During our team’s recent trip to Lahore, Pakistan earlier this November 1839 Ventures’® Managing Member signed an MOU with PITB. This Memorandum of Understanding (MOU) is an effort to further solidify our firm’s relationship with the Punjab Information Technology Board (PITB), its project Plan9, and PITB’s Rs. 300 million Punjab Technology Fund (PTF).
ATX+PAK Entrepreneurship Program
Prior to the signing of the MOU with PITB, during an event at Austin’s City Hall which celebrated the successes and creative collaborations between Austin and Pakistan inspired by the ATX+PAK Launch Entrepreneurship Exchange Program. 1839 Ventures® acted as an ambassador to the ATX+PAK Entrepreneurship program which was spearheaded by officials from the City of Austin.
The ATX+PAK program was funded by a grant from the U.S. Department of State and overseen by the U.S. Consulate General Lahore. This program was established to encourage investment activity and to spur further trade between Pakistan and the United States. A direct result of our involvement in this program, 1839 Ventures® announced the launch of a $20 million dollar Pakistan venture capital fund to be dedicated to Pakistani based startups.
US-Based Pakistan Venture Capital Fund
In light of this announcement, and upon closing the fund, the 1839 Venture Funds – Pakistan Fund I anticipate investing in technology-oriented Pakistani based startups. Further, the fund primarily is interested in incubated and accelerated startups, who adhere to the 1839 Ventures’® thesis and this fund’s theme.
Part of the fund’s theme will be to invest in exceptional teams who operate promising early and growth-stage companies whose products and services show the potential to scale internationally. The ability for these companies to scale internationally is an integral goal of the fund and the main component of its theme. By making use of this theme it is the hope that these companies can expand to Austin area.
The $20 million dollar 1839 Venture Funds – Pakistan Fund I, upon its closing seeks to implement a multi-stage investment strategy, investing in early and growth-stage technology-oriented companies operating across Pakistan.
Punjab Technology Fund
As a result of the MOU with PITB, 1839 Ventures® and the Punjab Information Technology Board’s have strengthened our relationship with the Punjab Technology Fund (PTF) and 1839 Venture Funds – Pakistan Fund I. In most cases the PTF shall award grants to promising startups without receiving equity in return.
Grant Model
Making use of this grant model the PTF may lesson investment risk and potentially increase returns. Resulting from the MOU the Punjab Technology Fund has formed a co-investment relationship with 1839 Venture Funds – Pakistan Fund I. Both funds plan to maintain their own discretionary authority over their funds and their investments. Deal flow can be introduced bidirectionally between the two funds.
The Punjab Technology Fund should operate as a grant model in most instances where the PTF fund may not seek equity in most cases. With this in mind this co-investment relationship has the potential to lower risk and in some cases, increase return by having a co-investor who may not expect a return in certain cases.
