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A start of something big

By Nabeel Qadeer

Pakistan’s IT industry is emerging on the world map. Now it needs some home -grown public and private venture capital fund managers to fast-track it to the first billion dollar mark.

PAKISTAN’S information technology (IT) industry, up till the beginning of this decade, was premature and just gearing up to takeoff. The number of internet users in the country stood at 29 million, or as the World Bank reported, eight subscribers per 100 people. Cellular subscribers numbered at 100 million and of these, 14.4 million were using mobile internet.

Entrepreneurship, specifically as a technology-based term, was a concept the community was not at all comfortable with. Besides other factors, supply remained low as the economic risk was deemed ‘too high.’ Successful startups, such as Mindstorm Studios, Sofizar and Tintash Games to name a few, were present yet the number was far too low to create a sustainable culture.

Fast forward five years to 2015 and we find that the technology industry has transformed into a thriving one which has made its mark globally, even in high profile hubs like the Silicon Valley. 3G mobile users have now surpassed the 12 million mark, 25 percent of total revenue for telecommunication companies now comes from data usage, and the country is the third largest user of freelancer platforms as a means of self-employment.

The complementary role played by the public and the private sector is the driving force behind developing an ecosystem conducive to the industry’s growth. Moreover, academic institutions are also playing a supportive role.

Universities based around IT programs, such as Information Technology University, funded by the provincial government, and FAST-NU now offer courses on entrepreneurship. Similar academic opportunities train students in entrepreneurship, at least theoretically, besides giving them the confidence to pursue an ‘unexplored’ profession. The recent trend of startup competitions, some, like Startup Weekend, as local chapters of global competitions, and other business competitions by student-run societies expose aspiring entrepreneurs to the industry at a young age thus increasing their practical learning graph early on. With a pre-entry insight, they become aware of, and are better prepared for the calling of the entrepreneurial world and the risks it entails.

Institutional platforms, such as The Nest i/O by P@SHA and the LUMS Center for Entrepreneurship by Lahore University of Management Sciences, and other private initiatives, including i2i and Dot Zero, though following different models, are acting as powerful platforms accelerating entrepreneurship locally by providing mentoring and other technological and business amenities.

The government has also been a catalyst for this change. The Punjab Information Technology Board (PITB) has significantly contributed towards raising awareness among the public regarding the uses of IT through its various ventures in e-governance and public surveillance. These include projects such as the Automation of the Boards of Intermediate and Secondary Education and the Citizen Feedback Monitoring Program. IT and its associated benefits become apparent to the general public when they are invited to participate in governance through this medium. More directly, the PITB has laid strong foundations for tech-entrepreneurship by establishing Plan9, which has become the largest technology incubator in Pakistan and is distinguishable by its zero-equity model.

Based in Lahore’s Arfa Software Technology Park, Plan9 takes its name from the distributed operating system by Bell Labs, and runs incubation cycles biannually. Since 2012, when it was founded, 66 startups have graduated from Plan9 and subsequently created approximately 500 jobs and raised over $2 million in funding.

These startups have a product base as diverse as e-commerce, computer vision and alternative energy to ICT and IoT devices; the only common denominator among them is focus, self-belief and determination. The passion to make a mark and the desire to solve a problem has led to the success of many. Markhor, a startup from Plan9’s first cycle, sells handmade leather shoes online to support local craftsmen, and is the first Pakistani startup to successfully complete a crowdfunding campaign on Kickstarter; Groopic, also from the same batch, has raised $100,000 from Kima Ventures; Vivid Technologies has been incubated at Microsoft Ventures London and Transparent Hands – a global crowdfunding platform which connects patients and donors to ensure transparency- now works in collaboration with the World Health Organization.

Yet we at Plan9 noticed that the gap in the current productivity of startups and their potential remained unfulfilled. For the outcome to be effective, startups needed to be facilitated from a step further on from just the early stage as the dynamics of the local industry were different from mature markets. A method had to be devised to support mid-stage startups so they could grow beyond regional and user-based limitations, overcome
hindrances such as social ideas of ‘risk’ and ‘failure’ and access greater funding channels.

The solution was to launch PlanX, an accelerator to empower mid-stage tech startups to the point where they are enabled to positively contribute to the economy in a sustained manner. PlanX is also a government-backed project under PITB, and follows a zero-equity based model just like Plan9.

The success of this accelerator can be gauged by its collaborations on an international level, and the market reach of its startups. XGear, which offers a connected-car platform and a complete fleet management solution, has corporate giants including Nestle and Pepsi as its clients; Bookme.pk, which is revolutionizing the local ticketing industry by providing electronic solutions to customers, has signed on Microsoft as its national marketing partner, and secured an angel investment deal with Etohum.

The landscape of technological entrepreneurship is taking a strong shape in Pakistan: Its representation at international events, global partnerships and a generation of ‘mentored’ startups are creating a credible name for the local industry. The government now, once again, needs to step up in leading a combined effort with the private sector to form a venture capital fund at home, which will be an important boost for startups which are staggering.

Nabeel Qadeer is a project manager and entrepreneur. Currently, he is serving as
Director of Entrepreneurship at the Punjab Information Technology Board, Government of Punjab, Pakistan.

Authors
  • Nabeel, I really applause your efforts for the industry.

  • Yasar Mehmood

    It is very encouraging that public sector is making an effort to boost enterpreneurship in Pakistan.

  • IDEA_KHAN

    It’s quite interesting to read Nabeel Qadeer’s ‘The Start of Something Big’ on the IT industry in Pakistan and Salaina Haron’s ‘Pakistan’s e-Volution’. Frankly, I found both ‘big’ enough to fancy the write-ups. But then my 64,000-rupee question for Mr. Qadeer is: can this government really set up a venture capital fund amid the current politics?

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