Formalizing Startup Investment Landscape: PSX Private Market Team


In a recent initiative taken by the Pakistan Stock Exchange, a new framework has been established as the ‘PSX Private Market Team’, with the aim to reach out to startups and investors under a formal capital-raising platform. This came out as a result of PSX’ partnership with the Punjab IT Board, to develop a gateway to investors vis-à-vis the startups and their perusing business at the stock market.

Currently, the three layered setup here includes a PSX Main Board for large organizations, SME Board which also happens to make up 90% of the local enterprises, and then the recently announced PSX Private Market, where startups who have had at least six months in the market and not more than 5 years in total will be invited to sign up.

Read: Ministry of IT Commemorates the Initiation of National Incubation Centers

In an event hosted earlier last week at the PSX Headquarters, the idea was introduced to select startups, where the PSX team was actively taking feedback, and answering queries the startups had about the platform. Among those participating in the conversation were startups including WonderTree, Formula Electric Racing, Bogo (Buy One Get One), SmartChoice, Sukoon, Mandixpress, Dynamis Solution and others.

Mr. Haroon Askari, Managing Director at the Exchange also graced the occasion and got feedback and comments from each of the startups. He concluded the session on a very positive note, commending the excellent work that the startups were doing, and hoping to have them on board with this project to make the most out of their efforts.

Read: The Rise and Fall of Ecomm: FIA to Take Down Phoney Online Shopping Sites

According to the PSX Private Market Team leads, Mohammad Abdullah and Asmaa Saleem Malik, the objective of the session was to explain the concept of the PSX Private Market to the startups invited and to take their feedback on the capital-raising platform. They added:

We look forward to understanding the startups’ perspective better, and would also like them to be closely affiliated with the PSX Private Market Team in our endeavours to improve the online capital-raising platform.

The portal will have a formal registration process for startups and investors, with their profiles updated with areas of work or interest, so the matchmaking between the two remains fairly automated, the team explained. A third side includes the intermediaries; including financial and legal consultants, firms and auditors.

Read: Careem Raises $500M at $1B+ valuation as Daimler steps in

Startups will be paying a nominal fee to remain on the network where they have access to these investors, while at the same time ensuring that communications between the two parties are observed by the PSX.

This portal is not limited to technology startups, but businesses of any kind will be encouraged to sign up and use the service. We’re hopeful that this will formalize the startups’ investment ecosystem, while at the same time reducing operational and legal delays in the process of any funding. As of now, Private Market has already partnered with Pakistan Software Houses Association (P@SHA), and Plan9 – Punjab IT Board’s incubator, to acquire their startups’ database.

Read: National ICT R&D Fund Brainstorms on Igniting Industrial Innovation

In recent news, Securities and Exchange Commission Pakistan sent out a warning against online crowd funding, making this PSX platform the only legalized platform to allow online fundraising.

In the long run, Private Market is targeting international investments as well, since the backing of the nation’s stock exchange adds value and credibility. In their global marketing campaign, PSX will be showcasing the kind of businesses they have listed, allowing these startups to reach out beyond Pakistan as well.

Though the portal is being designed as a user friendly, easy to navigate system, with a simple Find>Match>Deal process, the communication or interest level on part of the investors is something that will only be seen once it goes live.

Written by: Aqsa Tariq 
Image source: IDG