Lakson Investments becomes Pakistan's first VC firm
Pakistan’s Lakson Investments claims to have been awarded the country’s first venture capital license with the launch of a new fund that will target domestic start-ups.
According to a statement, the vehicle, known as LI VC, will make seed-stage investments alongside entrepreneurs and local businesses in order to establish new enterprises. Projects are set to benefit from the firm’s 50-strong team of professionals as well as the resources of parent company Lakson Group, a private equity-focused consultancy that has been operating in the country since 2000.
Lakson won government approval to launch alternative funds in October of last year, and is currently building a new investment team. LI VC is expected to focus in part on the IT sector with technology advisory support from Lackson Group-owned outsourcing services company Sybrid.
It follows closely on an announcement that identified Ijara Capital Partners as the first Pakistani investor to receive approval for a private equity fund. The firm’s Pakistan Emerging Markets Fund I (PEMF) has received $100 million from five LPs comprised of high net worth individuals, companies and banks across Pakistan, the Middle East and the UK.
PEMF aims to transact up to eight investments in small-to-medium sized enterprises in healthcare, fast-moving consumer goods, IT, telecommunications, education, and logistics. It has finalized one healthcare investment to date.
“Private equity is very new in Pakistan, there’s not a high level of awareness among business owners about how it works,” said Farrukh Ansari, CEO of Ijara. “There are mostly family-owned businesses in the country, and the younger generations who have been educated abroad are now considering private equity as an option for their growth.”
Pakistan has benefited from renewed investor confidence in recent years on the back of an economic turnaround and progress controlling regional terrorist networks. Key sectors for PE and VC focus on physical and social infrastructure needs associated with urbanization and a growing middle class.
Founded in 1954, Lakson is one of the largest private sector asset managers in the country with more than $300 million under management. Last year, it initiated a private equity fund, LI PE, which will be led by former directors at Goldman Sachs and Abraaj Group. LI PE plans to begin investing in the second half of 2017.
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