Growth Opportunities in Pakistan from the Country’s First Female-Led Venture Manager with Kalsoom Lakhani

24th May, 2021

Episode 08: Show Notes.

On today’s episode of the PitchBoard, we talk to Kalsoom Lakhani, founder of i2i Ventures, the first female-led venture capital fund in Pakistan. Kalsoom kicks off the conversation by telling us about the beliefs that sparked the birth of her company, Invest2Innovate. She goes on to give us some background on the Pakistani startup investment climate and the factors that make Pakistan a compelling opportunity for investors. We talk about how Pakistan’s changing economy compares to the Indian climate and touch on the effect of COVID in pushing entrepreneurs to embrace digital in 2020. Kalsoom explains how a different mindset is required for venture capital than real estate and expounds on the advantages of running two sister companies that feed into one another. She goes on to speak about the flexible nature of venture and its potential to contribute to a better world and closes with some thoughts on the pressures of being a female-led venture capital company. Tune in to hear this powerhouse business-owner tell her story and get inspired to allow your values to inform your career!

Key Points From This Episode:

  • How the belief that the world’s best innovators come from unexpected places led to the birth of Invest2Innovate.
  • Recent rapid growth in Pakistani startup investment; the high potential of those markets.
  • The danger of investors taking on too much equity too early on.
  • The elements that make Pakistan so compelling from a macro and scales perspective.
  • What has changed to enable FinTech companies to raise a significant amount of capital.
  • How Pakistan’s changing economy compares to the Indian climate.
  • How COVID pushed entrepreneurs to embrace digital in 2020.
  • Why India is more expensive for early-stage investors.
  • Why FinTech is especially exciting in Pakistan at the moment.
  • How Invest2Innovatesees local players and startups as having an advantage over regional players.
  • The different mindset required to invest in equity versus real estate.
  • How having a sister company gives Invest2Innovatebetter access to deal flow.
  • How supporters wanting to see Pakistan succeed helps garner greater investment, even though Invest2Innovateit is not a socially-driven enterprise.
  • The flexible nature of venture capital and the potential it has to contribute to a better world.
  • How being a female-lead venture capital company creates pressure to outperform competition.


[0:00:18.5] JM: Hi, I’m Jenny Merchant, Co-founder of PitchBoard and welcome to The Pitch Podcast. We’re here to have thoughtful discussions with forward-thinking managers who are taking unique approaches to professionally investing capital. Through these conversations, we hope to introduce you to new ideas and strategies that will help you better manage your own portfolios.


Before we begin, we want to remind our listeners that everything in this podcast is for educational purposes only. Nothing here is tax, legal or investment advice. We don’t endorse any products, services or opinions made by our speakers. Some statements in this podcast may contain forward looking projections. These projections do not guarantee future performance and any past performance does not guarantee future result. Finally, nothing in this podcast is an offer to buy or sell securities. Speak to your own advisor before making any financial decision.


[0:01:05.1] AH: Hi, this is Andrew from PitchBoard. I had a great conversation with Kalsoom Lakhani, founder of i2i Ventures, the first female led venture capital fund in Pakistan. She talked about the country’s large economic potential, the sector she’s most excited about and how foreign investors are changing the startup scene in Pakistan. I think you’ll enjoy our chat.


[0:01:24.5] AH: Hi, this is Andrew from PitchBoard. Today I have the pleasure of speaking with Kalsoom Lakhani of i2i Ventures. Pakistan’s first female-led venture capital fund. In 2011, she founded the country’s leading startup accelerator. Kalsoom, welcome to the show.

[0:01:39.0] KL: Thanks for having me, hi.

[0:01:41.2] AH: Can you just give our listeners a sense of your career background and your involvement in the startup scene in Pakistan?

[0:01:47.6] KL: Sure, as you mentioned, about 10 years ago, I had kind of been in non-linear, I found myself in the VC space but about 10 years ago, I decided to launch a company called Invest2Innovate, which was really founded with this Y statement that we believe that the next great innovators are coming from the most unexpected places and not necessarily just from Silicon Valley but from places like Pakistan and Nigeria and Vietnam.

Because they exist in these really hard places to build a business, Invest2Innovate was really started with how do we actually help unleash the potential of amazing young entrepreneurs in these really hard places.

The sister into our fund was launched with that purpose, we launched the country’s first startup accelerator program in 2012, we’ve expanded that vertical considerably with partnerships with players like Facebook and the world bank, we’ve trained about over 40 incubators and accelerators now throughout the region as well as trained over 400 entrepreneurs just through different partnerships that we’ve built. Built out a research arm of our work and really kind of became very embedded as an early player in the startup ecosystem in Pakistan.

All of that work was actually really pivotal and important because it allowed us to actually form the thesis by why we decided to launch a venture capital fund. I think a lot of people that launch VC funds tend to come from investment banking backgrounds or come from maybe a more traditional route from finance and I think my partner has more of a finance background but for myself, launch, deciding to launch the VC fund, it was really based off of and grounded in all the years of, you know, the blood, sweat and tears of building a startup ecosystem early and really seeing startups on the ground for over a decade.

[0:03:29.7] AH: With over a decade already in the startup space, what lessons did you learn there that have sort of proven pivotal as you launch this new venture?

[0:03:39.5] KL: Yeah, I mean, so much. Pakistan story of ecosystem was extremely nascent when I started working there 10 years ago. Being the first startup accelerator really doesn’t mean much when there really isn’t much going on.

[0:03:52.1] AH: Right.

[0:03:53.6] KL: It was really all of us that were operators in that space so early, we were all just building the road in front of us. What’s interesting about Pakistan as a market is that because it’s seen with such a high-risk perception, comparatively to other emerging markets. The good thing about that in some ways, it wasn’t people moving from outside of Pakistan, it wasn’t like Americans moving to Pakistan and deciding to launch a company, right?

You might have seen in East Africa or even some places in Latin America. For Pakistan, the startup ecosystem that really developed was really an indigenous startup ecosystem, it was built by Pakistanis and Pakistan or people moving back to Pakistan. A lot of it was really grounded in that local context, which was really exciting and interesting. However, getting like international investors to look at the market was really hard early on and I think a lot of the early startup investment that was happening was really from local players, which oftentimes had meant that there were some, a lot of predatory practices that were happening with people that wanted to take a lot of equity in companies early on.

I started to see a lot of really great companies and great ideas die just because of bad investors. I think what’s been really interesting in the last few years so in the last five years, Pakistani startups have raised over 200 million dollars in capital but about half of that funding has happened in the last 18 months. It kind of shows you just they overall acceleration and generally, I would say in the last 18 months, there’s been more and more international investors that are looking really bullishly at Pakistan as one of kind of, one of those last untapped emerging markets where our average valuation is relatively low compared to Indonesia or India and where the potential is quite high where we’re seeing a lot of pattern recognition of models that have worked in other markets happening there.

It’s been really interesting and exciting is that prior to that happening, the space was relatively un-professionalized in terms of these investors behaving in that predatory way and we’ve started to see that change as more international investors are coming in and providing better terms on the table for founders, that’s also creating more – just making sure that the bad players aren’t really at the table anymore and it’s really only room for the good players that are coming in. It’s also forcing the space in the industry to become a lot more professionalized than maybe it was before.

[0:06:10.8] AH: Of that 200 million you mentioned that’s been raised recently, where is that money mostly coming from? Is it international funding, is it domestic funding and what is the makeup of the investor base right now?

[0:06:23.1] KL: Yeah, I would say that maybe five years ago up until maybe three years ago, the majority of it was mainly from local funds, local investors, some regionals and then I would say that now, we’re starting to see the balance shift to a lot more international funds that are involved in almost all of the major deals that have happened in the market.

I think that is interesting, the most of that money that that’s been raised also was mostly happening very early stage, happening at pre-seed and seed versus we started to see more series A-deals happen in the last 18 months, the last two years we’ve seen more series A-deals happen and then the first series B-deal since 2015 just occurred last year where there’s another one that’s going to be announced soon. The space is still extremely early and nascent in that way but it’s also speeding up a lot more too.

[0:07:16.6] AH: We talked about how the deal terms are getting better for companies as international investors are moving in. How would the deal terms for a typical deal compare if you were saying, comparing the States versus Pakistan?

[0:07:30.9] KL: I mean, I think you’re just in the States, I’ll see valuations be extremely high early on, also because the addressable market is much larger. I think in Pakistan it’s such a high friction market that we would often times see not only valuations be relatively low because people were saying, there is a discount for Pakistan because we knew that there was a lot of it being so high friction, it would take a lot for a company to be able to grow and raise for their next round.

Then, as a result of that, with a lot of the players that were – because there weren’t, it was just a scarcity model, right? If there are not enough players that are willing to take a bet on companies, oftentimes, they can give terms that are just really onerous to companies early on, right? They can want to take more than 25% equity at an early stage at a seed stage round.

Now, an offer to take 40% of your company, most entrepreneurs have much better options on the table than there were before. I think in the US, I’m sure that happens maybe when you’re outside of the major cities maybe but I just think overall, you have not only just more options available to you but you also have an environment structurally that is there to protect the investors.

In Pakistan as well, one thing that I would say is that because, from an intellectual property regime, it’s there but it’s not very well-enforced, protections for minority investors is much better now than it was before. A lot of local investors would feel that, “Oh, well I’m taking the risk now so I should be rewarded for that because there’s not much else there that rewards me from this environment.”

A lot of the ways that they would try to justify it wasn’t really justification but it was how they would see it because they felt that they were the ones taking the risk when other people wouldn’t but ultimately, what they weren’t understanding and didn’t have a mindset for was the long-term, which is if you take that much equity in a company early on, that company is being killed before they even have an opportunity to raise for future rounds.

[0:09:27.2] AH: We are harming the innovation of the company.

[0:09:29.6] KL: Yeah, and you’re not creating an incentive for the founders to also want to build a company in the long term, that grows to a potential exit or grows from a multiple of the standpoint to a serious C and D round, right? Because a lot of the investors were so unsophisticated early on and you know, a lot of these family-based companies locally and things like that.

I think now just by virtue of having just more competition in these rounds, it’s forcing, especially local players to really step up their game and to know that you can’t – you have to be able to set-up a company to succeed in the long term.

[0:10:05.6] AH: Right. What makes Pakistan in your view such a compelling opportunity for startups from a macro perspective?

[0:10:13.9] KL: Yeah, it’s obviously like I sip my own kool aid, I’ve been operating in that ecosystem for 10 years. I wouldn’t – I don’t think I would still be there if I didn’t believe in that potential but I think that conviction has become so much stronger, something that I almost have like, I believed in it but it wasn’t in front of my face before. Now, we’re really seeing itt.

From a macro standpoint, obviously, population-wise alone, 5th largest country in the world, right? In terms of population, population growth our needing age is about 26 years old, that’s not unlike pretty much every other emerging market but basically with the advent of 3G and then 4G, obviously, we just hit a hundred million broadband subscribers from a freelancer market, we’re in the top 10 freelancers in the world.

From a scales perspective, it’s there, locally. Lots of it, local universities that are putting out good tech talent that’s there to basically fulfill the companies that are raising money that need to be able to hire good talent, we’re seeing, generally, like a lot of Pakistan faced the issue of brain drain before with a lot of really great talent leaving the market. I think with things like Careem which is the Uber competitor in the Middle East that was acquired by Uber.

Pakistani co-founder, they’re backend, all built in Pakistan though, it’s considered a Middle East success story. There’s something called the Careem mafia, similar to – the PayPal mafia before where a lot of people that worked at Careem were Pakistani and are now launching companies right now.

There’s just like a general, overall, excitement of businesses and ideas that we’ve seen even work elsewhere in other markets really start to plant roots in Pakistan. Another thing I think is interesting and we’ve done through our research side, have released a lot of analyses on this over the last six years but the regulatory environment in Pakistan was something that I think we were 108 in the world for doing business rankings, right, by the World Bank.

Actually, we’ve improved significantly in the last 18 months because the state bank of Pakistan and the securities and exchange commission have created all these regulatory changes that not only make it easier for a founder to raise capital for investors to put money into a company but also for – as an example, the FinTech space, laying the rails for the regulatory changes that lowered the barriers for FinTech companies to be able to really be able to build well, right? Not be constrained by barriers like licenses that were really expensive and onerous.

In the last nine months, FinTech companies have raised a significant amount of capital in the country which they hadn’t been able to do before. There’s a lot of things happening macro that are things that we’re seeing in a lot of other emerging markets and then when you kind of get down into the nitty gritty of the startup ecosystem, we’re starting to see that play out with the types of companies that are coming up and what sectors they’re coming into.

[0:13:01.3] AH: Right, a lot of people, when they think of the big emerging market economies, they obviously think about China and India and Indonesia but you don’t hear Pakistan mentioned at least in the west very often but the numbers actually suggest as you mentioned it, that they should be in that conversation, right?

[0:13:17.8] KL: Yeah.

[0:13:18.5] AH: How does Pakistan’s economy and startup scene, how does that compare with India?

[0:13:23.2] KL: I would probably say, to be fair, that we’re maybe 10 years behind where India is right now, right? There’s a few reasons for that, obviously India’s much bigger, much more developed as an economy and from an economic growth standpoint, even when you think about it, when we think about digitization of these economies, the government has to play a pretty significant role for that to happen as well and we saw that play out in India where the Indian government actually created financial and regular incentives for people to digitize, right?

Whether that meant SME’s, basically becoming digital, a lot of reasons, a lot of people don’t do that is because of taxation issues and for things like that. Those are barriers and challenges that the government can solve through actually creating real incentives around that. The Pakistani government didn’t do that, it’s starting to do that now. That’s actually one main reason why we’ve lagged behind for so long and I think COVID in a lot of ways, as tragic as that was for the rest of the world and for the world, period, did kind of create like a push for people going online when they wouldn’t necessarily have felt comfortable before, right?

That being said, I think there’s still so much more to go when it comes to incentivizing people to – from a credit card penetration perspective, in order – having credit card penetration improve means buy now, pay later becomes better as a better option for people, there’s so many things that can happen, which in a lot of ways, becomes a potential risk for people looking at Pakistan.

I look at it from the other angle of like, there’s so much opportunity right now. I’ll see a lot of different companies that come up in a particular space but oftentimes, they’re one of the first few that are coming up in the sector, period. Right? Whereas India is quite saturated in that way, right? In India might be much further along than us 10 years out but a company that’s coming up has probably had like seven or eight pretty big competitors in comparison and where, from a valuation standpoint, it’s quite expensive for early-stage investors to come into that space.

Versus then Pakistan, of course, you have to understand the market, you need to understand the barriers to entry, the barriers to growth that are quite unique to the context, locally but I think at the same time, Pakistan, anything that’s coming into the space is like a pretty open field for innovation which I think it makes it quite exciting.

[0:15:38.6] AH: I guess investors are always – they always can be scared off by the risks, right? Sometimes the best investments are the ones that – where there are risks, right? That’s why the valuation is lower than something that’s seen as more of a not a sure thing but more of a conservative investment. It’s interesting that investors always want to buy low and sell high but then they get really scared off when things are low, right?

[0:16:03.7] KL: That’s definitely the case for Pakistan.

[0:16:05.6] AH: Are there any sectors, I know your fund is sort of sector agnostic but are there any particular sectors or industries in Pakistan that you’re particularly excited about?

[0:16:15.9] KL: FinTech is really exciting right now but I’m more very mindful of what that means because obviously, FinTech is a pretty open space and it’s pretty generic to say that we’re excited by FinTech but then within FinTech, savings is kind of like, less exciting for us than maybe someone who is going into other consumer finance products and the entry points to me are also the most interesting so we just invested in a company that is digitizing financial ledgers for MSNE’s which is similar to what caught the book that’s done in India [inaudible 0:16:46.7] have done in Indonesia and in Pakistan, there’s now like three or four players that are coming into this space.

Super exciting but actually, that’s just the entry point, right? Because digitizing ledgers is great but then, it’s like, what do you do after that and then you can go into a lot of really interesting credit products related to that, right? You’re gathering a lot of data which will lead to a lot of really interesting other types of finance products.

FinTech, I think is exciting, I think that – I also say FinTech is exciting with the caveat that my partner’s background was in FinTech before this, she worked at a global FinTech. Actually, is like the resident skeptic when it comes to that and she’s our best weapon, right?

Because she understands what it actually means to execute a FinTech in a market like Pakistan that is so high friction. Every time I get excited about something, I always just wait to see whether or not it’s something that’s truly exciting for the Pakistan context or whether or not I’m just excited because it sounds exciting, right?

[0:17:38.5] AH: Yeah.

[0:17:38.5] KL: I’m also really excited about it, I think there’s so many really interesting place right now that are really innovating parts of the value chain when it comes to ecommerce. Not like a straight ecommerce platform itself but players that are innovating when it comes to logistics payments. Players that are looking at fulfillment really in an interesting way. I’m really excited about like players in mobility right now because in our other margin markets, we’ve seen the unit economics actually really be figured out and be really exciting.

You know, there are some spaces that I think are interesting in other markets where as in Pakistan, consumer adaption is still quite slow like I think how tech is a really important play but whether or not it’s a venture play to me, I think we are still a little bit far out – not far out but maybe like a year out before I will really fully feel comfortable but it is time for it. We just invested in an ed tech player but within ed tech, which is the large I don’t think B2B ed tech is that exciting right now from a consumer adoption perspective. It’s quite slow but I did think that exam prep is really interesting and exciting.

[0:18:41.3] AH: How do exits normally work to companies or do they tend to be bought by larger companies that are in that sector or are they bought by private equity funds? How do you think about that as someone running in a venture capital fund?

[0:18:54.9] KL: Yeah, I think exists is probably one of the hardest questions because we haven’t really had significant exits. I mean we’ve had like two or three that have happened in the market, right? Which is like bought mostly acquisitions, maybe one listing that’s happened. I think there has been some really interesting regulatory changes that are creating like a startup called Gem, which is the entrepreneur like basically a startup board for startups being able to list publically and that is still early days for that but the interesting thing by being an early player in the space is that we also play a role in actually helping to form some of the execution of some of these things.

Some people are bullish on listing on the back cents doc exchange. We are a little bit more cautiously skeptical about it. I think acquisition regionally is probably the most likely case to happen in the near future given where Pakistan sits geo politically and also just geographically with the Middle East, we’re often times seen as part of most Middle East funds mandates. As a result, a lot of Middle East companies are looking to scale into Pakistan and I think a lot of the thesis that we have is that because Pakistan can be so high friction, we’d rather invest in a local play that could be then be acquired by a regional player that is looking to enter and then also from East Asia side as well.

There is a lot of macro-trade that is happening between China and Pakistan right now in terms of the Chinese-Pakistan economic corridor and right now, that is mostly been through infrastructure but hopefully the next phase of that will also be more of a role of like larger tech conglomerates like Tencent and players like that looking at the market, you know, more bullishly from a startup perspective. That is kind of the thesis that we have right now.

We are looking at players where we can really see that growth and also where we can potentially see our local players having an unfair advantage compared to the regional players that are coming into the market.

[0:20:51.2] AH: Right now, you talked about the stock exchange. Right now, for foreign investors, if they are looking for equity exposure to Pakistan, are most of them putting their money into large cap stocks on stock exchange?

[0:21:05.9] KL: Yeah, I think a lot of X on the gas spread could look at it that way and that’s maybe a more safe version of where to put your money or part of your money. A lot of outside people who are boxed money also find it just more bearish to put their money in land in Pakistan in terms of return on their money. Startups, it’s a lot more of a risky bet, right? Whereas we know with this, with VC, it’s a game where one bet can really return the whole fund, right?

For a lot of people that maybe aren’t exposed to VC and other markets where aren’t LPs and other funds and other markets they don’t necessarily understand the value of that. If people are looking at us versus putting money in real estate in Pakistan, I’m like maybe you’re better off putting it in real estate because I can’t compare the appetite with that. The appetite has to be really that you get that there is a potential here. It might still be slightly unseen but it is like forming in front of us, right?

I think it’s putting your money in the public market versus private. It’s just a very different mindset that you have to have for it.

[0:22:03.7] AH: You’re absorbing the potential for high risk because you see the potential for much higher rewards, right?

[0:22:09.1] KL: For sure and I don’t blame people for not feeling that way because it is still an – it is not there yet but if we look at comparable markets, if we look at what’s happening in Egypt right now, if we are looking at what’s happening in Indonesia, we can see similar trajectories with funds from those markets that are coming in and investing in Pakistan. I really truly believe that it’s happening and it will happen in the next few years where we are going to see that realization of people putting their money in but it kind of requires the first people in the door who just get it, right? Not everyone gets it right away so that’s okay as well.

[0:22:44.1] AH: Do you tend to get access to sort of better deal flow because of your sister company you mentioned?

[0:22:50.7] KL: Yeah, I mean I would say that we definitely, our exposure to pipeline is quite unique. I mean three out of – we’ve done six deals so far in five companies and three out of our five companies have come from either our accelerator program or one of our support programs that we run and even right now in our pipeline, I would say that you know, of the few that we’re looking at, one is a company that went through our accelerator a few years ago.

Pakistan is so heavily relational as a market that having that pipeline is really key to what we do and then yeah, obviously like we realize we have to be super activist when it comes to pipeline generation. If we just kind of sat back and only relied on our sister entity, we definitely wouldn’t get access to the best deals only but I think it’s important that you know, my partner, Misbah, and I are out there attending every single demo day that other programs are running.

Where people messaging us on LinkedIn, we’re taking, you know, our team is taking most of those calls. We’re seeing who’s entering or looking at YC and trying to get access to those deals before other people do. I think it requires all of us to just make sure that we’re doing a really good combination of outbound and inbound.

[0:23:55.6] AH: Are the stakeholders that you deal with, whether it’s the investors or the founders, how do they tend to think about purely shareholder returns versus an emphasis on social impact?

[0:24:10.1] KL: That’s a good question. I mean I would say that like you know, all of us who are raising as VCs in the market right now, there is like six or seven of us at this point, all of us are a commercial funds so we really are promoting the fact that we’re trying to raise like 25 to 35% IRR or like all of those things but given the unknowns that are there, I wouldn’t say it’s necessarily social impact but I do think that there is at least for people that just get it and are maybe the early supporters of it.

I think a lot of them really are – there is a little bit of like an emotional attachment to wanting to see Pakistan succeed. Even though obviously, they are looking at this from a commercial lens, there is that element as well and I think another thing that’s really interesting about a lot of [inaudible 0:24:55.4] looking at Pakistan is the recognition that the market is so – it is a hard market to navigate if you don’t know it and so sitting outside of the country fully and not being fully connected, even if they want to invest themselves, they may not get access to the best deals.

Learning through funds like ours tends to be the best way for them to kind of see things closer up than doing it by themselves, which is typically the conversation that I have with most potential LPs.

[0:25:21.7] AH: You’re investing obviously in smaller private companies. How much innovation is happening in large Pakistani companies and is the government, are they helping to facilitate innovation across all types of businesses?

[0:25:37.7] KL: I mean that is such a big loaded question so –

[0:25:40.0] AH: It is a little bit but yeah, no I am just thinking about how you know like, I mean if there’s often talk about how in the past and the US government has been no integral and helping technology of various companies in the US. Is there an analog there in Pakistan that you see or that you see emerging?

[0:25:56.9] KL: I think it’s definitely improved. With the new government for sure but it’s always kind of boils down to who’s the head of whatever part of the government is running things, right? For Pakistan, before when it came to just generally innovation in the startup space, so not just bigger companies, it all kind of fell to the state bank of Pakistan and the Securities and Exchange Commission, right? Also, the federal bureau for our tax regime and what’s been interesting is that the people leading those, the state bank and the SCCP now are very, very progressive.

As a result from a top-down perspective, we’re just seeing a lot more changes that are amenable to startups and innovation happen as a result of that. That being said, that hasn’t been mimicked by FBR so the tax regime has stayed the same, which is probably the one major thing holding back so much of innovation in the space and also is why the current tax regime doesn’t favor small businesses right now. It favors large businesses so as a result, until that changes I really feel like we’re still holding back or have the ceiling on the growth and evolution of what’s happening in the startup ecosystem.

In terms of large companies, I mean you have like from an agri energy perspective, there are large groups that are quite interesting and exciting and maybe there is even a room for corporate acquisition in the future for like an EnGrow or like these telecom communication companies like Telenor, which has their parent company in Norway and all of that. We’re definitely seeing like attempts in corporate innovation happening generally and I think attempts to become a part of the startup space, where we’ve seen players like EnGrow, which is one of the large groups with food and agri and all of the stuff.

Then with the telcos like Telenor, Vion, which also has a parent company in Europe wanting to start to invest in the startup space. I think the interplay is quite interesting. I haven’t really fully seen it play out in a way where I’ve seen like really be supportive of the startup ecosystem fully yet but I have seen overtures and attempts to be more innovative.

[0:28:07.4] AH: Would you say that right now that politically there is a tailwind for startups in Pakistan? You mentioned it adopts more progressive policies?

[0:28:18.7] KL: Yeah, I mean everything remains to be seen, right? It’s only been a few years since we’ve had this new administration and this new government. I think a lot of Diaspora Pakistanis were very excited by the new prime minister and him being elected. He was actually a former cricket star of Pakistan and so a lot of Pakistanis were crowing that this – outside of Pakistan were crowing that this is the new Pakistan.

I think the reality is probably it’s much closer to what it’s always been like status quo but I think with certain players that are in this government, I’ve actually seen much more willingness to support change and innovation than I ever have before to be honest and I think my partner on the fund, Misbah, us on our team have all been part of these working groups that typically these working groups are completely just like, you know, these like you just go and nothing ever happens but I’ve seen real incremental change in legislation happen as a result of people pushing things that have been happening at the working group level.

I’ve never seen that level of really listening before happen. I am the first person to be a skeptic. I’ve been probably huge vocal critic of the government in the past of what needs to change and we’ve written about that in our research and the mappings that we put out on Pakistan but I’m also the first to say that this is – I’ve never seen this level of listening and real attempt to accept constructive criticism and change things as a result than I’ve seen right now.

[0:29:44.5] AH: Yeah, I guess in fairness, the political risk exists in every country, right?

[0:29:48.4] KL: For sure.

[0:29:49.0] AH: Even the most developed economies so it is not like this is something that’s unique to emerging markets. I’m out of questions. Is there anything that I’ve not – that we haven’t talked about that you are dying to talk about whether it’s the Pakistan’s economy or the startup scene there or your company?

[0:30:06.8] KL: Nothing that we haven’t talked about. I mean one of the I guess, the elephant in the room or the first thing that people notice or you know, we don’t use it as a crutch for ourselves but my partner, Misbah and I are the first female-founded venture capital fund in the country, right? What that means for us I think is really important because we don’t just invest in female-led companies but we do believe that our – the leadership that we have in the space creates a lens that is a lot more inclusive and we still have to be very active as to ensure that.

As an example, three of our five companies have female co-founders, right? Which from a VC standpoint, if we are really attempting to be, I mean Misbah and I both entered the space because we don’t want to be business as usual. We believe that venture capital should be something that evolves and something that really is reflective of the world that we want to see and I think not in a soft, you know, woo-woo way.

We really believe in female-lead companies and we’ve had about 60% of our companies that have graduated from our accelerator program have been women-led, right? We’ve had like a really great pipeline of amazing female-led companies that we’ve seen over the last 10 years and so I truly believe that that’s important and even if we invest in a company lead by men, how important it is for us as female investors to ensure that there’s fair and equitable and inclusive policies in a workplace.

Where we can at least push for good hiring practices to allow for inclusion so that more women feel comfortable to work there. All of those things are something that I feel really passionately about. It is something that obviously, you know, we don’t have a lot of VCs run by women period in the world comparatively than the ones run by men, so I do definitely feel that that’s something that’s very important in who we are.

[0:31:44.8] AH: I would think that if anything, it probably increases the number of opportunities that you have that if someone is a female in Pakistan running a startup and they see that you guys are the first female-led VC fund that that’s really amazing for them and not just the females but anyone who considers themselves to be not what the status quo is, right?

[0:32:10.4] KL: Fore sure and I think it’s so important because I think if we were – one thing that Misbah and I have realized is that it requires even us as female fund managers to be activists in our pipeline generation, right? If we were to just sit back right now and just let the deals come to us and just allow only for inbound, most of the deals would be companies led by men. It means that we have to go out there and find the companies that we really love.

If it means the best muscle that we have is this sister entity so if we find really great companies that maybe need a little bit more work to become investment ready, we can send them to apply for one of our programs and then as a result, be able to invest in them after that, it means that we’re getting on the phone and like some female-led companies that may not have put themselves in the arena to raise venture before. It means talking them through and kind of being an advocate for them.

It’s something that we feel really passionately about, it is something that we think about a lot internally and it is also something that we just don’t want to rest on as a crutch that just by virtually being a woman it automatically makes us better because we’ve seen in the data that’s come out that that doesn’t necessarily change unconscious bias. It means you still have to be very much interrogating that on a regular basis.

[0:33:18.7] AH: I guess hopefully, whether it’s three, five, ten probably, like unfortunately, it’s probably going to be closer to the longer end but that it won’t be such an elephant in the room and people won’t blink an eye at the fact that there’s a female-led VC fund.

[0:33:35.3] KL: Yeah and hopefully that just becomes the norm, right? I mean it’s great to be the first but I really wish that we weren’t the only.

[0:33:42.6] AH: Yeah, it probably feels a bit self-conscious and risky to be the first, someone has to be the trailblazer, right?

[0:33:51.5] KL: Someone has to be the first and then also, you know, we experienced the same biases that our female-led companies experience when they fund raise, right? It’s also battling a lot of people thinking that we are automatically soft or we must be an impact fund because we’re women and all of these things that happen just generally in fund raising conversations, right? I think there is a reason why the data shows that female fund managers outperform their male counterparts is because we have a lot to prove, right?

There is a lot resting on our shoulders because if we don’t do well as a fund, no one is going to knock the rest of the women out there. It’s like when male like ours and they would basically, they were like, “Oh this is what we meant. This is why female fund managers don’t perform” versus I feel like when men, if a male fund doesn’t hit it out of the park, no one really blinks an eye. It is just part of VC. We are very mindful and very aware of that.

It also makes us feel like startup founders ourselves in the way that we operate and think about things so it’s why we’re so thoughtful. It’s why we constantly feel the pressure to perform better than anyone else.

[0:34:50.0] AH: Yeah, okay well on that note, this has been a great conversation. Thanks so much, Kalsoom. It’s been wonderful to have you on the show and thank you to our listeners for tuning in and we’ll be back here soon with another episode. Thanks very much.

[0:35:02.2] KL: Thank you.


[0:35:03.2] JM: Thanks for joining us on this episode of The Pitch Podcast. Make sure you check us out online at If you liked our podcast today, please make sure to subscribe to The Pitch Podcast so you don’t miss an episode.


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