Caretaker IT Minister Dr. Umar Saif officially unveiled the Rs. 2 billion Pakistan Startup Fund (PSF) in a ceremony attended by domestic and international venture capitalists, diplomats, and tech industry leaders. Alongside the Federal Minister, Secretary IT Hasan Nasir Jami and Ignite CEO Asim Shehryar were present at the launch.
Dr. Umar Saif emphasized the PSF’s primary goal to accelerate venture investment in Pakistan, highlighting its crucial role in the country’s economic development. The fund aims to offer vital financial support to startups, with each venture receiving 30% from the PSF and the remaining 70% from venture capitalists.
The government envisions the PSF as a facilitator for the growth of innovative ventures, providing financial backing and creating a conducive environment for startups to thrive. The IT Ministry is actively working to support IT startups, part of a broader strategy to boost the local tech ecosystem. Dr. Umar Saif noted that over the past four years, Pakistani startups have attracted approximately $800 million in foreign investments, indicating global interest in the country’s entrepreneurial landscape.
In a tweet, the minister highlighted a unique aspect of the PSF, stating that for a foreign VC evaluating a Pakistani startup for a $1 million investment, the VC only needs to invest $700k, as the PSF will provide a grant of $300k to help close the round. The PSF aims to lower the risk for international investors, betting on startup success without taking equity or board positions.
The PSF launch revealed that eight National Incubation Centers across the nation support over 4,000 startups. The government is committed to aiding startups in securing funding, with an annual allocation of Rs. 2 billion earmarked to help startups raise a substantial Rs. 50 billion.
The fund is set to disburse financial support to startups starting from March 1, providing policy guidelines for venture funds, ensuring investment protection for foreign investors, and enabling major corporations to invest in Pakistani startups. Dr. Umar Saif expressed hope that the PSF would create a value of at least Rs. 50 billion per year in the Pakistani startup ecosystem.
Overall, the launch of the Pakistan Startup Fund signals a significant step toward fostering innovation, supporting entrepreneurship, and attracting global investment to Pakistan’s burgeoning startup landscape. The government’s commitment to providing financial backing and creating a favorable environment is poised to contribute to the growth and success of startups in the country.
