Tazah Technologies, a B2B fresh produce marketplace that aims to empower millions of farmers and businesses by providing them access to capital and market, closed a pre-seed round co-led by Fatima Gobi Ventures (FGV) and Vibe Capital, with participation from Shorooq Partners, Nuwa Capital, Ru-net, Alter Global, Julian. Capital, Kinnow Capital, Early Grey Capital, and K3 Fund. The round also had participation from prolific Silicon Valley-based angel investors including Sahil Bloom, Siqi Chen, Matt Brezina, among others.
For Nuwa Capital, one of the largest funds in the Middle East, this will be their first investment into Pakistan.
Existing investors including Global Founders Capital, Zayn Capital, i2i Ventures, and notable angels also reinvested in the round.
This latest funding round follows closely on the heels of a US$2 million pre-seed round announced in October and brings total funding to date to US$6.5 million.
Founded in August 2021 by two ex-Careem executives— Abrar Bajwa and Mohsin Zaka — Tazah has scaled operations to an annualized gross merchandise value (GMV) of US$7 million in a little more than four months of operations.
Headquartered in Lahore, the startup has already expanded operations into Karachi with another city launch in the pipeline. Tazah aims to improve the lives of food producers, businesses, and consumers by building a tech-enabled operating system for the agriculture and food value chain.
Abrar Bajwa, Co-Founder of Tazah, said:
“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.”
Tazah has realized a high rate of month-on-month customer retention, with many users being return customers and exhibiting a subscription-like ordering frequency very rarely seen in other industries.
To drive expansion into other Pakistan cities and across the region, Tazah also announced two key hires: Sultan Raja as VP Product and Umair Majeed as VP Operations. Raja has over 13 years of experience in product development and deployment globally with companies including Empiric.ai, Netsol, and Techlogic. Meanwhile, Umair has worked in leadership roles in the operations arms of leading food companies in Pakistan.
Mohsin Zaka, Co-Founder of Tazah, said:
“Our experience of leading large national teams and growing complex marketplaces has helped us tremendously in quickly scaling our business and building the capability to manage multi-city operations. We have also built a very strong founding team by acquiring the best talent from different industries.”
Fatima Gobi Ventures (FGV) is a joint venture between Fatima Group, one of the largest and oldest stakeholders in Pakistan’s agricultural sector with a strong presence in fertilizer, textile, sugar, and trading businesses; and Gobi Partners, a pan-Asian VC that has backed over 270 startups across 13 countries.
Being one of the most active venture investors in Pakistan, FGV is well-versed with the local e-commerce space, having backed quick commerce startup Airlift, e-commerce payments startup Safepay, and B2B marketplace Tajir, among others.
Ali Mukhtar, General Partner for FGV, said:
“At FGV, we constantly envision Pakistan’s tomorrow, today — and that is the essence of Tazah, which is revolutionizing Pakistan’s massive yet incredibly complex agricultural sector to solve inefficiencies in food and Agri supply chains. It’s incredibly ambitious, but building a digital, forward-looking Pakistan does not happen by just picking low-hanging fruits, and we can’t wait to see what’s next on Tazah’s plate.”
Meanwhile, New York-based Vibe Capital was launched last year by Ankur Nagpal to invest in pre-seed and seed startup founders in emerging markets. Vibe Capital’s latest fund has some of the top US funds as its LPs including Tiger Global, Spearhead, Foundation, Bessemer, Tribe, and partners at GSV, A16Z, Quiet, Buckley Ventures to name a few. Nagpal had founded EdTech marketplace Teachable in the US and sold the business to Hotmart in early 2020.
Ankur Nagpal, Founder of Vibe Capital shared the following reasons for his investment:
It’s inevitable that this business should exist — it’s a very inefficient supply chain at the moment, and Tazah streamlines it. The company is growing really fast and on track to hit 8 figures in annualized GMV in the next couple of months — and that still represents a very small percentage of the overall market. What we are most excited about is the ability to build additional products (particularly financial products) for this market — for instance, Tazah is in a great position to start extending lines of credit to their business buyers that they pay off after reselling the inventory.
While they do want to eventually go international, even the local market in Pakistan is massive. For instance, Pakistan’s GDP is 1/100th of America but their food market is 1/20th of America, so proportionally 5x bigger. We do think it will be a competitive market, but we’re most excited about the founding team here, and back them to win this space. We love investing in rounds like these with a strong local leadership and being able to pull in some of the best operators as well.
According to the Pakistan Bureau of Statistics, the agriculture sector is the largest, contributing around 24%to the country’s gross domestic product and accounting for half of the employed labor force.
Given that the agriculture sector is the backbone of Pakistan’s economy, Tazah’s growing team is set on making a massive impact in Pakistan. However, as these issues are common across the global agriculture industry, Tazah’s ambitions extend beyond Pakistan.
“With the technology and talent pedigree that we are building, we believe that expanding into regional markets with similar dynamics is a logical move,” Abrar said.