Pakistan’s star startup announced its shutdown on July 12, 2022.
The announcement surprised the country, hundreds of Pakistani startups and even the startup evangelists in India. This came as a shock as ‘Airlift’, the same startup that raised more than Rs 500 crores a year ago, suddenly announced its shut down.
Airlift’s founders were Usman Gul, Meher Fahrukh and Ahmed Ayub. Within a year or two, the trio became the poster boys of Pakistan’s startup ecosystem. ‘Airlift’ was an Uber-like bus service. In 2020, Covid-19 messed up everything for them. Two questions stood before them: Should the company go ahead when Pakistan is in total lockdown with no buses running? Or, should it shut down without incurring further operational expenses?
The founders decided to pivot the idea a bit to fit into the Covid-19 scenario. When everyone stayed at home, ‘Airlift’ delivered groceries, food and medicine to homes and soon became Pakistan’s star startup. ‘Airlift’ rose to become Pakistan’s most-valuable startup after securing $85 million, i.e. Rs 680 crores in funding in a single round. Airlift had big dreams, employed 1300 workers, and its business grew outside Islamabad. But, what happened next was not as simple as defeating Covid. Pakistan’s economic downturn hit ‘Airlift’ hard.
Kalsoom Lakhani, the co-founder of venture capital firm ITUI in Pakistan, says that the target of grocery delivery in 30 minutes caused Airlift to crash and die on the track. Lakhani also says that shutting down ‘Airlift’ would destroy the confidence of all startups in Pakistan. Shehryar Hydri, a partner at Deosai Ventures, is of the opinion that Pakistan’s star startup founders’ hopes were killed overnight. In fact, that’s what happened to ‘Airlift’ and its three young founders.
Currently, Pakistan does not have a single unicorn to boast of. The ‘Airlift’ crashed while it was on the verge of being a unicorn. Even though it has happened in Pakistan, that massive fall is a lesson for startups in India as well. No matter what the valuation of your startup is, the overall financial position of your country is very important for survival. Also, don’t forget to do your homework and research during the growth phase. ‘Airlift’ would not have failed if they had paid attention to the story of online grocery providers such as Europe’s ‘Gorillas’ and Turkey’s ‘Getir.’ Businesses that require constant cash infusions will not run on the size of the funds they receive.
