Pakistan B2B marketplace Dastgyr secures $37m Series A

Veon’s contribution was USD 15m. The rest came from Zinal Growth, DEG, Khwarizmi Ventures, Oman Technology Fund, Cedar Mundi Ventures, Reflect Ventures, Haitou Global, GoingVC, Astir Ventures, K3 Diversity Ventures, Chandaria Capital, and Century Oak Capital, as well as the founders of Property Finder, Ayoconnect, and Quiqup, and senior management from DoorDash.

There were re-ups from several existing investors, including SOSV, EquiTie, and Edgebrook Partners. They took part in a USD 3.5m seed round in July 2021 that also featured ADB Ventures, Seedstars, Zayani Venture Capital, and Tricap investments.

It is the largest-ever Series A for a Pakistan-based start-up, surpassing the USD 30m raised by Bazaar in August 2021. Earlier this year, Bazaar, which is also a B2B marketplace, closed a USD 70m Series B led by Dragoneer Investment Group and Tiger Global Management. It wasn’t Pakistan’s biggest Series B – that status is held by last-mile delivery app Airlift, which raised USD 85m in 2021.

Founded in 2020 by Muhammad Owais and Zohaib Ali, Dastgyr connects retailers directly to suppliers, with a view to eliminating tiers of intermediaries in Pakistan’s fragmented supply chain ecosystem. It offers real-time visibility on pricing and financing rates, as well as 24-hour delivery. Platform partners include Coca-Cola, Nestle, and Reckitt.

The company estimates there are 2m underserved retailers across Pakistan and promoting financial inclusion could unlock an additional USD 10bn in GDP. It has served 100,000 customers to date in Karachi, Lahore, Sialkot and Gujranwala and fulfilled over 1m orders. The new capital will support expansion into 15 new cities.

Ali noted in a statement that Dastgyr aspires to become “an Alibaba for emerging markets worldwide.” The motivation to launch was in part driven by a recognition of how badly hit small businesses were hit by the pandemic.

“At the peak of the COVID-19 lockdown, our co-founders visited a local kiryana shop and found the shop owner, Abdul, devastated. The pandemic had led to halted operations for wholesalers and distributors preventing Abdul from procuring inventory efficiently, leaving him in a troublesome situation,” the company said on its website.

“This problem, that had existed in Pakistan’s retail supply chain, was amplified by the pandemic. Eager to improve this situation; one month later, a pilot was launched for Dastgyr.”

This represents the largest investment in a Pakistan start-up by Veon Ventures. Veon’s Jazz network has approximately 75m subscribers in the country. The company wants to plug Dagstyr into this network and into the JazzCash mobile payments platform. Dagstyr already provides microloans to small-scale retailers.

"Pakistan's start-up ecosystem is at a critical juncture and only start-ups focused on addressing key challenges and adopting localised solutions will survive and thrive," said Aamir Ibrahim, CEO of Jazz. "This investment highlights Veon’s commitment to scaling up Pakistan's digital economy.”

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• Topics
• South Asia
• Technology
• Early-stage
• Consumer
• Pakistan
• TMT
• German Investment and Development (DEG)