NIC Launches Report on Impact of COVID-19 on the Startup Ecosystem in Pakistan

The National Incubation Center has launched a report ‘Impact of COVID-19 on Startups in Pakistan and the Way Forward’, to gauge how the pandemic and lockdown are threatening the local Startup Ecosystem. An unprecedented crisis of a scale and intensity not experienced in the recent past, COVID-19 has the potential to change how businesses are run and operated across the globe.

An amalgamation of primary and secondary research, this report gives a global and local perspective to the Covid-19 impact on business. The report explores the effects of the pandemic on startups with respect to four key areas – Investments and Capital, Markets, Consumer Demand and Revenues, Talent and Jobs, and Support from Government and Policymakers.

Using secondary research, the report explores these areas in a global context, while primary research is used to understand the impact it has had in a Pakistani context. Based on in-depth analysis of data, the report puts forward a set of recommendations for startups, government bodies, policymakers, and incubation centers, on collaborating and helping startups sustain themselves during these critical times and on the way forward.


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86 startups from across Pakistan took part in an online survey questionnaire. Surveyed startups were from Ed-tech, Health-Tech, Agriculture, IoT, Manufacturing and Production, Fashion, Event Management, Robotics, Travel and Tourism and E-Commerce sectors. Startups from NIC Islamabad, NIC Karachi, NIC Lahore, NIC Peshawar, and Bahria University Innovation Center took part in the survey.

The survey results reveal that startups most severely affected by the pandemic belong to the verticals of Manufacturing and Production, Event Management, E-Commerce, Health-Tech, Ed-Tech, IoT, and Travel and Tourism.

Fig 1: Some key findings from the report

The findings of the survey reveal that while many sectors have been negatively impacted by the pandemic, some are experiencing increased demand and therefore revenue. Startups working in the verticals of Health-tech, Ed-Tech, Gaming, E-Commerce, and Remote-Work are likely to benefit from the current situation. This paints a promising picture for possible investment opportunities, with many investors expressing interest in Ed-Tech, Heath-Tech, and Remote Work.


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The report highlights how many startups have been able to pivot and/or diversify to explore other opportunities, as demand for existing products and services has dropped. Indeed, the startups to survive during the pandemic will be those who respond to the changing dynamics, while those who stick to the pre-existing status quo are likely to die out. With almost 90 percent of surveyed startups reporting cash runway of 6 months or less, coupled with a decline in investments, startups need to proactively seek alternate opportunities to generate revenue and simultaneously reduce costs. Unfortunately, this need to reduce costs is forcing startups to resort to employee layoffs, or reductions in salaries, or both.

Fig 2: Startup sectors most effected by COVID-19

The report shares insights on the journey startups are taking right now and analyzes some of the most prominent impacts the Covid-19 pandemic has had on small businesses. It concludes with a set of recommendations for various stakeholders in the ecosystem, to come forward and facilitate startups in sustaining themselves during these difficult times. This includes the government, private sector organizations, and incubation centers.

The report highlights the need for systematic support from all stakeholders to help startups survive past the pandemic and continue to contribute positively towards the economic growth of Pakistan.

Download the complete report here.



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