media to champion
political causes.

Local Entrepreneurs
Most Young People Prefer to join MNC’s or go
Abroad
•  Most young graduates prefer to join a multinational company or
ﬁnd work abroad.
•  However, local universities such as LUMS & IBA are
encouraging students to be more entrepreneurial and assist
them in setting up their own ventures

“Entrepreneurship should be taught at school so that children know
that opportunities exist beyond regular professions like medicine
and engineering”
Ishrat Hussain, Dean at IBA

Returning Entrepreneurs
There are 12,500 Pakistani’s working in Silicon
Valley
•  Many Pakistani’s who have studied and worked abroad are
returning to start their own ventures.
•  There is an enormous amount of patriotism and family
connections that wills a lot of people to return and build a better
Pakistan.

“The target is to contribute to the evolution of a more efficient
business ecosystem in the country”
Jamal Khan, Founder of Arpatech

In depth look
“Recent Investments are testament to the increasing interest and
confidence of investors in local startups. Investors can see beyond
the short term issues in Pakistan and have foresight to capitalise on
the long term future potential.
@kayzafar

Infrastructure
Entrepreneurs can overcome challenges in setting
up basic infrastructure.
•  Transport – Improving network of highways, although rail
system is unreliable.
•  Logistics –Courier companies ship COD packages to
over 200 cities/towns.
•  Internet – 3G & 4G recently launched. Coverage of rural
areas is still patchy.
•  Electricity – Generators compensate for frequent power
cuts
•  Payments - Low penetration of credit and debit cards
means most orders are via COD. Pakistan is also the
second highest country for credit card fraud.

People
Academic Excellence
•  With about 12,500 Pakistanis said to be working in Silicon Valley, local
universities are producing some of the most sought after talent in the
world.
Freelancing
•  Pakistan lays claim to some of the world's best IT engineers and designers
many of whom choose to go into freelancing. There are approximately 1
million freelancers working online in the country.
Talent Costs Entry level Experienced
Professional
Engineer Salary (Yearly) $7k $12k
Undergrad Salary (Yearly) $4k $8k
MBA Salary (Yearly) $7k $12k

Policies
One of the most liberal investment policies in the
region
•  No limit on equity so investors can hold 100% of the company
with no local partner.
•  100% repatriation of capital is allowed so all profits can be
returned to the original investor.
Prime Ministers Youth Business Loan
•  The Government is offering local entrepreneurs loans of up to
$20,000 with a fixed 8% interest cost including 1 year grace.
•  50% of the loan is designated for female entrepreneurs.

Government Initiatives
The Punjab IT Board (PITB) is pioneering
entrepreneurship, m-governance and e-governance.
•  Empowering workers with smartphones, the PITB is using
custom apps to report the water levels within canals and
monitor the spread of diseases.
•  Using robot calls and SMS messaging, the PITB have
implemented a Citizen Feedback Model as a proactive
measure to curb corruption, improve service levels and
customer engagement.
•  The PITB is also behind the very successful Plan9, a startup
incubator, Techhub, a freelancers co-working space, and
PlanX an accelerator for already established companies.

Opportunities
Building a business in Pakistan is like Germany, but only 20% more
difficult. But we are in it to do whatever it takes, if we have to build a
Pakistani Post, we build a Pakistani Post”
Oliver Samwer, Rocket Internet

Search
Google 
Google
Classiﬁed
OLX 
Asani
Electronic Retail
Homeshopping 
Shophive
Job Listings
Rozee
Mustakbil
AutoSales
Pakwheels 
Carmudi

Delivery
FoodPanda 
EatOye
Fashion
Daraz.pk
Labels E-Store

Real Estate
Zameen 
Lamudi

Payment
EasyPaisa
Omni
Local Discovery
KarachiSnob 
KiaSceneHai
Group Buying
Deal Today 
Lootlo
Gaming
Mindstorm
Caramel
Travel
Chutti 
TourPlanner
MicroWork
KamataPakistan
Groceries
Aaramshop
Pakistan Grocery
Dining
EatOye
Olaround
Ticketing
Bookme
KiaSceneHai
Taxi/Carpool
EasyTaxi 
Savaree
Finance
Eccountant
Medicine
Sehat
Dawaai
Music Streaming
Plane Ticketing
Recipe
Rental

???
Saturated Mature Semi-mature Infancy Non-Existent
Pakistan Commodity Innovation Map
A map of Pakistan’s current market leaders in 25 commodity internet business models

Competition
Lack of competition amongst Startups
& Angels provide a great opportunity for
entrepreneurs and investors alike.
•  Classified are now facing stiff
competition as Schibsted’s
Asani.com.pk has just entered the local
market and are looking to challenge
Nasper’s OLX.
•  There is competition in the ecommerce
sector, however this is still primarily
limited to the electronics market. For
most players to make a dent in this
market they will have to enter with
significant funds.

Advice for Local Entrepreneurs
Approach Incubators and Accelerators
•  Plan9, The Foundation or Invest2Innovate are great instituitions
to guide you through the first few months of operations. You
will also have access to a variety of mentors who can provide
invaluable advice.
Participate in Startup Competitions
•  Be sure to compete in events such as Startup Weekend,
Launchpads, and Civic Hackathons. These are great platforms
to test your ideas and may even help you find mentors.
Be Optimistic
•  Building a startup is always hard, be optimistic and keep at it.
Remember if you chase money, it will run away from you, but if
you keep working, the money will automatically follow!

Advice for Foreign Entrepreneurs
Be Quick to Enter As Open Market Space is Quickly
Disappearing
•  If you are thinking of returning to start an internet business do it
now and be quick to exploit all the opportunities currently
available.
Quickly Create A Professional Network
•  Any foreign entrepreneur will be highly regarded so use it to
your advantage. Be sure to mix and build relationships with the
local community who will be more than happy to co-operate.

One of the Most Liberal Investment Policies in the
Region
•  There is no limit on equity and no limit to capital repatriation,
so you can be the sole owner of the company and take away
all the earnings.
Need for Value Added Investors
•  Investors with international connections as well as area
expertise is crucial for local startups who are looking to
expand abroad and to raise additional funds.
Exits are virtually non-existent right now
•  Regular dividend payment are likely after gaining profitability.
The ecosystem is still young so a lot is expected to change in
the coming years.
Advice for Foreign Angels

Advice for Foreign Companies
Have Reasonable Expectations as the Market is Still
Growing
•  Enter the market early to build your brand identity and team.
Doing this will ensure that as the internet revolution takes
place amongst the 180+ million people you will be
strategically positioned for growth.
Adapt your processes to the local environment
•  SMS messaging is a lot more prevalent than email, so be sure
to use it to build a relationship with your customer.
There is no Intermediate Liability Protection
•  Pakistan has no cybercrime bill, however the bill is passing
through the Parliament and a Cyber crime agency will be
established shortly.

Conclusion
Pakistan will grow, the only uncertainty is the
speed at which it does.
We all know how fast China and India has grown. We also know
that Pakistan is generally 5 years behind India in terms of growth
and development.
So now is the right time to start building your startups and
investing in entrepreneurs within the country.

Pakistan
Startup Wiki
For the latest updates on the
Pakistani Startup Ecosystem
and our full Pakistan Startup
Report, please visit:
www.worldstartupwiki.org/
page/Pakistan

Acknowledgements

Special Thanks To

Thanks for reading!
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Pakistan Startup Report

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