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Crumbling tech dreams

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The journey from boom to bust can be quick, as we Pakistanis know all too well. However, in the last couple of years, the tech industry has also come to this realization after a long period of what seemed like reality-defying invincibility at one point. From $648.6 billion of venture capital in 2021, global fundraising went to $248.4 billion in 2023, marking a solid correction in the market. And that entirely changed how companies operated, or more aptly, went back to how they have continuously used: to make profits.
Far too many times, I have heard founders talk about how their maverick accounting — with all those adjusted earnings or margins calculated on the gross merchandise value instead of revenue — wasn’t intellectual dishonesty but somewhat indicative of a new age that the boring old-school indicators couldn’t capture. Once, an engineer of a well-funded startup argued that in tech, profitability is a thing of a bygone era and doesn’t matter anymore.
Of course, this was when engineers like himself were getting offers left, right, and center at eye-popping pay bumps as a poaching war ensued. As per Pakistan Software House Association’s Salary Survey, companies struggled to retain talent, and the employee turnover rate spiked by 12 percentage points to 30 percent in 2021.
But the past is another country, as many have to realize the hard way. Especially those associated with the technology sector, be it the founders, customers, or employees. The latter has had a rough period with a wave of layoffs and shutdowns across the country, and no amount of venture capital seems to provide such immunity. Beginning mid-2022, we have seen the who’s who and what’s what of startups fall or fumble.

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