Pakistan’s workplace platform COLABS announced on Thursday that it has raised $2 million in a pre-Series A round led by UAE-based alternative investment company Shorooq Partners with participation from Saudi Arabia’s Waad Investment that focuses on growth-stage startups in the region.
The funding will go towards setting up a campus in Saudi Arabia and prepare the company for Series A planned for next year, COLABS CEO and co-founder Omar Shah told Business Recorder.
In its statement to the media, the company said the latest investment brings COLABS’ total funding to over $5 million, positioning it for “strategic expansion into Saudi Arabia and the broader MENA region”. Its previous round in March 2022 was led by Indus Valley Capital, Zayn Capital and Fatima Gobi Ventures.
Founded in 2019, COLABS said it now has 5,000 seats across 10 locations and a team of over 300 employees. Its revenue has grown five times and the company has been profitable since last year.
Shah said the company sees 40-50% site-level margins in existing developed locations.
“With KSA vision 2030, the market in Saudi Arabia is ripe for companies like ours to open and taken advantage,” Shah told Business Recorder as he explained the wider expansion to the Gulf and Saudi Arabia’s interest in venture capital (VC) funding.
In an emailed brief, the company said it is the only coworking space in Pakistan to raise VC funding post-WeWork crash from top investors including Indus Valley Capital, Shorooq Partners, and Fatima Gobi Ventures.
The company’s members include Digital Ocean, Glow insurance, Gelato, Bbox, Overjet, Burq, Vartana, Edufi, K Trade and Sadapay.
The company said it works with freelancers, has a strategic partnership with Google Cloud, as well as the Pakistan Air Force in building the National Aerospace Science and Technology Park operating a 1,000+ seating facility to support tech companies in Pakistan’s growing aerospace sector.
Pakistan’s startups have seen a dry run, attracting a measly $3 million in the first half of 2024. The amount was a massive 92% drop year-on-year, showed data released by Magnitt, a data analytics platform, in its report in July.
The decline in Pakistan startup funding was the biggest drop in emerging markets that are covered by Magnitt, showed the report ‘H1 2024 Emerging Venture Markets Venture Investment’.
However, some momentum seemed to have picked again as PostEx, a prominent player in Pakistan’s financial technology sector, announced the completion of a $7.3 million pre-Series A funding round in August, while Zyp Technologies, which operates in the energy and electric motorcycle assembly space, said it raised $1.5 million in Series Pre-A funding in July.
DealCart, a Pakistani social e-commerce startup, also announced in July it has successfully raised $3 million in seed funding. Just last week, Pakistan’s fintech Abhi also secured $15 million in credit financing.