Airlift’s Rise and Fall is one of the most significant stories in Pakistan’s startup ecosystem. Launched in 2019, Airlift quickly became a symbol of tech ambition, raising over $110 million, including a record-breaking $85 million Series B round, the largest ever in Pakistan’s tech ecosystem at the time. What began as a mass transit platform pivoted to quick commerce during COVID-19, aiming to revolutionize same-day delivery in the country.
But by July 2022, the company announced a complete shutdown. The startup that had once captured global investor attention collapsed under the weight of unsustainable growth and misaligned business fundamentals.
So what exactly went wrong? And more importantly what can early-stage startups and founders learn from Airlift’s downfall?
Airlift’s Rise and Fall: How Rapid Growth Fueled Early Success
Airlift’s initial model focused on app-based mass transit, targeting inefficiencies in public transport. The company quickly gained traction in urban centers like Lahore and Karachi. During the pandemic, it pivoted to a quick-commerce model Airlift Express offering groceries and essentials delivered in under 30 minutes.
Its Series B round attracted top-tier investors like Quiet Capital, Harry Stebbings, and First Round Capital, with promises of disrupting traditional commerce in South Asia. With millions in funding, Airlift expanded operations aggressively, launched in new cities, hired rapidly, and invested heavily in tech and warehousing.
At first glance, it seemed like a textbook case of rapid scale. But cracks were forming behind the scenes.
Airlift’s Rise and Fall: Key Factors Behind the Collapse
- Unsustainable Burn Rate
Airlift’s operational costs ballooned as it raced to scale. Heavy investment in warehouses, logistics, and headcount wasn’t matched by revenue or unit profitability. The quick-commerce model, already challenging in developed markets, became harder to sustain in Pakistan, where consumer margins are thinner. - Over-Pivoting Without Stabilizing
Switching from transport to q-commerce was strategic, but not enough time was invested in stabilizing the new model. It was a massive operational shift that required completely different infrastructure and economics. Yet the company continued to scale before proving the model’s viability. - Over Reliance on VC Funding
Airlift’s business model was heavily dependent on investor capital. When global VC sentiment shifted in mid-2022 amid economic downturns, the company failed to secure its next funding round. Without a safety net or a break-even point in sight, it collapsed quickly. - Lack of Focus on Core Economics
The obsession with growth overshadowed fundamental metrics like customer lifetime value (CLTV), customer acquisition cost (CAC), and operational efficiency. When investor money dried up, so did the ability to sustain operations.
Key Takeaways for Startup Founders
Airlift’s story is not just a cautionary tale, it’s a masterclass in the real cost of unbalanced growth. Here are five essential lessons every founder should internalize:
- Prove the Model Before Scaling: Validate product-market fit, unit economics, and core operations before aggressive expansion.
- Manage Cash Prudently: Rapid scaling must go hand in hand with financial discipline. Don’t let a big funding round give a false sense of stability.
- Have a Plan B for Funding: Always build a buffer. Relying entirely on future rounds can backfire if the market shifts.
- Don’t Pivot Blindly: Strategic shifts require deep understanding, timing, and resources. Avoid switching lanes unless absolutely necessary and well-researched.
- Sustainable > Spectacular: In the end, sustainable growth will always outlast hype-driven sprints.
Final Thought on Airlift’s Rise and Fall
Airlift’s shutdown sent shockwaves through Pakistan’s startup landscape but it also brought a much-needed reality check. As ecosystems mature, discipline, focus, and sustainability must guide innovation.
Founders building in emerging markets must remember it’s not about how fast you grow, it’s about how well you build.