KARACHI: A large consumer base, along with a nascent digital entrepreneurship landscape and not many international players, makes Pakistan a great place for investments, said Riyad Abou Jaoudeh of Middle East Venture Partners (MEVP) on Saturday.
He was addressing the ‘Investor Panel – Where is the money?’ at the 021Disrupt event. The two-day event, organised by Nest I/O – a technology incubator, featured Pakistan’s diverse startup ecosystem along with local and foreign venture capitalists, innovators and entrepreneurs.
During the discussion, panelists talked about how the local ecosystem is faring in terms of innovation. They were all of the view that Pakistan is currently in the stage where tech-enabled startups are imitating ideas from successful American or European business models that have investors’ interest. Deep tech, on the other hand, requires much more funding and patience for which the country is not yet ready, they said.
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The panelists also cautioned investors against becoming too involved. “We are the venture capitalists. We don’t tell entrepreneurs what to do. We advise but we don’t tell,” underlined Jaoudeh. However, Khaled Talhouni of Wamda Capital differed: “We have specialist teams in operations, marketing and all which our portfolio companies can seek consultation from.”
Responding to a question regarding the best way to connect with a venture capital, Bernhard Klemen of Sarmayacar stressed on avoiding cold calling and rather focusing on recommendations.
To would-be entrepreneurs, Shahida Saleeem of PEP anot money bags!” She, however, stressed that it wasn’t the investors’ job to figure out where the startup is going. “The job of an investor is to offer support.”
Speaking to Dawn on the sidelines of the conference, Mr Jaoudeh, managing director of MEVP – a fund investing in Arab states – shared the company’s intentions to enter the emerging Pakistani market. “We haven’t invested anything here as yet but now we are exploring opportunities here, particularly in companies wanting to raise B round,” he said, referring to the second round of funding that startups require after the initial seed money. The company has a portfolio of around 40 startups, ranging from fintech to bookings.
Sarmayacar — the Netherlands-based early stage venture capital that just raised $30 million to invest in Pakistan — also shared its plans. Klemen and CEO Rabeel Warriach said that they were looking to invest between the range of $100,000 to $2 million in local tech or tech-enabled startups. Sarmayacar already has stakes in three Pakistani companies – Patari, ProCheck and Simpaisa – and would now be expanding that portfolio.
The event also officially marked the entry of a South East Asian venture capital Gobi VC in Pakistan, with an investment of $1.5m in local booking app, Sastaticket.pk. Raof Zainuddin of Gobi told Dawn that their VC will be actively looking for more opportunities here in early stage startups.
On the occasion, Badr Ward, CEO of Lamsa, an edutainment app from the Middle-East, announced that the company would be launching the application in Urdu in early 2019. The app provides education and entertainment for children with over 10m downloads. In his talk ‘The serious business of edutainment’, Mr Ward stressed on the need for localised content in mother tongue and making learning fun. Repeatedly underscoring the need for teaching kids in mother tongue, he said, “I spoke Arabic and I grew up fine.” “I highly encourage young parents here to speak to your kids in Urdu. Empower future generations in Urdu!” he urged.
Earlier in the day, Paul Papadimitriou, founder of Intelligencr — a global innovation headhunting firm — spoke about the way technology changed lives within the past six decades. In his talk ‘The new global race to disruption’, he underlined the importance of accepting failure and not being afraid to ‘jump’."This era belongs to developing countries like Pakistan, where the environment is ready for disruptive ideas."
Published in Dawn, November 11th, 2018