Report flags capital bottleneck as ecosystem grows to 170 VC-backed firms without a unicorn
Startup. Design: Mohsin Alam
LAHORE:
A little over $4 billion. That is the combined enterprise value of Pakistan’s venture capital-backed startups today, up 3.6 times since 2020 – a pace that has quietly outperformed larger ecosystems such as India, New York, Paris and Dubai over the same period.
The figure, compiled by Dealroom.co and inDrive in the January 2026 Pakistan Tech Report, places the country firmly on the global map of what the report calls “New Frontier” ecosystems, fast-growing technology markets outside traditional hubs such as North America, China and Western Europe.
Globally, more than 70 cities in these emerging ecosystems have produced at least one billion-dollar startup, a tenfold rise since 2015. New Frontier tech ecosystems now attract 11% of global venture capital, up from less than 4% fifteen years ago, with a combined enterprise value exceeding $2 trillion. Pakistan’s story stands out for acceleration from a low base. The report shows companies launched since 2015 have grown their enterprise value by 11.3 times since 2020, outpacing the Bay Area, New York and India in percentage growth terms. Despite small absolute numbers, momentum among younger startups remains strong.
Pakistan hosts more than 170 VC-backed startups that have collectively crossed the $4 billion mark. Around 17 companies are classified as “breakouts”, having raised between $15 million and $100 million, while two have entered the scale-up stage with funding above $100 million. Thirteen companies are generating annual revenues between $25 million and $100 million, placing them in the “Colts” category. However, the country has yet to produce a unicorn valued at $1 billion or a company generating more than $100 million in annual revenue.
This gap between potential and outcome is a defining feature. Capital, not talent, is widely seen as the main bottleneck. While dozens of founders launch startups locally each year, roughly 32 raise their first VC round annually. A significant portion of growth capital is secured abroad, limiting the development of a self-sustaining domestic investment cycle.
Macroeconomic indicators provide a mixed but stabilising backdrop. Real GDP growth rebounded to around 3.0% in FY2024-25 from 2.6% a year earlier, with projections in the 2.6-3.0% range for FY2025-26, according to World Bank data cited in the report.
Demographics offer a structural advantage. About 59% of the population falls within the 15-64 working-age bracket, and the median age stands at roughly 21-22 years.
Digital adoption is advancing, though unevenly. Smartphone penetration stood at about 68% in 2023-24, while 3G/4G coverage reached around 81% of the population. Early 2025 data show nearly 190 million active mobile SIM connections, roughly 75% of the population, and an estimated 116 million internet users, translating into 45.7% internet penetration. The gap between mobile access and active internet use signals both a challenge and an opportunity for tech firms.
Sectorally, enterprise software, fintech, transportation, education and health tech dominate the startup landscape. Early international investor interest has been concentrated in fintech and mobility, with participation from operator-led and corporate venture arms such as Veon Ventures and Yango Ventures. Several logistics and delivery startups have secured funding in the $16-40 million range, while fintech ventures in mobile payments and crypto have attracted $18-20 million rounds.
Another underexplored area is women-led entrepreneurship. In 2025, Pakistan accounted for 288 applications to the Aurora Tech Award out of roughly 3,400 globally. Yet most female-founded startups remain at pre-seed stages, highlighting limited access to early capital despite strong participation in sectors such as health tech, AI, energy and sustainability.
The report argues that underfunding may paradoxically create opportunity. Early and strategic investors entering at this stage could play a disproportionate role in shaping outcomes and capturing value as the ecosystem matures. International experience suggests ecosystems often require a first generation of large exits to trigger reinvestment and repeat founders. India was at a similar early stage a decade ago before producing a wave of large-scale tech outcomes.
Pakistan has built a base of 170-plus startups, accumulated founder experience and attracted early foreign investor interest. What remains missing are large exits and deeper pools of growth capital. If those pieces fall into place, the current $4 billion ecosystem could scale rapidly over the next five to seven years.
