Islamic venture capital: Key to knowledge-based economy
FAILURE is a mark of success in venture capital.
Today, Islamic venture capital is a feel good theory presented at conferences about the lofty goals of this niche market with the focus on the formalism of structuring and screening. Its impact investing, yet we see it as a cost (at best) and a write-off (at worst).
The chairman of Malaysia’s Securities Commission, Zarinah Anwar, stated in a keynote speech in 2007, “… how can Malaysia distinguish itself in the emerging market VC (venture capital) pool? Our belief is that Islamic VC provides that distinguishing factor.” Obviously, the industry needs to catch-up to the vision of the chairman, according to a report in Business Times.
To date, Islamic finance has missed two important opportunities: Addressing the “have nots” (micro-finance) and deploying the funds of the “haves” into Islamic VC funds. Yes, VC is labour intensive requiring specialised skills, entails active risk capital as part of portfolio and a long-term play, much like Sukuk, in hold to maturity portfolio or lock up periods in real estate and private equity. >>More here