In a significant boost to Pakistan’s startup ecosystem, the International Finance Corporation (IFC) has committed $3 million to i2i Ventures, the country’s pioneering female-led venture capital fund. This investment, part of IFC’s Startup Catalyst Program, aims to bridge the critical funding gap faced by early-stage startups, particularly those led by women, amidst regional and global challenges like political instability and economic volatility.
Founded in 2019 by venture capital veterans Kalsoom Lakhani and Misbah Naqvi, i2i Ventures invests in pre-seed and seed-stage startups, offering not only financial backing but also hands-on support. The fund has already made a notable impact, with portfolio company Oraan reaching over 2 million Pakistani women with secure and user-friendly financial products and services.
Oraan’s spokesperson highlighted i2i Ventures’ unique focus on gender diversity and inclusion, emphasizing the fund’s role in supporting women-led businesses beyond just financing. The IFC’s $3 million investment, including up to $2 million from its own account and up to $1 million from the Women Entrepreneurs Finance Initiative (We-Fi), is expected to help startups like Oraan access the crucial support needed to grow and scale.
Zeeshan Sheikh, IFC Country Manager for Pakistan and Afghanistan, emphasized the potential for Pakistani startups to develop new technologies and tech-enabled business models addressing issues such as climate change and access to quality education, healthcare, and financial services. He noted the significant challenges early-stage entrepreneurs, especially women, face in accessing necessary resources to launch and grow their businesses, underscoring the importance of building ecosystems that foster innovation and entrepreneurship.
i2i Ventures provides financial support, strategic guidance, and mentorship, drawing on insights from Invest2Innovate, a sister company founded by Lakhani in 2011. Invest2Innovate has pioneered Pakistan’s startup ecosystem, offering business support to entrepreneurs and connecting them with investors. Naqvi explained that i2i Ventures was born from the experience of seeing the potential of startups in Pakistan and the need for founder-centric investors who understand business and market challenges.
One-third of i2i Ventures’ portfolio consists of women-led startups, addressing the disparity in funding between male-founded and female-founded startups in Pakistan. Invest2Innovate’s 2023 annual report showed male-founded startups raised nearly $60.5 million across 29 deals, compared to just $10.5 million for five deals with female founders.
The impact of i2i Ventures extends beyond female founders. Ali Moeen Malik, co-founder of ezBike, credited much of his company’s success to the support provided by i2i Ventures. He emphasized their role in providing financial backing and strategic guidance, helping navigate numerous challenges and boosting growth and development.
Other companies in i2i Ventures’ portfolio include Abhi, a fintech salary advance platform, and Truck It In, a company working to improve efficiency in Pakistan’s fragmented trucking and logistics industry.
IFC’s investment in i2i Ventures is part of its broader strategy to support innovative startups and nascent ecosystems essential for sustainable and inclusive growth in emerging markets. Since its launch in 2016, the IFC’s Startup Catalyst Program has supported 22 accelerators and seed funds, investing in over 1,180 startups across 24 emerging markets.
Hanh Nam Nguyen, IFC’s We-Fi Program Manager, reiterated We-Fi’s commitment to supporting women entrepreneurs through funds like i2i Ventures, which enable more private sector financing for women startups and make the ecosystem more supportive for women founders. These initiatives align with the World Bank Group’s new gender strategy for 2024-2030, aimed at accelerating gender equality to end poverty on a livable planet through concerted action, financing, and programs.
Farid Fezoua, Global Director for Disruptive Technologies, Services, and Funds at IFC, highlighted the positive impact of providing startups with access to early-stage capital and expertise. This fosters an inclusive startup ecosystem that drives entrepreneurship, boosts gender and inclusion, supports innovation, and creates jobs. He noted the positive signal this sends to the wider investment community.
Lakhani and Naqvi remain optimistic about the future and the potential for their fund to continue making a significant impact on Pakistan’s startup ecosystem. This new IFC investment in Pakistan’s first female-led venture capital fund will help bolster the country’s startups and drive innovation, addressing the critical need for funding amidst regional and global challenges. Venture capital funds like i2i Ventures are essential for closing this financing gap, investing in early-stage startups, and providing them with comprehensive support.
