According to data made public by Data Darbar, startup funding in Pakistan is still having a dismal year, with investments dropping to $6.8 million between July and September 2023.
This is down from $55 million recorded during the same period last year by 87.7% year over year (YoY). As a result, the 9MCY23 amount has dropped to just $35.1 million, a decrease of almost 90%.
In comparison to Q2’s $5.2 million, financing climbed by 30.8 percent on a quarter-over-quarter (QoQ) basis. The number of deals was five, down 37.5 percent quarter over quarter and 50% year over year.
Only 21 trades were completed in total for 9MCY23, around the same number that was observed in just Q1-2022. In Q3 2023, the average ticket size dropped from $4.26 million to $1.36 million, a 70.5 percent decrease year over year. This represents a slight increase from $742,900 in the prior quarter.
Five startups raised seed capital in total during the quarter. The most prevalent stage in 9MCY23 is seed fundraising, which accounts for 15 of the 21 transactions.
The five seed rounds in Q3 were each in a different sector. The majority of the $2.6 million came from Edtech, thanks to Taleemabad.
Fintech dominated overall in 9MCY23 in terms of both money amount ($14 million) and transaction volume (7). With $11.1 million and four deals, the transportation and logistics sector came in second.
The only other investor, Indus Valley Capital, closed two deals in the quarter, while Sarmayacar closed just one. No investments were disclosed by Zayn VC, i2i Ventures, or Fatima Gobi in Q3-2023, and each disclosed just one in 9M2023. This might also mean that although local VCs aren’t making many announcements, they are nonetheless allocating capital.
The amount of worldwide venture capital was $60.5 billion in Q2 2023, the lowest level since the first quarter of 2018 (before COVID), according to CB Insights.
One of the most well-funded companies, Medznmore, closed its doors during the quarter. Shortly after, Jugnu stopped conducting its basic business. The Carta database reports that a record number of startups have closed their doors this year.