Aside from building a network of investors who can fund The Foundation affiliates, NIC is also working with LUMS Alumni, corporations and other organizations to help create a Special Purpose Vehicle (SPV) with a sizable seed stage investment fund. An independent and seasoned investment committee will make equity investments in the most promising startups led by passionate and dedicated founders in exchange for equity in those companies.
Although there is a lot of capital in Pakistan that is chasing growth-stage investment opportunities, the deal flow at that stage is limited. The Foundation Fund aims to invest is seed stage startups to ensure many do not fall into the large chasm that exists post-graduation from business incubators and before the companies are cashflow positive or have enough traction to tap into growth stage capital.
The fund is envisioned to be setup as a not-for-profit SPV seeded by endowments from LUMS Alumni, Pakistani corporations, high net worth individuals, donor agencies and the Government. Aside from supporting the operations of the NIC and investing in startup ventures, any dividends and capital gains from the investments made by the fund will channel back into the fund and will be used to for investments in more startups down the road. The primary objective of the fund will be to support the growth of entrepreneurial ecosystem in Pakistan as envisioned by LUMS.