Source: Islamabad Scene
Tazah Technologies, a B2B marketplace for fresh fruit located in Lahore, has secured an extra $4.5 million in its pre-seed expansion round, bringing the total pre-seed fundraising to $6.5 million. In October, $2 million was raised for Tazah’s pre-seed round. Pakistan’s Fatima Gobi Ventures and Vibe Capital, a company located in the US, jointly led the expansion financing.
Shorooq Partners, Nuwa Capital, Ru-net, Alter Global, Julian Capital, Kinnow Capital, Early Grey Capital, and K3 Fund all participated in the financing. Angel investors from Silicon Valley, including Sahil Bloom, Siqi Chen, and Matt Brezina, among others, also took part in the round. This would be one of the major Middle Eastern funds, Nuwa Capital, first investment in Pakistan. Global Founders Capital, Zayn Capital, and i2i Ventures are some of the current backers.
In 2021, former Careem directors Abrar Bajwa and Mohsin Zaka founded Tazah, with the goal of developing a product line that would solve issues in the food and agribusiness and improve the lives of all shareholders, particularly farmers. This all started with a market that encourages capable firms, primarily tiny shops, to buy fresh fruit. The agrotech firm purchases the veggies directly from the growers, sorts and grades them in its warehouses, and then delivers them to the street vendors.
Tazah, which was just established four months ago, asserts that it has grown to have a $7 million gross merchandise value annually and thousands of customers in Lahore and Karachi. Many of its customers use the app frequently, “showing a subscription-like ordering commonness.”
According to co-founder Abrar Bajwa, the business wanted to give working capital financing to fresh produce vendors and simplify the fresh produce supply by shortening the period between harvest and sale with the help of the new funds. He said, “We are thrilled to have the support of some of Pakistan’s most active investors. We also appreciate the value that our current investors have contributed and their ongoing support of Tazah.The increased investments will enable us to accelerate our market dominance and execute some interesting projects that will help us boost our margins as we grow.”
According to Bajwa, they plan to use the additional funds to simplify the fresh produce supply by shortening the gap between harvest and sale, as well as to provide working capital loans to vendors of fresh fruit. In his words, “We are excited to have the confidence of some of the most active investors in Pakistan. We are also grateful for all the value added by our existing investors and their continuous backing of Tazah. The new investments will help us accelerate our market dominance and execute some exciting projects that will help us improve our margins as we scale.”
When asked why Vibe Capital chose to invest in Tazah, its founder Ankur Nagpal said that it’s inevitable that this business ought to exist – it’s currently a tremendously inefficient supply chain, and Tazah simplifies it. In addition to representing a very modest fraction of the overall market, the company is growing extremely quickly and is on track to reach 8 figures in annualized gross merchandise value in the coming few months.
The ability to develop new products, particularly financial products, for this market is what excites him the most. For instance, Tazah is in a great position to start offering lines of credit to its corporate customers, which they can then repay after reselling the stock. The VC further added, “We do assume it will probably be an aggressive market, however we’re most excited in regards to the founding group right here, and against them to win this area. We love investing in rounds like these with a robust native lead and having the ability to pull in among the greatest operators as nicely.”
The Pakistani firm has developed a strategy to use the existing funds to expand its reach in Karachi and Lahore, establish new cities, and boost its tech. The founders are also working on a fintech product to “provide financing solutions to both sides of the market.” With the assistance of Fatima Gobi Ventures, Tazah now has a strategic partner in Fatima Group, one of the leading operators in Pakistan’s agriculture sector with stakes in the sugar and fertilizer industries.
“At FGV, we continually envisage Pakistan’s tomorrow, now,” said Ali Mukhtar, a general partner of the company. “And that is the spirit of Tazah, which is revolutionizing Pakistan’s enormous yet highly complicated agricultural industry to tackle inefficiencies in food and agro supply chains.” Tazah’s goals were “extremely ambitious,” he continued, but FGV was eager to see what the business will do next.
According to Vibe Capital’s founder, Ankur Nagpal, they are most pleased about having the option to develop new goods, particularly financial solutions, for this market. He asserts, “Tazah is in an excellent position to start giving lines of credit to its business purchasers that they pay off after reselling the product.”