Airlift Technologies Announces Complete Shutdown in Pakistan
You’ll be thinking “Why airlift shut down its operations in Pakistan?” That’s all, fellas. Over three years of operation in Pakistan, Airlift Express now had announced that its fast eCommerce activities would be completely shutting down and starting from 13 July, 2022.
In a statement, Airlift, the second-biggest startup in Pakistan, blamed the global financial crisis and the collapse of the stock markets as the reason for its shutting down.
Since SOPs have loosened and individuals are less fearful of leaving their homes, the popularity of q-commerce, which grew during Covid, has also declined.
Airlift Technologies has been responsible for the greatest individual private funding in the country’s history. Nevertheless, with its shutdown, some startups’ sustainability has been called into doubt, according to Business Recorder.
The business of Airlift Express that was meant for delivering groceries and goods was doing well last year and had secured $85 million in a Series B fundraising round, the largest sum ever secured by a Pakistani startup.
Ismail Iqbal Securities’ head of research, Fahad Rauf, said,
“Airlift also faced such a scenario where it’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,”
A few months prior, the company had already stopped operating in secondary cities including, Sialkot, Hyderabad, Faisalabad, Gujranwala and Peshawar.
Airlift express said,
“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 Technologies, a mass – transit unicorn firm was founded in 2019 to provide buses with an Uber-like operation. Airlift swiftly discontinued its transport service and switched to grocery deliveries as the Covid-19 virus spread across the nation. Usman Gul is the CEO and co-founder of Airlift Pakistan Technologies.
Airlift also stopped operating in South Africa and it stated,
“We want to inform you that due to a significant downturn in global economic conditions, Airlift South Africa will no longer be operating in Johannesburg, Pretoria and Cape Town. We thank you for your support… More over the last few months, it has been a pleasure serving you!”
When the recession originally started, Airlift was among the first few businesses in emerging economies to alter their company operations. Three changes were made as part of its response code, including;
- An immediate headcount cut,
- The suspension of activities in all new markets,
- And changes to the platform scenarios to generate more revenue (i.e., the implementation of increased pricing and a delivery cost).
Well with above measures, Airlift was capable of reaching rank profitability, maintaining a manageable scale, and cut back on financial loss by 66%.
The startup has revealed a layoff plan for its staff that includes two months’ salary and a site for future employment. It added,
“For suppliers, vendors and other third parties, our team will communicate proactively to manage arrears and liabilities as a part of our ongoing shut-down process,”
Here is my reviews on it;
As a business owner I think following are the reasons startup had to take exit station;
- Crucial financial conditions of the country unfortunately, including;
- instability in the prices of oil
- Fluctuation of dollar rate
- Increase in interest rates
- Prices touching high skies
- Decreased power of buying
- Too many investors and it shook the confidence of founders and founders did not take it to next level as their interests were already met
What do you think about it, you can share in comments below.
I will be writing more related to startups in Pakistan, stay tuned!