SECP has officially launched its report titled Empowering Innovation: Roadmap for Startups, offering a detailed framework to guide the growth of Pakistan’s startup ecosystem. The report outlines specific recommendations for private sector investors, financial institutions, entrepreneurs, and government bodies, focusing on measures that encourage capital mobilization, mentorship, public-private collaboration, and policy support.
Among the key recommendations for private investors and financial institutions is the need to increase risk appetite for startups by designing tailored financial products such as venture debt and micro-loans. These institutions are also encouraged to collaborate with regulators to create co-investment funds and develop risk-sharing models that make early-stage investments more feasible. Emphasis is placed on high-impact sectors including agri-tech, health-tech, and manufacturing, which hold strong potential for economic and social return.
To foster a culture of guidance and scale, the report recommends expanding mentorship networks through partnerships with incubators and accelerators. It calls for the creation of remote mentorship platforms that bridge the expertise gap between urban and underserved areas. Incentives for mentors, such as tax benefits and formal recognition, are also proposed to boost participation.
Public-private partnerships are seen as essential in catalyzing startup growth. The roadmap urges collaboration with government agencies to co-develop financial instruments, especially for the proof-of-concept phase, which is often the riskiest stage for startups. The involvement of large financial institutions as co-investors is suggested as a way to attract substantial capital and confidence into the startup domain.
A significant portion of the report details SECP’s recent regulatory interventions. These include reforms to the Companies Act 2017, with the introduction of stock split guidelines, share buybacks now permitted for private and public unlisted companies, and the drafting of the Employee Stock Option Scheme (ESOS). The Regulatory Sandbox, now permanently open after completing four cohorts, has supported innovations such as P2P lending frameworks and digital-only insurance models. The Innovation Office, revamped in 2024, has also played a pivotal role in engaging early-stage startups, supported by collaborations with universities and incubators.
The report adds a formal definition for startups under SECP’s regulatory domain, categorizing them as companies under 10 years of age, with a turnover under PKR 500 million, and focused on innovation. SECP also approved the GEM Board as a dedicated capital-raising platform for SMEs, startups, and greenfield projects.
Entrepreneurs are encouraged to stay informed on evolving regulations by engaging with the Innovation Office and utilizing the sandbox for compliance and product testing. They are also advised to focus on operational resilience, scalable financial models, and a customer-centric approach informed by real-time feedback and affordability. Cross-ecosystem collaboration with other startups, accelerators, and investors is highlighted as a method to share resources, influence policy, and foster collective growth.
For other government bodies and policymakers, the report recommends investing in education and digital skills, revamping curricula, launching certifications, and enabling inclusive access to digital financial services. FBR is urged to introduce tax exemptions, credits for R&D, and incentives for capital gains reinvestment. Programs focused on women-led startups are suggested, including mandates for public procurement quotas and targeted funding. Inspired by models like the “Saudi Garage,” SECP encourages the development of fully supported startup hubs in Pakistan.
The roadmap concludes with recommendations for SECP itself to continue streamlining the corporate registry, promoting capacity building, adopting emerging technologies, and engaging with global regulatory best practices to ensure a dynamic and responsive startup ecosystem.
