Pakistani startups collectively raised a record $ 365.87 million in 2021, 450% more than the $ 66.44 million raised in 2020.
The year 2021 was when Pakistani startups finally joined the big leagues, collectively raising a record $ 365.87 million, which was not only 450% higher than the $ 66.44 million raised in 2020, but also more than the amount raised in all previous years combined. The number of transactions also rose from 49 to 82 the year before, with an increase of 67pc.
This was helped by a few big rounds, most notably Airift’s $ 85 million Series B. But beyond that, the average ticket size has climbed to $ 5.30 million this year, from $ 1.36 million in 2020.
Other startups that raised $ 10 million or more in capital during the year included Bazaar, which raised $ 36.5 million in two rounds, Jabberwock (Cheetay) which raised $ 18 million, TAG, a cumulative, which raised $ 17.5 million, Tajir which raised $ 17 million, QisstPay which raised $ 15 million, Creditbook which raised $ 12.5 million and Bridgelinx which raised 10 million of dollars. Collectively, these companies represented 57.85% of all invested capital.
Despite increasing capital amid growing banknote sizes, most of the activity was concentrated in the early stages, as seed deals accounted for the lion’s share at 46, followed by 15 in rounds. pre-selection and nine A series. During this time, only two B series of rounds were recorded.
At the industry level, e-commerce dominated the fundraising landscape, garnering $ 174.6 million across 20 transactions. However, almost half of the capital came from a single startup, Airlift.
Read: Pakistani startups on the rise as they rake in $ 120 million in first half of 2021
On the other hand, fintech dominated for the first time in terms of the number of transactions (24), raising nearly $ 97 million. This was mostly split between payments, credit / loan, and general ledger space. Meanwhile, the transportation and logistics industry slipped to third place with eight deals and $ 35.4 million.
As of 2020, there has also been a growing tendency for Pakistani startups to try to streamline the kiryana ecosystem – a phenomenon carried into 2021. From B2B markets to general ledger applications, there have been at least 11 agreements within the DukanTech set – which mainly extends to the fintech and e-commerce sectors – amassing more of $ 87 million.
Another sign of healthy activity was the growing number of startups lifting multiple rounds in a single year, as 2021 saw eight. This included Bazaar, Creditbook, Abhi and TAG raising capital at two different stages while Truck It In, PostEx and Taazah carried out extension rounds.
But, more capital flowing into the ecosystem does not necessarily mean that it becomes accessible to everyone to raise funds. For example, startups run by women only managed to raise just over $ 4 million in three deals, compared to $ 250.8 million raised by businesses run by men. The remainder of the $ 111 million (13 deals) went to startups co-founded by mixed teams.
Likewise, having an education abroad also seems to be paying off, as startups with founding teams with at least an international degree accounted for almost 87% of the dollar value ($ 317.3 million) over the course of of the year, which fits well with the trends for 2020.
The year 2021 saw some of the most notable investors make their foray into the Pakistani market, including Tiger Global, Kleiner Perkins, Global Founders Capital and Stripe, and lead a number of rounds. It is these foreigners who have helped increase the size of transactions. This is evident from the fact that out of 49 deals, each worth over $ 1 million, international firms were the only lead in 27 and co-lead with local investors in 11 others. This is simply a function of the small size of the investment. vehicles raised by venture capitalists based in Pakistan, which is increasingly falling short of the capital needs of some startups.
Header Image: An archive photo of people working at their workstations. AFP / File