Why startups fail

Not too long ago, the venture capital (VC) and tech sector was the place to be where employees were paid hands over fist. And then came the wave of popular startups shutting down. Recently, there have been rumours about layoffs in established tech companies. What happened? Shifts in consumption patterns have been the first benefactor of digitisation — for example there are multiple ride-hailing options available instead of just the traditional rickshaws. However, Pakistan still lags behind countries, narrates Rabeel Warraich, Founder and CEO of venture capital fund Sarmayacar. A number of funds came into the market from 2019 to 2022. However, the numbers were down 75 per cent in 2023, in line with the global phenomenon. In Pakistan’s peak years over 2021 and 2022, about $1.2 was invested per capita in terms of venture capital compared to $30 per capita for India.