Famous Pakistani Startup, Cheetay Is On Brink Of Shutting Down

2023 posed significant challenges for Pakistan’s economy. Pakistan has been navigating through a sharp slowdown, escalating inflation, and a near-default situation. Due to continuing uncertainty and a serious decline in funding, several Pakistani startups are either planning to shut down operations or undertake massive layoffs. Cheetay, B2B startup Dastgyr, the Electronic Monetary Institute (EMI) known as YAP, and fintech company Paymob are four prominent startups facing the heat. One of these startups, Cheetay is on the verge of shutting down. Sources claim that the remaining have been downsizing significantly with staff members cutting up to 85%.

Cheetay to shut down permanently

For all those unaware, Cheetay is a famous startup co-founded by brothers Ahmad Khan and Majid Khan in 2015. It is an online food delivery platform, a competitor to FoodPanda in the food delivery space. Cheetay also launched a grocery delivery arm at the start of the pandemic, dropshipping grocery items from physical stores to the doorsteps of customers. It became quite popular and a quick commerce model due to dropshipping allowing dark stores to do deliveries swiftly.

Political instability in Pakistan has been a persistent challenge that has hampered the country’s economic growth and development, especially the growth of the startup ecosystem. It has created an environment of uncertainty and unpredictability. For startups in Pakistan, political instability resulted in disruption of supply chains, increased costs, and negatively impacted consumer confidence. It made it quite difficult for startups like Cheetay to access capital, talent, and other resources, which are essential for their growth and success. Cheetay has been facing the heat for three years and now the company is going to take the unfortunate decision of shutting it down permanently. Last year, Cheetay let go of half of its staff. It shut its food delivery operations and was only operational as an aggregator for restaurants. Now, the startup will be shutting down all operations including the quick commerce business. Some of the main reasons Cheetay has to take this tough decision include the current high-inflation environment of Pakistan, the global dearth of risk capital, and the need for sustainability in business.

High-ranking sources at Cheetay recently disclosed that the company was planning to shut down and a formal statement ensuring the news is expected soon. Cheetay official stated:

“As a business, it doesn’t make sense anymore. There isn’t enough demad for an immediate grocery service because quick commerce has a high-burn business model.”

Other than Cheetay, Dastgyr, YAP, and Paymob also need a helping hand to survive. They have been taking massive layoffs and downsizing significantly. So, let’s wait and watch if they combat the economic troubles or not.