Start-ups are part of Pakistan’s most recent success stories with technology acting as the great enabler. Pakistan is a country of unequal opportunities driven largely by the privileges of birth. The higher up people are on the privilege scale, the greater their access to quality in terms of education, learning, health, and every other resource that determines their quality of life. The digital space has become a huge equaliser in this respect.

Smartphone penetration has provided access to information and educational resources, previously beyond the reach of thousands of Pakistanis, so that today start-ups represent the best chance for Pakistanis to leapfrog into better opportunities. New vistas have opened for young Pakistanis, enabling them to overcome entrenched barriers, perhaps even more so for women, who have found a gateway to validate their talent that may have been unattainable before.

Along with this has come a tremendous sense of excitement and possibility. Most significantly, start-ups have become important contributors to Pakistan’s economy, so much so that as per the recent budget announcement, they are slated to come under the tax net. On this score, the government must tread with care. This is still a fragile ecosystem operating in a fragile economy, and economic difficulties have already dented the progress achieved in earlier years. According to the Pakistan Export Board and the Pakistan Software Houses Association (P@SHA), the highest annual funding obtained by a start-up venture was in 2021 and raised approximately $365.8 million. The funding trajectory then went from $75.6 million in 2023, to $22.5 million in 2024, and so far in 2025 the funding raised so far has been $196 million. Clearly, the momentum has been stymied and recent ‘connectivity’ issues have created multiple issues for start-up entrepreneurs and, in fact, pose a tangible threat to the further development of the ecosystem. Microsoft’s recent decision to close its operations in Pakistan after 25 years is another unfortunate development and a strong indicator of the seriousness of the mounting issues that need addressing by all stakeholders and most of all the government.

The dream is of course for Pakistan to have its own unicorn, and this is entirely possible given the success of overseas Pakistanis, such as Amir Husain, founder of SparkCognition and Sauleh Asif, whose start up, Cursor, has reportedly been valued at $10 billion in the US. But in Pakistan, given systemic challenges, the idea of a new venture crossing the one billion dollar value threshold remains elusive. And yet, the potential is there. Start-ups and the entrepreneurship ecosystem can, if given the right opportunities and incentives, bring about a transformative change in the economy and create significant employment opportunities. They have the talent, the drive and the passion. All they need is to be facilitated.

From Aurora’s archives

INTERVIEW Nadeem Hussain, Coach, Planet N

PROFILE Whatever Will She Do Next?: Jehan Ara, the iconic founder of The Nest I/O and former President, P@SHA

ARTICLES
Not All Unicorns and Rainbows Yet – Mehwish Aslam

Women On The Net – Jehan Ara

Crashing Pakistans startup ecosystem – Nabeel Qadeer