Chinese venture capital firm Gobi Partners is exploring a Pakistan-focused fund, its founding partner Thomas G Tsao said.
Tsao declined to reveal the size and timeline for the fund but said he was impressed by the talent and potential of Pakistan’s entrepreneurs and ecosystem.
Tsao, who was in Karachi for the 021Disrupt startup-investor conference, earlier announced leading a $1.5-million Series A funding round for Pakistani online travel agency Sastaticket.pk. The deal makes Gobi the first Chinese venture capital firm to invest in the country.
Pakistan has one of the fastest growing Internet markets in Asia, with over 1 million people going online via their mobile phones every month. The country’s e-commerce market is also expected to surpass $1 billion in revenue by 2020, according to Google.
Pakistan’s predominantly Muslim population also aligns with Gobi Partners’ interest in TaqwaTech. TaqwaTech refers to tech startups led by Muslim entrepreneurs or those that serve Muslim consumers, businesses and communities.
Tsao said: “Where is there a market that is bigger than 1.4 billion Chinese people? It’s 1.8 billion Muslims. And if you ask me what’s a bigger opportunity than TaqwaTech? It’s women. There are 3.5 billion women, who you could argue have also been under-served.”
So far, Gobi Partners has launched two $10-million market-focused funds – one for the Philippines and one for Indonesia. Both funds focus on early-stage companies, covering sectors such as e-commerce, travel, logistics and healthtech.
Pakistan finding its way on to investors’ radar
Venture capital firm Sarmayacar recently announced that it had secured the first close of a $30-million Pakistan-focused fund targeting seed to early-stage startups in the country. This is the largest venture fund focused on Pakistan to date.
In May, Chinese e-commerce giant Alibaba Group announced the acquisition of Pakistani online retailer Daraz. In March, Ant Financial invested $184.5 million for a 45 per cent stake in Telenor Microfinance Bank (TMB) to develop its mobile payment and digital financial services. TMB is a subsidiary of Telenor Group and a leading lender in Pakistan.
Tsao said Gobi is open to setting up more market-focused funds. However, he declined to say which markets the venture firm is currently eyeing, apart from Pakistan.