Pakistan’s startup ecosystem has grown steadily despite economic and political challenges. This blog explores probable and possible venture capital (VC) funding levels in Pakistan by 2028, the reasons and assumptions behind these projections, and trends up to June 04, 2025.
Trends in VC Funding in Pakistan (Up to June 04, 2025)
Pakistan’s VC landscape has seen significant fluctuations. In 2017, tech startups raised $23.1 million across 74 deals. Funding peaked in 2021 at $350 million across 83 deals, driven by global liquidity and successes like Airlift and Bazaar. However, 2022 saw a decline to $346 million across 42 deals due to a global VC slowdown and local instability. In 2023, Q1 raised $23.1 million, but the annual total fell to around $70 million. By 2024, startups raised $16 million in the first nine months, with $15 million in Q4 alone, showing cautious optimism. For 2025, projections estimate $14.63 million, with early-stage investments at $12.02 million.
This volatility reflects global trends (Asian VC funding fell 51.4% to $14.9 billion in Q3 2024) and local challenges like political uncertainty and limited domestic capital. However, initiatives by funds like i2i Ventures and platforms like Shark Tank Pakistan have supported growth.
Regarding the number of startups, data indicates there are 16,700 startups in Pakistan as of 2025, a significant figure reflecting the ecosystem’s growth since 2015. This number aligns with the Securities and Exchange Commission of Pakistan (SECP) report, which noted 196,805 total registered companies by June 2023, with 27,746 new companies registered in FY2023 alone, many of which are tech startups.
Probable VC Funding Levels in Pakistan by 2028
A probable scenario for VC funding by 2028 is $60 million to $80 million annually, assuming:
- Ecosystem Growth: With 16,700 startups, the ecosystem is expanding, supported by incubators like the National Incubation Center.
- Sector Focus: Fintech (e.g., NayaPay’s $13 million raise in 2022) and e-commerce (e.g., DealCart’s $4.5 million in 2022) remain attractive.
- Policy Support: Government initiatives like the 2022 IT reform package could bolster investment.
Possible VC Funding Levels in 2028
An optimistic scenario sees funding reaching $120 million to $150 million by 2028, driven by:
- Global Partnerships: Funds like Zayn Capital, which backed TruckItIn ($13 million in 2022), could draw more international capital.
- Local Investment: Increased involvement from firms like Fatima Ventures might stabilize funding.
- Exit Opportunities: More M&A activity, like Daraz’s acquisition by Alibaba, could encourage investment.
A pessimistic scenario might limit funding to $25 million to $35 million if political or economic challenges intensify.
Reasons and Assumptions
Projections assume moderate stability, global tech interest, and policy effectiveness. Examples like i2i Ventures’ investment in Oraan ($1.5 million in 2022) and Sarmayacar’s support for Bykea ($10 million in 2022) highlight growth potential. Risks include regulatory hurdles, brain drain (with 37% of Pakistanis willing to emigrate per a 2022 survey), and limited exits.
Conclusion
By 2028, Pakistan’s VC funding could range from $60 million to $80 million to a possible $120 million to $150 million, reflecting the ecosystem’s potential with 16,700 startups. While challenges persist, strategic investments and policy support could drive significant growth.