Up and coming: Pakistani startup raises $5m from venture capitalist

Published: November 14, 2013
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“Faizan is a perfect example of why we [America] need immigration reform,” said US President Barack Obama in a tweet. PHOTO: EXPRESS

“Faizan is a perfect example of why we [America] need immigration reform,” said US President Barack Obama in a tweet. PHOTO: EXPRESS

KARACHI: 

In what can serve as an inspiration for the country’s tech firms seeking expansion in the world’s largest market, Pakistani start-up ‘Convo’ has raised $5 million in investment capital from a top tier venture capitalist (VC) in Silicon Valley. It is, arguably, the first Pakistani company to receive such major funding from an institutional VC firm in the world’s IT hub.

This is Convo’s first major investment from Morgenthaler Ventures, one of the top institutional VC companies in the Valley, which has investments in over 300 companies including tech giant Apple Incorporated.

VC firms are private investors that provide financial capital to early-stage, high-potential, high-risk, growth startup companies. The investment, therefore, reflects Morgenthaler’s confidence in the product.

“We have been amazed at the level of engagement we have seen from Convo’s early customers, including many global brands. These organisations won’t settle for inconsistent, light-weight solutions,” Rebecca Lynn, Partner at Morgenthaler Ventures said. “There are collaboration services you use to run chit chat, and there are those that run your company. Convo is relied on for the latter,” she said.

Convo is a multi-platform social network enterprise designed to allow teams to share and work together simply by combining discussions with messaging, images, documents, presentations and PDFs – it’s like the Facebook of enterprises. It’s available as a desktop app across all major platforms with versions for Windows, Mac, Web, and iPhones and Androids.

The company, which has been witnessing exceptionally high levels of engagement in their paying accounts since 2012, is planning further expansion with the help of this capital injection.

“Our immediate priority is to use the new infusion of capital to continue delivering a service that meets the ease-of-use, reliability, and security demands of our customers,” Convo’s founder and CEO Faizan Buzdar said. “We are building out our team in both San Francisco and Islamabad.”

The funding will be used to evolve the company’s products, introduce its service on more platforms, and accelerate user reach and growth. Convo will also use the money to more than double its team in Pakistan, the company’s Director Marketing and Operations Shehryar Hydri told The Express Tribune.

The product is making big waves already and giving social enterprise giants, the likes of Yammer and Jive, a run for their money according to reviews published by top technology blogs; it has even taken away a chunk of their clientele.

The company’s market position couldn’t be determined because it didn’t disclose financial data. It did say however that over 10% of the Fortune-500 companies use their product, and they have 6,000 customers in more than 150 countries.

What really brought Convo to the limelight were the rave reviews it received from customers and leading technology blogs, such as TechCrunch and The Next Web, for its innovative features. In fact, this innovative product even got the attention of the United States President Barack Obama few months ago.

“Faizan,” Obama tweeted, “is a perfect example of why we [America] need immigration reform.”

Obama’s tweet, which praised Buzdar, was meant to gather support for an immigration bill that would allow non-US citizens into the country to help promote innovation in the country’s technology industry.

Buzdar, too, faced a host of immigration hurdles before getting his green card recently. “America needs immigration reform or it risks losing out on innovation,” he had told The Next Web prior to getting his resident permit.

Launched from Islamabad in 2005 as Scrybe and later renamed Convo, it is one of the few software product-based companies that originally started in Pakistan and gained a global footprint in terms of funding and customers.

Buzdar started his company from a five-member team working from a small room in the federal capital but he is determined to make it big, perhaps the biggest in the market it serves.

“Our customers say that Convo is the first app they check as soon as they wake up, even before email or Facebook. I want to see that behavior across many more organisations,” Buzdar said.

Published in The Express Tribune, November 14th, 2013.

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Reader Comments (28)

  • Ricky
    Nov 14, 2013 - 2:53AM

    How much Saudi money is being offered for such Pakistani companies vs the most hated country in Pakistan?

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  • Sidster
    Nov 14, 2013 - 3:06AM

    Well done Faizzan Bhai. May Allah give you more success for your hard work, Ameen.

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  • S
    Nov 14, 2013 - 3:07AM

    MashAllah

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  • Programmindrone
    Nov 14, 2013 - 3:35AM

    Nice to hear about startups in Pakistan.

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  • Z
    Nov 14, 2013 - 3:41AM

    @Ricky: You’re confusing the issue. The money is not being ‘offered’ to this company. VC’s don’t throw their money around. They provided funding because the saw a sound investment opportunity.

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  • Malik
    Nov 14, 2013 - 4:12AM

    You have conveniently forgotten that millions of Pakistanis work in Saudia and other gulf countries. Why should the Saudi government fund Pakistani civilians? It does not make any sense.
    And Yes, local Saudi venture capitalists do invest in Pakistani companies but they are of a different genre mostly related to real estate, oil and gas exploration. To top it off Saudi is not a player in the IT field any ways so such investments are rare.
    Saudi despite of its short comings when it comes to religious tacklings, has always been on the fore front when push comes to shove for Pakistan.

    There are also lots of internet dot com success stories that have not been given main stream media attention simply because the owners choose not to disclose them. I personally know of Pakistani Internet Entrepreneurs who have made it big in the US and UK IT sector, starting their small one room companies from the confines of their room.
    And venture capital inductions have their own downgrades also; Biggest being the founders being replaced by a more experienced CEO.
    I have a recommendation for ET. They should put up a request on their website and ask all the local Internet dotcom entrepreneurs to come forward and share their success stories. This will give a lot better picture of bright Pakistan actually is exporting IT.
    From a personal experience, Lahore, Karachi and Multan are serious internet dotcom hubs. Yes, Multan! There is an IT company there that makes more than $25 million dollars per year in revenue and no one in Pakistan knows about it! Why you would ask? because the owners absolutely do not want the media to know about them.
    There is more to what meets the eye sometimes. ;) @Ricky:

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  • Ussama Yaqub
    Nov 14, 2013 - 4:23AM

    Great news coming out of Pakistan after a long time.

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  • PakArmySoldier
    Nov 14, 2013 - 5:03AM

    From their website, “Convo is headquartered in San Francisco, CA.”

    Might have started in Pakistan but it’s an American firm now. A little research goes a long way, ET.

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  • Khanfused
    Nov 14, 2013 - 5:44AM

    I’m a little confused. Should this news make me hate the US more or less? ET – please clarify.

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  • aaaaa
    Nov 14, 2013 - 6:10AM

    @Ricky:

    Theyve had an app up and running in Pakistan since the 70’s. Provided billions of dollars by now one would think.

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  • Feroz
    Nov 14, 2013 - 6:38AM

    Excellent, all start ups should be encouraged with VC funding.

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  • PixelArt
    Nov 14, 2013 - 6:44AM

    Great to read about this.

    “The product is making big waves already and giving social enterprise giants, the likes of Yammer and Jive, a run for their money according to reviews published by top technology blogs; it has even taken away a chunk of their clientele.”

    Can you put in a source for this? Would be a great share.

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  • Farhan
    Nov 14, 2013 - 7:08AM

    Good stuff – we need to encourage more enterpreneurs.

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  • Farhan
    Nov 14, 2013 - 7:08AM

    Watch out for government goons who will be coming for their pound of flesh.

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  • Hammad
    Nov 14, 2013 - 8:59AM

    Pakistan doesn’t lack the motivated and talented souls! Great job Mr. Buzdar

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  • Faheem
    Nov 14, 2013 - 10:39AM

    Just brilliant. Very happy to read such a positive news from Pakistan after a long time. Best of Luck Mr. Buzdar & Shery bhai.

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  • Saima E
    Nov 14, 2013 - 10:47AM

    @Malik:
    Would like to know a little details about the company from Multan. Not name may be if they wish but we should know what work is being done here for others to be inspired from and do more

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  • Mirza
    Nov 14, 2013 - 10:56AM

    @Ricky:
    I agree with you 100%. We are a thankless bunch and love those who export terrorism and jihadi culture to our poor kids. The US has not become great by accident. They support, endorse and finance good ideas for the whole world not just the madrasas.
    Regards,
    M

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  • usman786
    Nov 14, 2013 - 12:02PM

    @Mirza: @Ricky:
    We could had been well off had USA not choosen to use Pakistan against its fight to USSR. USA brought Saudi money and also fooled them about Iran which is a known fact. Can you tell how much money Saudis have invested in USA? All our leaders go to them to beg money for poor countrymen because rich people like you donot pay taxes and elect incompetent leaders

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  • Ali S
    Nov 14, 2013 - 4:47PM

    @PakArmySoldier:

    I don’t blame them. They have several million dollars in their pocket, the Pakistani media has outed them and they have the talent to make it big in a country that will reward them for their work. Best of luck to Faizan and Convo.

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  • Arzoo
    Nov 14, 2013 - 5:36PM

    @usman786: I am not contributing to the debate per se because it’s a meaningless comparison. I am just answering your question about how much Saudis invest in the United States. Saudis contributed $46 million to President Clinton’s Foundation: Here is the link: http://www.foxnews.com/politics/2008/12/18/saudi-arabia-biggest-donors-clinton-foundation/ . In terms of Sovereign funds the Saudis pour in literally billions in the United States. According to US government sources, Saudi’s investments in the US approaches $800 Billions. Private Saudi investments in the US totals $400 Billion according to the Saudi government sources: http://www.saudiembassy.net/latest_news/news11080903.aspx .
    So, the point to ponder for the commenters here is that Taliban’s avowed enemy are the Americans. And, Taliban’s financiers are Saudis. So who is fighting who???? All I know is that innocent, already oppressed and dispossessed Pakistanis are being blown up on the streets of Karachi and other cities of Pakistan, leaving their families penniless and without a breadwinner because of these international intrigues and conspiracies.

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  • Jamshed
    Nov 15, 2013 - 12:41AM

    Faizan Buzdar. GIKI Batch 1 (or maybe Batch 2). Has made all GIKIans proud!

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  • Aziz
    Nov 15, 2013 - 7:43AM

    Well done Faizan Buzdar!!! We need more such stories and shinning stars to keep spreading good news and high hopes for our nation.

    Great job ET we need to highlight more such achievers from all walks of life, Unfortunately media is only making this nation a nations of politians and our prime time shows are focused on bad news glorification and how we are approaching dooms day sooner. We have lots more other good things to highlight and talk about e.g. Culture, Academics, Sports, Art, Science, etc.

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  • RAF
    Nov 16, 2013 - 12:55AM

    great job MA…we need such people to make us feel proud in these times of disarray n hopelessness

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  • optimist
    Nov 16, 2013 - 6:18AM

    @ Ricky

    Apart from support at world forums and remittances from people based in Saudi Arabia, the Saudi Kingdom has been giving Pakistan $2 billion dollar worth of oil for free every year since 1998 nuclear blast.
    .
    That is nearly $30 billion dollars in free oil alone. If Pakistan has not utilized that saving, it is not Saudi Arabia’s fault.

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  • ZElahi
    Nov 20, 2013 - 1:52PM

    I’m actually surprised at the comment moderators who’ve allowed unrelated comments (abt Saudi funding) on this post. The whole purpose of comments is to have some constructive feedback and the purpose of moderation is to control and disallow disruptive arguments. Instead of concentrating on the post and what it stands for, people are sharing information that is in no way, linked to this post and moderators are allowing it. Sad.
    And to all those who are bent upon leaving unappreciative comments, please learn to appreciate the achievements of your fellow countrymen instead of trying to underplay them out of envy. We’ll be a much better country if we could just stop being jealous, mistrustful and skeptical.

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  • Nov 22, 2013 - 10:09PM

    lol, i see no location office in pakistan from ‘convo’ how they can say it was a pakistani ventures lol

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  • Dec 28, 2013 - 11:06PM

    great news for Pakistan. We need more like that.
    http://www.stuffwrap.com/

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