Indonesia has never lacked halal ambition. What it lacks is money willing to back that ambition.
Two weeks ago, at the 13th Indonesia Sharia Economic Festival (ISEF) in Jakarta, a coalition of regulators, investors and universities launched the Indonesia Halal Innovation and Venture Ecosystem (I-HIVE). The aim is to fix the second problem.
I-HIVE brings together 26 partners. They include Bank Indonesia, the National Committee for Islamic Economy and Finance (KNEKS), financial regulator OJK, planning agency Bappenas and five ministries, alongside investors, banks, industry associations and universities. The pitch is simple: give Indonesian startups building halal products a single route to local and global investors, make them strong at home, and then send them abroad.
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The timing is deliberate. Startup funding in Indonesia fell to US$355.7 million across 91 deals in 2025, down from roughly US$6.9 billion at the 2021 peak, according to DiscoveryShift’s Indonesia Startup Report 2026. Economic think tank Celios estimates that only about 10 per cent of venture capital in the country’s digital economy comes from domestic sources.
That leaves founders dependent on foreign money that has largely gone elsewhere. The market is in what Tracxn described as a structural reset. Ajaib’s US$270 million raise in August was Indonesia’s biggest tech round since 2022. It was also the exception that proves the rule.
Demand is real, and now it is mandatory
The demand case is stronger than the funding case. The State of the Global Islamic Economy Report 2025/2026 puts Muslim consumer spending across six real-economy sectors at US$2.6 trillion in 2024 and projects US$3.56 trillion by 2029. The same report ranks Indonesia fourth globally. Bank Indonesia says the country’s halal value chain grew 5.5 per cent year on year in Q2 2026, faster than the wider economy.
Regulation adds urgency. The phase-in period for halal certification of food, beverages and slaughter products made by micro and small businesses ended on 17 October 2026. The scale is enormous. More than 9.6 million products had been certified by 2025, and the government planned 1.35 million free certificates for small businesses this year. That creates a large, slightly panicked customer base for compliance, traceability and supply-chain software. It is the kind of halal integrity problem technologists have pitched solutions for since before the pandemic.
The caveat is that the halal agency has said enforcement will begin with guidance and supervision rather than sweeping raids. Soft enforcement means softer urgency. And Indonesia’s MSMEs are big in number but weak in value. Millions of warung owners needing a certificate does not automatically translate into millions willing to pay for software.
What I-HIVE actually does
I-HIVE organises the ecosystem as a single pipeline. Startups move from venture formation through incubation, halal and investment readiness, and financing and market access, to scale. The pipeline connects eight groups of actors, from Sharia assurance bodies to Islamic social finance institutions.
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I-HIVE will also run a sandbox for halal startups, in line with KNEKS’ roadmap, which targets acceleration in 2026 and 2027 and scale by 2030.
“What holds many back is access to investors who understand Sharia-compliant business and will stay with them as they grow,” said Helma Agustiawan, Deputy Director of Islamic Business Incubation at KNEKS.
What I-HIVE does not have, at least publicly, is a pooled fund or committed capital. It is a coordination layer. That is useful in a market where founders bounce between ministries, certifiers and investors. But 26 partners is also a recipe for a very long WhatsApp group. Coalitions of this size tend to succeed or fail on whether one or two members do the heavy lifting.
HASAN.VC wants to be that member
The most obvious candidate is founding collaborator HASAN.VC. Its Labuan-domiciled early-stage fund is backed by angels, family offices and waqf (Islamic endowment) funds across Southeast Asia, the Gulf and North America. The firm has built its thesis around ethical, halal investing and resilient “camel” startups rather than cash-burning unicorns.
It says it has backed 15 Indonesian startups over the past two years, which would make it among the country’s more active investors in a market with only 91 disclosed deals last year. The demo day it co-hosts with KNEKS shows both progress and scale.
In 2024, HASAN.VC was the sole investor behind Rp3.4 billion (about US$200,000) in deals. Deal value rose to Rp21.1 billion in 2025 and about Rp35 billion (around US$2 million) in 2026, a tenfold jump in two years. That figure spans both investment and trade, though, so not all of it is equity. And US$2 million is less than one per cent of a single Ajaib round.
HASAN.VC plans two more Indonesian investments before year end and a larger push in 2027. “What its startups need most is patient capital that shares the risk with them,” said General Partner Umar Munshi.
On stage, Munshi urged Indonesian investors to step up, arguing that local participation gives foreign investors confidence. It is the right message. It is also a hard sell in a year when prosecutions have rattled the venture community. Domestic investors have watched startup failure being treated as a potential crime, and that does not encourage risk-taking.
Gulf money and Dutch expertise
The cross-border corridors may matter more than the domestic pitch. Moria Ventures, a Jakarta-based Islamic investment firm, connects Saudi and Gulf investors with Indonesian companies. After several project-financing deals, it began venture investing six months ago and has made two investments. HASAN.VC has also invested in Moria Fund, Moria Ventures’ fintech business, in a corner of the market where Islamic fintech’s revival is still unproven. Partners backing partners is a sign of commitment. It also means the circle is still small.
“Saudi Arabia has the resources and the Vision 2030 mandate to deploy it,” said Moria Managing Partner Husni M. Bajamal. Gulf interest in Southeast Asia is rising across tourism and trade. But Indonesia competes for that money with Malaysia’s long-established Islamic finance ecosystem, and Gulf investors have historically preferred late-stage deals to seed cheques.
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From Europe, PUM Netherlands brings 1,200 volunteer experts who advise SMEs in more than 30 countries. PUM was founded in 1978 by the Dutch Ministry of Foreign Affairs and employers’ federation VNO-NCW.
The real test
I-HIVE gets the diagnosis right. Indonesia’s halal founders sit on top of a growing, now partly mandated market, and they cannot raise money. A shared pipeline, a sandbox and investors who understand Sharia structures are all sensible fixes.
But the bottleneck is capital, not coordination. Next year’s ISEF will show whether I-HIVE has moved real money, and whether any of it came from Indonesian pockets.
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