We could start by telling you all the superlatives, such as the fact that the largest Series A and Series B in Pakistani history (Bazaar’s $30 million and Airlift’s $85 million respectively) were announced in the same week and put together were more than total startup funding raised by all startups in the country over the previous three years combined.
We could tell you that this is a fantastic thing for Pakistani startups, and that the country’s economy is better off for having all the attention from foreign investors. We could list all of those foreign investors and tell you why each one is significant. We could even write a piece telling you why these investors should have been paying attention to Pakistan all along.
But those are all obvious takes and you have no doubt read countless of them already, including in the breathless tweets that quote-tweeted these announcements (including one from this author… guilty as charged) on Twitter.
Instead, we will focus on a layer below: why is this happening, what it will mean in terms of financing and business strategy for Pakistani startups and, crucially, what could potentially go wrong and how to avoid the more obvious pitfalls.
Why are foreign investors coming to Pakistan?
Let us start with the biggest and most obvious question: why is big money finally looking at Pakistan? As we see it, there are five key factors, one of which we classify as a push-factor, and the other four are pull factors.
Exit from China: the push...
Read Full Story: https://profit.pakistantoday.com.pk/2021/08/29/beware-of-foreign-vcs-bearing-term-sheets/
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