Pakistani startups secured $42.5 million in funding in 2024, according to the Pakistan Startup Ecosystem Report (PSER 2024). While the total was lower than 2023, the final quarter saw notable growth, signaling positive momentum for the ecosystem.
A Closer Look at Q4 2024
In the last quarter of 2024, startups raised $26.5 million across four publicly disclosed deals, marking a 76.7% jump from Q3. Notably, Q4 alone accounted for 62% of the year’s total funding. Fintech led the way, securing $19 million or 72% of the quarter’s funding.
However, this figure was still 30% lower than Q4 2023, when startups raised $38 million. Globally, venture capital trends painted a different picture, with Q4 funding reaching $93 billion, driven by a surge in AI investments.
Major Deals That Stood Out
Several high-profile deals were finalized in Q4, with fintech and e-commerce taking the spotlight:
- Abhi: A fintech company raised $15 million, the year’s largest deal, led by Shorooq Partners and Amplify Growth.
- Neem: Secured $4 million from DNI Group to expand its Earned Wage Access (EWA) solutions.
- Laam Technologies: An e-commerce startup raised $5.5 million to enhance its AI capabilities and scale globally.
- Colabs: Received $2 million in pre-Series A funding for its coworking space business.
Deals involving Farmdar (agritech) and Krave Mart (e-commerce grocery delivery) were also announced, but the amounts remained undisclosed.
Sector-Wise Performance for Pakistani Startups
Fintech emerged as the top-funded sector in 2024, raising $30.5 million and accounting for 72% of the year’s total funding. E-commerce followed, contributing 20% with $8.5 million. This trend highlights the growing interest in sectors that leverage technology to solve everyday challenges.
Economic Indicators and Ecosystem Trends
Pakistan’s improving economic landscape has bolstered the startup ecosystem. Inflation fell to 4.9%, the lowest in over six years, while interest rates dropped to a two-year low of 13%. These developments are encouraging for investors and entrepreneurs alike.
The launch of Shark Tank Pakistan in Q4 added a fresh dynamic to the entrepreneurial scene, inspiring young innovators to pitch their ideas and secure funding.
Challenges and Global Context
Despite the positive developments, Pakistan’s startup ecosystem still faces challenges, including political instability, internet outages, and infrastructural limitations. These issues have contributed to the 42.5% drop in total funding compared to 2023.
Globally, venture capital funding showed resilience, growing by 7% to $336.5 billion in 2024, fueled by an 82% increase in AI-focused investments. This highlights the potential for Pakistani startups to tap into emerging technologies like AI and attract international investors.
New Funds and Future Prospects
Investors have shown renewed confidence in the ecosystem. Gobi Partners launched its $50 million Techxila Fund II, targeting high-growth sectors like fintech, e-commerce, and SaaS. Similarly, Sarmayacar unveiled its $40 million Climaventures Fund, focusing on sustainable startups in energy, recycling, and agritech.
With falling interest rates and improving investor sentiment, 2025 holds promise for a stronger and more vibrant startup ecosystem in Pakistan.
