KARACHI: When it rains, it pours. And Pakistan’s startup ecosystem has caught the worst part of it for the past year or so. In the latest in a series of lows, e-commerce platforms Daraz and Byte have been experiencing serious downsizing, whereby they have cut 11% and about 30% of their workforces respectively. Earlier, tech giant foodpanda also discretely laid off employees as the startup This looming threat of unemployment has both the companies’ employees teetering on the precipice of getting fired. Apart from the overall economic slowdown in Pakistan, what else can be causing such pressing job insecurity in the startup industry?
What has been happening in Pakistan’s startup ecosystem?
The last year ended with a total of an estimated $355 million raised in disclosed funding across 57 deals by Pakistan’s startups in 2022, according to data compiled by VC and insights firm Invest2Innovate (i2i). Compared to more than $380 million of funding in 2021, last year’s numbers translate to a drop of about 6.6%. This might not seem like a significant drop, however, when considered in light of the expected increase in funding every year, even a small drop seems sizable. The tl;dr below explains how the last quarter of 2022 recorded the lowest amounts of startup funding in the last four years.
For those who thought that last year was the final step in the opposite direction, with prominent startups like Airlift and SWVL shutting down operations in Pakistan, the worst is yet to come....
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