Airlift, the second largest startup in Pakistan, has shut down in the country due to global recession and the downturn in capital markets, Reuters news report said.
“This has been an extremely taxing decision that impacts a large set of stakeholders and an emerging technology ecosystem,” Airlift said.
Although Airlift was closing, the statement looked forward to further work in emerging markets.
“Due to factors beyond our control, the Airlift journey must come to an end. However, our broader mission of creating positive change in the region will find a new life,” Airlift said in a news statement.
The statement did not make clear whether Airlift would continue to operate beyond Pakistan.
Airlift, which delivered groceries and goods, raised $85 million in the largest funding round to date by a local startup in 2021, but ran into trouble as a global market downturn made further fundraising difficult.
The only more sizeable startup in Pakistan is foodpanda, a food delivery service.
Fahad Rauf, head of research at Ismail Iqbal Securities, said the rising cost of financing as central banks raise rates to tackle soaring inflation has meant business models with high cash requirements are especially vulnerable.
“Airlift’s Series C1 funding round failed, resulting in the closure of operations. This is because the growth-based business model required continuous liquidity injections to sustain operations,” Rauf told Reuters.