Impact investing or responsible investing is about leveraging finance to make the world a better place. Yet, it amounts to less than 1% of the total money that gets invested.

Tanvir Uddin, a Bangladesh-born Australian entrepreneur is narrowing this gap with Wholesum. His innovative project recently launched its first fund, the Wholesum Responsible Fund, which has just just crossed a major milestone with one million dollars under management. With this news, Tanvir’s years of efforts to advance impact investing are starting to gain attention.

“My story begins in Bangladesh where I was born. I was six, when my family migrated to Sydney, Australia. My parents held regular jobs in Bangladesh – my mom was a school teacher, and my dad worked at a bank. Like any immigrants, they aimed for a better life for us. This led them to migrate,” says Tanvir as he recalls his roots.

Despite all the struggles, Tanvir’s parents knew the importance of a good education. Growing up in Sydney, Tanvir excelled in his studies, later securing the prestigious Scientia Scholarship to study law and economics at the University of New South Wales. While he wasn't sure if he wanted a career in any of these, his family always preferred him to have a stable “9 to 5” job. 

“Uncertain about my career path, I ventured into management consulting at McKinsey as a generalist commercial learning opportunity. And post that, I got a role with the Clinton Foundation in Indonesia. The latter focused on agricultural finance and social entrepreneurship. That experience sparked my interest to pursue finance, particularly project financing for initiatives like solar and wind farms and impact investing,” he says.

Returning to Australia, Tanvir delved into the world of startups. Initially he worked with a solar fintech called Brighte. Later, he co-founded Vyro, an electrical vehicle marketplace, that was incubated through Antler. Following these experiences, Tanvir decided to merge his finance background with his passion for responsible investing for a better tomorrow. And that startup idea was called Wholesum.

The Birth of Wholesum

Tanvir spotted an opportunity in the complex world of investment. He observed a mismatch between investments and people's values, particularly for certain communities. Many investment options appeared to cater to the wealthy or lacked entry-level features for millennial and less financially-literate investors (such as shorter investment periods, less volatile investments and the need for regular income payouts). Tanvir aimed to change this by realising the need for ethical investment options and short term investment solutions. 

Though he was already well-versed in impact investing and sustainability, over three years Tanvir dedicated himself to learning and experimenting. He explored how tech startups and digital solutions could simplify investment. And during the research for his PhD on microfinance, Tanvir finally found a solution.

Tanvir, along with  a group of angel investors including Ash Nazim, participated in a series of closed-ended trial funds to test various investment strategies. They wanted to determine if it was safe, efficient and profitable to invest in small-and-medium-sized enterprise (SMEs) debt finance, particularly in emerging markets such as Indonesia and the Middle East. 

The funds performed well (averaging ~15% net of fees) and they received a positive response from trial investors. That initial uptake led Tanvir to begin considering how technology for ethical investments could benefit communities globally.

“The decision to pursue Wholesum full-time came after thorough testing and positive customer feedback. Potential customers' responses, personal reflections and encouragement from loved ones moved me. It's a leap of faith that I'm grateful to take, driven by the belief in making a positive impact,” explains Tanvir.

Excited about the idea, Tanvir and his team pooled initial funds to start Wholesum. And in 2023, the company finally came into existence. After 6 months of regulatory and compliance work, they introduced their first product and inaugural fund - the ‘Wholesum Responsible Fund’ in February 2024.

“When people invest, they expect a return greater than their initial investment. For instance, investing $100 with an expected return of 10% means aiming to grow their initial investment to $110. Investing with Wholesum introduces an additional objective beyond financial gain. It seeks to achieve positive societal benefits alongside financial returns,” says Tanvir.

“These benefits can vary - from aiding individuals and communities to supporting environmental causes, gender empowerment, and poverty alleviation. With the Wholesum Responsible Fund, the investment strategy focuses on short-term debt provision to fund businesses growth,” he adds.

How does Wholesome measure impact? 

Measuring the tangible benefits of impact investing can be complex. But it is also crucial for accountability and improvement. Impact assessments help evaluate the amount of positive societal change that investments are making. 

There are different tools and metrics to measure the societal impact of a financial activity. These range from the “social return on investment” to specific impact metrics such as positive changes in social and environmental outcomes. 

Wholesum is planning to undertake "Impact assessments"  with their investees and investment partners to evaluate the outcomes of investments along various dimensions such as job creation, poverty reduction and access to finance. The data collection methods include case studies and surveys of investees pre and post funding to identify the major benefits of Wholesum’s investments. Additionally, they are exploring "third-party evaluations" to provide independent analysis to measure the effectiveness and impact of their investments.

However, measuring impact isn't straightforward and will be a long-term effort as Wholesum grows and gathers data from its investees.

“While it's a complex task, redirecting capital toward socially beneficial companies and projects is a step towards creating positive change.”

Why hasn't impact investing gained more traction?

Even though impact investing isn't a new concept and has been around for decades, Tanvir and his colleagues wondered why it wasn't as popular as other forms of investment.

“The main reason is a lack of awareness. Limited financial knowledge worldwide is another reason. Impact investing is still seen as a niche area. It is primarily understood by philanthropic institutions or venture capital. The systems for traditional investments aren't equipped for impact investing. Plus, measuring the impact of these investments is a challenge,” believes Tanvir. 

Impact investing holds a promising future, addressing many of today's challenges. Yet most people do not realise it's an option. Tanvir aims to raise awareness among communities by promoting financial literacy.

"I'm passionate about financial literacy, education, and community engagement. I'm open to collaborating with schools, community organisations, or cultural groups to discuss topics like investing and finance," he stated.

However, he stresses the importance of self-education and gaining knowledge on such matters.

"To promote financial literacy, it begins with individual responsibility. Educating oneself can help to avoid scams and make informed financial decisions."

Organisations, including cultural and educational groups, can also play a role by hosting workshops and providing resources, he says. 

"I'm particularly committed to empowering vulnerable communities, such as women facing financial and emotional abuse," he stresses.

As of now, impact investing accounts for less than 1% of the world’s total assets under management. However, Tanvir admits there is growing awareness. He feels conscientious consumers may drive future growth in the sector.

“Globally, impact investing has gained traction. Concerns over harmful investment practices, like those exacerbating climate change or involving unethical labour, could be a reason. Therefore, there's a growing push for investments that deliver both financial returns and positive social or environmental outcomes,” he says.

What role can average investors play? How can they get involved?

Though very few funds focus on impact investors, there are ample opportunities for average investors to get involved, Tanvir says.

There are ethical and impact-focused investment funds available. Similarly, some banks and superannuation funds also align with impact principles. 

However, he underlined a gap even among major impact investment funds where they are not sufficiently investing in SMEs and microfinance. 

"Wholesum aims to bridge this gap by focusing on SMEs and microfinance. It will provide investors with opportunities to support impactful businesses while earning financial returns."

Exploring Islamic finance

Certain communities are discerning about the where and how they invest and generate profits. They look for a platform that respects their values and prefer investing in zones that mirror their principles. Tanvir, with his expertise and PhD in Islamic finance, is more aware of this crucial need. 

“Islamic finance adheres to Shari’ah principles, avoiding industries like alcohol, gambling, and usury while promoting positive social impact. Wholesum aligns with Islamic finance principles, by emphasising ethical considerations alongside financial returns. This approach appeals to both Muslims and other ethically conscious investors seeking investments aligned with their values,” Tanvir explains. 

Although Wholesum offers a more inclusive investment service, it isn't solely targeted at Muslims or Islamic funds. It's a community-focused operation open to people from all backgrounds, he emphasised. 

Be it Islamic finance or impact investment, both need careful filtering and allocations of funds. When asked how his team ensure they don't commit mistakes and how Wholesum ensure it delivers what it promises, Tanvir says:

“We partner with investment fintechs and platforms worldwide that specialise in compliant financing for small and medium-sized businesses  with our funding and utilise their wide-reaching operational capabilities to oversee the underlying investment activities. As we grow, we aim to conduct more direct deals, maintaining compliance and managing risks effectively to protect investors' funds.”

More growth of diversity needed in the Australian startup ecosystem

Along the way of working in multiple startups and founding Wholesum, Tanvir reflected on his journey in the Australian startup ecosystem, and compared that to the other countries where he has worked. 

While Tanvir lauds the government for all measures the Australian government has taken to promote startup culture, he also sees room for improvement.

"As for government support, there's room for improvement. Especially in fostering diversity and inclusion in the startup ecosystem. Initiatives like free co-working spaces and startup hubs are positive steps. But education on entrepreneurship and financial literacy should start earlier, even in high schools in disadvantaged regions."

How do South Asian communities choose more impactful investments? 

To encourage impactful investments, individuals should choose services carefully. Financial literacy is crucial. Starting early can empower individuals to make informed financial decisions, gain the necessary financial management skills and habits and avoid scams. 

“For South Asian communities, fostering connections between capital providers and businesses in need can unlock impactful investment opportunities. Empowering entrepreneurs and supporting innovative solutions is vital for driving positive change," says Tanvir. 

He stressed that individuals could contribute by making informed choices about their money. 

"By supporting initiatives aligned with their values, they can drive meaningful social and environmental change."

The Journey: Reflection And Gratitude

Tanvir’s journey has been shaped by numerous individuals who have inspired and guided him. “It is the collective effort of our team and partners at Wholesum that have been instrumental in realising our mission,” he said.

"I've been fortunate to have some great South Asian mentors. Some notable ones include Ashik Ahmed, Co-founder of Deputy, and Syed Ahmed, CEO of Innowell. They have imparted valuable lessons about building a successful start-up. 

“Ashik emphasised prioritisation and fiscal responsibility, while Syed inspired my confidence and resilience, urging me to stand my ground despite oncoming challenges.”

 “Their guidance has been invaluable. They've navigated challenges like finding customers, building teams, and leveraging successful partnerships,” Tanvir gratefully explains.

Getting involved with Wholesum

"If people want to support Wholesum, they can connect with us on LinkedIn. They can explore our investment solutions, or simply spread the word," he urged.

"In the next 10 years, I envision Wholesum thriving as a global company. We want to support migrant communities worldwide with their financial service needs. I hope to delegate day-to-day operations and focus more on education and philanthropy over time,” he emphasised. 

A strong supportive network is key to Tanvir.

"The journey with Wholesum has taught me the importance of customer-centricity, financial prudence, and building a strong support network”.

You can connect with Wholesum at their website, LinkedIn, or by emailing Tanvir directly at tanvir@investwholesum.com. 

Radha Mishra is a seasoned journalist with over a decade of experience in newsrooms. Now practising independently, she is passionate about covering issues that matter. She strives to deliver accurate and impactful stories to audiences globally.