The year 2025 was not one when Pakistani startups made a comeback — but it was the year they stopped falling. Funding activity ticked up from the lows of 2024, offering a small but measurable improvement in an ecosystem that has spent the last two years recalibrating expectations and exploring rock bottom. Based on press or social media announcements compiled by Data Darbar, local startups raised approximately $36.6 million in equity capital across 10 rounds, while four additional transactions did not disclose dollar values.
On a yearly basis, that’s a modest increase from $22.5m in 2024, even as dealflow edged slightly lower to 14 transactions from 15. For the glass-half-full people, this is progress as we seem to have bounced back from rock bottom. Alternatively, you could argue that the numbers are still not only well below the highs of 2021 and 2022 but also slipped below the pre-Covid levels, when none of the frenzy really hit us. Technically, both perspectives are valid.
But what’s even more critical is that at these figures, the base is so small that activity can be moved drastically by any single round. The average disclosed equity deal size stood at roughly $3.7m, up meaningfully from last year, though this likely understates actual activity, as four of the 14 equity deals did not disclose amounts, particularly at the seed and angel stages.
From a gender lens, female-led startups raised $8.8m in disclosed equity funding, accounting for around a quarter of total capital deployed, despite representing a larger share of dealflow. This is a marked deviation from long-term trends and represents a major improvement over 2024. However, like all numbers in the last two years, every minor change is amplified due to the low-base effect.
As the global venture capital world inches upward in dollar value, the race is not particularly suitable for a developing country, given the lack of compute and scale
Fintech once again dominated, both in terms of volume and capital raised. The sector was anchored by Haball’s Pre-Series A funding round, backed by Zayn VC and Meezan Bank, alongside Metric’s $1.3m seed round led by an international syndicate. Consumer-facing fintech remained selective, with Qist Bazaar raising $196,000 in debt as part of its Series A round from Bank Alfalah. In contrast, additional angel and early-stage rounds contributed to the volume without materially moving the aggregate dollar figures.
Healthtech emerged as the second most active sector by both equity value and number of deals. MediQ’s $6m Series A, led by Rasmal Ventures and Joa Capital, was among the largest disclosed equity raises of the year, followed by Xylexa’s $1m seed round. Accelerator-backed startups such as BeMe further contributed to deal activity, underscoring continued investor interest in digital health and wellness models.
However, the more interesting developments happened beyond equity as 2025 saw the continued rise of alternative capital. Debt, in particular, has been in vogue, and now we are noticing a growing trend of bank-fintech partnerships where the former either extends its capital to build a loan book while the latter leverages its distribution. None can illustrate this example better than Haball, which raised $47m in debt from Meezan Bank, making it the single largest capital deployment of the year and possibly more than what all others raised combined.
Secondly, consolidation remained a major trend (whatever that means in Pakistan’s context) as Bazaar Technologies, the most-funded surviving startup, acquired Keenu, a non-bank leader in point-of-sale payments. While these transactions sit outside traditional equity metrics, they point to a gradual shift toward balance-sheet-led growth and platform integration.
Globally, the aggregate venture capital dollar value also witnessed an increase of 30.8 per cent to $512.6 billion in 2025, recovering back to near-2022 levels but still 32pc down from the 2021 peak. But as always, headline numbers hide more than they tell. Essentially, it’s a tale of two halves. On the one hand, you have artificial intelligence (AI), where investment amount surged 80pc to $270.2bn, reaching an all-time high while rising at a 10-year compound annual growth rate of 33pc.
In contrast, funding to all other sectors combined managed to raise $242.4bn — ie, fewer dollars than AI — with the figure essentially flat over the previous year. Over the past decade, the rest of the verticals have barely increased at a compound annual growth rate of 3.5pc, with the aggregate value in 2025 standing lower than where it was in 2018.
By number of deals, AI wasn’t enough to push the aggregate figures upwards as volumes slipped to 37,745 in 2025, down 11.5pc from the previous year. Nevertheless, its share in total further climbed to 31.4pc; a fresh peak. To sum up, activity in the venture world is now more concentrated than ever.
This plays out at two different layers: first, at a geographical level, North America now accounts for over 79pc of global AI funding, almost 20 percentage points higher compared to the 10-year average. The rest of the world, which includes all of Asia and Europe, managed just over a fifth. Secondly, even within the US, it’s actually a handful of companies — including OpenAI, Anthropic, and xAI — moving the needle substantially.
To be fair, the phenomenon is not drastically different from what we see in the public markets, where the so-called ‘Magnificent 7’ stocks contributed 40pc of the incremental market capitalisation between 2014 and 2024.
For Pakistan, the global trends offer little in the way of lessons. The concentration in AI funding — both geographically and by company — reflects capital chasing clear winners in categories that initially require high burn and large research & development expenditures. That race is not particularly suitable for a developing country, given the lack of computing or scale. So maybe once more, our role will be that of a net buyer.
Mutaher Khan is co-founder of Data Darbar and works for the Karachi School of Business and Leadership, and Natasha Uderani is co-founder of Data Darbar.
Published in Dawn, The Business and Finance Weekly, January 12th, 2026
