A $20 million US Shariah-compliant seed fund has been established by the Malaysian social finance platform Ethis Group in collaboration with the venture capital company Gobi Partners.
Initally concentrating on companies in the ASEAN and Middle East and North Africa areas, the joint fund will invest in firms that adhere to Shariah law.
The investment vehicle, whose first closing is scheduled for the end of the year, supports businesses that provide products for Muslims.
“The establishment of this joint fund will allow us to channel investments into tech startups driving change and making an impact,” said Ethis COO Mohamed Shehzad Bin Mohamed Islam. “Venture capital is in high demand and suitable for ethical investment.”
Gobi Partners helps early- to growth-stage entrepreneurs in developing and underrepresented regions from its bases in Malaysia and Hong Kong. Over 320 firms have received funding from the VC company thus far.
The networks of entrepreneurs in Gobi and the connections in Shariah-compliant investment that Ethis has are expected to help the joint fund, according to the firms.
Even though Muslims may make up over a third of the world’s population by 2060, their “digital requirements remain mostly unmet or unfulfilled,” according to Thomas Tsao, a co-founder of Gobi.
“Through this partnership with Ethis and the creation of this dedicated fund, we will now be able to fund, nurture, and support even more Muslim entrepreneurs,” he added.
