We started in LUMS as six partners. We were working on a product which we thought would fix all problems of electricity theft, power losses and billing in Pakistan. We built a proof-of-concept and went to some of the ‘biggest’ business men in Pakistan (don’t wanna take names). We estimated that we need 1.2 million rupees to start with and that should be enough to fund us (we won’t take any salaries etc.)

So anyway, these big businessmen treated us like kids, smiled a bit and said best of luck.

We then built a prototype set-top box and went to CTI (Carrier telephony industries) to build it as a product and market it. They were interested but the boss’s son was my class fellow but obviously nothing came out of it. It was quite exciting though, meeting people, trying to sell the idea etc.

Then we got a project from one of the friend of a professor at LUMS (related to image processing). Then we got another.. then another..

Then we moved out and got an apartment (we ate, slept, and worked on the same desks) and hired a couple of our batch mates as part time programmers. Then we hired a few full time developers and then the apartment turned out to be too small and we moved in to a bigger location.

Because we were quite a few people so there was no direction and eventually we got stagnant. At that point one of my partners joined a big MNC (think of the comparisons drawn between us and our class fellows making more than 80k and us struggling to run the business), another one joined his dad’s business, and another one started his own startup … and then we started focusing on improving the firm…

To cut the long story short, 3 years down the line we are now a team of 50+ with more than around million $ revenues (growing fast) and offices in europe and pakistan. Bottom line – you can build a startup without an investor as well!

Regarding investors, i personally wouldn’t wanna give you 1.2 million rupees. That’s such a small amount that you can get it from your family. In any case, investors know you can’t do much with 1.2 million rupees and you’ll be back for more. If you need a million $ then they’ll talk. I know VCs in Germany as well as the US, and i know for a fact not many people are interested in small investments, simply because small investments yield small returns. If you are a building a business, any serious investor would like to see a proof of concept, a marketing and sales plan, a competition review and how you’d make money (sell out or whatever). If you don’t have all of this, you should probably take a loan from friends and family.

Just my humble opinion and story

It is certainly harder to setup a company in Pakistan, given the culture, mindset and infrastructure. A good incubator, like Plug&Play Tech Venture, would do a lot to alleviate the problem.

All this in an environment that is not conducive to innovation and entrepreneurship – at least not in the technology sector.People like Adnan Haider would never have explored their entrepreneurial spirit if someone like Jawwad Farid had not been around to “show him” that it was a possibility. Our business schools certainly don’t do it.

P@SHA has so far been a bunch of volunteers who have given two years of their time to run the Association, continuously pushing the IT industry agenda with the government, branding the industry and highlighting the companies within its fold as well as organizing capacity building events, conferences and Annual Awards to recognize innovation.

P@SHA now has a secretariat with a few administrative staff. The communication vehicles are being strengthened and a newsletter and magazine will be launched this year together with a much more effective web presence.

A small group of CEOs have put together the first angel/startup fund (Jawwad mentioned that). For P@SHA to handle anything more than what it is doing now – creating networking opportunities, capacity building, branding, liaising with govt on policies, holding several events a year – it needs to strengthen itself a little further and have a full time CEO and a small team of dedicated people.

What I meant was that you can demonstrate a reason for your continued existence with $20K. Once you do that you can generate or raise your capital on a milestone by milestone basis.

Omidyar, the founder of Ebay, built Ebay as a profitable business with only a single employee – Himself. It was only when he found someone smarter than himself that he hired his first team member. Oh and it helped that by that time the business was generating more money than his monthly paycheck.

There are numerous IT investors in Pakistan. I am sure if local startups prepare realistic budget and be committed enough to deliver, they can surely get funded.

IMHO bootstrapping is the way to go. We did exactly that for many years and now we are standing on our feet.

PS. If somebody sets up a local community of angel investors, we are all game to participate and do our bit for the growth of Pakistani Web Entrepreneurs.

I also heard that their “Apprenticeship” program – they can be a useful relief for startups in managing employee costs, requires the company to already have a certain set of customers to show them — in other words pre-launch product companies automatically disqualify.

As for the numbers; yes a half-crazy guy could run on 10k or 10k but unless you find a team of half-crazy geeks around you in college or work etc, typically you would have to go through hiring people.

Sometimes its just needed because of the complexity of a system – a great area of innovation is video application middleware systems for the telecom environments but they just require a bigger team to get through.

But even then you can get about the same amount of traction here in $100k or so that you’d get with $1MM in the USA.