Halal-Preneurship: Halal Tech Building a Digital Halal Ecosystem

The Makkah Halal Forum continued its groundbreaking discussions with a dynamic panel on “Halal Entrepreneurship and Funding,” shedding light on the challenges and opportunities faced by Sharia-compliant startups in today’s competitive market. Moderated by Dr. Wael Eldesouki Bedda, Secretary General of the Saleh Kamel Sustainable Entrepreneurship & Enterprise Development Organization (SKSEED), the panel featured Ms. Tulay Kabatas Salva, Head of Capital Markets Funding Department at Albaraka Türk Katılım Bankası AŞ, Turkey; Mr. Morrad Irsane, Co-Founder and CEO of Takadao, an innovative Islamic financing platform; and Mr. San, Founder and CEO of Duru, a Halal streaming app based in Malaysia. Together, they explored the critical role of funding, innovation, and Islamic values in driving the growth of Halal entrepreneurship.

With the global Halal economy projected to reach $3.2 trillion by 2024, the discussion highlighted the urgent need for Muslim investors, financial institutions, and entrepreneurs to collaborate in building a sustainable ecosystem for Sharia-compliant businesses. Here’s a comprehensive breakdown of the key insights and actionable strategies shared during the session:

Mr. Morrad Irsane kicked off the discussion by addressing the unique challenges faced by Sharia-compliant startups in raising funds. He emphasized that while traditional venture capital (VC) firms often dominate the funding landscape, their terms and conditions frequently conflict with Islamic principles.

Key Insights from Mr. Irsane:

• Challenges with Traditional VCs: Many VC contracts include non-Sharia-compliant terms, such as interest-based clauses or unethical exit strategies, making it difficult for Halal startups to secure funding.
• Pushing Back Against Non-Compliant Terms: Entrepreneurs must advocate for Sharia-compliant terms in investment contracts, even if it means walking away from lucrative deals.
• Role of Muslim Investors: Mr. Irsane called on Muslim investors to take more risks and actively support startups that align with Islamic values. He stressed that building a robust Halal ecosystem requires not just capital but also mentorship and strategic guidance.

Ms. Tulay Kabatas Salva provided a deep dive into the thriving Islamic banking sector in Turkey, known locally as participation banking. She highlighted how government initiatives and increasing demand for Sharia-compliant financial services have fueled the sector’s growth.

Key Insights from Ms. Salva:

• Government Support: Turkey’s government has played a pivotal role in promoting Islamic banking through favorable policies and regulatory frameworks.
• Digital Transformation: Islamic banks in Turkey are leveraging technology to enhance customer experience, offering mobile banking, digital wallets, and AI-driven financial solutions.
• Albaraka Garage: Ms. Salva shared how Albaraka Türk’s startup incubator, Albaraka Garage, is supporting entrepreneurs by providing funding, mentorship, and access to a network of industry experts.

Ms. Salva’s insights underscored the potential of Islamic banking to drive innovation and entrepreneurship while adhering to Sharia principles.

Halal Media and Content: Building a Global Muslim Audience

Mr. San, the founder of Duru, a Halal streaming app, shared his journey of building a media company that aligns with Islamic values. He highlighted the challenges of creating Halal-focused content and the importance of tapping into the global Muslim market.

Key Insights from Mr. San:

• Challenges in Halal Media: Building a Halal-focused media company comes with unique challenges, such as balancing creativity with adherence to Islamic values and competing with mainstream platforms.
• Global Muslim Market: Mr. San emphasized the untapped potential of the global Muslim market, which represents over 1.9 billion people. His success in raising funding from Y Combinator, a leading Silicon Valley accelerator, demonstrates the growing interest in Halal-focused startups.
• Investment in the Creative Industry: Mr. San called for more investment in the creative industry to build a sustainable Halal media ecosystem. He argued that Halal content has the power to shape narratives, promote positive values, and connect Muslim audiences worldwide.

The panel concluded with a powerful call to action for all stakeholders in the Halal ecosystem. The experts agreed on the following key takeaways:

1. Pitching to Non-Muslim Investors: Muslim entrepreneurs should not shy away from pitching to non-Muslim investors, as long as their business models are Sharia-compliant. The global appeal of Halal products and services presents a significant opportunity for growth.
2. Role of Islamic Banks: Islamic banks and financial institutions must play a more active role in supporting Halal startups by providing Sharia-compliant funding, mentorship, and access to networks.
3. Collaboration and Innovation: Building a sustainable Halal ecosystem requires collaboration between entrepreneurs, investors, and financial institutions, as well as a commitment to innovation and ethical practices.

The Halal economy is one of the fastest-growing sectors globally, with immense potential to drive economic growth, create jobs, and promote ethical consumption. However, the lack of Sharia-compliant funding and support for startups remains a significant barrier. The insights from the Makkah Halal Forum panel provide a roadmap for overcoming these challenges and unlocking the full potential of Halal entrepreneurship.

By fostering collaboration, embracing innovation, and adhering to Islamic principles, the Halal ecosystem can thrive and contribute to a more equitable and sustainable global economy.

The Makkah Halal Forum continues to serve as a platform for thought leadership and collaboration, driving the Halal industry toward a future that is not only profitable but also principled. As the panelists aptly demonstrated, the journey toward a thriving Halal ecosystem is a collective effort—one that requires vision, commitment, and unwavering adherence to Islamic values.

Stay tuned for more updates from the Makkah Halal Forum as we explore the latest trends, challenges, and opportunities shaping the Halal industry.