Startup Pakistan

Published Dec 24, 2012 10:46am

Illustration by Bilal Brohi/Spider Magazine

Pakistan has a whole host of problems. So does every other country in the world. The trouble is that the name Pakistan carries an increasingly negative connotation in more places simultaneously.

This would not necessarily be a problem if Pakistan was a self-reliant, thriving country. The current state of affairs can be attributed to many different things depending on whom you ask, and it involves entirely too much human opinion. However, the majority would agree that there is substantial room for improvement.

Most Pakistani governments are unfit to lead the nation into the business world of today.

It doesn’t matter whether it is a democracy or a dictatorship, the parties/individuals in power can self-rationalize all they want about circumstances, wars, inherited problems and poverty, but it doesn’t change the facts; the results have never been there consistently.

The question I want to float for further exploration is: What does Pakistan bring to the global table, and can the tech sector play a role in it’s reinvention?

This is not meant to be backseat driving with useless criticisms. The following is my suggestion to infuse some vitality.

I believe that when governments fail, people pick up the slack. This may be one person, a small group or a mass of people rallying behind an idea whose time has come. NGO’s and the private sector have been doing this for many years sporadically. Their resilience shines through to become the silver lining the future will look for and latch on to.

In my opinion, this can be one of the alternatives to focus on for the present. The government can launch a platform for the people - much like a business incubator - and get out of the way.

To clarify, Wikipedia defines business incubators as: “...programs designed to support the successful development of entrepreneurial companies through an array of business support resources and services, developed and orchestrated by incubator management and offered both in the incubator and through its network of contacts”

Shared Workspace

Build or re-purpose an existing building into a cocoon facility which houses all the infrastructure and assistance an entrepreneur might need including accounting, legal, finance, administrative, marketing and human resource help.

Land isn’t in short supply. It’s not like trying to find a 100,000 sq ft. facility in downtown Manhattan.

Advisory Board

There is no dearth of intellectuals or bright minds in Pakistan. They arguably are some of the most gifted people in the world because they not only rise to the challenge, they do so in extremely challenging circumstances.

From academics to business owners, there are hundreds of individuals in the private sector who have used everything from a foreign education to sheer determination to be wildly successful in every facet.

To not leverage their expertise, insight and acumen is an unforgivable oversight.

Education

An ASP.NET developer who doesn’t know what masterpages are might suffice for a private businessman who’s only looking for a web presence because he’s expected to have one, but this is the gateway to a never-ending, self-perpetuating spiral of mediocrity.

In the international marketplace, it’s intolerable nonsense and it tarnishes the reputation of the country.

An intensive bootcamp focusing on specific areas of developmental excellence can be crafted with the assistance of companies and institutions, and amplified with adjunct faculty.

Weekly dinners with visitors, professors, clients, potential customers or peers from other parts of the world could play an intrinsic role in the development cycle. 

Standards.

As a result of the longstanding ineptitude and dismal economic conditions, short-term gain is vastly favored in Pakistan. This mindset needs to be changed quickly and permanently. To this end, a system of checks and balances needs to be in effect, perhaps with a tiered compensation model which vests in time.

Tailored tax incentives are another tool to ensure companies continue to strive for excellence.

Less Bureaucracy.

Currently, there are associations setup which lobby for legislation and delve in all types of irrelevant nonsense which is one of the reasons why the country’s tech sector can’t keep up with the rest of the world.

‘Software house’ is an obsolete term which conjures up images of a slow, lumbering beast. It might work for a contained setup which handles outsourced calls for foreign businesses, but doesn't really apply to the agile developer who wants to take a brazen idea global in a matter of months to keep pace with today’s industry.

Turning ideas into high-quality, viable products quickly should be the modus operandi here. The government can become an enabler for such individuals, with the help of the vast, accomplished private sector.

Less Corruption.

Don’t ignore the elephant in the room. Pakistan is corrupt!

This applies to both, it’s government and it’s populace. An incubator program would have government officials asking for kickbacks to accept individuals who would like nothing more than to get a handout. A couple of years later, the entire project would be shelved for lack of results.

Measures can be taken conceptually to circumvent this possibility. Some international incubators and Venture Capital (VC) firms already do so albeit for slightly different reasons. There is no shame in emulating their methodology if similar results are desired.

  1. Make the initial investment the only investment, and make it small, and make it arduous. Not more than 400,000 - 500,000 PKR
  2. In order to be accepted into the program, you must either come through the 3 month bootcamp; a fast-paced, intensive training program held at the facility, or have a rudimentary prototype illustrating capabilities and pass a couple of rounds of interviews with the advisory board.
  3. You must spend 3 months refining your product and readying your business to take to market under strict contractual obligation
  4. The investment is made for equity. Applicants will give up 7 - 10% of their company to the Government’s Incubator Program.
  5. Make the group move to another city for the entire duration at their own expense.
If a person or a group is willing to apply to move to another city at their own expense for 3 to 6 months to gain access to infrastructure, technology, expertise and guidance, then chances are they are not motivated by the 400,000 PKR, but rather fueled by conviction. 

More Transparency.

In addition to enlisting the services of a renowned audit firm, the incubator could have an online portal where all capital and operational expenditure can be monitored by anyone. This will ensure that servers don’t cost tens of millions per unit and teabags worth 3 million are not purchased for 50 individuals.

Rebrand a City.

What do Bangalore, Berlin, Seattle, San Francisco and Taipei have in common?

They’re known for being technology hotbeds.

Zoltan Acs, Director for the Center for Entrepreneurship and Public Policy at George Mason University stumbled across a trend while studying government data documenting the survival of businesses in the United States. The insight revealed that the survival rate for startups was significantly higher in cities with a higher number of startups. Whether this is due to some kind of micro culture, higher levels of receptiveness or some other unknown parameter, it has happened with enough regularity to emerge as a pattern.

Cities reinvent themselves all the time through sustained, synchronized efforts. Brooklyn, NY is fast becoming a cultural capital and a breeding ground for several cottage industries. Portland, OR is gaining a reputation as something of a hippie heaven. Berlin has done the same in recent years with consumer technology.

There is another compelling reason to do so. Forcing people to relocate to be a part of the incubator will add an additional layer of filtering to ensure only the really dedicated strive to partake in it.

I’d like to throw in Murree as a suggestion into the hat. It’s close proximity to the Capital gives it many advantages in terms of governance and access to customers and international visitors and it doesn’t yet carry any of the negative associations of the other major cities of Pakistan.

Customers.

Internationally there are small startups catering to very different needs with a varying scope of customers. A single person company who’s product is an iOS app with a global audience.

A private car service which expands city by city.

A small company that rents your car to visitors instead of it being parked in long-term airport parking.

A school going boy looking to reinvent news consumption on mobile devices.

The list goes on. The point is that startups can cater to a local city, a niche market, the whole country, regional businesses or the entire world. Being in close proximity to the capital affords the incubator the opportunity to showcase it’s product offering to many international visitors and partners.

Results.

Culminate in a demo day which offers first dibs to private investors in the board of advisors. They win because they get a prime investment opportunity with substantially reduced risk. The participants win because apart from a company with an instant valuation, they get access to training and infrastructure. The government wins because it gets equity in rapidly developing businesses. The country wins because it’s perception will alter if it brings something else to the table. There are no losers.

Using this time frame, the program can be run 2 - 4 times a year with 30 - 50 participants per cycle. 60 - 200 businesses with global potential in 365 days, after being vetted and mentored by accomplished business people and nurtured in a top-notch facility with consistent interaction with like-minded people.

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Is it perfect? No. In a ideal scenario there would be no need to write this post. As they stand today, these suggestions are just a conceptual blueprint to be tweaked and implemented. They are a map between where we are today, and where we want to get to given the limited means, current circumstances and pressing time constraints.

For cemented perceptions to change, there must be a movement with impetus. Then the rebranding efforts can start to take place. Before all that happens, there has to be a coherent strategy. This could be a minuscule portion of one fragment.


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Comments (2) Closed




22422 Heatherwoode
Dec 24, 2012 11:31am
Godspeed. Thankfully, potential is endless. All that is needed are: perseverance and positive attitude. Keep at it!! Muqtadir
A. Khan
Dec 25, 2012 12:00pm
Nice work in collating this article. Now if only we can find sincere people to do the work.