IFC to invest $2.5m in Sarmayacar to 'boost entrepreneurship' in Pakistan

Published July 31, 2019
The investment is meant to boost tech-based startups in Pakistan. —AFP/File
The investment is meant to boost tech-based startups in Pakistan. —AFP/File

The International Finance Corporation (IFC), a sister organisation of the World Bank, will be investing $2.5 million in Sarmayacar — a venture capital firm for tech startups — in order to "boost entrepreneurship and spur economic growth" in Pakistan, a press statement said.

"The early stage of local venture capital ecosystems is often the most crucial building block for sustaining healthy entrepreneurship and innovation, which helps to drive economic growth and create quality jobs,” Nadeem Siddiqui, IFC’s Senior Manager for Pakistan and Afghanistan was quoted as saying.

"Our aim is to support these entrepreneurs by helping to bridge issues around insufficient seed capital and strengthen the entrepreneurial ecosystem in Pakistan."

According to the press release, $2m of the total IFC fund are equity commitments from Startup Catalyst, the body's global programme to support seed funds and accelerators — that include investments, mentorship, connections etc — in emerging markets.

The remaining $500,000 is from the Women Entrepreneurship Finance Initiative (We-Fi), that provides support to women entrepreneurs in developing countries by building their capacity, providing them access to financial services as well as domestic and global markets. We-Fi, which is hosted by the World Bank Group, is a partnership between governments, development banks and stakeholders, both public and private.

The investment by IFC will boost the "country’s entrepreneurship ecosystem" by increasing market competition and will also encourage entrepreneurs to expand into new markets, the press release said.

Sarmayacar's founder Rabeel Warraich lauded the step and said: "This marks the first such investment from the World Bank Group in Pakistan and will enable us to back more startups in the country, while also providing access to a global network, new markets and domain expertise to our portfolio companies."

"Pakistan offers a unique opportunity with its improving stability; large, young population; rising middle class; fast-growing internet and smartphone penetration; and a dearth of venture capital in the ecosystem. Our goal at Sarmayacar is to provide value-add early-stage funding to entrepreneurs who are building scalable, market-transforming consumer and enterprise technology businesses in Pakistan," he was quoted as saying.

Sarmayacar is a Netherlands-based venture capital firm that invests in budding tech-based startups with the aim to help build "scalable, market-transforming enterprise and consumer technology businesses in Pakistan", according to its website. The company's clients include local startups like Bykea, Dot & Line and Patari, among others.

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Judiciary’s SOS
28 Mar, 2024

Judiciary’s SOS

SOME clearly thought that senior judges would prove just as easily ‘manageable’ as our seasoned politicians...
Data protection
28 Mar, 2024

Data protection

WHAT do we want? Data protection laws. When do we want them? Immediately. Without delay, if we are to prevent ...
Selling humans
28 Mar, 2024

Selling humans

HUMAN traders feed off economic distress; they peddle promises of a better life to the impoverished who, mired in...
New terror wave
Updated 27 Mar, 2024

New terror wave

The time has come for decisive government action against militancy.
Development costs
27 Mar, 2024

Development costs

A HEFTY escalation of 30pc in the cost of ongoing federal development schemes is one of the many decisions where the...
Aitchison controversy
Updated 27 Mar, 2024

Aitchison controversy

It is hoped that higher authorities realise that politics and nepotism have no place in schools.