Silicon Valley is probably the Goldilocks zone for startups with a plethora of angel investors and techie local culture. A central hub for business in the world, there is no other place that can come close in the race to the startup culture of Silicon Valley.
However, from nascent colony, to a self-sustaining environment, startup ecosystem in Pakistan has grown so big in the past five years. An online real estate startup in Lahore, Zameen, has grown so large that it has placed itself among Zillow-like apps and websites to find and buy real estate listings in the country.
Founded in 2006 by Zeeshan Ali Khan and his brother after leaving an e-commerce business in the U.K., Zameen, just like many famous U.S. internet companies, was founded first in their bedrooms. Despite the online buy-sell culture being extremely limited back then, Ali Khan followed the money coming into the real estate business in Pakistan from the outside, the U.K. specially. Currently, the company employs 500 people, and has offices in all major cities in the country.
“Zameen.com came into being when we realized there was a desperate need for a trustworthy online real estate enterprise in Pakistan, especially given the importance the average Pakistani attaches to property,” Ali Khan told Newsweek.
“Back then the state of internet infrastructure in Pakistan was extremely poor but the offline property market was exploding. Facilitated by large investments from the Pakistani diaspora, people found that investing in real estate would earn them significant returns.”
Pakistan has a large English-speaking population, and a fast-growing economy which is believed to be the backbone of new startups and cultures to work with foreign companies. From Lahor and Karachi, just like Boston and San Franciso in the U.S., the country has several startup hubs specially connected to elite universities.
The Punjab province is the major hotspot for startups in Pakistan. Plan9, the Punjab provincial government-run technology incubator, hosts over 80 startups. Ali Khan also commented on the effectiveness of the incubators.
“Lahore has clearly taken the lead and is emerging as the tech hub of Pakistan. Not only is it the city of choice for the headquarters of some of the leading indigenous tech companies including Zameen.com, it is also home to two of the most active incubator programmes i.e. Punjab Information Technology Board’s Plan9 and Lahore University for Management Sciences’ LUMS Centre for Entrepreneurship (LCE). Since their inception, Plan9 and LCE have groomed over 140 startups which have created close to 1,000 jobs and have raised $2.6 million in investment.”
There are myriads of people currently involved in home based business including blogging in Pakistan which has helped them bring foreign currencies into the nation.
— Raza Ali (@chrazaali) February 4, 2016
Despite developing startup trends, the business culture in Pakistan is still minnows when compared to that in Silicon Valley. The major hindrance in doing business comes because of socio-economic culture and norms, which generally are the major obstacles. Despite leading the South Asian region in consumers using mobile payments, only 9 percent of Pakistani men and 2 percent of women have used mobile phones for money transfers. Around 39 percent of Americans have used mobile banking in 2015, according to a report from the Federal Reserve.
Several startups have been able to grow and attract angel investors in Pakistan. Sukoon is one of the recent ones that raised an undisclosed amount of seed funding led by Crescent Ventures.
“The TIE Islamabad Angel fund and Dotzero Ventures also participated in the round. While specific financial details were not revealed, the startup did say that the investors have acquired a non-controlling, minority stake in the company,” reports Business Standard.
Another startup, PKship promises to deliver Amazon and eBay items within a week through its big Unique Selling Point.
“This model is not novel; these entrepreneurial ideas have been employed in other countries. But for Pakistan, this is a first. PkShip users are given addresses in the U.S., the U.K., Germany and China. Whenever they visit an online retailer and make a purchase, they will get their products delivered to the closest global address, from where PkShip will send them the packages to their address in Pakistan,” says the founder and CEO Asif Seemab.
Similarly, Markhor, a shoe startup that made headlines when they raised $92,000 in Kickstarter funding with pledges from 508 people in 32 different countries, announced its acceptance into Y Combinator. This also puts Markhor in a position to become the first Pakistani startup to be placed into the prestigious startup accelerator.
Going with the flow of the burgeoning startup scene in the country, the national government of Pakistan has also announced their plans to launch a national incubation program, just like what the Punjabi provincial government has been doing.
“Government’s support for the tech startups in Pakistan has come a bit later than desired,” says Ali Khan. “But I believe these measures will encourage the startup culture in Pakistan.”
[Photo By Daniel Berehulak /Gettyimages]