2019 was one tough year around the globe. Where the world was fighting the modern-day pandemic era, we saw the emergence of many startups that made the process of retail for both buyers and sellers an easy task. Over the past two years, we’ve seen the emergence of many B2B marketplace startups catering to the needs of the people and excelling at doing that.
Among such startups one is Dastgyr. The startup was launched under strict lockdown conditions by the two founders Muhammad Owais Qureshi and Zohaib Ali in 2020 with a total investment of $300,000. Dastgyr was launched with an objective to solve inventory procurement challenges for more than 2 million retailers across the country.
What is Dastgyr?
SME retailers are the backbone of Pakistan’s economy, representing a combined market of roughly $125 billion dollars, about 30-40 percent of the country’s GDP. Dastgyr aims to empower and uplift this segment with a near-perfect supply chain and financial inclusion to increase that contribution even further.
Dastgyr is a B2B e-commerce marketplace that uses technology to connect retailers directly to manufacturers and wholesalers with guaranteed next-day delivery and telephonic helpline support. Through its operations, the company plans to fix the fragmented supply chain. Dastgyr’s platform partners include Coca-Cola, Nestle, and Reckitt.
Additionally, the platform’s retail services apply wholesale research to the lowest possible rates on inventories over a wide variety of products. Product categories on the app include fast-moving consumer goods, stationery, mobile accessories, and more. The startup claims to have grown the gross merchandise value 7x between September 2020 and July 2021, while boasting 5,240 daily active users on the app.
Dastgyr has also introduced a Buy Now Pay Later offering and further plans to extend lending products for its sellers as well. In an interview, the company’s co-founder, Muhammad Owais, said that the platform aims to become a unicorn in the next few years.
Background of Founders
Muhammad Owais Qureshi
Owais is a LUMS graduate with a bachelor’s in Science. He kicked off his professional journey as a Strategy Associate at the Karachi-based firm, Teamants. In 2015, he joined Hilal foods as a Business Analyst and in 2016 got promoted to the position of Business Development Officer.
He has worked with a number of firms including, Careem and Domino’s Pakistan. In 2019, he cofounded Airlift and in May 2020, he founded Dastgyr with his colleague.
Zoahib is also an alumnus of Lahore University of Management Sciences(LUMS). He graduated with a Bachelor of Science and started his career as an intern at a German firm named Everest Capital. After that, he joined the UK-based company, Pepperstone as a Foreign Exchange Trader.
In 2019, alongside his colleagues he co-founded Airlift. And in 2020, he along with his partner founded Dastgyr.
It allows users to purchase inventory from a wide range of over 2,000 products listed on the app and provides next-day doorstep delivery and microloans.
Dastgyr’s asset-light model functions on a cross-docking approach: goods are delivered to sorting centers, sorted into individual orders and routes, after which they are dispatched to retailers. Currently operational in both Karachi and Lahore after its official launch in September 2020, it has fulfilled hundreds of thousands of orders worth millions of dollars to roughly 30,000 customers.
Funding Raised by Dastgyr
Seed Funding: Raised $3.5 million
In July 2021, Dastgyr raised $3.5 million in a seed round led by SOSV on top of a $500,000 investment, which it has raised in an angel round back in 2020. The seed round took its total raise to $4 million and also involved participation from:
- Asian Development Bank’s VC arm ADB Ventures
- Seedstars, Edgebrook Partners
- Bahrain’s Zayani Venture Capital
- Dubai’s Tricap investments
- Some other angel investors – including Twiga Foods’ founder Grant Brooke and Tokopedia’s VP of Marketplace Albertus Aldo.
The impressive thing was that it was the first Pakistani investment for most of these investors.
Series A Funding: Raised $37 million
In June 2022, the startup raised another $37 million but this time in Series A funding, the first round of financing for a new business after seed capital that too for the biggest investment yet in Pakistan at this stage.
In this round, VEON venture invested $15 million which is its largest investment in a startup in Pakistan.
Other participants in the round included:
- Zinal Growth
- Khwarizmi Ventures
- OTF Jasoor Ventures
- Cedar Mundi
- Reflect Ventures
- Century Oak Capital
- Hi2 Global
- Astir Ventures
- K3 Diversity Ventures
- Chandaria Capital
Along with the founders of Property Finder, Ayoconnect, Quiqup, and senior management from DoorDash.
So far, Dastgyr has raised $41 million from SOSV and other global investors. Previously, the duo were part of the team that helped found Airlift, a mass transit startup that in November 2019 raised a record $12 million in Series
The startup claims to have grown 300%since its last funding and added 42,000 retailers across five cities since its inception in 2020 during the peak of the pandemic.
The Veon Partnership
In a statement, Atyab Tahir, the CEO of JazzCash said that the “possibility really is that we are a digital financial services enabler in the market and when we talk about digitization of cash in the economy, there is a large chunk of cash that SMEs have. The outreach Dastgyr is trying to build, we can be their embedded financial services partner.”
To put it simply, for now, Dastgyr would have access to a large merchant base of Jazz and JazzCash to onboard them for eCommerce services. Wherever Jazz or JazzCash has an outreach, to couple with the merchant and agent network that Jazz and JazzCash have to be able to digitize the underlying financial services. We will enable the underlying digital payments, and Dastgyr will provide B2B eCommerce services to them
While the company started by catering to grocery stores, it’s now venturing into new domains of business-to-business categories, including cement, steel, and other building materials. It is also looking at electronics, pharmaceuticals, and other retail sectors, said Owais.
Furthermore, the company plans to use the newly raised funds to improve its tech stack and strengthen its seller app, which provides credit to sellers, giving them additional working capital for growth.
Besides looking to expand in 15 new cities in Pakistan, Dastgyr is also understood to be wanting to ramp up its global presence and tap emerging across Southeast Asia, the Middle East, and North Africa.