With the investment thesis of Z2C Limited focused on bringing transparency to the media supply chain, the venture accelerator has been revealed as the seed backer of Begin.Watch, a new ad-free over-the-top (OTT) platform that focuses on sports and entertainment.
Speaking with ProPakistani, chairman Raihan Ali Merchant shared that Begin.Watch will give viewers access to legally sourced live sports and premium entertainment.
This is but the latest in local ecosystem investments from Z2C Limited, which has gradually shifted its focus away from its advertising services roots and towards content and distribution.
Speaking about the venture, Merchant highlighted the reliance on advertising as the primary revenue source in the television industry and emphasized the need for innovation in this regard. He noted that the market is still dominated by cable broadcast but believes there is room for a new format.
In 2023, Pakistanis spent over $60 million on the app store and consumed an average of 7.8GB worth of data per user.
Merchant acknowledged the challenges of implementing a paywall on television and cited India’s successful transition to OTT platforms as a model to emulate. He expressed his intention to adopt a hybrid model for ad monetization and technology, combining premium subscription services with ad-supported content.
The content on Begin will primarily focus on sports and entertainment, catering to both local and global audiences,” said Merchant. “We will tap into the existing market of streaming subscribers in Pakistan, leveraging the country’s familiarity with platforms like Netflix.”
The monthly active users (MAU) of the top streaming apps of 2023 were Tamasha at 11.7 million, Netflix at 2.9 million, Amazon Prime at 1.36 million, MyCo at 1.33 million, and Tapmad at 830,000 users. Notably, live sports is the new battleground for attracting avid users and is an area that Netflix and Amazon struggle with even in their own market.
Aside from the aforementioned local and global streaming apps, Begin.Watch will have to contend with sites with pirated content and with Pakistani internet service providers (ISPs), which offer foreign channels and content illegally, without licensing from the owners and without securing PEMRA landing rights.
“While there are challenges posed by illegal cable operators, we plan to address the issue gradually, focusing initially on partnerships with ISPs,” said Merchant. “ It’s important to work within the legal framework and collaborate with industry stakeholders to ensure Begin.Watch is a sustainable success.”
He expressed confidence in the founding team of Begin.Watch, particularly chief commercial officer Jonathan Mark and creative lead Ali Mankani. Mark has a track record in launching global channels in the Pakistani market, such as CNBC, while Mankani has a track record in providing creative production solutions and operational excellence in campaign production.
Using the seed investment provided by Z2C Limited, Begin.Watch was able to secure sports streaming deals with the Professional Golfers Association, Saudi Premier League, and All Elite Wrestling. The streaming platform is in talks with the Grand Slam tournaments, F1, soccer, and volleyball leagues for legal and licensed streaming deals.
On the entertainment side, Warner Brothers Discovery, Sony Pictures, and NBC Universal are reportedly on board as well. The content will become available in mid-April once the mobile app is live. The business is quietly acquiring content across sports and entertainment for its launch across Pakistan, Saudi Arabia, Bangladesh, Sri Lanka, and Nepal.
Track Record of Z2C Limited
The venture accelerator is the primary holding company for media agency Brainchild and creative agency Blitz Advertising. Since the pandemic, Z2C Limited has made several stealth seed investments in technology companies focused on bringing transparency to the media supply chain. Public and disclosed portfolio companies include bSecure, Walee, and Lytics.
bSecure
In 2020, Z2C backed universal checkout solution bSecure. After three years of struggling to grow and achieve market fit, founding CEO Adam Dawood left in 2023. Shortly thereafter, career banker Arshad Ali took over Dawood’s role in bSecure. The business folded in Q1 2024, with its payments technology integrated into Begin.Watch to hasten the SVOD roadmap.
Walee
In 2021, Z2C backed Walee with $2.7 million, which Merchant commended as pivoting in time to outsurvive start-ups from the same time period, without any additional fundraising. In 2024, Walee was able to beat ARY, GroupM, Daraz, Jazz, and MyCo for the PSL streaming rights for 2024-2025 with a $7 million bid.
Speaking briefly on the matter, Merchant said that he has an arm’s length relationship with the founders of all his invested ventures and that the business leaders took the pivoting advice they were given to out-survive start-ups that received 10-30x investment in 2021.
Lytics
Rehan recalled that in 2022, Z2C backed Lytics, an AI-powered broadcast media tracking tool, with use cases in sentiment analysis, scenario mapping for crisis communications, and for tracking the root of misinformation campaigns.
In 2023, IBA’s journalism school upgraded its journalism masters with Lytics, giving students and faculty the power to track misinformation and disinformation created around political campaigns and rights movements.
In 2024, the journalism school pooled the power of Lytics with a variety of tracking technologies to debut iVerify, in partnership with UNDP. Outside of academia, the enterprise customers of the tool are NGOs, listed companies, investor relations consultancies, and policy think tanks, he added.
Begin.Watch
In Q4 2023, Z2C backed Begin.Watch after the venture secured a founding team with a commendable track record in content acquisition, content production, and customer acquisition. Given the content acquisitions secured so far and the clear focus for Southwest Asia, the business will be tested through Q2 and Q3 2024, from a technological and traction standpoint.
Given how it’s positioned, it is likely packaged as the perfect distribution mechanism for the largest sovereign wealth funds seeking to project soft power. This is reflected in various intentional facets of the business, including its diverse and youthful leadership team.
Distribution is King
Merchant is not the first advertising magnate to make the drastic shift from the services model to content development and distribution.
Airwaves Media (Private) Limited, owned by Tahir Anwer Khan, has holdings in creative and media agencies, including a TV channel and a radio station. East River founder Faizan Syed is the host of a very popular business podcast and IG Square CEO Sarwar Khan has stakes in Digital Engagement Network, which is a foil to Walee.
The industry leaders recognize that in the absence of a direct regulator or watchdog for the advertising and media industry, private entities have to move the needle forward, without worrying about how consolidation may be perceived as anti-trust or uncompetitive.
“Case in point, nowhere in the world is the owner of a sports team also the owner of the channel where said the sport is aired, but we have one prime example in Pakistan,” Rehan added.
As the sole advertising proprietor that backed untested content models such as Coke Studio and the Pakistan Super League, Merchant is on a warpath for a hat trick.
