Muslim Money Talk
Introducing the Muslim Money Talk Podcast, a place for all things Muslim and Money related.
Every week we'll be sitting down with Founders, leaders and industry experts from across multiple disciplines to discuss lessons learned, mistakes made and most importantly 'How they did it?'.
Brought to you by Kestrl: The Muslim Money App, software to help Muslims grow their wealth without compromise. Find out more here: https://kestrl.io/
Muslim Money Talk
More MUSLIMS Should Become Entrepreneurs! | Areeb Siddiqui - Muslim Money Talk Ep 22
In today’s episode we’re flipping the script and interviewing our host Areeb Siddiqui- the founder of Kestrl: The Muslim Money App!
Driven to leave the corporate world by his growing discomfort working around interest- Areeb discusses his MBA at Cambridge, inspiring stories about money from the Quran and Hadith, and why Muslims are so poor with money today.
Special thanks to Ali Siddiqui (Areeb’s brother) for stepping into the host’s seat this week!
This podcast is powered by Kestrl.
Kestrl is an app that helps Muslim to grow their wealth without compromising their beliefs
Kestrl - The Muslim Money App
https://kestrl.io/
Show Notes:
00:00 - Coming up
02:02 - Intro
03:17 – From Physics to Finance
05:57 – The need to experiment
07:14 - What you study doesn’t matter!
09:21 – Deloitte grad scheme
13:30 - Islamic Finance at Deloitte
15:31 – Understanding salary bands and consulting culture
22:01 - Lessons from the du’a of Prophet Suleiman AS
28:52 - the Cambridge MBA: Should you do it?
32:57 - Finding a Co-founder and the inspiration for Kestrl
36:17 - Speaking to 3000 Muslims
39:01 – Going full-time, fundraising and early business models
48:35 - Tying your camel before you invest
53:55 - Dark Days: Money struggles and becoming a dad
56:33 – B2B partnerships, profitability and the blessing of children
59:40 - Kestrl’s name and branding for Muslims
1:03:57 – Using open banking for boycotting and upcoming features
1:06:40 – A.I in Islamic finance
1:11:08 – Money lessons from the first Muslims
That's right. I am not a Reeve Siddiqui, but I am a Siddiqui and I'm joined today by Guys. I was in full flow. That was very good. Can I quickly film a thing where I talk about only 10% of you subscribed? Can that come from me on this episode?
Speaker 3:Okay, 95% of people told us that they really strongly desired an alternative to conventional financial services. But then, when we asked them, are you currently doing anything about it? Are you using any of these Islamic banks or these fintechs that are coming up? Only 3% of them said yeah, they are. When you're running a startup, I think the best founders are constantly experimenting. Right, you have this idea, you have this hypothesis about what's going to work in our case. Muslims want to bank and invest in a way that aligns with their faith. Here's the best way to do it, whether it's with our consumer app, with a budgeting tool, with xyz. We have privileges, yeah, we have unfair advantages. We have skills and talents. We should be using those things to follow in the footsteps of the giants who came before us, to take control of our finances, invest in our future and, ultimately, for our akhiras.
Speaker 1:My next guest also my first guest is someone who needs no introduction. I am not Areeb Siddiqui, but I am a Siddiqui, and I am joined today by the Siddiqui, areeb Siddiqui. But I am a Siddiqui and I'm joined today by the Siddiqui, arif Siddiqui, the founder and CEO of Kestrel, the Muslim money app. Today, we'll be exploring his journey how he went from a corporate career in the city to an MBA at the University of Cambridge and then finally on to Kestrel itself, what it is, why it is and what it looks to do in the future, as well as anything and all things related.
Speaker 1:Before we go further, we just noticed that only about 10% of you subscribed. That's really not good enough. I think if you looked at the amount of content that you're benefiting from on this channel, you'd really want to subscribe so you can get that straight into your inbox. So if I were you, I'd go and click the subscribe button right now and benefit from more of this content. So, without further ado, I really thank you so much for joining me. It sounds weird to be just calling you, uh, by your name. Also weird to be sitting in the guest seats once again, despite now being the host. So, if I may start off this podcast by making a something of a reference, I might say well, well, how the turn tables well this was a lot for our usual, so for our usual listeners.
Speaker 3:you may be wondering what is going on. Um, a few people had said they wanted me as the guest, so we've turned the tables and, yeah, I'm the guest, and a lot of people really liked, uh, having my brother on the show and what it was like, and apparently I don't know why. So we brought him in as host today. So, yeah, he's taking that responsibility very seriously. Why am I staying in the usual seat? Because I like this side of my face better, so thanks for calling that out.
Speaker 1:It's good of you to admit that on camera.
Speaker 3:It's been a rush today, to be honest. It's like I don't't know. We were late into the studio and I should have got a haircut before this and, uh, I don't know, I shall, I'll go I did that on your behalf yes, um there you go.
Speaker 1:So I actually want to start off with something a little bit different, which you don't normally get asked about, which is just before any of this, before what's now this sort of sprawling thing that is kestrel wind, the clock right back. What did you study at university?
Speaker 3:oh, yeah, so I did my undergraduate degree at university college, london, ucl, same as you, but I did physics, actually with more of a lean towards astrophysics so, so talk to me about that.
Speaker 1:Was there any indication or hint at the time that finance, let alone islamic finance, might be something that you were interested in, or was this something just completely?
Speaker 3:out of my field.
Speaker 1:I mean look.
Speaker 3:I think, like many Muslims in this country, I didn't really have much of an idea of Islamic finance growing up. I think I'd heard whispers of it at university. Everyone knew that interest or riba, was non-Turiyah compliant and we should avoid it. We didn't have savings accounts for that reason and I think it mainly came into my mind when it came to the concept of a student loan, which I think is a very emotive issue today, where a lot of students are figuring out should we go for a student loan? Is university even on the agenda for me, and different scholars, as you know, have different takes on that situation.
Speaker 3:But no, I didn't have an idea of Islamic finance when it came to financial services, that was a very different story. So, as you know, our father has been in financial services for close to 40 years now and I think, whether you like it or not, you are greatly influenced by your parents and what they have done before you. So I think growing up there was always this idea that at some point I'm going to end up in and around financial services.
Speaker 3:I'd done you know I don't want to say internships, but during school, like between GCSEs and A-levels, I'd gone and shadowed him at work for like two weeks and lived in the city and saw what that life was like. So I always just thought that was what was going to happen. And physics was my little way of rebelling, almost in that I didn't want to just go and do economics at LSE and do the usual kind of path to banking. I actually really wanted to do zoology. That was my real passion, especially, as you know, into big cats and tigers especially. That's really what I wanted to do. But coming from a background like ours most immigrant backgrounds, even non-immigrant backgrounds a lot of parents are very concerned with how on earth you're going to be making a living even non-immigrant backgrounds a lot of parents are very concerned with how on earth you're going to be making a living.
Speaker 3:And me being the eldest child the eldest of the three of us brothers I think my parents were particularly focused on what on earth I was going to be doing.
Speaker 3:I was the first one, the experiment, out of all of us, I guess. So yeah, they were okay with me doing physics. It wasn't quite econ or maths or finance, but it was. There was strong enough, uh, previous evidence of people studying degrees like physics or like mathematics and then ending up with roles in the city that they were kind of okay with it interesting and and is there any part of your degree that you would say you've kind of used today or have used in recent working history?
Speaker 3:usually I would say no, but really thinking used today or have used in recent working history? Usually I would say no, but really thinking about it. The part I loved about my degree the most was the experimentation. So we would spend about six hours a week in the lab and when you're running a startup, I think the best founders are constantly experimenting. Right, you have this idea, you have this hypothesis about what's going to work In our case.
Speaker 3:Muslims want to bank and invest in a way that aligns with their faith. Here's the best way to do it, whether it's with our consumer app, with a budgeting tool, with X, y, z. But you want to be constantly iterating and testing out that hypothesis in as quick a means and methodology as possible. So a lot of founders and startup advisors today say that you should try and be rapidly testing within like two week periods, a sprint and whatever you can do in there. So I guess in that way yeah, there are a lot of carryovers between the science or science and the scientific methodology and running a business, especially in the startup stage.
Speaker 1:Okay, that's interesting. I hadn't thought about that connection before between experimental physics or being in a lab versus running a business.
Speaker 3:I will just say, from like an elder brother perspective, you did benefit from me. I'm not denying that.
Speaker 1:No no, it's a separate topic. No, but what I'm?
Speaker 3:saying is what did you study at university? So I studied classics right, yeah, so classics, what is?
Speaker 1:that dead languages.
Speaker 3:That's a controversial statement and one that we can get onto, maybe in a separate podcast but I think, but I want to make this point that, yeah, you studied Latin and ancient Greek.
Speaker 1:Yeah, with the understanding that I would always do do law after that. Sorry to any of my professors who are watching this, sorry to break your heart, but yes, the idea was that I would eventually do a vocational subject, so I would just-.
Speaker 3:And you're a lawyer today, but I think the point is for anyone who's watching and listening and thinking oh what on earth should I be doing at university? The big takeaway for me something I really wish I knew before applying was that it doesn't for most careers it doesn't really matter what it is that you study at university, unless you're going in to do medicine or to become an architect or something of that ilk. In reality, all that really matters when it comes to applying for these roles, whether it's in the city or in marketing or, in some cases, like data science as well.
Speaker 3:All they really care about is the brand of the university.
Speaker 1:Yeah, and to a lesser extent perhaps how well you do at the subject, for sure, but in most cases, as long as you've got a 2.1, then you're fine. Yeah, no, it's.
Speaker 3:But I think, if anyone is thinking about it, I would say look at what you are best at right now, whether it's English, lit or maths or French, and don't worry about what people are saying and just think where. What is the highest ranked university that I can get into, because most employers, I think, care about that the most, whether it's fair or not. I'm not saying it is fair.
Speaker 1:In most cases it's not yeah there is a preference for that yeah, it's a weird world in which we operate. I think that there have been attempts for that to change in recent years, but broadly speaking, I think that trend still follows that the, the name and the prestige, I suppose, of where you studied, is still an influential factor in yeah applications, and I think that's a good segue, because I was going to go on to then you telling us about your journey then at the beginning of your career. So you started at deloitte, yeah, so tell us about about that, like um, what was the inspiration for that? Where did it lead to?
Speaker 3:how did you find it there. So I was in my second year of university, having done physics at UCL, and there was, I think, the group of us that my friend group and those who were studying with me. They were split into two camps. There was a group that was quite content and wasn't really concerned about the future because they were going on to do masters and they were going to do PhDs and stay within this university and maybe some of them were thinking about other places like Imperial or Oxbridge. But then there was another group who were really focused on getting out and what that would be. So I think that was really where I fell into and I was thinking should I be applying for summer vacation schemes? So I showed off applications not really that targeted. I kind of knew that I wanted to look at big four firms, big four firms being Deloitte, pwc, kpmg and EY or Ernst Young, kpmg and EY or Ernst Young and those are the big four consulting, advisory and accounting firms that are here. So I showed off applications to each of them. The first one that came back was Deloitte and, really interestingly, they said sorry, our summer vacation scheme is actually full. So I thought this was a standard rejection email.
Speaker 3:But, alhamdulillah, I actually ended up reading the rest of it and they said but if you would like, do you want to apply for a grad scheme? And I wrote back and said look, I've not finished university, I've got another year to go for undergrad. And they said that's fine, if you pass this interview stage, we'll hold the place for you for a year, as long as you get a 2.1. So, alhamdulillahillah, it was quite a relatively unique situation. Most people do internships in their second year with the idea that, if it goes well, they may be given a job offer at the end of it. So I went for that. Um, it was quite a standard process. You go in for this assessment center where you have to pretend like emails are coming in to this, you log into this computer pretend emails are coming in.
Speaker 3:You need to prioritize and figure out which one to reply to. There's no spell check. They test really weird things at these companies.
Speaker 1:It can be quite weird.
Speaker 3:I did some of those as well. And then there's an assessment with a senior manager within the team where they're just asking you tell me about a time you had to deal with a problem, or you worked in a team or you felt like you made a mistake, and all those kinds of questions. But those interviews the best ones are really when it turns into more of a general chat is what I find and they pick out something interesting on your CV and really hone in on that.
Speaker 3:For me, I was writing blogs in the science space, so they really like that, and I also used to make silly videos about science, which they liked as well. So, again, nothing to do with what I was actually going to apply for, which was consulting in the financial services space.
Speaker 3:And then the final thing was I had to give a presentation, a presentation on what I thought was going to happen to the asset and wealth management industry over the next five years. So I gave that to two partners and then, yeah, alhamdulillah, I ended up getting in.
Speaker 3:And did what you projected for the next five years come to fruition I don't even remember what I said, to be honest, but I remember rethinking I I really like this presenting thing I'd done it before at university and at school, but I'd never done it in the context of like a career, yeah, but I really liked getting up there and and slimming down, trimming down the slides so that they were present, presentationally more efficient and all that kind of thing. Um, but yeah, I got in. So I did my final year. I'd said bye-bye to my master's, I wasn't going to do that and I started on a three-year graduate scheme and you asked me what I liked about it. I loved it. I think a lot of people have mixed feelings about this, but I really really enjoyed my three years at Deloitte because it felt like university phase two almost, because suddenly you're in there with people your age, similar ish background to you or from you know all kinds of different areas as well, but you're all studying together, you're working together and you're just suddenly exposed to this entire world which you didn't even imagine was actually out there before which in my case was banking and wealth management and
Speaker 1:thankfully, fintech began to come to the forefront there as well, yeah, yeah, and you talk about it being university phase two. I guess part of that is the fact that, especially at the big four, there tends to be very large muslim networks. So what was that like, and did that influence or start to sow the seeds of, you know?
Speaker 3:yeah, I mean that was my first interaction with islamic finance actually. So at the time deloitte mus Network was big I think out of all the corporate networks in London they were the biggest out there and they would do regular events, big Eid parties, ramadan events, all of that. I think the closest thing to that right now is arguably the EY Muslim Network. It's cyclical like that, but through that we were assigned mentors, like if you wanted, you could sign up to a mentor within that, and my mentor that was assigned to me was a lady called Hazra Munshi. Hazra, if you're listening, she's a shareholder over at Kestrel now and is a very senior director over at Deloitte, but based in Dubai now actually.
Speaker 3:But Hazra had the idea of putting on a series for Islamic finance within the firm.
Speaker 3:So there was this idea that we weren't doing enough in Islamic finance for our clients over in the Middle East in particular, and so we should be upskilling our staff. So we would bring in experts similar to this podcast, actually thinking about back on it so we'd bring on people like Faisal Qarbani, who runs Simply Ethical to talk about the idea of what makes a Sharia-compliant investment, and anyone could dial into these webinars and we would get sometimes hundreds of people from all across the global Deloitte network dialing into this to learn about Islamic finance, and that was my real first exposure to this. At the time, when I was thinking about careers in the space, though, I would look into what was already out there arian bank, then known as islamic bank of britain, and gatehouse would come up, but they weren't really things that places where I could really see myself building a career yeah, for myself. It seemed almost like everyone there was very, very senior yeah, yeah, they don't really have grad schemes but that was my first exposure to islamic finance that's interesting.
Speaker 1:Yeah, I was going to ask actually what your introduction to it was. So makes sense. And then, how did you go from deloitte to um, the nba, and what was the kind of road that?
Speaker 3:so the grad scheme I loved, yeah, but the thing about being on a graduate scheme so bear this in mind for anyone who's out there or thinking about graduate schemes is that when it comes to salary bands so when I say a salary band, if you're going in at a associate or senior associate level within a company, there's a range of salary.
Speaker 3:Say it's like okay, your associate, you could be paid anywhere between 25 to 40,000 pounds. They keep that range there for negotiation purposes. People who come in from other places, who may be being paid something before, not everyone comes in straight from university. When you come in as a grad, you don't have a previous salary. You have no negotiating power. In most cases they're always going to put you at the lower end of that salary band and when you get promoted, you'll be promoted to the next lowest end of the salary band and so on and so forth. And I was made very aware of this because a friend of mine joined when I've just finished my graduate scheme. After three years, a friend of mine joined at the same level. Uh, fahad if, if he's listening is now over at barclays and we were just talking and somehow he dropped his salary into the conversation okay, and I was thinking that's really different from my salary yeah
Speaker 3:and we're exactly the same level. Awkward, Right. So I had a conversation with the partner on my team and they explained this concept yeah. And then I thought, well, I think I just need to leave and become like an experienced hire within another firm yeah, To negotiate that. So that was the idea that I can't stay in this firm forever. Until that point, I'd really drunk the Kool-Aid of Deloitte, where they had said you come in as a graduate and within 10 years you'll be a partner right and you'll be an equity owner in the firm and you'll be a millionaire and you'll have made it.
Speaker 3:When you actually join, you'll realize how difficult that actually is, and also how much politics comes in to play, as well as, especially at the time, putting putting yourselves in situations that you may not feel comfortable in as a muslim, where to ingratiate yourselves with the higher up. Sometimes you'll be in situations like there's a lot of alcohol flowing, maybe you're doing trips to the pub and um or drinks evenings and things like that as a muslim, you don't really feel like
Speaker 3:you fit in there. So, anyway, I ended up applying. I found this firm called alpha fmc alpha financial Markets Consulting. Yeah, there you go. Yeah, alpha Financial Markets Consulting. And yeah, thankfully I got a place in there and I was there for two years and that was intense.
Speaker 3:I went from a firm with thousands of people to only being one of about 120 people within this little, almost startup consulting firm. They were doing similar things to deloitte, but the difference was because there was so few of us. Despite me being still relatively junior only with about three years of experience, I was going in and being like one of only two people and in some cases the only person on a client site, facing off with very senior people like chief operating officers, chief compliance officers and having to weirdly opine on their strategies right, which was a weird situation to be in, and it really was like a trial by fire. Is that intimidating at all? It wasn't at first, but then I really saw the not genius but the secret behind consulting is really fake until you make it right, as they say.
Speaker 1:yeah, I just asked because it's very different from the legal world where, firstly, we don't really go to the client's sites, if anything they come to us. Well, these days we just have calls on Teams, and the advice is different in that respect and it's more to do with the contractual drafting and you can sort of be more behind the scenes, in a sense.
Speaker 3:Whereas with consulting, I think there's definitely a lot of that, but there's also a lot of FaceTime being important and being out there on client side and presenting this idea, there's definitely clients who take issues with it. I think this is an issue in management, consulting in general, where you'll be going in there speaking to people, sometimes double your age, and they're like what on earth, can this guy tell me about my own industry that I don't already know? On earth, can this guy tell me about my own industry that I don't already know? But often the decision to engage with consultants is being made by higher ups and I think it's affecting the consulting industry a lot in today's world.
Speaker 3:Like should people actually be paying for consultants? As a business owner today, I'd never pay for a consultant, right, right. I wouldn't really see the value in that, especially not at our stage of company anyway. But what happened at Alpha was suddenly two things happened. I was really exposed to fintechs, the world of fintech.
Speaker 3:One of the first projects I was actually on was helping one of the first robo-advisors in this country, a most well-known robo-advisor called Nutmeg, which was coming up with this model, which allowed people, for the first time, to invest, through an app, into a whole range of portfolios with different risk weightings from low risk and low returns to high risk and high returns all with the touch of a button, which, back in 2015, 2016, was still pretty new, and, of course, that's how Wahid works today Wahid Invest. So I got to work on that and come up with the strategy paper. That was one of the first things I did. The other thing that happened was the projects that really made me think I need to leave this firm. Okay, and I was a couple of years in, but it was ramadan, and it was ramadan in 2018, 2018.
Speaker 3:Okay, and if you remember back then, yeah, ramadan was really hard in this country yeah it was like 18 hour fasts and the heat was intense hay fever sure yeah, I'll never forget that I'm done in 2018 anyway yeah, it was tough, but do you remember what I was doing during that time? Yeah, you were in glasgow. Yeah, I was being sent back and forth to glasgow, which was fine, of course, that's the job, but it was intense because we thought we had it bad in London, in Scotland, the fasts were like almost 21 hours.
Speaker 1:So you've got a three-hour window to eat and drink, and pray and do Tharaweeh and all of this, and you were working there each week and you would come back.
Speaker 3:Yeah, I would fly out there three or four days a week and then I'd come back and every evening I would spend in the office time which I would usually spend breaking my fast with family at home yeah or going to the mosque to pray Tharawi prayers. Yeah, I remember sitting there eating.
Speaker 3:I think I'd ordered like a wagamama, like a, really just like a very sad meal on my own sitting at the top of this beautiful building in London I can't say which one of those it will reveal the client but this beautiful building. But I was sat there on my own at midnight whilst you and the rest of the family were all at there. Are we prayers? And I was just like well london or glasgow in london right in london on this night I was just thinking I need to get out yeah right, I can't do this life forever.
Speaker 3:Um, and the final nail in the coffin was really during such a spiritual time as month. I was really thinking is this the best use of my abilities? I was really grappling with this idea of, for some reason, allah had chosen this path for me in and around financial services, yet, at the same time, making my money doing things which weren't exactly halal.
Speaker 3:Yes, there are steps removed from the actual interest-generating process but still it's an industry which benefits from the generational river and I think anyone in that should be concerned in asking questions about how that's going to affect your afterlife your akhira, and I heard a really interesting lecture at that time by Numan Ali Khan, who was talking about the dua that was made by the Prophet Solomon, prophet Sulaiman alayhi salam, and it really stuck with me to this day.
Speaker 1:I don't know if you're familiar with it. Yeah, yeah, I know the writing.
Speaker 3:So the dua that was made, and when you think about the prayer that is made by a prophet, you'd often think that, oh, they're going to be praying for forgiveness, for the Ahara, for future generations, for their Ummah. But this, though, was very, very different, and I'm gonna butcher the translation, but we'll put up like I think the actual thing but it was the first thing that he asked for is oh my Lord, forgive me. And then, after that, he asked grant me a kingdom, grant me a kingdom the likes of which no one else after me will ever receive. Wow, and at first it's really strange to hear that, because when you think of a prophet of God, you think they're not going to be asking for worldly success.
Speaker 3:So what, what is what is happening? Here you and here you have someone who's asking to be granted a kingdom so and not just not just a kingdom, but so large that no one else will ever be able to compete with that to come. So what, what was going on there? And then put it very well where he said to understand this, you need to look at the first line of this, which is oh my Lord, oh my master, forgive me. And there it's like okay, we're all here for a very limited amount of time. No one knows when we're going to go, and in that time, we pray that we use that time as efficiently as possible.
Speaker 3:And when we go. What do we leave behind us?
Speaker 1:A legacy.
Speaker 3:A legacy, but also this idea that the only thing that will remain, which will be able to ask for forgiveness on our behalves and continue to do good deeds, is what's called, in Islam, sadhika ijariya, the good that we leave behind.
Speaker 1:Ongoing charity Ongoing exactly. Or beneficial knowledge, or a righteous child that prays for you Exactly.
Speaker 3:So for different people that looks like different things. For some people it's children. They're blessed with children. Not everyone is given that gift. For other people, they're able to use their wealth to build a mosque, or to build a school or something else that benefits society in some way and will earn reward for them even long after they're gone. Now, we're all given different gifts and different opportunities and privileges. Even the prophets right Isa alayhi as-salam, jesus was able to perform miracles. You know, though, the alayhi as-salam David was able to bend metal with his bare hands all kinds of things. Musa alayhi as-salam Moses was incredibly strong, but what was Musa alayhis salaam? Moses was incredibly strong, but what was Suleiman alayhis salaam, solomon's real gift? I guess dominion.
Speaker 1:Yeah, governance leadership.
Speaker 3:He was able to lead and govern in such a way without becoming corrupted by that, falling foul of what every single empire in history, from the Mesopotamians, the romans, the egyptians and, to an extent, the islamic empires as well, eventually fall foul to corruption. And what he had identified is that I have this gift. Please let me use this gift so that I can better secure my afterlife and benefit society as a whole. And, sub subhanAllah, that struck me. That really shook me to my core and I thought what on earth have I been given All the privileges that I've been given? Right now? I've just been floating through life, making money, and things have been coming really easily to me. There was like this trend in my life that, oh, I applied for this and I got it immediately.
Speaker 3:Oh I applied for Deloitte and it came super easy. I applied for Deloitte and it came super easy. I applied for. I wanted to get out of.
Speaker 1:Deloitte the first thing I applied to. I got it really easy.
Speaker 3:There was no hardship there, so what?
Speaker 3:was the reason for all of this. Why was I doing any of this? And I didn't know. I really didn't know. So for me it came in that I need to step away from this for a while and I began to apply for MBA programs or masters in business administration and I at america way too expensive. So then I looked here in the uk uh, there's only three schools, um, at the time which were worth talking about, although there are many others now. Uh, which were london business school, cambridge and oxford. Yeah, I applied to all three.
Speaker 3:I chose cambridge for a variety of reasons and, alhamdulillah, I didn't know what was going to happen to my life. I just said to to alpha, please. I just want to go on secondment for a year. Yeah, hold my place for me, I'll come back afterwards. But in reality I was thinking I want to go and like, find something and figure out what I, what it is I want to do. Yeah, and alhamdulillah, it was at this university, at cambridge, at this year, that I took out that kestrel was born yeah, yeah, wow, that was an incredible answer.
Speaker 1:Um definitely took us on a journey. Yeah, it's interesting because I was actually going to ask you what is your favorite story from quran? Uh, with regards to money, but I think you might have, at least when it comes to a specific verse, you might have covered it, but we can get on to that.
Speaker 1:I mean yeah I think the, the prefacing of that world, the request with, uh, ultimately a request for forgiveness, I think, is um, yeah, likewise, what? What strikes me that, yes, um, there, there is scope for asking god for, you know, for worldly success, but it's, it's not at the expense of your ultimate destination, which?
Speaker 1:is at the that was at the forefront of the, the dua, the, the request of sallallahu alayhi wa sallam and, I guess, um, that is a a good footprint, or, you know, blueprint, for anyone who's a muslim looking to seek, seek out what to do with their wealth or how to build it, um, in a way that is still consistent with their yeah, or indeed, what to do with their lives.
Speaker 3:It's the most common thing that students or young people who just started out working come and ask me like, what should I be doing with my life? And my advice to you is really figure that thing out. What are you so good at? And that talent that can be used to really benefit society? Yeah, what are those things? What does that intersect between the two? And that's really what you should be trying to focus on right, the muslim ikigai, yeah, the muslim ikigai is as iqbal nasim yeah, puts it.
Speaker 1:Yeah, so that was a good segue into the nba itself and, um, tell us a little bit about that. Obviously that is where kashra was born, but how did exactly it come about? What was your? What was your favorite kind of module? As well, on the nba, my favorite module, yeah um.
Speaker 3:So for people who don't know the cambridge nba, there's different kinds of mbas you can do. There's like two-year ones, which is like the harvard business school model, and then there are one-year ones which cambridge and oxford and I think at london business school you can cut it down to, uh, an 18 month and even a 12 month one if you, if you really wanted to. That really appealed to me because the biggest element I was looking at was salary sacrifice, not the cost, because these things are almost inordinately expensive as well, especially if you don't get in with a scholarship. Alhamdulillah, I was able to manage, able to secure a scholarship of some kind, not full but partial, which made it a lot easier. And if your company's not paying for it, then you want to consider the cost and you also want to consider the salary sacrifice.
Speaker 3:So one year was what I wanted to do. So the other appeal of going to cambridge was that you're not just part of the business school, you're part of the larger university and that means you get the full experience. You're you're living. You're living in a college, in dorms, you have a bicycle. I would cycle to the business school and to my classes every day and you really feel like you're part of the larger university and the larger, over 800-year-plus legacy which as we'll hear in the story really came to help later down the line.
Speaker 3:And it's split into four terms or four semesters Michaelmas, lent, easter and then Summertime. Michaelmas term runs from the September to December time and that's where you do your core modules the accounting, the economics, the corporate finance, the bare basics of like business and after that you get to pick your own modules, the ones that really affected me the most and I have to make this clear for anyone thinking about doing an MBA should you do an MBA? It really depends. It really really depends. It's true that I would not have started my own business had it not been for the mba, but in reality you should only do an mba for two reasons, and two reasons only. Number one is the brand name of the school that you're going to, and number two is the network that you gain when you're studying there, because you're studying with a group of high performing, highly ambitious people who you're betting are going to become very senior and very influential one day in time and you'll be friends with them for life.
Speaker 3:That's the idea. It's a group of 150 to 200 people, um, who you know you'll be able to call upon in any part of the world now notice, when I said those two things, I didn't say the knowledge, Because the truth is anything that you learn on an MBA and the school's not going to like me saying this, apologies, if you're listening you can actually learn for free or at very low cost through books or online on the internet. And that's the truth.
Speaker 3:So, I would only advise doing an MBA if it's from a really really reputable brand name. If it's in the US, all the top schools Harvard Business School, yale, stanford, the like In the UK it's really those three, although Imperial is doing very well now as well, but yeah, the one module that really affected me was entrepreneurship, which was in module one, because I had no ambitions to be an entrepreneur.
Speaker 3:I really didn't. When I joined I didn't know what I was going to do, but I thought maybe I'll go back into consulting, but in a different field. Maybe I'll find something in Islamic finance, maybe in consulting. But I didn't. The plan was never to start my own business and we had a really interesting, if not a little eccentric, professor called Simon Stockley, who just opened my eyes to the possibility of entrepreneurship and what it would be.
Speaker 3:And we looked at things like the startup business canvas, which is a really good way of visualizing and assessing an idea very rapidly, from what the revenue sources are, what the costs are, looking at the competitors and what the landscape is and different models that could work. So, yeah, I mean look that up. So that's, um, what I really got out of the nba and, of course, meeting my eventual co-founder, dying tramesi which was the ultimate game changer for me yeah, yeah.
Speaker 1:So how did you meet him and what? What exactly was it in your interactions with him that led to ultimately kestrel today?
Speaker 3:yeah, so dying um, we've had him on the podcast before, along with one of our other co-founders, irfan Radzi. Dying and I were one of the few Muslims on the course, which meant just naturally you get to know the other Muslims. You're seeking out prayer rooms at the same time together, you're looking for halal food around campus together, so naturally we would hang out a lot and in our conversations we would talk about what our backgrounds were. And, unlike here in the UK where Islamic banking is considered a niche, in Malaysia it's pretty much the norm. Either they have full-blown Islamic banks or every bank worth talking about in Malaysia has their own Islamic window of some kind.
Speaker 3:And Dying had worked for the Central Bank of Malaysia where his specialty was in retail Islamic banking, looking at products for retail consumption, and we just used to kick around this idea what if we could take what I had learned in fintech and fintech strategy and compliance and regulation here in the UK, combine it with what he knew about Islamic banking to do something? And we used to kick around this idea like over lunch. And there's this cafe down the road from the business school called hot numbers, and we would talk there a lot. But then a couple of things happened. One was why had invest was really on the rise at that point and they got covered in the financial times.
Speaker 3:Yeah, so we were sitting in the library and we saw this article and we were like that's really interesting, and here we had a graduate from chicago booth business school School who was going on his own and launching this robo-advisor right, but with an Islamic tilt to it. The second thing was we saw an increase in the number of Islamic digital banks. This was 2019.
Speaker 1:Right 2018 to 19.
Speaker 3:Yeah, so this was 2019, this was happening, right. So we saw these people who were launching digital banks but islamic, okay. And the critique that we would always levy is how are they really islamic, right? Are you not just literally being monzo for muslims? But in reality, your business model is exactly the same and you're slapping islamic on top of it, right? So that's what we were thinking about.
Speaker 3:And then the idea was really cemented when, randomly so, the Cambridge Mosque had just opened, the famous Cambridge Eco Mosque, which is this beautiful masjid in the center of Cambridge. People go there just to view that masjid today, and we were sat there and Dying recognized someone in Jumma and he says I think that guy is the chairman of HSsbc amana, which is hsbc's islamic banking. Yeah, and dying recognized him because when he was very, very junior, he used to just sit in the meetings and take minutes and things like that. So he went up to him, introduced ourselves and we found out that his daughter was actually studying um dr ashraf iqbal I should say dr ashraf iqbal, who was our first ever mentor and advisor on orchestral, former chairman of HSBC Amana.
Speaker 3:Now he's working for a Somali bank, a Somali Labuan mixed entity called, called Wafi. But his daughter was studying at the same college that I was, at Homerton College at Cambridge, and he was very gracious with his time. He sat down with us and he really encouraged us to go for it because there was a gap in the market but we needed research. So in the summer term, the fourth term of the MBA, you can do pretty much whatever you want. You could do a research project, you can go and do an internship, you can even start working if you want, and I had, during the nba, secured another role for myself right this time at pwc.
Speaker 3:So another big four firm. I'd already gotten that offer and I thought should I start it now? Come to june? I had another three months in the nba, or maybe should we delay this a bit. And we chose to do that. Let's delay this and let's actually test this idea, okay. So we developed what we called the uh British Islamic Banking Survey. Oh, I remember this, yeah. So we printed off all these leaflets, we came up with these questions and we would stand outside masjids around.
Speaker 3:Cambridge and then London, and then eventually around the country just interviewing people and asking them key questions. Do you care about Islamic banking?
Speaker 3:Do you care about Islamic finance? Do you care about Islamic finance? And then also, do you currently use anything and if not, why? We ended up interviewing 3,000 people and the results were really compelling. 95% of people told us that they really strongly desired an alternative to conventional financial services. They cared about avoiding RIPA Mm-hmm 95%. But then when we asked them, are you currently doing anything about it? Are you using any of these Islamic banks or these fintechs that are coming up? Yeah, and only 3% of them said yeah, they are. Mm-hmm. 3%. Yeah, it's astonishing. So what is going on? Right, like what is actually happening when we ask them why?
Speaker 3:Top the top three reasons that came up time and time again poor user experiences offered by the banks and the fintechs that were out there. Poor customer service of those they often talked about when they were engaging with these entities. It felt like they were talking with a company from another country or from years ago. I mean, you experienced this yourself with a bank, an islamic bank, where I remember once you were just stuck on the underground because your debit cards just stopped working. Yeah, it wouldn't touch me in. Um, yeah, so so things like that, right, like it felt like we were having to really pay in some way just for aligning with our faiths. And the final thing was, weirdly, awareness. A lot of people just didn't know what was out there, unless you lived in East London where you saw a branch of our Rayon Bank, or maybe you heard about it from your parents or your grandparents in some way. Most people didn't know what was going on.
Speaker 3:So we saw there's a real problem Should we do something about it and I want to say the answer was immediately yes, but it was a little bit more winding than that. But I don't want to take away from your questioning.
Speaker 1:Sure no, but that's a good intro to, I guess, why Kestrel came about, which is where I was going with this. So obviously, eventually you did come to decide that you do want to solve this. I guess what you saw in the survey was the motivation for that. But what was the solution? Well, september came along.
Speaker 3:We graduated, I had secured a job at PwC and I went along to it and, alhamdulillah, it was amazing. It was like my dream position. It was within a new team called Digital Transformation and Wealth Management. So our whole thing was helping big wealth managers to actually launch their own consumer apps, retail propositions, robo-advisors so we worked on some really exciting things to do with that?
Speaker 3:But again it wasn't solving that issue that I had had, which was how do I align my faith and really take advantage of the gifts and the privileges that I'd been afforded? But meanwhile we've gotten these results, these results and dying. He talks about it a lot in the survey. He had opted to not go back to the job that he had in malaysia and to stay here and really figure this out with kestrel, so he was doing all kinds of things working nights and evenings and delivery jobs and cleaning and all of that whilst together we built this business model for what it would be and we also thought we're going to have to raise money.
Speaker 3:There's all kinds of debates raging. Do you do raging about do you need to raise funds or not for a fintech? The answer is almost, um quite clear in front of you, just because there's a certain amount of money, you need to actually build and and develop actual technology.
Speaker 3:But the biggest actual cost comes from the licensing. Because if you're dealing with people's money, if you're holding it, if you're distributing it, if you're investing it, you need to become licensed. And that's not a GFCA yeah, that's a regulated FCA From the Financial Conduct Authority. So those things were quite difficult to attain. So in this time we really got it knocked out of us.
Speaker 3:We created a pitch deck of what the idea was for Kestrel and very simply at the time it was we're going to help Muslims to grow their wealth in a halal way, and at the time we were going to be a digital bank, almost like a Monzo for Muslims.
Speaker 3:But the idea was that we were eventually going to offer new products like mortgages, that we were eventually going to offer new products like mortgages.
Speaker 3:We were super inspired by Fyther, who are known as Primary Finance, so check out the episode we did with them. So we thought, eventually we're going to offer products like that and that's how we'll make money. But we'll just do what Monzo did, what Revolut did, what Starling did, and basically we got our heads bashed in by the investors that we were pitching to where we would either not receive a response entirely, or the responses that we did receive were basically this is too niche, right? You're trying to do something that has not been proven by these other digital banks, but, worse, you're going for a much smaller percentage of the population there's about 5 million Muslims in the United Kingdom, of which only about half of them are over the age of 18, and then, of those, how many of them are going to go for this? And then marketing activities and all the costs required. People were just not seeing it, right and they were right had.
Speaker 3:We done that and we've seen that from, sadly, our competitors at the time who were trying to do digital banks. None of them are around today, especially not in the form that they're in. Yeah, so we went back to the drawing board and we thought what can we do? What is the most cost-effective thing that still helps us to meet our mission of helping muslims grow their wealth? Um, but it's a lot cheaper than us going down this digital banking route, because digital banking is super expensive.
Speaker 3:Yeah, for context, monzo's first round was 10 million and that was just to launch a few cards. So there was a really cool regulation we took advantage of in the uk, called open banking. So in the united kingdom, every person has the right to expose their banking data to third parties. Yeah, right, it's all about data ownership you taking control of your own data, large entities not controlling it. And we ended up getting our own open banking license, and what that meant was you didn't have to move money into the Kestrel app.
Speaker 3:You could just plug in your bank account Barclays, hsbc, monzo, which all the majority of Muslims were using. Plug it in, we could see your data and we could create a personal financial plan just for you. Let's see your salary and let's figure out how much of it can and should you be actually saving, by actually categorizing all your transactions into essentials, your non-essentials and, ultimately, how much you should save. Let's then put it into action. Let's create a savings plan. Tell us what you want to save for Maybe it's a car or a house or a wedding, or to go on pilgrimage or a hodge and we will make sure you're pulling in money regularly every month or week, or rounding up your spare change, putting it into these ring fence pots of money to help you save to it and then, crucially, we would link you with sharia compliance savings and investment products.
Speaker 3:So we opened this marketplace which allowed you to invest in anything from property to gold, to even just the stock market as well we. We also had faith-aligned features, so we had an auto-Zigarth calculator. We could see all of your finances.
Speaker 3:So something which is usually quite a difficult process calculating 2.5% of your net worth we could do that with the touch of a button, and also Sharia stock and fund screening. So a lot of people are very interested in buying shares in Amazon or Google or Apple, but they don't know if it's Sharia compliant. And again, we could look into all of the data available, all of the financial reports and metrics, to see where the revenue was coming from. Was it from any non-Sharia compliant activity, as well as looking at the balance sheet to see how much interest was actually being generated or held by this company and tell you whether it's Sharia compliant. So that's what Kestrel, was the Muslim money app doing.
Speaker 3:all these different things, all right, a one-stop shop, if you like exactly, and and it was on that idea that we managed to get funding right right so we, we used to just hang out. You remember? Yeah, we went out to istanbul. Yes, in the end of 2019, wasn't it?
Speaker 1:yeah, november 2019 yes, I wanted to actually mention this in my podcast but I forgot because that was a part of my story as well. But, um, but yeah, that was. That was sort of the beginning, in many ways, of both of us in our sort of parallel. It was.
Speaker 3:We booked some flights me, you and our father, and we uh flew out to istanbul for this large islamic finance conference being, which was being run uh by salam gateway gateway, global gateway, by haris afan and Ashley Freeman. That's right. Gateway Global, and this was by Ashley Freeman, Haider, Safan Abdul Hasib.
Speaker 1:He was there, yeah.
Speaker 3:Yeah, as well. So it was really cool because this was our first exposure to the real heavyweights and founding fathers almost of Islamic finance in this country. And we met people like Haider Safan, who was responsible. He was over at deutsche bank and then barclays and um. He invented models which allowed them to actually finance. He regrets this now, but it allows them to finance a lot of the construction in in makkah yeah, including the clock tower. And we also met sultan chowdhury, yeah, who was the former ceo of islamic bank of britain, now arian bank. And these guys got it. They liked the idea and they were willing to actually put forward some of their money and that was our first actual investment round. We raised about £150,000, which, alhamdulillah, allowed us to go full-time. So I quit my job at PwC and Dying and I came on board. We also you know our father came on as a chief financial officer. We found a plucky CTO who's a two-time founder himself your father, radzi, who used to go to school with dying.
Speaker 1:Yeah, likes burgers.
Speaker 3:Yeah, exactly yeah, he used to own a burger place and we also had Dr Masab Shaharim, who became our head of data, and you were in the story as well as our head of data and you were in the story as well as our head of legal yeah. So all of these people came together to build the early version of kestrel and I really must stress it was a shoestring budget. Most of that money went into development and licensing costs, so we didn't have a lot to function on.
Speaker 1:It was not glamorous yeah, no, it makes sense, and that obviously explains the need, for I believe it's called the e-money license rather than the yeah, that's right, regulators. You know banking license and, if I understand correctly, that also in a way prohibits you as an entity from actually taking your client's money and lending it out. That's right.
Speaker 3:So was that a coincidental meeting of the minds as to aligning the business with not, not, I think so, yeah, it was coincidental and that, yeah, it is sharia compliant, because you can't do anything with it. But it was also exactly what Monzo and Revolut and Starling had done as a track to getting a banking license. But we really focused more on the open banking than the electronic money side of things because we saw this interesting potential with using data to create a personalized experience.
Speaker 1:So the budgeting savings investments, yeah, exactly.
Speaker 3:No one was doing that even to this day. I don't think anyone's doing it the way that we do for Muslims in particular. Thank you for listening to Muslim Money Talk. If you like what you've heard so far, you might be interested in checking out what we do at Kestrel, the Muslim money app. Kestrel is a service that helps Muslims who want to grow their wealth without having to compromise, whether it's on their belief or user experience or price.
Speaker 3:I founded Kestrel because of how fed up I was at how poor Islamic financial services were in this country. Often people didn't use them because of how bad the user experience or customer service and indeed, how high in price they were. So Kestrel was the answer to that. If you download the Kestrel app today, it can help you by creating a budgeting plan. Plug in whatever bank account you have and it will create an auto budget just for you. You can then tell us what goals you're saving for, and we'll save towards them automatically into pots and then, crucially, link you towards Sharia compliant investment and savings products as well. So download Kestrel today and try it out for yourself. Now back to the podcast.
Speaker 1:I appreciate the sort of all-in-one aspects of it. But you know, today especially, we have a number of Islamic fintechs. They seem to operate in slightly different client sectors. We have the home financing ones, you know, we have wealth building, wealth generation, and Kestrel is doing bits of everything. So where do you see Kestrel's role within that? Is Kestrel an intermediary between those? Is it independent of those? How would you categorize Kestrel as an Islamic fintech?
Speaker 3:So it's a really interesting question. So Wahid Invest, for example, was really focused on the endpoint, which was helping people to invest their money in a Sharia-compliant way, and they'd built their own portfolios to do that. And then you had people like FIDA which were helping people to achieve a major life goal, which was to purchase a home, which for a lot of people is a big, big milestone. But no one was doing the education piece. People really really struggled with with that, with the financial education, and there was inspiration that we took from a famous hadith about tying your camel and we used to use this expression a lot at kestrel and stuff that we were building, which was tie your camel before you invest.
Speaker 3:and this refers to the famous hadith where a man I think he was slightly confused by the nature of of god and predestination, predestination and fate, and all of that and he went to the Prophet Muhammad, sallallahu alayhi wa sallam, and said should I just get off my camel and leave it untied, or should I tie it, because you know?
Speaker 1:ultimately, it's in Allah.
Speaker 3:Should I just trust in Allah that the camel is going to remain there whether I tie it or not, because it's all predestined? And the response was very interesting and we use it in a number of facets of our life today. And the response from the Prophet Muhammad peace be upon him was to tie your camel and trust in Allah.
Speaker 3:The idea is that you should make all necessary precautions and preparations yourself and only then should you leave, make all necessary precautions and preparations yourself, and only then should you leave. The remainder, the true unknown. Yeah, out there to god yeah that's. That's what it was, and I think the same is very, very true to financial services. Everyone was so interested in investing how do? I invest, how do I invest? How do I invest? And when we were looking and we would assess these people and we'd be like abdullah not not real abdullah, but just in case like abdullah, you're not even saving any money any salary every month you haven't built up an emergency fund or you know, god forbid, you lose your job, but it happens you haven't built that up.
Speaker 3:And then what are you investing for? Oh, you want to buy a house. You're much better off saving your money buying a house than investing towards that. People were not knowing these basics. Yeah, and that's really what we were trying to fulfill. It was the beginning stages, right, of the people's financial journey. Yeah.
Speaker 3:Okay, what is the tying your camel part? Let's build a budget for you. Make sure you're actually able to save some money, right, that your expenditures are not inordinately on non-essential type things like eating out right, or maybe you're paying for multiple subscriptions, things that you don't need, right, a lot of people. You'd be shocked when we see the data how many people have multiple netflix subscriptions and they don't even know. Right, are you actually saving towards an emergency fund, a rainy day fund? Yeah, which could be three months, six months, 12 months of your typical spending behavior, but just enough of a pot that you feel comfortable that I could go and find another job within this period.
Speaker 3:After that, figure out your goals right. What are they? Is it a house, is it marriage, is it having a school, Is it sending kids to school, and are they short-term or long-term? Are they goals that you're going to achieve in the next five years which will make them short term.
Speaker 3:If so, save towards those things. Save towards those things because if you invest, especially if you're investing in the stock markets, things can fluctuate If you look especially at the time. If you look at the financial markets just before and then after COVID was announced and lockdowns were announced, the market crashed right. And if you had been saving to buy a house and all of your money had been in some sort of Sharia fund which just tracked S&P, you would have been ruined At that time. You would have lost the house that you were looking to purchase. So the reason we say save for the short term is because in the short term, things can fluctuate a lot, but generally, in the long term, if you're investing into an asset which is well-tracked and well-known whether it's investing into the stock exchange or looking at gold and, to an extent, bitcoin as well but that's a topic for a different time Generally things are going to move upwards and to the right you can look at that for the price of gold.
Speaker 3:You can look at that for the price of gold. You can look at that for the stock market, a number of different assets. So the idea is that if you're looking at achieving a goal in 20 years time, which typically is retirement or sending children to school, invest for those things right, because you'll see short-term fluctuations, but in the long term it will be okay yeah yeah, so that's the kind of the tying your camel part right before you leave the rest to Allah and you trust in Allah but you have to make those necessary precautions and preparations yourself yeah, that's really interesting.
Speaker 1:I mean, in the psychology of wealth there's this concept, you know, an economic theory of bounded rationality that consumers or economic agents have certain biases at a cognitive level that actually restrict them from making optimal choices for themselves. And that's it's interesting, because it means no matter how much you input, no matter how much you tie the camel. There is also the other aspect, which aligns with our values, of leaving the rest to Allah, to God, which I find very interesting, yeah.
Speaker 3:Morgan Housel writes about this concept. It's an amazing book called the Psychology of Money.
Speaker 3:We talked about it in Niaz's podcast as well well, a lot but the idea that a lot of people assume that that money and wealth is a science. But in reality, the way we act is much more of a soft skill right and the way that you're raised, the way that your parents felt about money and what they did with money, the economic environment that you were raised in whether it was high interest rates or or high inflation can really affect what you're likely to do and your risk appetite. Right. People who were raised with very, in very low interest environments are much more open to investing. Right, because that was really the only way to make money yeah and the converse is true as well.
Speaker 3:Because a higher interest environment, people are much more likely to put their money in the bank right, whether or not it makes sense at the time yeah, it would be ironic to do so in that environment I suppose, but um, but yeah okay so that I mean that's a very helpful overview as to what what cash flow is.
Speaker 3:Yeah, so that's how it started. But I will say, we, we were struggling in those early days. Yeah, we were. I mean, we had, alhamdulillah, tens of thousands of customers, but we hadn't figured out monetization, we hadn't, and we and we were making a bit of money, but it certainly wasn't enough to sustain us, and I had gotten married at the time. So this is now fast forwarding to 2021, the end of 2021.
Speaker 3:And alhamdulillah, to the outside world Kestrel looked like a success because we were posting on socials and we'd done launch events and we were growing the team and all of that.
Speaker 3:But the reality was I hadn't taken a salary and our co-founders had not taken a salary in around at that point about four months well because we were just putting all that money in and hoping we'd be able to raise some more funds or crack the monetization angle and very naively we thought that this was going to going to come about. So we were just not taking a salary to extend our runway, the lifespan of the company. But it was dark days, very, very dark days. And I just remember coming home one day and just thinking have I made a huge mistake?
Speaker 1:Yeah, what if this doesn't work? What if this didn't work out?
Speaker 3:And then we found out my wife Sabah. We found out we were expecting and, subhanallah, I was immediately ecstatic, really, really happy. But then immediately I thought how am I going to provide for this job? What is going to happen? I'd left alhamdulillah, a very, very comfortable position in a world-renowned company to do this.
Speaker 3:Not just that, but I'd brought all these people on this journey with me All the employees, all the customers, customers, all our shareholders as well yeah and then something honestly incredible happened, something I'd never expected, and for me it was the hand of god and at play, which was from a early conversation we'd had months ago. The largest islamic bank in malaysia, bank islam, the ceo, reached out to us. Muazzam, who is actually our guest on episode number one, yes, I remember.
Speaker 3:He reached out and said you know, we like what you're doing. We're trying to launch our own digital bank and we would like to use your platform and what you've done to help us accelerate and get there more quickly. We want to basically pay a subscription service for your technology and integrate all of your features, everything you've built into, accelerate and get there more quickly.
Speaker 3:We want to basically pay a subscription service for your technology and integrate all of your features, everything you've built, into our own digital bank so we can go live with features from day one, and that's the B2B side, exactly business to business. That's how that was born and it wasn't. If I was differently minded, maybe I would say that was always the plan. But, subhanallah, it really wasn't the plan. It wasn't the plan. It wasn't the plan at all. It wasn't something we ever saw for ourselves, because we got back to our mission.
Speaker 3:We wanted to help Muslims to grow their wealth in a Sharia compliant way. And when we were confronted with this proposition, we thought is this still what we want to do? Was this why we started this business? And ultimately it is it's the same.
Speaker 3:You're still helping Muslims, but you're doing it through a third party which is a large, Islamic bank, and we went from being on our knees, taking a salary or anything, to subhanAllah after that being month-on-month profitable, getting investors knocking on our door, being able to invest more into our application, and I really think it came through um, first, trusting in our love but secondly, finding out that we were expecting a baby because, as we know, every child is proportioned their own, their own risk their own um what's the translation for risk?
Speaker 3:sustenance, their own sustenance, their own provision, whether that's wealth or opportunities or whatever it is, but every person in this life is proportioned to that and I think when that child came they were being allocated that risk through the success of the business. Savanala yeah.
Speaker 3:Savanala. The recipient came before the means, exactly I say this to people who are saying look, I don't know if I should get married now. I don say this to people who are saying look, I don't know if I should get married now. I don't think I don't know if we should have children, because, honestly, I look and provide in ways for you that you would never imagine yeah, I would never imagine that was going to happen and that changed everything, not just for me, but for our company yeah, yeah.
Speaker 1:Yeah, I know what you mean, that sometimes you sort of feel like you're on a path which is slowly unfolding before you, or you're on a book which has several pages and you can't see what's on the next page, but you just know that you're turning it and that's sort of the way I see fate and other destination unraveling for us in our stories and it's part of that. It sounds like that came to the. You know the benefit ultimately, and survival of cash flow as a business. So that's a really great way to answer quite a few of my questions on this. Actually, I was going to ask you about challenges being living as a CEO, as a Muslim, and you've covered, I guess, the bulk of them. The name, though, kestrel, is something that might be quite enigmatic to people. Do you want to?
Speaker 3:shed a little bit of light on that Enigmatic.
Speaker 1:Yeah.
Speaker 3:Yeah, I mean, look, kestrel for people who don't know is the name of a little bird, a little falcon that lives in this country and some people are familiar with it if they're like wildlife enthusiasts like myself. Other people know about it if they read books in school, like Kestrel for a knave, or they saw the movie kez. Uh, but it's the smallest falcon that exists in this country. It's found around the world. Why did we call it kestrel? Do you want the real answer or, like the, the answer we have on the website and things?
Speaker 3:I mean, I want the genuine, okay, the genuine answer was we thought at the time we don't want kestrel to just be for muslims, we want to benefit everyone. We don't want to exclude anyone to just be for Muslims. We want to benefit everyone. We don't want to exclude anyone by giving it a very Muslim sounding name. So we went up and came up with ideas like Ethipe. I was a big fan of the Ethipe name, I know, but the feedback was it sounded like dog food or something like that. There was Tiger.
Speaker 1:Do you remember that? Yeah, I really pushed for Tiger T-I-G-R.
Speaker 3:Yeah, and then T-Y, no, T-Y-G-R, t-y-g-r, which I'm still a fan of, right. If we can rebrand, I'd be up for it. Let us know in the comments if you're up for that. You know powerful animal, the real king of the jungle. But the reason for Kestrel a lot of things, including Starlings, and the idea was we're going to come after Starling Bank.
Speaker 3:We're going to take out Starling Bank and we're going to replace it and all of that. So it started off as a little bit of a joke, but it turns out people like the name, so we stuck with it and we took out the E, so it's K-E-S-T-R-L. Because the domain name wasn't available and the branding wasn't available, but kestrel was um, it sounded a bit more techie and and that's the real answer for for how we came up with the name and that's what kestrel is um, we we went back on that actually, because originally we were really branding it as an ethical brand and I think if you go back in the way back machine you can see the original yeah
Speaker 1:uh websites and all of that strap line was very different back then. What was the strap line? I think it was something like oh, it wasn't budget saving, investment without compromising on your values. It was something like bank without compromises it was it was grow your wealth, uh, in a way that is interest-free and ethical payment and wealth services provided.
Speaker 3:It wasn't very snappy no, no, but that was the original. Uh, and we found something interesting was happening muslims were coming to the website and they weren't seeing anything really directed towards them. Yeah, and they would just think is this really?
Speaker 1:yeah, muslims, is it? Don't see the word sharia in here, yeah, exactly.
Speaker 3:And then, um, non-muslims were coming in and seeing a little hint of halal, right, they'd see like, oh, there's a sharia advisor and they'd see all this, and then they would just be like, well, what is this?
Speaker 2:it's not for me, and then we just decided let's well, what is this?
Speaker 3:It's not for me. And then we just decided let's be true to ourselves. We were built by Muslims, for Muslims, for the ummah, and to leave a legacy. So we rebranded ourselves to Kestrel, the Muslim money app, and, subhanallah, had we not done that, then the Islamic banks who we work with today would not have found us. To be honest, they wouldn't have really seen okay, this is a fintech, but focus on Muslims who can also help us out. So we chose to do that, to double down on it.
Speaker 3:But I do feel and we talked about this in our podcast a little bit as well that, if Islamic finance is truly successful, I think it is a true rebuttal and alternative to the existing economic system which, ultimately, is proving and continues to prove to this day, as we're like on the brink of another financial crisis, and there's been so many in the past couple in our lifetimes.
Speaker 1:Yeah, it's a detrimental system.
Speaker 3:It's detrimental to society, to people in general and if islamic finance is done right yeah it has a built-in welfare system yeah right which can look after everyone.
Speaker 3:It ultimately abhors the idea of making money on money right and and entrenching people and societies in debt, in cycles of debt that they will never escape from right. The US has so much debt now that it will never, ever be able to repay. It has more debt than it has actual dollars in existence. How does that make any sense? But anyway, this is a topic for a different time.
Speaker 1:No, but it's an interesting one because I remember at the start when those conversations were happening. As interesting one because I remember at the start when those conversations were happening.
Speaker 1:As it happened, I was always in favor of it being muslim focused, at least to begin with you know the idea of you got to clean your own rug before you know anyone else's, and I probably butchered that, uh, that idiom. But um, what would you say, though, is the appeal for people of other faiths? And none of cash? I appreciate the budgeting aspect is not uniquely muslim, so, but you know they could argue they could find that elsewhere. So what is the universality of something really interesting happened?
Speaker 3:yeah, we took part in muslim tech fest in london and we had you were there, we were manning the stall we had a big touchscreen tv where people could interact with the app and play around with things and see what they liked, and we would ask them things. We would question them and ask them their opinions and in that survey we found we asked similar questions Do you care about Islamic finance? This time about 85% said that they did, but then we asked them do you care about boycotting? Because this is very, very topical, still is right now. It's a very emotive issue. What's going on in that part of the world, in the Middle East, boycotting brands, especially the likes of McDonald's and Starbucks, and it's showing that it is reaping benefits. But do people care about moving their money and divesting their money from those types of corporations? Who are going to?
Speaker 3:support. Israel.
Speaker 3:And, lo and behold, close to 100% of people, so they felt very, very strongly about it. So the new product that we've been working on and which is going to launch a couple of weeks after this episode comes out but if you download Kestrel today you will be able to benefit from it is a boycott tracker where you will be able to instantly see how much of your salary is going towards companies which are on a boycott tracker right where you will be able to instantly see how much of your salary is going towards um companies which are on the boycott list on the bds official sanctions list, and then be presented with alternatives to allow you to move your money away from that. And I think that's one of the examples of how islamic finance is not just a way of adhering to your faith but ultimately should be a way about bettering society, for as a whole. As a whole, yeah, as a whole.
Speaker 3:Absolutely, and I think that is one of the key things if we can get it right and alhamdulillah. You know, we soft launched it on socials. The feedback was overwhelmingly positive and I think we're the first people to actually use open banking in this way, so we're really looking forward to launching that. Okay, so that's coming out in the near future. It'll be in December, inshallah.
Speaker 1:Next month, inshallah, yeah, anything else on the horizon in 2025 for Kestrel?
Speaker 3:Yeah, we're going to be launching in Saudi, so we're very excited about that, inshallah. And another really, really big thing which I look forward to talking about closer to the time, but I think it will impact the UK Islamic finance space in a way that it hasn't been impacted in a long time. Okay, you can't say what it is yet. I can't say. I really can't say right now.
Speaker 1:Okay, interesting.
Speaker 3:But inshallah, I will be able to in future episodes.
Speaker 1:Okay, it's nothing that we were exhibiting at the Muslim Tech Fest, is it? No, no, no.
Speaker 3:Oh, okay, Because then in that case I do want, you can talk about it in more detail, but this idea of sort of in building uh an ai sharia advisor. Yeah, that is something that we showcase, something it is indeed, yeah, kestrel gpt, or, as we affectionately called it, the uh the ai mufti I'm fd.
Speaker 1:So it's a controversial topic and, you know, potentially one for a separate podcast. But what, um, what exactly is the the idea there, and do you think that there needs to be any checks and balances?
Speaker 3:I think what we built and we built this in collaboration with the Financial Conduct Authority in the sandbox, because it is a tricky issue, not just on the faith side, but on the investment management side and advice side as well Can you take investment advice from an AI tool. So the idea here is that you would not only be able to ask this AI any question you want about Islamic finance or finance, but also about your own personal finances. What is my situation? How much money do I actually save? Could I be getting any more savings by moving away from non-essential activities or unnecessary subscriptions and ultimately asking it where should you be investing your money?
Speaker 1:in a career-compliant way.
Speaker 3:So we showcased the early version of it, which, thankfully, was received very, very positively, and we did that recently. We demoed it with the FCA as well In terms of the checks and balances. So, as people who are in the space in GPT know, the AI does have a propensity to sometimes make things up and move away and take inspiration from other sources. It does do that every so often. You can test it out on chat. Gpt or on X has their own version as well, I think, called Grub, but you can ask it the same question multiple times at different times of the day and the answers aren't always the same, and that is very, very important when it comes to asking about islamic finance or sharia law in general which is meant to be completely conserved.
Speaker 3:It cannot be changed in any way.
Speaker 1:Well, the application of it might be, to different circumstances.
Speaker 1:But, yeah, the input, the inputs and the, I guess answers to specific questions might be. And it's interesting because I suppose, looking at it from a non-technical perspective, if you're inputting all of the Quran and Sunnah into this AI and existing fatawa from, let's say, classical al-ama'a, and you then ask a question, a fit question, to the AI, it's an interesting thought experiment. Would this AI must be able to deliver a satisfactory answer? And to my mind, I don't think so, because fatawa and you know if the process of generating a verdict on, in response to a question of islamic law does not just involve those key primary sources and inputs, but there's also elements of, uh, rationality and intellect yeah, as we call it.
Speaker 1:Yeah, that's the thing and I don't know, obviously, that the extent of that is limited and caveated by the use of revelation. But even revelation is being filtered through your own and and other scholars own intellect.
Speaker 3:I'm not convinced that ai necessarily can replicate no, it may not have the rationality as of yet, but you know, every I feel like every other week there is a new breakthrough when it comes to artificial intelligence, and I think we need to have a special episode specifically around, yeah, yeah um ben affleck weirdly had a very interesting take on it, weirdly okay, right.
Speaker 3:So he was being asked this in the context of what happens if actors are completely replaced, or editors and film writers and all of that will be replaced by ai one day, right, and he said I'm going to completely butcher what he said, but the idea was that, yes, it could make something incredible, right, something so visually appealing, the likes that you've never seen before. But a real artist knows when to stop, when something goes from being a masterpiece to being tacky, right, and the AI doesn't quite have that taste. Yeah, so you know, apply that as you will within the Islamic finance space.
Speaker 1:Yeah.
Speaker 3:I thought that was an interesting take.
Speaker 1:No, definitely. Yeah, Maybe we can get an expert on that for a future podcast episode yeah.
Speaker 1:Okay, so you know we're coming a little bit close to time, but I do want to ask. In our podcast episode we talked a lot about the origins of seeing, whether you want to call it Islamic finance, or at least just finance in a halal way, in practice among the early generations. Is there any particular story amongst either the companions of the Prophet peace be upon him or even the Prophet peace be upon him himself, that particularly inspire you or interest you?
Speaker 3:Yeah, I mean I talk about this a lot, but a lot of things happened during the Hijrah, when the Muslims were forced to flee from Makkah to Medina and take refuge in that city. There's two stories which really inspired me, I think, which really show the power of financial literacy and also go against this idea that wealth is something that we need to abhor, that Muslims cannot be wealthy and religious, and I don't know when this came about in our history, but we even talked about this in the last podcast episode with Ghazi, where his father was an imam and he thought his sons were too focused on making money which is an interesting thing to think about, but it does.
Speaker 3:It does come up quite a lot in our culture and it's so interesting and and important for us because Muslims in this country and in many parts of the world make up some of the most impoverished religious communities that there are. So in the UK, almost 50 percent of Muslims actually live below the poverty line, struggling to pay at least one of their bills or even taking advantage of food banks, which is crazy. But despite that, muslims are by far the most generous and donate the most to charity out of any religious group right. Whether it's through their Zakat or their sadqa donations every Friday at Jummah, whatever it might be, they pay far and above all the other religious groups combined right. So what is going on? And if we look back at the time, at the time of the Sahaba, when they were forced to go from Makkah to Medina, there's two very interesting things. The first is, when the Muslims first arrived in Medina the Prophet Muhammad peace be upon him the first thing he asked them to build was what?
Speaker 3:Firstly a mosque, A masjid, correct, a place to pray, which seems you know, you wouldn't immediately think, oh, that's weird. What was the second thing?
Speaker 1:It was a market.
Speaker 3:A marketplace, a marketplace. So even then, it was understood to this group of travelers, who had left everything behind and come with just what they could carry to this new city, that they had to be financially independent. They had to be independent, and the way to do that was through building wealth again and through that was came power and privilege and a standing in society.
Speaker 3:so that was really interesting to me.
Speaker 3:The second is the story about Uthman Radhi, allaah and her and the well, and this is this idea that investment, investing can actually last, not just for you, for your children, but for a millennia, and this story really like shook me to my core.
Speaker 3:So at the time, the Makans, the Muslims who had come from Makkah, were used to fresh water from the famous well of Zamzam. And when they came to Medina, the best well and the best water supply was in the control of a non-Muslim, a Jewish man, who would charge people for the smallest handful of water. And it became such a serious situation that the prophet muhammad, sallallahu alayhi wa sallam, actually approached the man and said we, I can't buy the well from you, but if you grant us access to the well, I can promise you a place in paradise. Now, obviously, this didn't work with the guy um, but uthman radhila and her heard about this and realized he needed to do something about it, and he is, by today's standards people have calculated would likely have been close to, or perhaps even a billionaire, and if you were to convert his wealth to net wealth and net wealth.
Speaker 3:so he approached the man and began the negotiation and in the end he managed to say he managed to purchase 50% of the well, a 50% ownership stake in the well, for the sum of 20,000 dirhams, which was a huge amount at the time, a huge fortune. And the agreement was that he would own the well on one day and on the other day the original owner, the Jewish man would own the well and they would run the wells as they like on each day, and on the other day, the original owner, the jewish man, would own the well and they would run the wells as they like on each day.
Speaker 3:So the on the day that the jewish owner ran it, he would charge people every day. But on the day that uthman radhi allah ran it, what do you think he did? Give it for free? He just gave it for free for everyone. So everyone came on that day and they would take as much water as they needed, and then they would never come on the day that they had to pay for it. So this was um. You know, I think this speaks to the negotiating power and the business and commercial mindset of the early muslims.
Speaker 3:But it ended up with the other owner ended up selling the rest of the well, over to the muslims, over to uthman radhi lana it was no longer profitable to him.
Speaker 3:It wasn't profitable for him to keep it, but he made his money when he sold the rest of it. So the other Muslims began to make their own money. And then they came to Uthman, radhi La and her and they said thank you so much for what you did. We want to buy this back from you. And he would refuse. And they eventually ended up offering twice what he ended up paying for, the well. And he said no. And what he asked for was? They said well then, who could offer a higher price than this? Yeah, and he said allah. And that was it. And it's a beautiful story, because the well continued right. The muslims eventually went back to makkah, but the well remained. The waters were used to feed the, the date palms that grew around it. The dates were sold, 50 of the wealth was actually used, um went to charity, 50 was invested, reinvested back into the project.
Speaker 3:And then years passed, the years became decades, centuries, until whole empires, muslim empires, whoever was in control of the area, would look after the well yeah and this well and its wealth exists to this day yeah and the money from that is stored in a bank account which is ascribed to Uthman by the Alar and that money, that investment, is actually used to finance a lot of the building work that happens around Makkah, which allows the the people to go on pilgrimage and live there and keep moving.
Speaker 3:And what's insane is that the money that's generated annually is estimated to be the equivalent to about 50 million USD a year, which makes it not only the oldest but arguably the most profitable asset and investment of all time. So, subhanallah, I think it really speaks to the power of financial literacy.
Speaker 3:It's Uthman, radiyallahuohan Ho certainly used his wealth and his privilege to not just benefit himself and his Akhara, his afterlife, but to benefit all of society, and I think it really speaks to us. We have privileges, we have unfair advantages, we have skills and talents. We should be using those things to follow in the footsteps of the giants who came before us, to take control of our finances, invest in our future and, ultimately, for our akhiras inshallah, yeah, no, it's a remarkable story.
Speaker 1:The the ultimate wakf or perpetual endowments.
Speaker 3:Yeah, that's what it's called today. It's called a wakf charitable endowment ongoing until this day.
Speaker 1:So proud of that. I wish we could go on further, but I think I think we're out of time. So thank you so much for coming on for my first uh hosted podcast episode. Um, hoping to make a reappearance at some point. Maybe we can have a going on, I don't know. But um, it's been, it's been a privilege, pleasure. So, and look forward to the next episode. Thank you, as-salamu alaykum Wa alaykum as-salam wa rahmatullahi wa barakatuh.
Speaker 3:Thank you for listening to the Muslim Money Talk podcast. If you like what you heard, then please subscribe to Muslim Money Talk. Wherever you might have been listening to this, give us a like and share it with someone who you think might be interested. It really, really helps us out. Thank you, as-.