Islamabad, Pakistan, 09/22/2021 / Islamabad News Bureau /
Pakistani startups have already raised $2.5 billion this year, which is more than the money raised in the past five years combined. To begin, let’s sketch out how flourishing startups have the potential to alter not only the industries they’re disrupting individually, but also our communal culture, economics, and politics as a whole.
Pakistanis have a long history of investing in tangible assets such as real estate. As an alternative, startups represent an investment in people with a vision. Growing investment in startups would lead to the emergence of a specialized meritocracy in the country, which will challenge our social norms by motivating the most intelligent people and resources to become rent-seekers rather than productivity or innovation seekers. When this system evolves, it will seek representation in government and challenge the rent-seeking aspect of the country’s political economy.
For countries like the United States, startups have served as engines of growth and innovation in the economy. Think of what startups can do for a developing country like Pakistan, where markets are not so efficient, and disruptors may provide new opportunities that aren’t even conceivable now. If you are unable to imagine, consider the days when you had to wait months to acquire a landline from PTCL. Then came mobile phones and sim cards, making it possible to get a phone number within minutes. Take a moment to reflect on all the things you’ve accomplished as a result of your smartphone. That’s how a market sector gets disrupted. It challenges people’s preconceived notions about what is and isn’t feasible.
Consider the possibilities that a meritocracy might open up for women and other historically underrepresented groups in our country. Earlier, big business, mainly headed by males, served the interests of other men. Now, businesses may provide specialty services to underrepresented segments of the market. While our conventional banks struggle to find borrowers other than the government, entrepreneurs are now providing unsecured loans to the poor. What will happen to our financial industry if FinTech firms start devouring our conventional banks for breakfast? Smaller bonuses for bankers and greater access to better service for the rest of us.