Despite Pakistan’s precarious economic situation, entrepreneurial activity has been on a rise which is a welcome sign, although the true potential is yet to be unleashed. Over the years, numerous startups have managed to raise funding while some experienced failure and have shut down operations (Airlift, Yayvo, Patari) as operating in a market as volatile as Pakistan is certainly no easy task. There are numerous reasons behind startup failure in Pakistan but some of them are as under:
Lack of market research: Most startup owners have a good business idea but do not back it up with research. As a result, they begin to invest in an idea that sounds perfect on paper but may not have any market demand. They don’t understand that without R&D, it is impossible to refine the product or stay ahead of the competition.
Financial mismanagement: Startups that manage to raise funding spend the money irrationally. They use the money to offer subsidized rates to their target audience. The focus should be on determining the right pricing rather than implementing penetrative pricing, which is not sustainable.
Lack of funding: Unfortunately, there are very few local investors in the country. Foreign investors are keener to invest in stable markets. Without adequate funding, startups risk closure before realising their potential. It must be noted that most startups run at considerable losses during their initial years. The goal is not to earn money but to refine the product. Profit-making comes later. Unfortunately, Pakistani startups don’t have the funding to bear the initial losses.
Top 10 Pakistani Startups
The first three startups revolve around e-Commerce which holds a lot of potential for Pakistan. This sector alone can easily earn billions of dollars and bolster the economy.
1. Dastgyr
Numerous international investors, including VEON and ADB Ventures, back this startup. It is a B2B e-Commerce platform for engineering, agricultural, chemical, and construction products. It connects retailers with manufacturers and wholesalers, thereby improving the supply chain. This platform is available outside Pakistan, including the Kingdom of Saudi Arabia, UAE, the UK, and Qatar. It is one of the standout points of this platform, as hardly any local platforms hold the same advantage. Indeed, it is a perfect opportunity for Pakistani retailers, manufacturers, and wholesalers to participate in the international market. It can prove instrumental in expanding the customer base and bringing much-needed foreign exchange to the country.
2. Tajir
It is another B2B platform. Unfortunately, procurement in Pakistan’s retail industry is quite cumbersome. Retailers waste considerable time talking to different suppliers, enquiring about the rates and expected delivery dates. Even after finalising everything, late and incorrect deliveries are common. Tajir solves this problem by enabling retailers to enquire about goods online, removing the need to visit wholesalers or spend considerable time negotiating. Everything is done online smoothly and transparently. A process that took considerable hours is now completed in mere minutes.
3. Bazaar Technologies
Pakistan’s retail sector is troubled with high fragmentation and inefficiency. A tech-based solution will always be a hit as long as it improves efficiency and reduces operating costs. Bazaar Technologies provides an integrated procurement solution similar to Tajir.
However, it goes one step further with its other product offerings. One such product is Easy Khata – which is a simple bookkeeping application. It allows businesses to move from paper-based bookkeeping to a more secure and digitized version. It has also launched Bazaar Credit, offering short-term loans to businesses.
4. Salesflo
Amazon Web Service (AWS) ranks it as the number one software as a service platform for the Pakistani fast-moving consumer goods industry. This startup boasts notable brands such as Unilever, Nestle, National Foods, and others as its clients. Under the Salesflo umbrella, the startup offers four distinct products. One of the products is the Salesflo Core, which offers numerous features, including delivery vehicle load optimisation. By using advanced analytics, the software is able to optimise the routes, thereby improving time to delivery and reducing costs.
5. SadaPay
The Pakistani banking industry is fraught with challenges, ranging from poor customer service to increased scrutiny of personal transactions. SadaPay strives to be the alternative to the conventional banking system. It is an online money management platform that allows you to manage local and international payments. It is designed to be fast and efficient. With further enhancements expected down the road, SadaPay can truly become an alternative to banks. It has no hidden fees, the exchange rates are perfect, and the platform is highly secure.
6. Finja
This startup is dedicated to fostering the growth of micro, small, and medium enterprises (MSMEs), corporate entities, and salaried professionals through digital transactions. A leading Finja product is the Finja Invest, a P2P platform. It allows businesses to provide instant loans to others without any bank involvement.
The lending business earns a monthly profit and can withdraw the principal amount anytime. Other than this, the startup offers creative solutions to manage business operations. Its human resource management system enables businesses to manage their workforce using smartphones.
7. NayaPay
It is an electronic money institution regulated by the State Bank of Pakistan. It is a faster, more secure, and more reliable alternative to traditional banks. There is no account opening fee nor any annual charges. The platform is upfront about all charges, thereby ensuring high transparency. For businesses, NayaPay offers fully integrated POS machines. The POS are compatible with almost every wallet, debit, and credit card. There is no need to set up a website to receive payments. Businesses can simply use the NayaPay Arc to create shareable payment links with customers.
SadaPay and NayaPay are giving tough competition to each other. Of course, this competition is healthy for the industry and offers considerable benefits to the customers. As a tech-oriented startup, it provides users instant ways to manage their money, which traditional banks still lack in today’s digital age.
8. Truckistan Technologies
This company offers tech-oriented solutions in the less-than-truckload (LTL) sector. LTL is where a business wishes to ship goods by truck, but their goods don’t occupy the entire truckload. Using technology, the company can optimise loads and routes, reducing transportation costs. Unlike other companies, Truckistan enables businesses to track every shipment carton. It is a much-needed feature, especially due to the high rates of theft and loss during transportation. Truckistan promises to deliver goods from Lahore to Karachi in 72 hours.
9. Dawaai
While it is mainly an online platform for buying medicine, however, it also allows customers to seek medical help online (telemedicine). Customers can book online appointments with leading healthcare professionals with just a few taps. Dawaai also allows users to book at-home services, including home nursing and sample collection. It recently launched the Diabetes Care Programme, which provides users with strips and a glucometer for daily reading. Under this program, users can access a doctor and get tested on a quarterly basis.
10. Bykea
Bykea is not a new entrant in ride-sharing sector. Last year, it raised an additional $10 million from its existing funders. The startup said it will use the money to refine its existing app and to expand its footprint in the food and e-Commerce sectors.