Tech & VC Landscape report reveals that Pakistani startup funding plummeted by 77% in 2023

Morning! Is the sudden popularity of lip products might be because at once, women around the world started finding lip products fun, or is it... economics?

The lipstick effect theory means that when economic times are tough, consumers simply trade down to cheaper items to cheer themselves up such as buying a lipstick like women did in the 2000s great recession. So, while it means you might be seeing a lot of glossy lips around you, a less fun fact might be that we really are in some deep sh*t.. economically.

In this week’s edition:

💡 Where Info Meets Inspo: Zuhaib Raja from Southwest Airlines (US) - Fortune 500 company

✨ It’s the glow-up season for S&P 500

🐼 Pak to venture into panda bonds

⚔️ US Vs Apple

📊 Tech & VC Landscape Pakistan 2023 | Report

- The Itla Squad 💼

Itla Careers

Where Info Meets Inspo with Zuhaib Raja 💡 

Where Info Meets Inspo is an Itla segment where we highlight professionals who work within the tech and business realm - in Pakistan or abroad. Hit reply if you’d like a chance to be featured.

How would you explain your job to someone with no exposure to your field?

I'm a Crew Analytical Consultant at one of the leading airlines in the USA, a Fortune 500 company. My job revolves around enhancing crew business processes and efficiencies in pilot scheduling and planning through data-driven techniques. Using advanced analytics, I delve into vast datasets to uncover insights that improve our operations and optimize crew resource planning. Essentially, I'm tasked with finding innovative solutions to ensure our airline operates smoothly and efficiently. From analyzing flight patterns to identifying crew scheduling trends, my role is pivotal in driving the airline's success. It's a dynamic position that merges analytical prowess with strategic thinking, making each day both challenging and rewarding.

What’s the most interesting project you’ve worked on?

One of the most intriguing projects I've worked on was developing a quality-of-life metric for our pilots' working schedules, aligning with company goals while prioritizing their well-being and preferences. We optimized scheduling algorithms based on pilot behavior and preferences to enhance both their personal and professional lives. This project struck a balance between operational efficiency and employee satisfaction, fostering a harmonious work environment. By leveraging data-driven insights, we crafted schedules that met company objectives while improving the pilot's quality of life metric. This experience was compelling as it showcased the intersection of data analytics, employee welfare, and organizational success, ultimately driving greater efficiency and satisfaction within the company.

What’s your favorite tech/business-related media you read/watch/listen to?

When it comes to staying informed about the latest in tech and business, I rely on a variety of platforms, but my top choices are Harvard Business Review and The New York Times. These sources provide in-depth analyses of business challenges and solutions, offering valuable insights into the ever-evolving landscape of technology and industry trends. From exploring case studies to uncovering innovative strategies, these publications offer a wealth of knowledge that helps me stay ahead in my field. Whether it's dissecting emerging technologies or understanding market dynamics, I find these sources to be indispensable for gaining a comprehensive understanding of the business world.

Business

Global 🌎️

S&P 500 is having a glow-up

Amid all the craziness going on in the world – you know, economic troubles, climate change stresses, and some genocide – America seems to be in its own little bubble.

The S&P 500, a stock market index, has been doing really well lately. It hit a low point in October 2022 but has since bounced back and reached record highs. This turnaround means it’s the start of what we now call a "bull market," where stock prices generally go up.

The details:

• Looking back at history, when we look at past bull markets, we see that the S&P 500 usually does quite well during the first two years. On average, it goes up by about 61% during this time. This gives us some clues about what might happen in the current bull market.

• Right now, the S&P 500 has already gone up by 43% since the bull market started in October 2022. Based on what happened in the past, it could go up even more in the next couple of years.

• But the stock market is always changing, and there are some things that could make it harder for stocks to keep going up. For example, there are concerns about things like inflation and interest rates.

Way forward: Even though there might be ups and downs along the way, history shows that the stock market tends to go up over the long term. So, if you’ve invested in the stock, you might wanna calm down and not make decisions based on short-term ups and downs.

TLDR: The S&P 500, reflecting the performance of 500 top US companies, has surged to record highs after a dip in October 2022, signaling a "bull market." While past trends suggest continued growth, factors like inflation and interest rates could pose challenges. Despite short-term fluctuations, history indicates long-term market growth, advising investors to stay steady amidst ups and downs.

What else is new in news

✶It's good to be an American it seems as last week, there was a slight drop in the number of people applying for unemployment benefits, which means there’s a healthy job market and stable employment for most workers (can’t relate at all). According to the report from the Labor Department on Thursday, there were 2,000 fewer claims, bringing the total to 210,000 only.

Local 🇵🇰

Pakistan to enter the Chinese panda bonds market (spoiler alert: it has nothing to do with Foodpanda)

Pakistan's finance minister announced a plan to introduce Panda bonds worth $300 million into the Chinese market this year. It's the first time Pakistan is selling these bonds in China, with an initial offering of $250 to $300 million.

The details:

• The finance minister sees this as a smart move because China has a big bond market, and selling Panda bonds will let Pakistan borrow money in Chinese currency.

• These bonds are attractive because they have lower costs, and the market for these bonds could double in 2024, according to experts. Other countries like Egypt and Hungary have sold them too.

• The finance minister, who used to work for a bank, admits they should have thought about selling these bonds earlier. But now, it's a good way for Pakistan to raise money, especially since China has been helping Pakistan a lot with loans (as usual).

Way forward: The finance minister's main job now is to get more loans from the International Monetary Fund (IMF) to boost Pakistan's money reserves when the current loan ends soon. Pakistan wants a new loan from the IMF for at least three years, and they'll talk more about it after the IMF's meetings in the spring.

TLDR: Pakistan's finance minister plans to introduce Panda bonds worth $300 million in China for the first time. It's seen as a smart move to tap into China's bond market, especially given China's substantial financial support to Pakistan.

News Flash

✶ In 2021, trade between Pakistan and the European Union (EU) increased by 78%, reaching €12.2 billion, up from €6.9 billion in 2013. This significant increase was largely due to the implementation of the Generalised System of Preferences (GSP) scheme starting January 2014. This scheme helps poorer countries like Pakistan by giving them better deals on taxes when they sell things to richer countries like those in the EU.

Tech

Global 🌎️

US to Apple: “Can you try to be lil’ bit less... powerful?”

A wise man (read: we) once said “Be so powerful, that the world’s greatest superpower gets mad at you”.

The US government is taking on Apple by launching a lawsuit against the big tech giant, claiming the company has too much control over the smartphone market. The outcome of this lawsuit could change how we use our phones and how companies like Apple operate.

The details:

• The government says Apple is playing unfairly by blocking competition and harming consumer choice by hindering the development of competitive apps and restricting access to its hardware and software. They're also saying Apple is making it hard for us to use our phones with other companies' products.

• Apple says its practices are lawful and aimed at providing a seamless and secure user experience. They argue that they're being singled out unfairly.

• This lawsuit could change how Apple does business. If the government wins, Apple might have to change its rules or even split up into smaller companies. This could affect how we use our phones and what kinds of apps we have access to.

Way forward: The US government's response to Apple's actions might seem like an overreaction, but considering the sheer scale of Apple's net income that exceeds the individual GDP of more than 100 countries, it makes sense. Whether you're an Apple user or not, this case will be interesting to keep an eye on as it could impact the future of smartphones and technology.

TLDR: The US government is suing Apple for having too much control over the smartphone market. The government accuses Apple of unfair competition practices, while Apple defends its actions. If the government wins, Apple might have to change its rules or even break up.

What else is new in news

✶ AI experts predict a new kind of artificial intelligence called Collective AI, inspired by the Borg from Star Trek. Unlike the Borg's villainous portrayal, future computers can work together like a team and use this to do good things, like make medicine better and keep computers safe from hackers.

Local 🇵🇰 

May tomorrow be better than yesterday (Ameen)

This report is like a roadmap for understanding Digital Pakistan. In simple terms, it tells us all about Pakistan's tech and investment world – where money is going, who's investing, and how the tech sector is looking. The Tech and VC Landscape Pakistan 2023 report, with support from Data Darbar and Indus Valley Capital, is a brilliant piece of work, and would highly recommend checking it out, but since we kinda like you, we read the 87-pager-document for you.

The details: In 2023, Pakistani startups got less money overall, with a 77% drop to $76 million. Each deal also got smaller, down 64.2% to $2.2 million on average. This trend is happening worldwide, especially for new startups.

• Even with less money, e-commerce, especially in groceries and quick commerce, still got a lot of attention in 2023.

• While more people shopped online in 2023, not enough used digital payments, showing we need to work on making them more popular.

• Investment in financial technology went down in 2023, but deals focusing on credit and financing stayed strong, showing continued interest in improving financial services.

• Business-to-business (B2B) startups were the main players, making up 48.7% of all deals in 2023, while business-to-consumer (B2C) startups saw a decline.

• Local investors were less involved in 2023, making up only 24.4% of all investors, while international investors, including Pakistanis living abroad, played a big role.

• Pakistan's information and communication sector did well despite economic challenges, with technology and communication stocks doing better than the KSE-100 index. The technology sector drove new business activity in Pakistan, with over 4,000 new IT companies registered in 2023. Employment in the technology sector kept growing, with about 600,000 people working in it in 2023, showing a 12% growth rate over five years.

Way forward: In Pakistan, there aren't many organizations focused on documenting data in the tech and startup world, making Data Darbar's documentation of key events a relief. Let’s hope that this year is better than the last.

TLDR: The Tech and VC Landscape Pakistan 2023 report outlines Pakistan's tech and investment trends. Despite reduced startup funding, e-commerce flourished while digital payments lagged. Financial tech investment declined, but credit and financing remained popular. B2B startups led deals, with local investors less active than international ones. Despite economic hurdles, Pakistan's tech sector grew, evident in IT registrations and employment.

Tech tour of news

✶Secure Logistics Group, a Pakistani company offering logistical services, is preparing to launch its initial public offering (IPO) next week. This will make it the first company in its sector to raise capital from public investors. The IPO aims to raise around Rs600 million ($2.1 million) by offering 50 million shares at a floor price of Rs12 each.

More interesting Itla (اطلاع) we consumed:

😬 LinkedIn adorns the crown for being the most cringe social networking site ever (Tinder must be feeling very relieved) and this article named The Shame of LinkedIn smartly acknowledges that. On the helpful aspect, it also teaches us how to overcome the cringe factor. Because in the real world, being cringe might just pay the bills (Case in point: TikTok).