Pakistani Raw Materials Marketplace Zaraye Raises $2.1M Seed Round
The Karachi-based outfit looks to streamline the supply chain between suppliers and small manufacturers, operating with 300 partners across over 20 cities.
Pakistani B2B procurement startup, Zaraye, has announced the raise of a $2.1 million seed round led by US form, Tiger Global, and Zayn Capital, a UK form that provides debt and equity financing to startups in MENAP and Bangladesh. Other investors include +92 Ventures, Alan Rutledge, Jack Rizvi and current and former employees of Careem.
Founded in late 2021 by Hashair Junaid Ahmedani, Taha Iqbal Teli and Ahsan Ali Khan, is best and most succinctly described as a marketplace for raw materials, one that looks to help help manufacturing businesses in both the procurement of said materials and the financing of working capital. The platform serves clients in the textile and construction fields and boasts 300 partners and suppliers across over 20 cities. It’s the financing of working capital that speaks most of the startup’s core aim, which essentially boils down to entrepreneurs providing solutions for other entrepreneurs. The startup targets smaller manufacturers, whose annual revenues fall between $250K and $2 million.
“We aim to strengthen the backbone of the country’s economy by helping the entrepreneurs in finding avenues to optimise and scale,” said Ahsan Ali Khan, who also serves as the startup’s CEO. “Zaraye will help partners to compete locally and globally as they find more savings in time and money to create the best products.”
Saving time and money is key to solving issues with the supply chain, which would traditionally find a manufacturer going through intermediaries. Even if, however, they are able to deal directly with suppliers, the process often descends into a series of seemingly aimless communications, as suppliers furnish rates. Using Zaraye, manufacturers are able to post their requirements for any given product, with suppliers then able to furnish rates in real-time. The process offers manufacturers with enough information and options to make fast and efficient buying decisions. Zaraye essentially handles the whole procurement process, from getting quotes and assuring quality, to delivering to the manufacturer and offering after-sales assistance. On the part of the suppliers, meanwhile, the vast network of buyers allows them to access consolidated demand volumes.
“Small and medium business owners have been trapped in a cycle of high competition and lack of financing options,” added Hashair Junaid Ahmedani. “Zaraye aims to help these businesses scale as they find the efficiencies in procurement and financing options to make better decisions for their businesses.”
The investment further cements e-commerce’s position in Pakistan at the top of the funding table for Q1’22, which comes off the back of a 2021 that saw e-commerce in Pakistan hit $203 million in venture capital funding. Across 21 deals, the likes of Bazaar, Tajir, Grocer App and Tazah Technologies all all scored big, while highlight deals of this year include Jugnu's $22.5 million Series and Bazaar's $70 million Series B, both in March.
What the Zaraye team intends to do with their new found capital has not been disclosed, but with industrial manufacturing contributing to 20% of Pakistan’s economy and raw materials representing at least 60% of total costs for manufacturers dealing with small net margins, there’s plenty of small business empowerment to be had - and indeed more funding to be had, as more and more international investors put Pakistan in their targets.