Exploring Pakistan's startup ecosystem

Just like in any other country, getting funds in Pakistan requires creative ideas and quality presentations.

I am Fawwaz Abdulnasir, a student of Bachelors in Business Administration currently enrolled in Iqra University located in Karachi, Pakistan. As you can tell by my degree program, I’m a business student, I’m also a part-time content writer, a fitness enthusiast, and somewhat of a tech geek.

Today, I will be giving you guys a thorough insight into what the business industry is like in Pakistan. Being a business student myself and closely affiliated with a resort rental business owned by my father, I can say that I know a thing or two about what starting up a business in Pakistan is like.

Now, here’s a simple question, what is the first thing that comes to your mind when you think of business in Pakistan? If you’re thinking of a biryani shop on a road full of potholes right next to some crowded pollution-ridden rickshaw stand, then you’re thinking wrong.

Insights on Pakistan's Startup Ecosystem Potential

Pakistan is still often considered by foreigners as just another third-world country where the Wi-Fi speed is no more than 2 MB/s. On the contrary, the country’s rapid progress in technology is unknown to most and rarely highlighted by mainstream media.

Despite dealing with several blows such as load shedding, poverty, scarcity of water, the country is still referred to as the next big market for tech startups in South Asia.

The Pandemic’s Effect on Pakistani Businesses

The pandemic shook the economies of countries all over the world from their roots. The same happened with Pakistan’s economy. A country already in debt having to close down its business activities is obviously not beneficial for its economy.

However, the pandemic did not hit Pakistan as hard as it did other countries. After the first case of the novel coronavirus showed up, the ministers of the country took quick action and imposed a strict full lockdown to stop the spread.

Business activities came to a halt and the nation faced a mandatory hard time just as every other country did. Millions of Pakistanis lost their jobs and that is when the trend of startups paved its way through the minds of 216 million.

Source: Bloomberg

Rise of Freelancing

Apparently, the tech-savvy youth of Pakistan did not enjoy Netflix in their homes during the lockdown period, instead, they set up their PCs and got to work. Millions of students across the nation took to freelancing marketplaces and generated a heavy income during 2020.

This led to the doors of remote business opening in Pakistan and e-commercial activities were given a completely new meaning. With such a sudden shift of waves, the renowned global platform Payoneer listed Pakistan as 8th on its list of countries with the fastest-growing rate of freelancing.

What Pushed the Trend of Startups in Pakistan?

As I mentioned above that the youth of Pakistan was given a year with their digital devices. In my opinion, this was the core reason why the trend of startups rose significantly in the last year. A low rate of employment opportunities is also a reason why the youth of Pakistan dislikes the thought of a classical 9-5 job and aims to go for startups.

Moreover, the lockdown period also opened doors to new possibilities and ideas for the Pakistanis to break the cycle and think differently. Taking McKinsey & Co’s report into account, 720 businesses in Pakistan have started up since 2010 and 67% of them are still alive.

Capital Funding Landscape

Just like in any other country, getting funds in Pakistan requires creative ideas and quality presentations. Before 2017, Pakistani entrepreneurs faced tons of difficulties in getting their startups running. Now that the trend of startups has gotten more common, investors from not only Pakistan but from foreign countries too, look forward to helping businesses get up on their feet. Many startups in Pakistan were funded by foreign investors.

For example, Lahore’s Airlift, which is quite a successful transport agency startup, was funded by an American party. As far as starting a business is concerned in Pakistan, the government has taken measures to assist entrepreneurs in getting their startups running. Now before I wrap up, I’d like to give you guys an honest overview of the benefits and troubles of starting a business in Pakistan as a foreigner.

Pros and Cons of Starting a Business in Pakistan as a Foreigner

Pakistan’s business industry is set to reach heights that it has never reached before. The country is set on the right track and it would be fair to state that things are finally changing for Pakistan’s economy quite rapidly. What does a foreigner have to face if they decide to run their own business in Pakistan, you ask? Here’s my answer.


  • Ease of Commencement. Pakistan is a country where starting a business is known to be easier, as compared to other countries. The government has taken several measures to assist startups in commencing and growing.

  • Tax Advantage. Directors are allowed to receive salaries from their company. This does not apply to every business type but this is a relatively heavy advantage in terms of tax payment for business owners.

Ease of Transferring Ownership. The traditional practice of transferring ownership to other members of the family still prevails in Pakistan. That is why it is easy for owners of Pakistani businesses to transfer control to another authority.


  • Complicated Laws. Although starting a business is easy but keeping it as per Pakistani laws is difficult. The government needs paperwork and documentation from A-Z making legal matters highly troublesome.

  • Dishonest Labor. Being a Pakistani, this is hard for me to write but I promised to keep things honest. The majority of the labor force in Pakistan is not passionate about their employment and shows dishonesty as well as disloyalty. This is one of the leading reasons for what holds the country back from proper development.


Those were some of the hurdles and benefits you face in starting a business in Pakistan. Rules vary from business types and therefore, I tried keeping this as short and general as possible. The city of Karachi in which I live is known to be the business hub of the entire country and it contributes a major fraction of the nation’s overall wealth.

If you’re a foreigner looking to invest in a Pakistani business or start your own, I suggest you start from Karachi.

To summarize, I would say that Pakistan is filled with an unimaginable amount of raw talent ready to be utilized. All it needs is the resources to get things done and a bunch of other social improvements to move forward.

It would be correct to assume that the country will make it to the big leagues of technological advancements by the end of this decade. I hope you guys learned a thing or two about Pakistani entrepreneurship.

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