Adaverse, a seed fund with a focus on scaling Web3 solutions has invested an undisclosed sum in Saudi Arabia-based fintech Takadao, making it the first venture capital fund in the Kingdom to specialise in Web3 and blockchain early-stage investing.
Founded in 2022 by Sharene Lee and Morrad Irsane, Takadao offers its users two Shariah-compliant blockchain-based services, savings and loans and cooperative life insurance.
In addition to Takaturn, a savings and yield generation platform that enables collective savings and liquidity access, the new investment will help Takadao launch its flagship product, Takasure, in June 2024.
Takasure, is a cooperative life insurance DAO (Decentralised Autonomous Organisation), a model where members pool funds for mutual insurance, redistributing profits among members. A key difference from traditional financial services is its ability to leverage blockchain technology to enhance transparency and reduce costs, offering community-driven, halal insurance and financial solutions.
Local Web3 startups
For Adaverse, an initiative by EMURGO, the global blockchain technology firm and a founding member of the Cardano blockchain platform, the investment is part of plans to invest $10 million in local Web3 startups in 2024.
In October last year, Takadao raised a $1.6 million pre-Seed round, led by Silicon Valley-based investor Tim Draper, along with BIM, Core Vision Ventures, and Prince Sultan bin Fahad bin Salman Al Saud.
Vincent Li, Adaverse’s founding partner, said: “Adaverse’s entry into Saudi Arabia with Takadao is more than an investment; it’s our commitment to elevate solutions that solve everyday challenges and empower communities. Takadao, with its groundbreaking and community-centred approach, adeptly meets essential everyday needs, and we’re enthusiastic about backing this fusion of tangible innovation and market opportunity.”
Morrad Irsane, Co-Founder of Takadao, added: “Partnering with Adaverse propels us forward in our journey. Their expertise in the web3 space, coupled with their deep-rooted connections in key markets, accelerates our knowledge and community-building efforts.”
The emergence of Shariah-compliant financial services
Shariah-compliant financial services are rapidly emerging as a significant force in the global financial landscape. Currently, these services, which encompass banking, capital markets, money markets, and Takaful (Islamic insurance), are estimated to be valued at around $2 trillion.
Most of the sector’s accelerated growth is coming in Muslim countries where Islamic banking assets are growing at a faster pace than traditional banking assets. The trend is largely being driven by strong economic growth and strategic development plans, especially in markets like Saudi Arabia, where the corporate sector is playing a pivotal role in increasing the volume of Halal financial transactions.
Despite Shariah-compliant insurance serving the fast-growing Muslim demographic, which accounts for 24% of the global population, it currently represents less than 0.5% of the $5 trillion global insurance industry. With the Islamic finance sector anticipated to grow by 10% annually and reach around $5.1 trillion by 2028, Takadao will be looking to make further inroads in key regions like Saudi Arabia where this market is expanding.
