Ethis Group and Gobi Partners to unveil Shariah-compliant $20m seed fund

By Leandra Monteiro

Ethical investment and social finance platform operator, Ethis Group, having launched EthisX as part of its global expansion plan, continues to expand by collaborating with pan-Asian venture capital firm, Gobi Partners, to set up a $20 million Shariah-compliant seed fund.

The partnership is aimed at capturing the growth of start-ups in the Halal economy where start-ups adhere to Shariah law, and thus their products are built to serve a large Muslim community. The geographic presence of Gobi and Ethis in markets with large Muslim populations bode well for the joint fund to invest in these start-ups. Furthermore, the fund’s focus on the broader ethical investment agenda resonates well with the post-pandemic emphasis on Environmental, Social, Governance and sustainable investments that also stretch beyond the Muslim community.

The Fund, which is targeted to have its first closing by the end of this year, is notable for being Ethis Group’s first move into the venture fund space as well as Gobi Partners’ first-ever fully Shariah-compliant fund.

“The establishment of this joint fund will allow us to channel investments into tech startups driving change and making an impact. Venture capital is in high demand and suitable for ethical investment,” said Mohamed Shehzad Bin Mohamed Islam, Chief Executive Officer of Ethis Investment Platform LLC (EIP).

“We are excited to partner with Ethis Group in creating this new Shariah-compliant Fund, which is very much in line with our existing TaqwaTech focus. Muslim consumers represent a US$2.2 trillion market opportunity, and the Muslim community is anticipated to make up more than 31% of the world’s population by 2060, however, the Muslim community’s digital needs are largely unmet or underserved. 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,” said Gobi Cofounder, Thomas Tsao.

Once launched, the joint Fund will invest in Shariah-compliant start-ups globally with an initial geographic focus in the MENA as well as the ASEAN regions. EthisX’s presence in the Sultanate of Oman in particular is timely as it can have direct access to the growing investment opportunities supported by the Oman Vision 2040 which emphasised the diversification of its economy, development of the FinTech industry and digitisation efforts by the authorities.