I read this with interest, it is also indicative of the fact that the ecosystem is slowly getting there. But what every one seems to be missing that the free report from the article is a MAC(Mutual Admiration Club) because it shies away from asking the million $ Question
The question being, how many of these VCs, or Angels actually operate being domiciled out of Pakistan? Whilst I whole heartedly agree that regulations make it tough to near impossible to setup efficient structures quickly, all these cheerleaders of Pakistani talent + Startups
from the Valley to DC to Holland to Ireland to Singapore and beyond are and continue to encourage most if not all startups to incorporate outside of Pakistan. So Much for misguided front end Optics of Promoting Pakistan and Pakistani companies. Why is this important now?
In short they are raising overseas in to offshore entities & when liquidity events happen this money will be far far away from our shores. When the time comes most startups will pull of The double Irish with a Dutch sandwich for tax efficiency .investopedia.com/terms/d/double…
What our simple champions & retweeters and the Pakistan VC promotion brigade is missing out on, is the fact that since time immemorial, starting from Daraz, none,if any money exchanged hands in PK.Yet every one wants to give in bound investment in to PK tax breaks and BOI support
It would only be fair if their operating structures were Pakistani based vs foreign. Even the PM + Team of SPAMMers continue to miss the point, beyond the hype & media articles of VCgroups raising 10/20/30m$ to focus on deals in PK almost all comprise of foreign raises+ entities.
In simple terms, the money they raise, is held in NL/Singapore, they ask Pakistani Startups to be eligible for funding to also incorporate there. They then advance the money into that startups Singapore account, the startups then takes what it needs for ops and sends it home
Whilst money is coming to PK, i.e use of proceeds will happen locally mostly. When the startup scales or is ready to raise Series A etc, the money comes in to its foreign account, similarly if the startup sells equity, the money lands in its foreign account. Do you see the issue?
From the Daraz Deals and Telenor banks deals whose FX impacts I highlighted in '17 here bit.ly/3kfoMcS to the VCs & the real cost of these funds coming to PK which I wrote about here bit.ly/3c4UYfT r a good starting point for founders to evaluate their options
The sad reality is that very little has been raised by Pakistan incorporated startups, not talking about PK Origin startups that we love to own and claim like Careem, Airlift, Bykea for example, from what I know are all foreign domiciled.Just using them as an example because of
The hoopla around their rounds and their Pakistani origins. Don't get me wrong, money coming to recognize talent and a good idea is great. I am just identifying the VC cheerleading thats happening and why its mis-guided as an image of Pakistani startups getting funded.
Thats not true & these Pakistani Origin VCs & Cheerleaders are actually doing a dis service as their 1st ASK is for the startup to do a foreign incorporation.Whilst its not a gaali to do so,it shows you a great deal about ecosystem maturity & the wild west attitude of those with$
So dont believe the hype thats the moral of the story, question all these posers who want to sell you snake oil and verify their self interest before your evaluate their interest in your company. Every ones not bad and some truly have no other way to bring money in, but most
are seeding this culture of quick exits on follow on capital by telling the founders nothing will happen if they don't incorporate offshore. So when I read the Cheerleading clubs glowing accolades for each other, I think its only fair to call out what they aren't highlighting
All that glitters isn't gold. We are still far away from mature VC/Accelerant money from really coming to our shores, the total blame cant rely on those raising offshore, but also in equal parts on govt policy and the lack their off. Its a tough situation but the VCs must
call a spade a spade. The las thing we need are visions of grandeur & mis placed expectations + a tweet from the SAPM claiming credit for bringing in tech funding. Whats really coming in,is part of the funds raised offshore to fund the labor arbitrage in PK for a long term VC Win
The more you know the better off you are and you can ask more intelligent questions and evaluate for your self whats really happening vs what you are being told. Given that the thought police regulates so many other parts of our existence, a public service msg like this is key
For the ecosystem to grow, real money has to land on our shores. Till then ask tough questions & don't be fooled, our time will come too lets make sure we are equipped to cash in, locally. @rebootdude @jehan_ara @YusufJan @raza_matin @Ash_Kalim @TalhaIzhar @SaadGH @FaizaYousuf

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More from @faizansiddiqi

4 Sep
Rule number one for any thing. Never take advice from spectators or from MACs.(Mutual Admiration Club) members. Those are the folks that give each other awards. If u aren't building ME2s(where funding is easier), bootstrapping is a different game that needs a different outlook.
Rule number two, its good to dream. Put the dreams in a box & chase them once you have the money. Before that, ask yourself the small data question"what can you build now, Iteratively?" that will add value to an existing market. Optimize your current resources & build for the now
Dont misconstrue passion for profit. Look for the unsexy,(industries/verticals) thats where the real jugular of profit taking is. While the(VC) money is solving sexy and sophisticated problems you need to focus on the low key low hanging stuff where simple is king.
Read 15 tweets
12 Aug
The most commonly asked question is what market am I missing? Where should I be building products?Seems like some folks didn't get the memo, we have an over abundance of last mile+ d2c+ market places + payment tech + bill aggregators + ride hailing + super app aspirants.
All excellent spaces to compete and get market share but you need jet fuel to burn.. $$s. Why dont we focus on areas & markets that we see, use and consume from daily. Google. If you turn your Google to India and even the US you will see it doesn't want u to leave the search page
It offers you all kinds of in-page/on-page content, It doesn't create most of it, it has either deep licensing arrangements or it displays breadcrumbs from other sites,more & more its shying away from scraping content esp in developing markets. So what does this have to with you?
Read 11 tweets
11 Aug
The golden age of photocopying and the curious case of APIs, Smart Cards and SuperApps. The most tragic thing I see daily is when a NADRA chip card gets photocopied. All the info we are allegedly photocopying exists on the card. Even for the basic variety card it can be read.
What we need to do is to build an ecosystem of verified tokenized info.Then we have the APIs that have come a long way, but have a long way to go. 1Link is a primary example of what can be,(and slowly getting there)but the real value unlock would be if the Banks Agreed to sell it
Next we have our obsession with SuperApps. The thesis was that if you captured enough DAUs and had a captive audience, you could build a semi walled garden of what ever it is they need to do in their digital life from playing games to paying people to checking the news and msging
Read 21 tweets
27 Nov 19
If you are just starting up, no one is expecting you to make a contribution to eradicate polio. Make money first before you tie your business model to some altruistic goal. When you have money & scale you can solve problems at scale, GROW before you Give.
Any business should be in the business of making money, having positive social, economic, climate or other impacts should be a planned/thought out consequence of where you want to be but cant be the cover under which you mis lead your self if your business isn't growing.
Self deception under the guise of "I'm doing it for a good cause "has killed more businesses than it has grown. Stop feeling sorry for your self because you feel sorry for others & want to help them, that help can come when you make some greenbacks. Confusing your end goal sucks
Read 10 tweets

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